Tomlinson & Webster Manuf'g Co. v. Shatto

34 F. 380, 1888 U.S. App. LEXIS 2304

• Court: U.S. Circuit Court for the District of Minnesota
• Decided: April 2, 1888
• Status: Published

Opinion

Nelson, J.

A motion is made for a receiver, after disclosure, upon an examination in proceedings supplementary to execution, in accordance with the state law and practice.

The appointment of a receiver is opposed for the reason that after the proceedings had been instituted, and an order served upon the judgment debtor forbidding any disposal of his property or interference therewith, he made a voluntary assignment to an assignee of his own selection under the insolvent law of the state of Minnesota, enacted in 1881. I have duly considered the case presented by the arguments of counsel and find:

1. That the return of the execution unsatisfied entitled the plaintiff to the order for the examination of the judgment debtor, and the order forbidding any transfer of his property, or interference therewith by him, so that property not subject to execution could be reached and applied to the payment of the judgment.

2. That the order for the examination of the debtor when issued and served gave the plaintiff a lien on the equitable assets of the debtor.

3. That he was at this time entitled to the appointment of a receiver to aid in the application of the debtor’s property interests to the payment of the judgment, and the assignment alter the commencement of the supplementary proceedings should not prevent the appointment.

4. This proceeding supplementary to execution is a substitute for a creditor’s bill, and has a greater scope, and when properly commenced the vigilance of I,he judgment creditor is rewarded by a priorty and lien upon equitable assets; and the discovery upon the examination in this case shows equitable assets; and that the plaintiff is entitled to a receiver.

5. The examination also shows real estate belonging to the judgment debtor in Dakota territory, which is only incumbered by mortgages, the legal title'being in him. It is necessary for full relief that a conveyance should bo made by the judgment debtor of this property, and the power and legal authority of this court is ample to enforce it, by an order, upon the defendant to make such a conveyance.

6. The law fixes the timo of the return of the execution by the officer, at any time within 60 days. After the return of the oxecution unsatisfied supplementary proceedings may be commenced. The plaintiff is not required to wait until 60 days have expired.

An order will be entered granting the application for a receiver, and a further order that the said defendant, Charles W. Shatto, upon due notice upon the part of the plaintiff, and upon being served with a copy of the order appointing a receiver, attend before me at my chambers in the custom house at St. Paul, at a timo to bo named in said notice, and then and there, under my direction, execute to the receiver, a conveyance of the real property described in the disclosure of the defendant, and on assignment of such property in trust, to be disposed of and applied, so far as shall be necessary in pursuance of his trust duties as such receiver. Consult Rid. & B. Supp. Proc. (3d Ed.) tit. “Priority,” etc.; Portar v. Williams, 5 How. Pr. 441, affirmed, 9 N. Y. 142; McDermutt v. Strong, 4 Johns. Ch. 687; Edmeston v. Lyde, 1 Paige, 637; Corning v. White, 2 Paige, 568; Lynch v. Johnson, 48 N. Y. 27; Flint v. Webb, 25 Minn. 264: Towne v. Goldberg, 28 N. W. Rep. 254; also Wait. Pr.