Case ID: kan_27/html/0707-01.html
Source: Caselaw Access Project
Author: {"author": "Horton, C. J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

N. W. Ellis v. W. C. Little, Receiver, &c.
    
    1. Receiver oe National Bank, Functions of. The receiver of a national bank, appointed by the comptroller of the currency, is the agent of the United States, and is limited as to his functions by the object of the receivership, and the duties which it involves.
    2. Receiver, Powers of. Such a receiver, upon the order of a court of record of competent jurisdiction, may sell or compound all bad or doubtful debts, and on a like order may sell all the real and personal property on such terms as the court shall direct; but he cannot sell the property of the bank in the absence of such an order, or upon terms in conflict with the directions of the order. ' . ■
    3. --Ultra Vires. Such a receiver cannot charge the estate of the bank by his executory contract unless authorized so to do under the provisions of the national-banking act, and the order of a court of record of competent jurisdiction obtained under the terms of said act.
    4. --Limit of Power. Where a receiver is directed by a court of competent jurisdiction to sell the assets of the bank “on such terms and in such manner as in his judgment shall be for the best interest of the creditors and all interested in the bank and its assets,” he is not empowered thereby to exchange, barter or trade the property of the bank for other and different property.
    5. Receiver’s Authority, Knowledge of. Persons dealing with the receiver of a national bank in his official capacity are bound in law to take knowledge of his authority to act; and if contracts are entered into by persons with the receiver, which are in excess of the receiver’s authority, such persons contract at their peril, and the estate of the bank cannot be charged for the default or inability of the receiver to perform the contracts.
    
      
      Error from Sedgwich District Court.
    
    Before the 18th day of September, 1876, one J. C. Fraker was tfye owner of the undivided one-third of the south half of the northwest quarter of section twenty-two, township twenty-seven, south, of range one, east, in Sedgwick county, together with the flouring mill, machinery and fixtures thereon, and the water-rights and easements thereunto belonging. On the 18th day of September, 1876, said J. C. Fraker was largely indebted to the First National bank of Wichita, Kansas, which bank was then insolvent, and its assets and property were in the hands of an officer awaiting the appointment of a receiver by the comptroller of the currency of the United States. At the date aforesaid, Fraker and wife conveyed his one-third interest in said lands and tenements, mill and easements to J. R. Mead, in trust, however, that when a receiver should be appointed for said bank, that said J. R. Mead should convey the same to said receiver in part payment of the said J. C. Fraker’s indebtedness to said bank. On the 19th day of October, 1876, H. B. Cullum was duly appointed receiver of said bank by the comptroller of the currency of the United States, and afterward said J. R. Mead by deed duly conveyed said property to said H. B. Cullum as the receiver of said bank. Cullum continued to act and perform the duties of such receiver until about the 1st day of March, 1878, when he resigned the receivership, and on the 9th day of March, 1878, the defendant, W. C. Little, was duly appointed receiver of the bank, and took charge of the assets thereof, and is still such receiver. On the 31st day of December, 1877, said H. B. Cullum, as receiver of the First National bank of Wichita, Kansas, executed a contract to sell to the plaintiff, N. W. Ellis, said one-third of said land, mill and water-rights and easements, and three different judgments that said bank claimed to own, amounting in the aggregate to something over three thousand dollars, for the sum of five thousand and five hundred dollars, to be paid as follows: $2,000 on the execution of said contract, and $3,500 on the 1st day of May, 1878. Before this contract was entered into, Samantha ■ B. Thomas and Emma A. Ellis, daughters of said N. W. Ellis, were the owners of a balance of a judgment rendered in the district or circuit court of Union county, Iowa, against William Groesbeck in favor of J. C. Eraker, but which had been assigned to said Mrs. Thomas and Miss Ellis; and said judgment was the second lien on a large tract of land in the county aforesaid. By the terms of the contract, N. W. Ellis was to procure his two daughters to assign. to said H. B. Cullum, receiver of the bank, two thousand dollars of this Iowa judgment, which was to be the two-thousand-dollar payment to be made on the execution of this contract. When Mrs. Thomas and Miss Ellis came to assign their interest in the Iowa judgment, it turned out that they owned $3,462.63, and Cullum was desirous of obtaining all of their interest in said judgment as a payment on this contract; and on the 2d day of January, 1878, they assigned all of their interest in the judgment to Cullum as receiver of the bank, and the same was receipted on the contract as follows:
    “Received, January 2d, 1878, of N. W. Ellis, an assignment of Iowa judgment by W. A. Thomas and Samantha B. Thomas and Emma A. Ellis, amounting to thirty-four' hundred and sixty-two and sixty-three one-hundredths dollars, it being in full of the $2,000 payment mentioned within, and the balance, $1,462.63, to apply in part payment due May 1, 1878. H. B. Cullum,
    
      Receiver of the First National Bank of Wichita, Kansas.”
    
    When J. C. Fraker conveyed his one-third interest in said land, mill, machinery and easements, W. A. Thomas and E. L. Wheeler owned the other two-thirds of the same, and the same had been operated as a flouring mill by Fraker, Wheeler and Thomas, as partners under the style of Thomas, Wheeler & Co. When Fraker conveyed his interest' therein to the bank, the firm of Thomas, Wheeler & Co. was insolvent, and H. B. Cullum as such receiver claimed to hold Fraker’s one-third of the property discharged from all liability for any of the debts of the above firm. On November, 1876, Wheeler and Thomas commenced this suit in the district court of Sedgwick county, to have said copartnership closed up, and for an accounting of the liabilities and assets of the firm of Thomas, Wheeler & Co., and to have the one-third interest of J. C. Fraker conveyed to Cullum as such receiver, held liable for the debts of the firm, and to have all of said property sold and the proceeds of the sale applied in payment of the liabilities of the firm; In said case a receiver was appointed by the district court tó take charge of the property of the said firm. At the May Term, 1877, of said district court, all the issues of law and fact were referred to'a referee, which case was duly heard by the referee, who found that the firm was largely indebted, and also found that the one-third interest in the property conveyed to the receiver by said J. C. Fraker, was, with the other two-thirds of said property, liable for the debts of the firm, and made his report accordingly. At the December Term, 1877, of the court, the report of the referee was confirmed, and the receiver appointed by the district court was ordered to sell all of said property to pay the debts of the firm of Thomas, Wheeler & Co.
    Before H. B. Cullum sold the property to Ellis, he had petitioned to the district court of the United States for the district of Kansas for authority to. sell certain personal and real estate, and the court by its order had authorized the receiver to sell the property described in his petition. On the 1st day of May, 1878, N. W. Ellis offered to tender to W. C. Little, who was then the receiver of said bank, the balance due upon the contract, and demanded a deed for the one-third interest in the property sold to him, and also an assignment to him of the three judgments mentioned in the contract. The receiver refused and failed to make such conveyance to the plaintiff and assign him said judgments. On the 1st day of May, 1878,‘all of said property was advertised for sale by the receiver appointed by the district court on the 25th day of May, 1878, and on which day the receiver of the district court, with the knowledge and consent of the defendant, sold all of said property, including the one-third sold to plaintiff, to H. W. Lewis, and the plaintiff, which sale was afterward confirmed by said court, and the property conveyed to Lewis and the plaintiff by the receiver.
    On the 19th day of July, 1878, the plaintiff commenced a suit in the district court of Sedgwick county against the receiver of the bank to recover the amount he had paid on said contract, to wit, $3,462.62, and for other damages, amounting in all to $5,000. At the May Term, 1881, of the court, this cause was tried, and the court rendered a judgment in favor of the plaintiff against the defendant for the sum of $587.50. The plaintiff filed a motion for a new trial, which was overruled by the court, and the plaintiff brings the case to this court for review.
    The following are the assignments of error presented on the hearing of this case in this court:
    1. That the court erred in the amount for which it rendered judgment.
    2. In overruling the motion of the plaintiff for a new trial.
    The contract set forth in the petition is in words and figures as follows:
    “This agreement, made and entered into on this 31st day of December, 1877, by and between H. B. Cullum, receiver of the First National bank of Wichita, Kansas, party of the first part, and N. W. Ellis, of the county of Brown, in the state of Ohio, party of the second part, witnesseth:
    “That the said H. B. Cullum, as receiver of the First National bank of Wichita, Kansas, party of the first part, in •consideration of the covenants and agreements hereinafter stipulated and agreed to be performed on the part of said N. W. Ellis, party of the second part, hereby agrees to sell and convey unto the said N. W. Ellis, hi's administrators, executors, heirs and assigns, the following real and personal property, rights and easements, to wit:
    “The undivided one-third of the south half of the northwest quarter of section number twenty-two (22), in township number twenty-seven (27), south, of range one (1), east, in the county of Sedgwick, in the state of Kansas, together with the mill and all of the machinery and fixtures on the same; also the right to build, erect and maintain a dam across the stream known as the Little Arkansas river, at a point at or about eight rods up said Little Arkansas river from the point-where said stream crosses the west line of the southeast quarter of the southwest quarter of section number twenty-nine-(29), in township number twenty-six (26), south, of range number one (1), east, in Sedgwick county, in the state of Kansas; and also the right to dig, excavate and maintain an aqueduct or mill-race not more than sixty feet wide, running from the above-described point of the location of said dam on-said river in a southeasterly direction to the section line running east and west between said section twenty-nine (29) and section thirty-two (32) of said township, so that said race shall strike said section line not further east than the quarter-section corner between said sections, and running thence east on said section line to the stream known as Chisholm creek, in said county, together with the right to enter upon said premises to erect, construct, operate or repair said dam and mill-race as fully and to the same extent as the same was conveyed-on the 14th day of November, 1873, by Arthur Sullivan and Aggie L. Sullivan his wife, to E. L. Wheeler and L. G. Sheets, to which deed reference is here made; also the rights,.privilege and easements now belonging to and appurtenant to said mill to flow the water to run said water mill from said dam in said Little Arkansas river to said mill, and to enter upon said race where the same runs to said Chisholm creek, and make all needed and necessary repairs; and also the right to erect and maintain a suitable dam at said mill to raise the water to a suitable height to afford sufficient water to operate said mill to the same extent that the same is now built and maintained. The said H. B. Cullum, receiver of the First National bank of Wichita, Kansas, also hereby agrees to sell, asssign, set over and transfer to said N. W. Ellis the following claims, judgments and accounts, which he holds as receiver of said First National bank of Wichita, Kansas, and due from Thomas, Wheeler & Co., and are liens against said mill property, to wit: A claim of Ruggles and Sterry, for attorneys’ fees performed for said Thomas, Wheeler & Co., and now owned by said Cullum, in the sum of one hundred dollars; one judgment rendered against Thomas, Wheeler & Co. in the district court of the United States for the district of Kansas, in favor of the said H. B. Cullum, receiver of said First National bank of Wichita, Kansas, for the sum of nine hundred and eighty-three dollars and sixty-three cents ($983.63), with 12 per cent, interest; one judgment rendered in the district court of Sedgwick county, Kansas, May 29, 1877, on A. W. L. Fraker’s note, in the sum of nine hundred and sixty-five dollars and ninety cents ($965.90), with interest at 12 per cent.; one judgment rendered in the district court of the United States for the district of Kansas, on the 23d day of October, 1877, on J. Henson’s note, in the sum of nine hundred and nine dollars and twenty-five cents ($909.25), with interest at 12 per cent.;, and an account of over-drafts from said Thomas, Wheeler & Co., to said First National bank of Wichita, Kansas, in the sum of fifty-six dollars and forty-four cents ($56.44), including all accrued interest on said judgment and claims.
    “In consideration whereof, the said N. W. Ellis promises and agrees to pay to the said H. B. Cullum, receiver of said First National bank of Wichita, Kansas, the sum of five thousand and-five hundred dollars ($5,500), at the time and in the manner following, that is to say: two'thousand dollars to be paid upon the execution of this contract, which said-sum of two thousand dollars is to be paid and satisfied as follows:
    “The said N. W. Ellis is to procure an assignment from ' Mrs. Samantha B. Thomas and Emma A. Ellis to said H. B. Cullum of two thousand dollars in a certain judgment rendered in the district (or circuit) court in Union county, in the state of Iowa, against William Groesbeck in favor of J. C. Fraker, for the sum of $5,960, and rendered in- the month of November, 1876, which assignment of two thousand dollars in said judgment, when procured in due form and delivered to said H. B. Cullum, he, the said Cullum, is to receive the same as the two-thousand-dollar payment to be made upon the execution of this contract, and the sum of thirty-five hundred dollars ($3,500) on the 1st day of May, 1878.
    “The said H. B. Cullum, as receiver of said The First National bank of Wichita, Kansas, agrees on or before the-1st day of May, 1878, to execute and deliver to said N. W-Ellis a deed for said property, conveying unto the said N. W. Ellis, his heirs and assigns, all the right, title, privileges and easements of the said H. B. Cullum as the receiver of the First National bank of Wichita, Kansas, in and to all the real estate, mill machinery and fixtures thereunto belonging, and all the water-rights, privileges and easements appurtenant thereto, hereinbefore described and set out.
    
      “It is agreed that the said H. B. Cullum, receiver as aforesaid, shall deliver to said N. W. Ellis, or his heirs or assigus, the undivided one-third interest in said mill and machinery in as good condition as the same now is, excepting the ordinary wear and tear in the use of the same; and that none of the machinery now in said mill shall be removed from said mill before said N. W. Ellis takes possession of the interest in said mill and machinery that he is hereby purchasing.
    “It is further agreed on the part of said H. B. Cullum, that he will consent and order to be issued by the district court within and for the county of Sedgwick, in the state of Kansas, ordering and directing the receiver of said property to turn over to said N. W. Ellis the undivided one-third of said property on the 1st day of May, 1878, on condition that the said N. W. Ellis shall, on or before that day, pay to said H. B. Cullum, receiver as aforesaid, said sum of $3,500, and also that a like order be rendered by said court directing the lessees of said property and mill to surrender possession of the same at the expiration of their present lease.
    “This agreement is not to be construed as an agreement by said Cullum to convey any items of mill fixtures or machinery put into said mill, or building put upon said land by John Rauche & Co., the present lessees of said property.
    “ It is further agreed on the part of said H. B. Cullum, that in case it shall be decided by the supreme court of the state of Kansas, or the district court within and for the county of Sedgwick, in the state of Kansas, that the said H. B. Cullum was not entitled to receive the money on the judgment rendered on the Fraker note, for the sum of nine hundred and sixty-five dollars and ninety cents ($965.90), with interest from May 29, 1877, at 12 per cent., but that said Fraker is entitled to receive the sum from the said Thomas, Wheeler & Co., the amount of said judgment and interest is to be refunded to said N. W. Ellis by said H. B. Cullum. In case it should be decided, before the 1st day of May, 1878, that said Cullum was not entitled to receive the money on said Fraker note, then and in that case the amount of said judgment and interest is to be applied as so much of .a part payment on the payment of $3,500, to be made by said N. W. Ellis to said H. B. Cullum on the 1st day of May, 1878; and if it be so decided after said payment is made, and said Thomas, Wheeler & Co. have to pay said judgment, then the said H. B. Cullum is to refund to said N. W. Ellis said ■sum of $965.90, with interest from May 29, 1878, at 12 per •cent, per annum.
    “In witness whereof, said parties have hereunto set their hands and seals, the day and year first above written.
    N. W. Ellis. (Seal.)
    H. B. Cullum, (Seal.)
    
      Receiver of the First National Bank of Wichita, Kansas.”
    
    The receiver testified, among other things, as follows:
    “That about the first of May, 1878, Mr. Ellis and W. A. Thomas came into his office; Mr. Thomas told him that he had the money to pay what was due to him on the contract, and wanted a deed for the land and mill property, and an assignment of the three judgments and other claims mentioned in the ■contract. I told him I was ready to fix up the matter. Mr. Thomas then asked me if I could assign the Fraker judgment, and asked if I had an assignment of that judgment. I told him that I did not know whether I had an assignment •of the Fraker judgment or not, or whether I could assign that judgment to Mr. Ellis. But I told him that the, deed for the land and mill property was placed in escrow in the Wichita Savings bank, in Wichita, and that I was ready to go with them and deliver the deed, and assign such of the judgments as I could. As a matter of fact, I could not assign the Fraker judgment, as the bank never owned or had an assignment to it; neither had the receiver any assignment of this judgment. I don’t know just what I said about that judgment. I know that I said to them that I was ready to deliver the deed and two of the judgments, and demanded the money that was due to the bank from Mr. Ellis on the contract. I don’t think anything was said about my assigning to Ellis the claim against Thomas & Wheeler in favor of Ruggles & Sterry, and by them assigned to the bank. Thomas said something about the dam on the Little Arkansas river being washed out, and that the mill was not in as good condition as it was when the contract was entered into. I told ■them that I didn’t know anything about that matter. Ellis and Thomas refused to receive the deed for the land and mill property, unless I also-assigned and transferred all of the three judgments. This I could not do, and they went away and didn’t pay me the money. I didn’t deliver to Ellis the ■deed or any of the assignments at that time or since. As I said before, I understood that a deed for the land and mill property had been made and placed in escrow in the Wichita Savings bank, but I never saw it, and don’t know of my own knowledge that such a deed was made out and placed in escrow; but if it was, it has never been delivered to the plaintiff. I have never obtained an assignment to myself as receiver, or to Mr. Ellis, of the Fraker judgment, nor paid him for the judgment, and have never delivered him a deed for the land or mill property. The bank still owns, or did own up to a short time ago, the other two judgments mentioned in the contract. A short time ago, these two judgments were sold to other parties by me, as receiver. The Iowa judgment, assigned to the receiver by Mrs. Thomas and Miss Ellis, has never been reassigned to Mr. Ellis. ... I sold the Groesbeck land in Iowa for the best price I could get, and the bank realized $500 from the sale. I have been at all times ready and willing to convey the land to Mr. Ellis, and at the time they came to my office on the 1st of May, I offered to deduct the amount of the Fraker judgment from the consideration expressed in the contract to be paid by Ellis.”
    
      H. Q. Ruggles, for plaintiff in error.
    
      Sluss & Hatton, for defendant in error.
   The opinion of the court was delivered by

Horton, C. J.:

The principal question in this case is, whether the estate of the bank can be charged with the damages resulting to Ellis, plaintiff in error, from the failure and inability of the receiver of the bank to comply with the .terms of the contract executed December 31, 1877. If the receiver exceeded his authority in executing the contract, plaintiff in error was not entitled to recover in the court below, and therefore cannot complain that the trial court erred in the amount for which it rendered judgment in his favor. The act of congress as embraced in the United States Revised Statutes of 1873 — 74, to provide a national currency, etc., and which establishes those associations for the carrying on the business of banking now known as our national banks, provides in section 5234 as follows:

“On becoming satisfied, as specified in sections five thousand two hundred and twenty-six and five thousand two hundred and twenty-seven, that any association has refused to pay its circulating notes as therein mentioned, and is in default, the comptroller of the currency may forthwith appoint a receiver, and require of him such bond and security as he ■deems proper. Such receiver, under the directions of the •comptroller, shall take possession of the books, records and assets of every description of such association, collect all debts, dues and claims belonging t.o it, ánd upon the order of a court of record of competent jurisdiction, may sell or compound all bad or doubtful debts, and on a like order may sell all the real and personal property of such association, on such terms as the court shall direct; and may,-if necessary to pay the debts of such association, enforce the individual liability •of the stockholders. Such receiver shall pay over all money so made to the treasurer of the United States, subject to the ■order of the comptroller, and also make report to the comptroller of all his acts and proceedings.”

In accordance with this section, H. B. Cullum was appointed receiver of the bank, October 19, T 876, about fourteén- months prior to the execution by him of the contract sued on. On the 9th day of January, 1877, said receiver filed in the district court of the United States for the district ■of Kansas his petition praying for an order of the court authorizing him as such receiver to*sell certain real estate, bills receivable, overdrafts and other property that were mentioned ■and described in a certain schedule marked “Exhibit B,” and attached to his petition. Among other things in said schedule B, under the head of real estate, were the following: “ One-third interest in-a flouring mill in Wichita, Sedgwick county, Kansas, (incumbered $961,) part of J. C. Fraker’s transfer, $3,500.” In said schedule there was also mentioned one judgment in favor of the said H. B. Cullum, as receiver of the First National bank of Wichita, Kansas, rendered in the district court of the United States in and for the district of Kansas against Thomas & Wheeler, for the sum of $983.63, with 12 per cent, interest, and a judgment on a note of J. Hanson, in the district court of the United Statés for the district of Kansas, for the sum of $909.25, with 12 per cent, interest; one claim for attorneys’ fees in favor of Ruggles & Sterry and against Thomas & Wheeler, for $100, assigned to said receiver; also a claim for an overdraft against Thomas, Wheeler & Co. in favor of said bank, for the sum of $56.44. Upon consideration of this petition, the-receiver was allowed and permitted by the court “to sell each and every item of personal property and real estate mentioned and described in said schedule B, attached to his petition, on such terms and in such manner as in his judgment may be for the best interests of the creditors and all interested in said bank and its assets.” On the 8th day of November, 1876, J. C.. Fraker assigned and transferred to Cullum an interest in a judgment rendered in the foreclosure of a mortgage upon real estate in Union county, in the state of Iowa, in his favor,, against one William Groesbeck, for the sum of $5,960, to secure and pay about $2,300 due the bank upon notes held by it, executed by W. A. Thomas & Co. On November 13,. 1876, the receiver bid in the mortgaged premises at sheriff's-sale, and on the 28th day of November, 1877, a sheriff's deed was executed to the receiver of the mortgaged premises. The consideration that Ellis agreed to pay to the receiver upon the contract sued on was $5,500. Two thousand dollars was to-be paid and satisfied as follo\vs: Ellis was to procure an assignment from S. B. Thomas and- E. A. Ellis to Cullum of $2,000 in the said judgment rendered in the foreclosure suit in Union county, Iowa, against the said William Groesbeck, in favor of J. C. Fraker, which assignment of $2,000 in said judgment the said Cullum agreed to receive as a payment of $2,000 upon the contract. The balance of the consideration,, to wit, $3,500, was to be paid upon the first day of May, 1878. When S. B. Thomas and E. A. Ellis came to assign their interest in said judgment, it turned out that they owned $3,462.63 therein, and on the 2d day January, 1878, they assigned all of their interest in said judgment to Cullum, as receiver of the bank, and he receipted on the contract as follows:

“(Eeceived, January 2,1878, of N. W. Ellis, an assignment of the Iowa judgment, by W. A. Thomas and Samantha B. Thomas, and Emma A. Ellis, amounting to $3,462.63, it being in full of the $2,000 payment mentioned within, and the balance, $1,462.63, to apply in part payment due May 1, 1878. H. B. Culltjm,

Receiver of the First National Banh of Wichita, Kansas.”

It does not appear that the Iowa judgment, or the judgment rendered in the district court of Sedgwick county on May 29,1877, on the note of W. L. Eraker for $965.90, was mentioned or referred to in the petition filed by the receiver in the United States district court; and it is not claimed that any specific order was made by the United States court permitting the receiver to exchange, trade or barter the property of the bank for other or different property. The power conferred upon the receiver by the court authorized him to sell the personal property and real estate described in the schedule attached to his petition filed in the court, on such terms and in such manner as in his judgment was for the best interests of the creditors and all interested in the bank and its assets. This — nothing more. The receiver of a national bank, appointed by the comptroller under the section of the act of congress quoted, is the agent of the United States, and is limited as to his functions by the object of the receivership and the duties which it involves. (High on Receivers, § 360; Kennedy v. Gibson, 8 Wall. 498.)

Under the order of the court, such receiver may sell the real and personal property of the bank on such terms as the court shall direct, but he cannot sell in the absence of such an order, nor sell upon terms in conflict with the order. As the receiver in this case did not apply for an order to sell or dispose of the judgment on W. L. Fraker’s notes, supposed to amount to over $900, any attempted sale thereof, or any agreement concerning a sale of it, was in excess of his power as receiver, and therefore not binding upon the estate of the bank. Without the order of the court, the receiver had no authority in his official capacity to buy the Iowa judgment or any interest therein, nor could he under the order of the court permitting him to sell the property of the bank, exchange, trade or barter it for other property. Nor could such receiver charge the estate of the bank by any executory ■contract of his unless he was authorized so to do by the provisions of the national banking act and the order of a court of competent jurisdiction obtained under the terms of said act. No application was made by the receiver to the court for permission to execute an agreement of the character of the one sued upon; therefore in the absence of such an order the estate cannot be charged for damages resulting from the failure or inability of the receiver to convey or deliver property not belonging to the bank, nor for his refusal to comply with covenants which he was without power as the receiver to make. As the power of a receiver of a national bank appointed- by the comptroller is limited, a person dealing with him in his official capacity is bound as a matter of law to have knowledge of his authority to act, and if contracts and agreements are entered into with the receiver in excess of his authority as conferred by law, the parties contract at their own peril, and the estate of the bank cannot be charged for the default or inability of a receiver acting outside of his functions as receiver and beyond the duties which it involves.

In answer to the point that the receiver exceeded his powers, and that his action did not bind the estate, counsel for plaintiff refers to several decisions; yet none of these are strictly applicable. Livingston v. Pettigrew, 7 Lans. 405, was an action to make a receiver liable personally, on his covenant > that certain judgments and claims assigned by him were due and unpaid. The court says:

“But assuming that the covenant in question was void, because the receiver exceeded his powers, and that it did not bind the estate, the question arises whether he thereby rendered himself personally responsible for a breach of it. I am inclined to think that he did not, and that the instrument itself showing that the act was done as a receiver, it cannot under any circumstances be construed as a personal covenant. The party who took the assignment knew all about its contents as they appeared, and it is presumed he knew the law and it is fair to assume he knew also that the covenant was void upon its face. If such was the law, he therefore has no valid grounds for claiming he has in any way been misled or deceived.”

Applying this doctrine to the case at bar, plaintiff has no cause for complaint. The other decisions are to the effect that corporations have no right to violate their charters, but they have capacity to do so and to be bound by their acts, when a repudiation of such acts would result in a manifest wrong to innocent parties. This principle does not control the acts of a receiver, whose powers are so strictly defined and limited by law as those of a receiver appointed by the ■comptroller of the currency, so far as to make his estate liable for acts of his in excess of his powers.

The trial court found in favor of the plaintiff in the sum •of $587.70. Upon what theory this judgment was rendered we caonot tell from an examination of the record. As it appears, however, from the evidence, that the estate of the bank realized about $500 from the sale of the land in Iowa, obtained under the judgment of foreclosure, we suppose the court thought best, under the circumstances, that the plaintiff should recover back the amount actually realized by the bank, notwithstanding the receiver exceeded his authority in executing the contract. In other words, the court seems to have thought that the estate of the bank ought not to retain the benefits of a contract, executed by the receiver in excess of his power. The defendant takes no exception to this judgment, and under the conclusion reached by us, plaintiff has no reason to complain thereof.

The judgment of the district court must be affirmed.

All the J ustices concurring.