Case ID: ohio-law-abs_3/html/0019-01.html
Source: Caselaw Access Project
Author: {"author": "", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

No. 33
    RITCHY et al v. BRETT Rec.
    No. 18811
    Ohio Supreme Court
    ON MOTION TO CERTIFY
    1002. RECEIVERS—Are plaintiffs for receiver appointment liable for operation deficit?
    Attorneys—Bulkley, Hauxhurst, Jamison & Sharp.
   Ritchey and Moeller filed a petition as stock holders and bond holders of the Euclid-One Hundred Two Theatre Co. asking for appointment of a receiver for that company in the common pleas. Brett was appointed receiver and ordered to continue the business of _ the company. The receiver operated the Circle Motion Picture Theatre in Cleveland for one and a half years during which time his operation showed a continuous loss amounting to approximately $15,000.00. The Cleveland-Trust Co., trustee of mortgages of the leasehold estate of the theatre company, instituted a foreclosure suit on the mortgages in a separate action.

On application to the court by the second mortgage bondholders protective committee the receiver was ordered to sell all the property of the theatre company not covered by the mortgage for $6,000.00, which was not sufficient to pay the receiver’s obligations, leaving a deficit which amounted to $9,243.69. The receiver filed his account with the court and movecPEhat it be approved. By separate motion the receiver prayed the court to tax the amount of his deficit as costs against the plaintiffs.

The common pleas approved the accounts of the receiver but overruled the motion to tax the deficit as-costs against the plaintiff ordering distribution pro rata to the receiver’s creditors and dismissing the action. In error to the court of appeals from the order overruling the motion to tax the deficit as costs the higher court by a divided court reversed the order of the common pleas and entered judgment against the plaintiffs in the sum of $9243.69. From this judgment error is also prosecuted.

It is contended that the plaintiffs are deprived of their property without due process of law in violation of Art. 14, Sec. I, of the amendment of the constitution of the United States and Art. 4, Sec. 5, 16 and 19, of the constitution of Ohio.

The question involved in the case is whether the plaintiff in a suit in which a receiver is appointed at their request become liable for a deficit incurred in the .operation of the receivership business in ease where the receiver was properly appointed and the said plaintiffs have been found entitled to the relief prayed for in the suit.