The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1894-01-26
WHILE APPEAL is PENDING.
State Investment Matters in the
Supreme Court.
WRIT OF PROHIBITION GRANTED.
Judge Hebbard Exceeded His Author
ity in Retaining Van Reynegom
and Citing Harrison.

The Supreme Court has decided that IN
cases where an action is taken by the At
| torney-General 10 dissolve corporation,
wind up its affairs and distribute It's as
sets the Superior Court has no power 10
appoint receiver during the tendency Oh
an appeal from a Judgment ordering the
corporation to be dissolved
The particular case in question was that
of the State Investment and Insurance
Company. which under proceedings by
Attorney General Hart. representing the
people of the State of California. was re-
Gently ordered to be dissolved by Judge
Hebbard, an adjudication Of insolvency
be ing set aside. The facts are as follows:
The company was incorporated in 1871
with capital of $500, 000, fully subscribed.
All went well until 1898, when certain
creditors, representing claims aggregating
$4,000, petitioned the Superior Court to
adJudge the company an insolvent debtor.
Proceedings were held in the matter be-
tore Judge Levy, and the court made an
order as required Oh July IA.
AT that same time an action was COM
menced against the CON Dany upon the in
formation OF the AttorDey-General, pray
Ing for dissolution of the company. the
winding mp of It's affairs and the dlStrlbu-
lOu Ot It's assets. Iu6 lid up Oh
August "a. 1898, before Judge Hebbard, and
as result Judge Hebbard decided that the
motion OF the Attorney General must prevail,
and the company was declared dissolved, ex-
Judge Van ReyneSom being appointed re-
ceiver
An appeal from this decision was taken TO
the supreme Court, aud on Judge HebOaId re-
talnns an ReynegOm as receiver during the
pending OF the appeal a WIFI OF pI ohlbitlon
was prayed for, directed 20 the Superior Court,
Judge Hebbald anu Mr. V an Reynegom, re-
Straluiuq them from fuffner DIOceeuiug
the Judgment or order with reference 10 any
property OF the corporation, ana from Interior
ing With or disturbing the possession or control
OF the COZ operation as 10 any OF lis property or
effects. In answer 10 Ihis 1t was cOnJended by
the respondents that the proceedings In insol-
vency had been superseded by ana merged in
the proceedings for a dissolution or tue cOTp0-
pordtlOn, and that the court III which this lat
Ter proceeding Is pending had jurisdiction to
make the orders and TO wind up the affairs and
dlStGlbutesthe effects Of the corporation.
The Supreme Court decided that the superior
Court had acquired jurisdiction over the estate
of the company on June !, when the petition
Tor Its insolvency was nled; ana that on June
Is, when the corporation appeared IN answer
10 The order TO show cause, tue court had ac-
CURED entire Jurisdiction OF the subject matt er
Of tie petition, ana of The lnSOlyent. had tie
lower court carried out the provisions OF the
inSolvent act aud distributed The estate, II
would not have been commended that its orders
and judgment had not been cOnclu slye. But
when an action 10 dissolve a corporation had
been brought by tue Attorney General the
only order which the court was authorized 10
make was one requiring the corporation 10
show cause why It's business should not be
closed. Until the return day of that ordyr the
court could neither enjoin the corporation
from doing business, nor could II disturb II Ill
the possession OF It's estate; and, If upon the
hearing al the return day 1t should not be
shown 10 the satisfaction of The court that the
corporation was lnsolvent within the meaning
OF the statute, It's only junction was TO annul
the act OF the insurance commissioner. The
court had no right 10 appoint d receiver.
hen ne neaIf m no i'm a papftu
fected Its execution was suspended until the
determination OF the appeal. and while that APP
peal Is pending the court cannot carry into execu-
tton that part OF its judgment authorizing the APP
polntment OF a receiver. The effect OF appeal
from judgment when the proceedings thereon
are stayed Is 10 preserve the rights of the parties
TO the controversy in the same condition they
were prior TO the entry of the Judgment IL the
court could appoint receiver take the appel
lanpS property from his custody and keep 1t in
his possession during the tendency OF the appeal.
II would exercise authority ter the Judgment
greater than It possessed before its entry, aud the
effect of the appeal would thus be destroyed. For
this reason the court had no lurisd iction to ap-
point Van ReynegOm as receiver OF the effects of
the corporation during the tendency OF the appeal.
The transfer OF the proceedings in Insolvency
after the or der OF adjudication had been made
from the department in which they had been
pending 10 the DEPARTMENT in which the acrIon
Tor dissolution was pending did not confer upon
the court any greater jurisdiction in the latter
matter than il prev lously had had Each of these
proceedings was statutory in its character, and
was to be conducted in the manner and within
the limits prescribed by the statute under which
1T had been instituted.
The application OF the petitioner must be
granted and the writ OF rohiDltion made peremp-
tory.
In the same way the proceedings taken by
Judge Hebbard against Attorney Robert Har-
TlsOn have been dismissed, the Supreme Court
having granted a VIII of prohibition restrain
ing Judge Hebbard from proceeding with an
order TO Harrison 10 show cause why he should
not be punished for contempt of court.
Harrison incurred the displeasure OF the
! court by proceeding with the insolvency pro-
ceedlDgs before judge Leyy,in defiance of an
order by Judge Hebbard restraining further
action Ia the matter during the tendency OF the
action by the Acknowledgement to dissolve the
corporation. The Supreme Court however
decided that as the action taken by Judge Ia eb-
bard In the matter OF the comuany's affairs was
Unauthorized Harrison was not guilty of
any contempt OF court, and that his application
Tor writ OF prohibition must be granted.