, 1885-03-07

/ the spokane Falls and Coeur d'Aleno
Transportation company were plain
tiffs and parties refusing TO pay as
Sessments were defendants. The de-
cision was rendered at the late term
OF court and Is a matter Of great In
terest to the people Of this city;
This is an action by tho plaintiff as ro-
oeiver Of tho Spokane Falls and Coour
| d'Alene Transportation company, a do
mestic corporation, to recover from the
defendants, a partnership, an unpaid bal
ance alleged to bo due from them as their
subscription to the capital stock Of the cor
poration.
The defendants demur to tho complaint.
The hrst ground Of demurrer urged Is
that the plaintiff has no Legal capacity 10
Tho complaint shows that 1.-THE Spokane
Falls and Occur d'Alono Transportation
1 Co. now u, and at all times heroinaftor mon
tioned uas, q corpaation duly organised
and existing under and BY virtue Of The
laws Of Washington territory, and having
It's principal place Of business at Spokane
Falls, Aforesaid, on to-wit; October Il, 1854,
at Cheney, in the county and territory
Aforesaid, in n certain action then and now
being in the above entitled court, holding
terms at Cheney Aforesaid, wh0roin the
| First National bank Of Spokane Falls, q
corporation duly Organized and existing
under and by virtue Of tho National bank
| ing laws OF the United States at Spokane
| Falls aforesaid, and then and now a credi-
tor Of SAID first named corDdration In the
sum OF Sl70O which still remains unpaid,
was plaintiff, and said Spokane Falls aud
Coeur d'Aleno Transportation company
was defendant, an order was duly made
and entered by said court, appointing said
II. NJ. Mccartney, plaintiff, receiver Of
the said Spokane Falls and Coeur d'Alene
Transportation company, its properties,
| goods, rights, moneys and credits, DC.
The proposition Of the defendants Is,
that the district court has no power to ap-
| point a receiver for a corporation In any
! case prior to its dissolution, and honce that
the order Of the district court described in
the complaint had no efficacy as clothing
tho plaintiff with capacity to sue.
II the premise be correct / think the re-
suit claimed must follow. An order in
excess Of the powc1 Of the court made in a
proceeding over which the court properly
has Jurisdiction Is OF no greater force than
an order within Its power ordinarily made
In a proceeding over which 1t has no juris-
| diction whatever. Every presumption Is
| In favor Of the acts Of courts Of superior
Jurisdiction, but what presumption can be
! lndulged TO save an act which Il is beyond
the power OF the court to do under any
circumstances7 / do not think, however.
that the district court Is wholly without
Jurisdiction to appoint recoivers for ex-
lsting corporations. The Jurisdiction Of
courts Of ordinary equitable cognizance 70
appoint receivers for corporations Is af-
hrmed by the highest judicial tribunal in
See Covington Drawbridgo Co. ct ais, vs..
Shepherd OF ais, q Howard, p. ll2.
oglvie vs.. Knox Ins. Co., q How. (U.
81 D. $50. See also TO same effect; Red
field on law Of railways, vol. 2, p. s6l, soc,
224.
Field on corporations, secs. ais, 4I6, Az
and AIS. Taylor's law OF private corpora
tions having capital stock, secs. 65s, 600
and 66l.
Adler vs.. Milwaukee Pat. Brick Man.
Co., Is Wisconsin 81.
In the last case cited, Dixon, chief jus
hoa, gives tha folloving a. the practice OF
the courts in this respect In states gov
erned by the common laws "Tho creditor
Is hrst 70 establish his claim by a judg-
ment at Law, and then after execution T.
sues and retured in whole or IN part un-
satisfied, he may file q bill in Ills own
behalf, and in behalf OF such other credi-
tors Of the corporation as may elect tn be-
come parties thereto, against the CORPORA
ton and It's delinquent or Withdrawing
stockholders alleging the recovery and
non-payment Of bis Judgment, and pray
ing the decree or order OF the court that
an account Of the assets and debts be
taken and q receiver appointed" &C.
The only authorities cited on the argG-
ment, or which l have been able to find
since squarely opposed 10 this position,
are the cases Of Neal vs.. Hill, 10 California,
l45, and tho French bank case, 63 Cal, 495.
These cases certainly hold that court Of
equity has no power 10 appoint a receiver
N.- - lie .IVUNNa
They proceed upon the theory that the ap-
pointment Of a receiver must necessarily
result in the dissolution II the corporation,
a result that the court could not decree di-
rectly and which 1t may not accomplish
by indirection.
The weight OF authority, however, and
Of reason also, II seems IN me, II against
the doctrine that the appointment Of a re-
ceiveT works dissolution. 1RylOr's Law
OF Private Corporations having Capital
Stock. Section 432 and note. kinkaid vs.
Wwinelle, SO n Y, 545.
Bank Of Bethel vs. Patquiosque Bank,
IA Wallace 3sS. The idea that the appoint
ment OF receiver works the dissolution
Of the corporation Is said To have sprung
from q dictUm OF Chancellor Kent that
such an appointment was equivolent to a
"VfTtltuL dissolution" The same thing
might be said OF the levy and sale on ex-
/
of which n corpor.tion eKereised and en-
loved its franchise. vet Il has never been
glsined that an execution could not be
levied on Dropertv of suob cbaraeter be-
longing 10 stTieily private oorDoration.
The appointment Oh receiver IA said 10 be
the levy Of a kind OF equitable execution.
High on Receivers, section s.
AZ moi think tbo tsnnra of corpor,fo
life 30 frail that a mere suspension Of cor
porate functions must result In its disso-
luton. In my Judgment IL rests alone
with the sovereign power, from which the
corporate franchise was carved, to say
when a voluntary act Of the corporation
will be accepted as a surrender, and when
an involuntary act will be insisted on as a
dissolution. A corporation may be in
solvent to-day and its property pass into
the hands Of receiver. Tomorrow an
appreciation Of values may make L more
than solvent. Why should Il not resume
| the exercise Of its corporate privileges and
the performance Of its corporate duties, II
the sovereign do not object : II il do 70
sumo certainly no one but the sovereign
would be heard to dispute It's continued