Case ID: tenn_17/html/0102-01.html
Source: Caselaw Access Project
Author: {"author": "Reese, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Waters, et al. vs. Carroll, Gov.
    
    The duties of a receiver appointed by the court, and those of a master in chanceiy, are enlitely uLlinct.
    It ¡s no part of the official duty of a clerk and master of the chancery court in this State, it/ act as leceiver.
    A court of chancery can no more impose, without his consent, (he office of receiver upon its clerk and master, than it can upon any piivate individual.
    Where a clerk and master is appointed by the court a receiver and as such receive^ into his hands, money or property, the sureties in his official bond , tali < n for the faithful p. i forma nee of his duties as clerk, are not resp msi hie.
    The court of chancery nnde the following order: 4 Or. I ere 1 by the court, that Nathan Ewing, the receiver, pay into (lie. hands of the clerk and master, the fun is in ids hamU as receiver in this cv-e; that he file his report and account with the clerk, who will make ieport at the next term; that the clerk and mi«ler report what would be a reasmable aüo.vmco to the receiver /or bis services: and it is further ordered by the court, that the clerk and master be appointed receiver of said funds, and continue to loan out the same al legal in* terest”: Held, that by the term* of this oider, the funds were to be placed in the hands of the clerk and master, in his capacity of clerk and ma.^tcr, and that the payment to him, and his reception of the money as clerk and master, were acts in entire consonance with the duties and functions of that office.
    Where a clerk and master has received money in his character of clerk and master, and he is appointed by the court a receiver and otdered to loan it out, but there is no evidence showing* that he loaned it out, and no lad or circumstance from which it may be inferred that he accepted the office of receiver, or acted under U the money will be considered as retained in his hunda as clerk and master.
    This is an action of debt, founded upon a bond executed by Eli Talbot and bis securities for the faithful performance of bis duties as clerk and master of the chancery court at Franklin. Tbs bond is drawn payable to the Governor, in the penalty of ten thousand dollars, with this condition:
    “The condition of the above obligation is such, that whereas the above named Eli Talbot hath this day been appointed clerk and master in the chancery court for tile counties of Davidson, Rutherford and Williamson, to be holdenat Franklin, in the State aforesaid. Now, if the said Eli Talbot shall faithfully keep the records, and faithfully discharge all and singular the duties of his office, then shall the above obligation be null and void, otherwise to remain in full force and virtue.”
    The declaration sets forth a copy of the bond and condition, alleging that the original is lost, and then avers as clerk aud master, it was the duty of the said Eli Talbot to receive all such sum or sums of money, as were paid into said chancery court by order of court, in all cases where he was ordered so to do by order or decree of said court of chancery, and to pay over any such sum or sums of money in such manner and. to such person or persons as said court of chancery might order or decree. The declaration also avers, that such being his duty, the said Eli Talbot, as-clerk and master of said court of chancery, was ordered and directed by said court of chancery, by its decree made at April term, 1S18, in the case of Nelson Patterson and others, against Samuel K. Green and others, to receive from Nathan Ewing, the receiver in said cause, the money and effects then in his hands, which had been paid into said court in said cause by its order, and to loan the same out at legal interest. And the declaration further avers, that the said Talbot did, on the 28th May, 1823, in virtue of said order, receive from said Nathan Ewing, receiver as aforesaid, divers moneys, to wit: Five hundred and eighty-seven dollars and sixty-one cents in cash, and divers notes and judgments amounting to two thousand five hundred and twenty-seven dollars and ninety-two cents. And lhe declaration avers, that said Talbot afterwards, viz: on the 28th April, 1832, in virtue of said order last mentioned, did receive from G. W. Gibbs, who was one of the defendants in one of said judgments, six hundred dollars in part satisfaction of said judgment. That Eli Talbot died without having loaned out said money. That Edwin II. Ewing has since been appointed receiver; and said Eli, before his death, and his administrator since, have failed to pay over or account for said money. that
    The first, second, fourth, fifth, sixth, and seventh pleas, it is not necessary to notice.
    The defendants in their third plea, set out the order of the chancery court under which the money was received by Eli Talbot, which is in these words: “Nelson Patterson and others vs. S. K. Green and others: ordered by the court, that Nathan Ewing, the receiver, pay into the hands of the clerk and master, the funds in his hands as receiver in this case; that be file his report and account with the clerk, who -will make report at the next term; that the clerk and master report what would be a reasonable allowance to the receiver for his service, and it is further ordered by the court, that the clerk and master be appointed receiver of said funds, and continue to loan out the same at legal interest.” The plea then avers, that said Eli Talbot did not receive said money-as clerk and master, but as receiver under said order, and not otherwise; and so he has not broken the condition of his bond.
    To this plea the plaintiff replied, that at the time said money was recieved, Talbot was clerk and master; that he was only appointed receiver to loan it out; and that he never elected to receive said money as receiver by loaning it out, but did receive and retain the money as clerk. To this, defendants rejoin, that Eli Talbot did not receive and retain the money, as clerk. Upon which, issue is taken. The jury found a verdict for the plaintiff below, under the instructions of the court, for fifteen hundred and forty-two dollars and fifteen cents. A new trial was moved for and refused, to all which, defendants excepted, &c.
    The bill of exceptions sets forth the testimony, and among other things, the order copied in the third plea, and evidence tending to prove that Eli Talbot had received the money for which the jury found their verdict under said order. The court was requested to instruct the jury,
    1. That if Eli Talbot received the money under said order, he received it as receiver, and not as clerk and master.
    
      2. That if he had said money and effects in his hands under the last clause in said order ajipointing him receiver, he and his sureties were not responsible upon their bond for the performance of his duties as clerk and master.
    Both of which instructions, the court refused to give; but did instruct them,
    1. That if Eli Talbot received the money under said order, he received it as clerk and master. . .
    
      .2. That if lie made use of said money, and at the' time he made use of it, he had .the money in his hands under the last clause in said order appointing him receiver, yet still, he and his securities were responsible.
    
      The court were further asked to instruct the jury, that the J J 7 office of receiver and of clerk and master, were separate . 1 distinct; and that for an act done or omitted as receiver, he was not responsible as clerk. To this the court said the offices were separate and distinct; but where the clerk was appointed receiver, he and his sureties were liable upon his bond as clerk, for any money in his hands as receiver.
    
      Jas. Campbell & T. Washington, for plaintiffs in error.
    1. The 'bond in question only embraces such duties as by law, Eli Talbot was bound as clerk to' perform. Nor ca-the duties of another and distinct office, be imposed upon him by the court, and thereby subject his sureties to liability, in case he fails or omits to perform them.
    2. It is manifest that Eli Talbot received the money under the special order of the court, set forth in the pleadings. If so, he manifestly became possessed of the money in the character designated in the order. The order directs him to receive the money; it then says he is appointed receiver, and is directed to loan it out. It is therefore clear, that the only sound construction which can be given to the order, when taken as a whole, is, that the clerk was appointed receiver in the place of Mr. Ewing. As such, the money was received, and as such only is he accountable.
    3. The whole case then, depends upon this single propo sition; is the office of receiver a part of, or an appendage to the office of clerk? It is confidently asserted that it is not. In England, the offices are distinct; the duties of the offices there, and here, are frequently incompatible. The clerk is not bound to accept the office, nor could the court compel him to do so. This proves it is no part of his official duty, for surely the court can compel its own officer to perform any act legitimately within the general scope of his duty.
    That the two offices are wholly distinct and unconnected, is proved, or fairly inferrable, from the following authorities: 1 Maddox Ch. 232: Garland vs. Garland, 2 Vesey, jr. 137: BmerbanJc vs. Callasen, 3 Vesey, 164: Wilkson vs. Williams, 3 Vesey, 588: Thorpe vs. Thorpe, 12 Vesey, 317; 
      Thomas vs. Dawkern, 1 Yesey, 461: 3 Brown’s Ch. Rep. 500, Cruise vs. Bishop of London: 2 Brown’s Ch. Rep. 253.
    
      G. 8. Verger & N. II. Ewing, for defendant in error.
    One of the principal questions in this case is, whether the securities of a clerk in chancery are liable for money received by him after he was appointed a receiver in a cause. The bond of the clerk and its condition obliges him to perform all the duties of his office. 1 H. & C. 41. The condition of the bond is, that he shall faithfully discharge the duties of his office.
    The act of 1809, c. 66: 1 H. & C., 41: makes it his duty to pay over all moneys received by him by the order, judgment, or decree of the court. A surety is not bound beyond the condition of the bond, but he is liable to the same extent the principal is; therefore, Talbot if bound under this bond, the securities are. 3 M. & Selwyn, 502: Theobold on surety, 69, 90.
    The engagement of the surety extends to all such things as were included in the office when the engagement was entered into. Theobold, 72.
    By the constitution of our chancery court, the clerks are ex-officio receivers. By law, all moneys ordered to be paid in court must be received by them. Laws Ten. 39,'40, 41. When they are specially appointed receivers of moneys, it is with a view to direct them what they are to do with the money. Wherever money is to be paid in court, the clerk must receive it, unless the court by its order appoints some one else a receiver of the money, in which case, security is taken. When the clerk is appointed receiver none is taken, because he has already given it.
    Under the constitution of our courts, what are the duties of his office? Among other numerous duties, one is, where he has ex-officio received money upon execution, to pay it over to the parties entited, &c.; another duty is where he has been appointed by the court to receive money, he shall pay it to persons entited, or comply with the order of the court as to its disbursement.
    
      If the court appoints him a commissioner to sell property, I - i l ! . r T , • R R which he neglects or reluses, or it he receives the money, on the sale, and does not pay it, it is a breach of his bond, because one of his duties is to sell if ordered by the court.
    If the court orders him to pay money in his hands to B, and he refuses or does not pay, he breaks his bond.
    When he is directed to loan out money in his hands, and does not, it is a breach of bis bond, and he and his securities are liable for the interest.
    When the clerk is appointed receiver, and ordered to apply the money' in any particular manner, as long as it remains in his hands unapplied, it is in his hands as clerk.
    Any neglect to fulfil an order of the court to sell property, or to pay money in his hands, or to take bond and security when an injunction issues, is a breach of his bond, for which his sureties are liable. The clerk is ex-officio a receiver, and where money has been paid into court, the clerk, as such, receives it, and as such, is liable for it.
    One amongst other of the numerous duties of the clerk is, where he is appointed by the court a receiver to collect and pay the money as ordered, if within the scope of his power, he is obliged to attend to it.
    But in this case the money was received by him as clerk. He never complied with the latter part of the order appointing him receiver, nor by any act showed he was elected to hold the money in a different capacity from that in which he received it. The first part of the order only authorized him to receive the money as clerk; as long as he retained it, he retained it in that capacity. He was by the latter part of the order constituted a receiver for a particular and specified purpose, to wit: to loan out the money. If he did not comply with the order in this particular, he never was a receiver.
   Reese, J.

delivered the opinion of the court.

A receiver in England is described as a person, indifferent between the parties, appointed by the court to receive the rents, issues, or profits of lands, or thing in question in a court of chancery, pending the suit, when it does not seem reasonable to the court that either party should do it. Wyatt’s ■ Practical Register, 108. He is considered as an officer of the court. Newland’s Ch. Pr. 206. He usually gives security for the faithful performance of his duties. So entirely distinct in that country are those duties deemed from those which appropriately belong to the office of a master in chancery, that it is incumbent upon the latter to select a suitable receiver and report him to the court for confirmation; and when the receiver has entered upon his office, it belongs to the master, as stated in Hoffman’s office and duties of Master in Chancery, from to time to time, to audit and report upon his accounts. Indeed, it is a rule in England, that a master in cban-eery cannot be a receiver. In the constitution of our courts of chancery in this State, we have united the office and duties of master, so far as they exist under our system, with those of clerk. But no statute has been passed to annex the office and duties of receiver to those of clerk and master. A practice, indeed, very early existed in our chancery courts, and has, perhaps, not yet been discontinued, of sometimes appointing the clerk and master a receiver in those cases in which it was supposed the latter office would the least interfere with the proper discharge of his other duties. This practice, originating when the simplicity and paucity of chancery suits, and the limited number of persons qualified to act as receivers, was such as might seem to indicate its necessity, should now, it is believed, -under a change in the circumstance of the country and in the character of chancery investigations, be entirely abandoned. There is nothing hero any more than in England to recommend this union of duties, distinct and scarcely compatible. Our master may select and report to the court a suitable receiver; may sometimes take from him security for the performance of his duties, and may pass upon his accounts in settlement. With us, therefore, these offices are in their nature and functions distinct; and a court of chancery can no more impose, without his consent, the office of receiver upon its clerk and master, than it can upon any private individual. If, therefore, in the present case, the clerk and master had, by discharging any of the duties of receiver, manifested his acceptance of the office, and the money in question had been in bis hands in that character, we are of opinion that the se- ' 1 curities of the clerk and master would not have been . . sible for its loss or misapplication. That the money, however, came into the hands of this clerk and' master in his capacity of clerk and master, is put beyond all doubt by the order of the court itself, out of which this controversy has arisen, which is in the following words: “Nelson Peterson, et al. complainants vs. Sami. R. Green, et al. defendants. Ordered by the court, that Nathan Ewing, the receiver, pay into the hands of the clerk and waster, the funds in his hands as receiver in this case; that he file his report and account with the clerk and master, who will make report at the next term; that the clerk and master report what would be a reasonable allowance to the receiver for his services; and it is further ordered, that the clerk and master be appointed receiver of said funds, and continuelo loan the same out at legal interest.” This order was made at the April term, 1828. The mandatory part of this order is upon the former receiver, that he pay over the funds in his hands to the clerk and master; that he file his report and account with the clerk cud master, and account with the clerk and master in that character; that at the next term he report the report and account of the receiver and a reasonable allowance to him. By dm very terms of this order, the funds were to be placed in the Hands of the clerk and master in his capachy of clerk and master, and the payment to him, and his reception of the money as clerk and master, were acts in entire consonance with the duties and functions of that office. He so regarded it, for afterwards, on the 29th of March, he filed a report showing the amount of funds received by him from the former receiver, in which, afeer stating the cause, he says, “the subscriber, the clerk and master, makes the following report,” &c. The legal operationof the order, therefore, and the official declaration of the clerk and master, concur in establishing the reception of the money by Eli Talbot in his character of clerk and master. Such being the character in which the money was received, it is urged that the latter part of the order, without more, and by its own proper force will in legal operation, place the money in his hands as receiver. The record shows no act whatever done by him in that char. acter. And there is no fact or circumstance from which an inference of his acceptance of the office of receiver can be drawn, unless he having been clerk and the order being found Up0n rec01-d? it is inferred from that fact, that he, and not a deputy clerk, penned the order, and that he did not object to it; for if he had, it is in argument inferred again, that the chancellor might have appointed another, and that if he did not object, it was an implied acceptance, and fixes him with the office. Certainly this would be pushing the matter to the utmost, in the effort to change by mere legal operation, the character in which this money was certainly received, into another in which it is supposed it may have been retained. It has, indeed, as has been insisted, been determined by this court, that if one be appointed administrator and afterwards guardian, and give bond, with sureties in both offices, the sureties for the administration shall continue liable for two years, the time limited by law for the settlement of the estate, and the sureties for the guardianship shall then become liable by operation of law, without any further act by their principal as guardian, or settlement as administrator. But the case cited differs materially from the present, by the decisive act of acceptance, manifested in giving the bond and taking the oath of guardian. No such act of acceptance appears in this case; nor, indeed, any act of acceptance of the office of receiver. We have not examined very particularly the charge of the circuit judge upon this part of the case, for we are satisfied there is nothing in the record which would have sustained a verdict for the plaintiffs in error if such a verdict had been rendered; and we think there is no error in the charge which should operate to set aside a verdict, which it appears to us, from the record, is altogether correct, and ought not to be varied by any proper charge which could be given. Let the judgment be affirmed.

Judgment affirmed.