The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1893-04-27
IRON HALL RECEIvERSHIP
Supreme Court Afirms the Decision
Taking the Order from Somerby.
Lower Court He'd q Right to Appoint q Re.
ceiver on the Ground Of Mismsnage-
ment of the Order.

celyer for the iron hall was yesterday
affirmed by the Supreme Court. in an
opinion of sixty-three pages. written by
Judge Olds- There was no dissenting
judge. The decision is that the complaint
shows q sufficient emergency to
justify the courts action. Tho ap-
peal having been made upon an
IN terlocutory order. the case must
now 60 back to the trial court. when the
receivership may be made permanent.
and the plesdines. Judge Olds took MP the
discussion of the subject Of the suficiency
of the complaint. over which in brief aud
oral argument. the attorneys made q sharp
contention. Concerning this. Judge Olds
said:
We think there can be but little doubt a. to
what the trial rule In thisregard il. IL the ap-
pointment Of a receiver is but an auxiliary to a
pending action to keep intact q fund sought TO
be rendered and applied In satisfaction OF a final
Judgment TO be rendered, or TO aid in carrying
out the final object OF the main action, the sur
nciency OF the complaint will not be tested on an
appeal from an interlocutory order appointing a
receiver In SO far as il relates to Its sufficiency
10 entifle the party TO the relief asked IN the
main action. In that respect il is under the con-
troll OF the trial court, and may DO amended at
any time before final Judgment. But the court
Will look TO the complaint and test Its suficlency
In so FAR as it relates to the appointment or q
receiver. whether the appointment be as an
,n1 nrassc to an t aSt ion . or e whether t ~ a .n1s rs 6e0
q receiver.
But the OPINION holds that there must be
formal application. stating a cause for the
appointment of q receiver, that the 0ppo.
site parties may know on what grounds the
right to q receiver is claimed. and that they
may know what they have TO meet and de-
fend against to prevent the tment.
and the pleadings in this behalf will bound
and limit the inquiry. lt will not do, it Is
said. to dispense with all the rules of prac-
tice in the appointment OF receivers any
more than in any other class OF legal pro-
ceedings.
The court announces q purpose not to
test the case alone upon technical grounds,
being the first of It's kind. and says some
cause must DO shown for o receiver. Tho
court treats the case as Q suit testing the
appellant as q legal corporation. Ii holds
shat the proceeding Is not one quo war.
sEsntially as follows. interspersing at vari-
Gus points discussions of authorities and
statements of facts:
It would seem from the general scope and
tenor OF the prayer TO the complaint in this case
that the relief sought by the appellees was !. dis
solution OF the corporation on the grounds OF its
insolvency and general Acknowledgement of its
affairs by its officers, and the appointment OF 9
receiver to wind up its affairs. This, it would
seem. Is whas the pleader had in mind when he
drafted the prayer. at least, TO the complaint
1uat, independently OF statute, a court or
equity has no power to dissolve an insolvent
corporation is well settled, the authorities seem
20 be universal in holding this doctrine. There
Is no statute OF this State authorizing o court OF
equity TO dissolve q corporation on such a pro-
ceeding as the one at bar. Hence the action
cannot be sustained or regarded as one having
Tor It's object the dissolution or the corporation
on the grounds of insolvency or being in i'm
mediate danger of insolvency.
But the court holds In the case at bar the object
OF the proceedings, as we held, is to secure the
accounting of the officers, the application of the
funds to the proper objects of the corporation,
and the Office OF a receiver Is the means or force
A court OF equity should not ruthlessly wrest
from the legally constituted officers OF q corpor-
alton the management OF its affairs and the
property of the cooperation, and turn it over into
the hands OF q receiver; such power should not
be exercised by a court OF equity except with
due cause and in a case where ft Is clearly made
20 appear that It is for the best interest of the
parties interested, and il will not be presumed
except when the exigencies of the case clearly
warrant IT, But We think under our statute the
court has such power when 1t Is clearly made TO
that IL be done.
The authorities from which we have quoted
enunoiate the doctrine that the right to call into
action this power OF a court in equity exists as
well IN . shareholder IN a corporation as in q
creditor OF a corporation, and We see no reason
why 1t should not be so. A shareholder. and es-
pecially. as in this case. q shareholder who has
rights as a policy holder or q creditor, though his
debt be not due. has an interest as In this case
equal TO any Otlor fnemDSr OF the corporation.
being properly conducted and the preservation
OF the funds OF the corporation and the proper
application OF the same to the Legitimate objects
payment OF its debts and obligations, and
In the perpetuation and prosperity of the cor
poration that it may continue In force until the
obligations due the shareholders shall mature.
Ii the officers prove false and set about
to bankrupt a corporation. the end sought by
them may be reached before any change in the
management can be accomplished, and unless a
court OF equity tnterferes TO wrest from their
MANAGEMENT the affairs and property OF the cor
poration the shareholders may be without rem
edy. Iti upon this theory which we have an.
nounced that We think this proceeding tor the
appointment OF a receiver can be maintained,
petitioners would indicate that the pleader might
have had In mind the dissolution OF the partner.
ship.
But I'm this the officers In charge of the affairs
of the corporation, and who are charged with
gross acts OF NEUTRALITY-SUSPICIOUS. OF its affairs
are nonresidents oil the State; they are charged
with already taking $685. 900 of its funds from
the treasury and depositing them IN an insolvent
bank outside the state controlled by them. and
using the same for their own benefit. giving no
security for payment or use; that the only secur
iy for the money held by the officers OF the local
branches existing ia the several states Is the
guaranty OF this insolvent bank. Money is con
stantly being paid 10 the officers OF these
local branches and coming into the
treasury, Of the corporation. To pre-
the beneficence OF the corporation and preserve
the interests OF the shareholders, the business
must be continued, the dues collected and the
beneficiarfes paid. IL Is manifest that any relief
which could be obtained by means or an injunc.
ton woGld not be an adequate remedy or NEE,
the emergency existing. While q receiver, IL one
be- appointed. would supersede the officers,
shareholders could pay the money. 1t would be
secure. and the business conducted until a
remedy could be had through the organization
itself, by displacement of Incompetent or dis
honest officials and filing their places by com
petent ana honest ones. and requiring the
Dnicers of local branches 70 give other and re
sponsible surety.
The showing in the complaint presents a case
where the officers charged with maladminlstra
ton are in a position TO take from the corpora
ton daily funds OF the corporation and durins
the delay necessary for a meeting OF the manag
Ing board or shareholders. and before displace
ment OF the alleged dishonest officials through
The process provided by the laws Of the corpora
ton could be had. many thousand dollars more
might come into their hands or be taken from
the treasury by them and sQuandered or con
verted 10 their own use.
The appellees have a right to have the fund.-
protected aud preserved and applied TO The
proper use and the corporation perpetuated
The complaint states q good cause for the ap
pointment or q receiver. and the presumption
Is that the proof made under IL fully sustained
the action OF the court in the appointment OF
receiver.
Marriage Licenses.
Marriage licenses were issued yesterday
- -. NH - 80. L u.-s-- r