State ex rel. Pope v. Germania Bank

114 N.W. 651, 103 Minn. 129, 1908 Minn. LEXIS 796
CourtSupreme Court of Minnesota
DecidedJanuary 17, 1908
DocketNos. 15,418, 15,419—(165, 166)
StatusPublished
Cited by17 cases

This text of 114 N.W. 651 (State ex rel. Pope v. Germania Bank) is published on Counsel Stack Legal Research, covering Supreme Court of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State ex rel. Pope v. Germania Bank, 114 N.W. 651, 103 Minn. 129, 1908 Minn. LEXIS 796 (Mich. 1908).

Opinion

BROWjST, j.

In July, 1899, respondent Willius was by the district court of Ramsey county duly appointed receiver of the Germania Bank of St. Paul, an insolvent banking corporation, and thereafter qualified and entered upon the discharge of his duties as such. At the time of and as a part of the order of appointment the court fixed the compensation of the receiver at the sum of $200 per month, subject to the further order of the court. The receiver, under authority of the court, employed Harris Richardson as his general counsel and adviser, whose compensation was fixed by the court at $2,000 per annum “until the further order of this court.” The receiver continued in the discharge of his trust until July 15, 1907, when he resigned.

Prior to his resignation certain creditors had petitioned the court for his removal for alleged negligence in the management of the estate, in that he had failed to cause the commencement of proceedings, to enforce the statutory liability of the stockholders of the bank, in consequence of which a large amount of money was claimed to have been lost to the creditors. The petition for his removal also contained a prayer for the appointment of his successor and for an order directing the new receiver to institute suit upon the receiver’s bond to recover the loss so alleged to have occurred through the receiver’s neglect. Pending the hearing on this petition the receiver tendered 'his account to the court for adjustment and settlement, in which he asked for an additional allowance of attorney’s fees to his counsel, Harris Richardson, in the sum of $3,000, for extra service rendered the estate, and an allowance to other special counsel rendered necessary by protracted [141]*141litigation. To the allowance and settlement of this account the creditors interposed numerous objections, concluding with the prayer that it be surcharged in certain respects, and particularly that the receiver be charged with the amount alleged to have been lost by reason of his failure to enforce the stockholders’ liability before barred by the statute of limitations, the amount of which was alleged to exceed $50,-000. The petition for the removal of Willius, his account, and the objections thereto, and the prayer that it be surcharged to the extent of the losses alleged to have occurred through his neglect, all came on for hearing before the court below at the same time and were tried together.

At the conclusion of the trial, but before a decision had been reached, Willius resigned, as already stated, and his resignation was accepted by the court. Thereafter the court made three separate orders in the matter: (1) Accepting the resignation of Willius and appointing his successor; (2) dismissing the petition for his removal; and (3) confirming and settling his fifth, sixth, and seventh accounts, filed with the court, thereby allowing $2,000 to Richardson as extra compensation and $9,000 to the receiver, the balance remaining due- for his services computed on the basis of the order of the court originally fixing his compensation. Though the receiver’s account thus settled was not presented as his final account, it was in fact final; for it included all transactions, receipts, and disbursements up to May 25, 1907, a short time prior to the hearing on the matters resulting in the order now before us for review, which were heard below June 22, 1907.

The question whether the receiver’s account should be surcharged to the extent of the losses incurred by his alleged negligence in not enforcing the stockholders’ liability was litigated before the court by both parties; but the court declined to determine the question. In the order settling the account the court, upon this branch of the case, incorporated the following special order, namely:

Ordered, further, that all matters relating to the question of the alleged negligence and malfeasance of said Gustav Willius as such receiver, and relating to the losses, if any, therefrom to this estate, and his liability, or that of his bond therefor, arising out of any negligent act, failure, or omission of said [142]*142Gustav Willius as such receiver, be and are left open, to be determined in proper proceeding according to law, and that, nothing herein shall operate to release said Gustav Willius- or his bond in any manner from the responsibilities for any and all acts as such receiver.

The creditors acquiesced in the order accepting the resignation of Willius and in that by which a new receiver was appointed, but appealed from the order settling the receiver’s account and allowing Richardson $2,000 for extra services.

The case in this court narrows down to two propositions: (1J Whether the court below erred in declining to determine the question whether the receiver’s account should be surcharged as claimed by the-creditors; and (2) whether the extra allowance to Richardson was authorized as a matter of law.

As stated above, the court expressly declined to pass upon the question of the negligence of the receiver in failing to enforce the stockholders’ liability before the bar of the statute of limitations set in, the-basis of the creditors’ claim that the account should be surcharged, and referred that question to some other court, to be determined in an action to be brought by the new receiver for that purpose. The-court, however, settled the account as rendered, with the reservation that the order should not in any manner affect or relieve the receiver from responsibility for any neglect of duty imposed by his trust. The-merits of the contention that the receiver was chargeable with negligence, .and hence that his account should be surcharged, were elaborately argued in this court; but the question is not properly before us..

The supreme court is a court of review, and, except in a few remedial cases, is vested by the constitution with appellate jurisdiction only,, the nature of which confines the court to such questions as, originating in an inferior court, have been there actually or presumably considered' and determined in the first instance. Dunnell Minn. Pr. § 1802; Johnson v. Howard, 25 Minn. 558; Northwestern Railroader v. Prior, 68 Minn. 95, 70 N. W. 869; Smith v. Kipp, 49 Minn. 119, 51 N. W. 656. We are concerned, therefore, respecting this feature of the case, only-with the question whether the trial court erred in declining to deter[143]*143mine the question in this proceeding. It was unnecessary for the creditors to make application to the court, after the rendition of its decision, for further findings upon this subject. The court had expressly declined to decide the question, and subsequent application would have resulted in a reaffirmance of the court’s first position. It is unlike a case where a question of fact has been unintentionally overlooked by the-trial court.

This question requires no extended discussion. It is elementary that the court appointing a receiver or assignee in insolvency proceedings has and retains exclusive jurisdiction over the proceedings and the receiver or assignee for all purposes, settling and adjusting, in the same proceeding, all conflicting interests, all controversies, and all matters arising out of or connected with the trust, all questions respecting the accounts of the receiver, allowances for his compensation, the compensation of his attorneys, agents, and necessary clerks. No other tribunal has concurrent or other jurisdiction to order or interfere with the receiver in any way in the conduct of the office, or to settle or adjust his accounts. High, Rec. 48; 28 Am. & Eng. Enc. (2d Ed.) 1061; Conkling v. Butler, 4 Biss. (U.

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Cite This Page — Counsel Stack

Bluebook (online)
114 N.W. 651, 103 Minn. 129, 1908 Minn. LEXIS 796, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-ex-rel-pope-v-germania-bank-minn-1908.