Cowen v. Merriman

17 D.C. App. 186
CourtCourt of Appeals for the D.C. Circuit
DecidedNovember 7, 1900
DocketNo. 986
StatusPublished

This text of 17 D.C. App. 186 (Cowen v. Merriman) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cowen v. Merriman, 17 D.C. App. 186 (D.C. Cir. 1900).

Opinion

Mr. Chief Justice Alvey

delivered the opinion of the Court:

There are three questions raised on the rulings of the court below, and which have been argued on this appeal, and they are the following:—

1. Whether the plaintiff was entitled to proceed with the action and recover judgment therein against the defendants, as receivers, after the passage of the order of June 30,1899, set out in the plaintiff’s replication; or whether the claim for the damages sued for should be filed in the cause in the equity court, in which the receivers were appointed, to be there adjudicated under the order referred to.

2. Whether the defendants were entitled to any other or different instruction from the court than that given in respect to a supposed variance between the allegation and proof, as to the location where the accident occurred.

3. If the cause was properly triable by the court below, whether the evidence of contributory negligence on the part of the deceased, Merriman, was so clear and unmistakable in its character, as to require the court to direct a verdict for [197]*197the defendants; — it being conceded that there was proof sufficient on the question of negligence by the defendants, or their employees, to require the case to be submitted to the jury, but for the supposed contributory negligence of the deceased in causing the accident.

1. It is contended by the defendants that the order of the court of equity of June 30, 1899, withdrew the property of the railroad company from their possession and control, and had the effect of discharging the receivers from any further liability for the claim sued for in this action; and that the only recourse of the plaintiff is by making application to the court of equity, having control of the cause in which the receivers were appointed, for an adjudication and allowance of the claim. We do not, however, entertain this view of the case.

The court below had acquired complete jurisdiction of the subject-matter of the suit and of the parties thereto, before the order of the 30th of June, 1899. The action was authorized to be brought without the authority of the court appointing the receivers; and the fair and reasonable interpretation of the act of Congress of March 3, 1887 (24 Stat. 552, Oh. 373), as corrected by the act of Congress of August 13, 1888 (25 Stat. 433, Ch. 866), is, that the remedy against receivers was not only to be protected, but promoted and made effectual by that act. The act provides that every receiver, appointed by a court of the United States, may be sued in respect of any act or transaction of his in carrying on the business connected with the property, without the previous leave of the court by which such receiver was appointed. It has been held by the Supreme Court of the United States, that such suit may be brought in any court of competent jurisdiction and proceed to judgment accordingly. Texas & P. Railway Co. v. Johnson, 151 U. S. 81, 101. In this case the question is not presented as to the power of the court to proceed in the action instituted against receivers while they are in control and management of the property [198]*198of an alleged insolvent corporation, and where they have been finally discharged from the receivership, and required to deliver up all control over the property, before trial and judgment had against them. Here the receivers were not discharged from th^ir trust by the order of June 30, 1899, and the property of the railroad company, though required to be surrendered and placed back into the possession and control of the corporation, yet was still held subject to the power and jurisdiction of the equity court to enforce all the powers and conditions enumerated in the order of June 30, 1899. By that order, as we have seen, it was expressly provided and reserved, as a continuing right and power, “to adjudge and declare what receivers’ or corporate debts are due and ought to be paid by the said railroad company, with full power by its future adjudications to bind the property, the possession of which is delivered under this order.”

The property of the railroad company, therefore, remained subject to the control and jurisdiction of the court of equity that appointed the receivers; and the property under the control and jurisdiction of. the court is the source from which payment of any judgment, in a case like the present, against the receivers, must be sought. The judgment is not recovered against the receivers personally, but against them in their official character as receivers, and the judgment is payable only from the funds in their hands or that may remain subject to the jurisdiction and direction of the court that appointed the receivers. This being the case, it is difficult to perceive any substantial reason why the action should not proceed to judgment against the receivers in their official character, or why the order of the court directing the property to be delivered to the possession of the railroad company, but without discharging the receivers, should be allowed to have the effect either to abate or stay the action, or to form an obstacle to the recovery of a judgment against the receivers. The judgment when recovered can only be made available by applying to the court that [199]*199appointed the receivers, and which has power and jurisdiction over the funds out of which the judgment can be paid.' It is to this end that the act of Congress, to which we have referred, provides that “such suit shall be subject to the general equity jurisdiction of the court in which such receiver or manager was appointed so far as the same shall be necessary to the ends of justice.” The plaintiff in the action is entitled to have his case tried by a jury, and the damages regularly assessed; and it is not to be supposed, in the absence of express terms, that Congress intended, by the act referred to, to deprive the plaintiff of such right. As said by the Supreme Court, in the case of Texas & P. Railway Co. v. Johnson, supra, “Certainly, the preservation of general equity jurisdiction over suits instituted against receivers without leave does not, in promotion of the ends of justice, make it competent for the appointing court to determine the rights of persons who are not before it or subject to its jurisdiction; and the right to sue without resorting to the appointing court, which involves the right to obtain judgment, can not be assumed to have been rendered practically valueless by this further provision in the same section of the statute which granted it.” It is only after the judgment recovered that the plaintiff is required to go to the equity court having jurisdiction over the property or funds from which he can obtain satisfaction. It is in that court that the equities between incumbrancers and other creditors are to be adjusted, and the time and manner of payment determined. Dillingham v. Hawks, 60 Fed. Rep. 494, 497.

We are clearly of opinion that the action was properly proceeded with to trial and judgment, notwithstanding the order of the equity court of June 30,1899.

There was irregularity in entering the judgment, but that was in mere' matter of form. The judgment, instead of being entered against the receivers personally, as appears to have been done, should have been entered against them in their official character as receivers. This, however, as there [200]

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Related

Continental Improvement Co. v. Stead
95 U.S. 161 (Supreme Court, 1877)
Texas & Pacific Railway Co. v. Johnson
151 U.S. 81 (Supreme Court, 1894)
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159 U.S. 603 (Supreme Court, 1895)
Texas & Pacific Railway Co. v. Gentry
163 U.S. 353 (Supreme Court, 1896)

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Bluebook (online)
17 D.C. App. 186, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cowen-v-merriman-cadc-1900.