Hartford-Connecticut Trust Co. v. Doherty

286 F. 926, 1 Ohio Law. Abs. 482, 1923 U.S. App. LEXIS 2792

• Court: Court of Appeals for the Sixth Circuit
• Decided: February 16, 1923
• Docket: No. 3726
• Status: Published

Opinion

KNAPPEN, Cir. J.

Epitomized Opinion

This is an action in the nature of a creditor’s suit. A receiver had already been appointed over property of a certain Railroad Company. Certain holders of liens upon defendant’s property filed an application before Federal Judge Killits of Toledo for leave to file-in the case a bill in intervention making-parties thereto not only such lien holders, but also certain parties asserted to he indebted to defendant on account of unpaid subscriptions to its capital stock. As this application for the collection of the alleg’ed indebtedness on stock subscriptions was refused an appeal was prosecuted in the U. S. Circuit Court. In affirming the order of the lower court, this court held:

1. It is not error or an abuse of discretion on the part of the court to deny an application of lien holders for leave to intervene and file a cross-bill for the collection of an alleged indebtedness on stock subscriptions where there had been nó refusal by the receiver to take action for collection thereof on refusal by the court to take proper action to enforce the stockholders’- liability.

2. As the application was addressed to the court’s discretion its denial was not subject to review unless the discretion was abused.

3. The receiver of the Railroad is normally the proper person to bring suit to collect alleged stock subscription unless in case of his refusal or negligence to do so or his unfitness therefor.