Case ID: ohio-law-abs_1/html/0482-01.html
Source: Caselaw Access Project
Author: {"author": "KNAPPEN, Cir. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

No. 491
    HARTFORD-CONNECTICUT TRUST CO et al v. DOHERTY et al
    U. S. Circuit Court of Appeals, Sixth Circuit,
    No. 3726.
    286 Fed. Rep. 926.
    Decided Feb. 16, 1923
    RECEIYERS — (1) Refusal to permit filing of cross-bill for collection of unpaid stock subscriptions in receivership suit held not error or abuse of discretion — (2) As application was addressed to court’s discretion, denial only reviewable if discretion abused — (3) Receiver is proper party to sue on subscription unless in case of failure or unfitness.
    Attorneys — Geo. M. Valentine, for Hartford-Connecticut Trust Co. et al.; E. H. Andrews, for Doherty et al.
   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.