Van Kempen v. . Latham

160 S.E. 759, 201 N.C. 505, 1931 N.C. LEXIS 24
CourtSupreme Court of North Carolina
DecidedOctober 21, 1931
StatusPublished
Cited by5 cases

This text of 160 S.E. 759 (Van Kempen v. . Latham) is published on Counsel Stack Legal Research, covering Supreme Court of North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Van Kempen v. . Latham, 160 S.E. 759, 201 N.C. 505, 1931 N.C. LEXIS 24 (N.C. 1931).

Opinion

OlabKSON, J.

This action was before this Court on appeal by plaintiff from a demurrer filed by defendant and sustained by the court below. This Court reversed the court below and held that the demurrer should have been overruled. Van Kempen v. Latham, 195 N. C., 389. In that case, at p. 394, is the following: “Ordinarily a receiver cannot maintain an action in another jurisdiction. As a rule, they have no extra territorial jurisdiction. But the weight of authority is to the effect that the privilege may be granted as a courtesy, not as an obligation- — by way of comity — and then only when it will not work a detriment to'the citizen of the state in which the jurisdiction is sought. In the progress of the age, the rapid transit and quick means of the intercommunication have brought the states of the union and the nations of the earth in closer alliance than ever before. Commerce is extended to every part of the globe — commercial paper travels with commerce. The present action is based on negotiable notes admitted by the demurrer to be due and unpaid and executed by defendant’s testator. The demurrer is founded solely on the ground that a receiver appointed in a court of a foreign nation should not be allowed to sue in this jurisdiction, although the receiver alleges ownership of the notes due and owing, permission granted to sue, order in the foreign court giving authority and' direction to bring this suit, and on trial would have to produce the notes in this jurisdiction. We must be friendly with other states and nations if we want other states and nations to be friendly with us. On the facts and circumstances of this case, we think the complaint states a cause of action.” Textwriters and decisions are cited by this Court in that opinion, to sustain the position in overruling the demurrer.

On this appeal it seems as if there is a repetition of the position heretofore taken by defendant, that a foreign receiver could not sue in this jurisdiction. For example, in defendant’s brief we find cited to sustain his contentions, the Federal case of Moore v. Mitchell, 281 U. S., 18. In that case, we find the following, at p. 24: “He is the mere arm of the state for the collection of taxes for some of its subdivisions and has no better standing to bring suits in courts outside Indiana than have executors, administrators, or chancery receivers without title, appointed under the laws and by the courts of that state. It is well understood that they are without authority, in their official capacity, to sue as of right in the Federal courts in other states.” 65 A. L. R., 1354, see anno.

*509 “In Converse v. Hamilton (1911), 224 U. S., 243, 56 L. Ed., 749; Am. Cases, 1913D, 1292), tbe Supreme Court of the United States has reviewed Booth v. Clark, and a receiver of a Minnesota corporation was allowed to sue in the courts of another state to recover the double liability imposed by the laws of Minnesota, the Court saying: ‘While an ordinary chancery receiver cannot exercise his powers in jurisdictions other than that of the court appointing him, except by comity, one who is a gwasi-assignee and invested with the rights of his cestui que trustent may sue in other jurisdictions, and his right to do so is protected by the full faith and credit clause of the Federal Constitution.” 1 Clark on Receivers, 2d ed., chap, 19, sec. 591(f), at p. 811.

It will be noted that defendant cites and discusses the jurisdiction of the United States courts, and relies on the Moore case, supra, which is a suit involving a revenue law of another state. Our former decision in this case was based upon comity between foreign nations and different states of the Union. Conceding that the United States courts do not allow or permit a receiver in another jurisdiction, as a matter of comity, to sue for a debt, yet the Federal Court has no control over the state courts in a matter of this kind. The decisions are merely persuasive. Van Kempen v. Latham, 195 N. C., at p. 393; 23 R. C. L., part sec. 151-2, at p. 142-3.

The whole matter is well stated in Tardy’s Smith on Receivers, Yol. 2, p. 1924: “The general principles involved in the question of the extent of the right of a receiver to sue or assert rights in respect to the receivership property outside of the jurisdiction of his appointment have been a source of controversy for many years. . . . (p. 1925) The international effect to be given to transfers of property by operation of law through the instrumentality of assignees and receivers, and the extra-territorial operation of the title of such officers as established in England, and other foreign countries, is based upon the broad and constantly growing system of international comity, and recognition of the fact that on account of the quickness of transportation of every character, freedom of business relations and easy transference of property rights should be fostered both among states and nations. Following the line of decisions of the earlier English courts upon the subject the courts in the American colonies prior to the Revolution, and many of the state and United States courts since that period, established the doctrine that an assignee or receiver’s title to personal property extended only to such property of the debtor as had a situs within the state of the assignee or receiver’s appointment, and that beyond the state line he had no title or right of possession, or at least such as the court would enforce. As a corollary of this doctrine it was held that a *510 foreign receiver could not sue or defend and bad no standing in a court of foreign jurisdiction. While some of the features of the earlier doctrine are still recognized and enforced in some of the American courts upon the principle of stare decisis, yet the modern doctrine as to the receiver’s rights to sue in a foreign jurisdiction, and reduce to possession the assets of his principal, or recover his choses in action is well established by the great weight of authority as well as by reason, though there are still some limitations that will be noticed hereafter. Courts of this country have recognized the justice and cogent reasoning of the modern English courts and jurists and have sought to break away from the doctrine of tire Court in Booth v. Clark (17 How., 322, 58 U. S., 15 L. Ed., 164), which, though not the earliest, yet has been regarded as the leading case upon the subject, sometimes by compelling the debtor to make a formal transfer of his property to the receiver and thus vesting in him the absolute legal title by act of the parties which is recognized and enforced in all jurisdictions. Sometimes the same end has been accomplished by the establishment of a species of interstate comity, by which the judgment, and decrees of other states, and the rights and powers of receivers thereunder have been given an extraterritorial virtue and force, and the right of the receiver to sue and enforce his property rights in a foreign jurisdiction recognized and respected.”

Minor, Conflict of Laws (1901), part sec. 118, p. 266: “A receiver, strictly speaking, has no more right to sue in a foreign state than to do any other act. But if a suit instituted by a foreign receiver will not work a detriment or an injustice to the citizens of the forum, he will generally, upon principles of comity, be permitted to appeal to its courts.”

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Whitehurst v. VIRGINIA DARE TRANSPORTATION CO., INC.
198 S.E.2d 741 (Court of Appeals of North Carolina, 1973)
Goodson v. . Lehmon
35 S.E.2d 623 (Supreme Court of North Carolina, 1945)
Pink v. . Hanby
18 S.E.2d 127 (Supreme Court of North Carolina, 1942)
State v. . Richardson
4 S.E.2d 852 (Supreme Court of North Carolina, 1939)
State v. . Scott
109 S.E. 789 (Supreme Court of North Carolina, 1921)

Cite This Page — Counsel Stack

Bluebook (online)
160 S.E. 759, 201 N.C. 505, 1931 N.C. LEXIS 24, Counsel Stack Legal Research, https://law.counselstack.com/opinion/van-kempen-v-latham-nc-1931.