Case ID: ny-st-rep_38/html/0892-01.html
Source: Caselaw Access Project
Author: {"author": "Lawrence, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Isaac L. Lyons, App’lt, v. The Atlanta Hill Gold Mining & Milling Co., Resp’t.
    
      (Supreme Court, General Term, First Department,
    
    
      Filed May 15, 1891.)
    
    1. Receiver— Corporation—Accounting.
    A receiver of a corporation will not be compelled to account where it appears that no property of the corporation has come into his hands.
    2. Same.
    A judgment was recovered by the corporation which it assigned in payment of an indebtedness before the appointment of the receiver. Held, that even if it could be assumed that the corporation was insolvent when it made the assignment, yet as it had parted with all title to the judgment before the receiver was appointed, no property in such judgment vested in him.
    Appeal from an order made at chambers denying plaintiff’s application to compel Charles W. Turner, receiver of the defendant to file an account of his proceedings as receiver, and denying plaintiff’s application for the appointment of a referen
    
      Raphael J. Moses, Jr., for app’lt; Salter S. Clark, for resp’t.
   Lawrence, J.

In this case we are of the opinion that the motion below was properly denied.

It appears from the record that the receiver was appointed on the 27th of June, 1888, and that he never knew anything about the action by the company against Andrews until the 27th of March, 1890, when he was notified by the appellant’s attorney of the decision of the court of appeals in the case of the Atlanta Hill Gold Mining & Milling Co. v. Andrews.

It also appears that the judgment had been assigned to Chapin ion the 1st of June, 1888, and that the assignment had been filed on the 20th of June, 1888, before the appointment of Mr. Turner ;as receiver.

The attorney for the company in October, 1887, had made a special contract with the company for his fees and expenses in conducting the litigation, and on the 27th of March, 1890, when judgment had been collected, there remained over and above his fees and expenses, the sum of $738.15 which was received by Chapin under his assignment. It cannot be disputed upon the record that the company at the time of the assignment of the judgment to Chapin was indebted to him in a large amount for moneys advanced upon the bonds of the said company, nor is there anything to show that the indebtedness to Chapin was not fairly and honestly contracted. We cannot assume that the company was insolvent at the time that it made the assignment to Chapin but even if that fact is assumed, as the company had parted with all title to the judgment before the appointment of a receiver, no property in such judgment vested in him. Whitney v. N. Y. & Atlantic Railway Co., 32 Hun, 173 ; Dudley v. Gould, 6 id., 97.

It would, of course, be competent for the receiver by permission of the court to have brought an action for the purpose of attacking the validity of the assignment on the ground that it was made in contemplation of insolvency. 2 E. S., § 4, p. 1534 ; Banks 7th ed. But this proceeding is not instituted to compel the receiver to bring such an action. It is a proceeding to compel the receiver to account, and as it is not even suggested that the receiver has ever had in his possession any portion of the proceeds of the judgment recovered by the Atlanta Hill Gold Mining and Milling Co. against Andrews or any property whatever yf said company, we agree with the learned justice who heard the case below, that as there is absolutely nothing to account for the court should not authorize a useless and expensive ceremony.

The order appealed from should be affirmed, with ten dollars costs and disbursements.

Van Brunt, P. X, and Daniels, J., concur.