The islander. [volume] (Friday Harbor, Wash.) 1891-1899, 1895-09-12
HAD NOT JURISDICTION.
Decision Against the Northern Pa
cific Receivers.

Seattle, Sept. 4.-By the decision O.
Judge Gilbert, concurred in by Judg,
Hanford, Receivers Cakes, Payne ant
Rouse must appear in the United State.
court for the northern district Of
Washington, in this city, October 2
and defend themselves against the
charges of NEUTRALITY-SUSPICIOUS. made By
Brayton Ives, president of the North.
ern Pacific
The opinion of Judge Gilbert was
read In court this morning, and the
opinion of Judge Hanford was filed
late in the afternoon. The receivers
are each ordered to file with this court
bond for $40, 900, and also a report
OF their actions from the time of the
last report confirmed by Judge Jenkins
up to the present. 1t is held that the
acts OF the receivers are not invalid,
and that the So, 900, 900 receivers GER
tlficates are valid liens as soon as con-
tirmed by the respective courts.
By the decision the question of jur-
lsdiction is settled, and the court here
becomes the court of primary jurisdic-
ton, settling the question of collateral
attack.
The second part of the Ives applica-
ton will come up at the hearing Of the
order to show cause, and the question
of fact as to whether the receivers have
been lax in their administration of the
trust estate will then be opened. Judge
Gilbert says:
1.-The actual possession of the prop
erty Of the insolvent corporation by the
first court, through its receivers, could
extend no farther than the territorial
limits of that courts jurisdiction. The
rights receivers are accorded in courts,
whose jurisdiction is superior to that
of initial proceeding, have their basis
in comfy. Such comfy rests upon the
fact that another court is in the acutal
possession of portion of the property,
which cannot we'll be segregated, and
which the best interests of all con-
cerned required to be managed by a
single system. Here, however, it is
shown that at the time of filing this
application to remove the receivers there
is no part of the railroad line of the
Northern Pacific Railroad Company
within the jurisdiction of the court
that first appointed them, and that
there is in that district no personal
property held in receivership. All the
property that remains to be disposed of
is in other jurisdictions. 1t follows
from this state of facts that the court
is utterly powerless to make an order
which affects in any way the manage
ment Or possession of any property of
the corporation. No foreclosure sale
of said mortgages can be had, no pos
session to a purchaser can be given,
until the courts which have the actual
possession of said railroad shall consent
thereto.
SIN our Judgment the rule of comfy,
which has been invoked in opposition
to the motion, does not apply to such a
case as this. The foundation of the
rule is the recognition of the right that
exists in another jurisdiction. 1t is
predicated upon the fact that another
court has first taken and retained the
possession of property. Its reason con-
sists in the fact that the court of initi-
atory proceedings has in its possession
and must necessarily administer por-
ton of property which wise policy
declares must not be disintegrated.
That reason does not exist in this case.
Not only does it not exist, but many
considerations lead us to believe that a
wiser, more satisfactory management
of railroad may be obtained by a
court which has jurisdiction over, at
least some of the territory wherein the
same is situated, or in which the home
office of the company is located"
In his opinion Judge Hanford con-
sidered as parts of one proposition the
question of remitting Ives to Judge
jenkins court as the court OF prelim-
mary Jurisdiction, and of collateral at
tack. The application he said was
direct proceeding and the assertion
that for the court here to take cognlz-
ance of the matter was collateral at
tack was untenable. Want of juris-
diction apparent on the face OF the
record was the ground on which the
attack was made and on such grounds
the rights of the parties to litigate was
not concluded by any decree of the
court whose jurisdiction was ques-
toned. The railroad and real estate
of the defendant being immovable
could not be brought within the juris-
diction of the Milwaukee court nor
could jurisdiction be acquired by tax
ing possession of such assets as money
bonds and other securities or railroad
cars migrating over other lines; and
no consent of parties could give to a
court jurisdiction that it never pos
sessed. As to the doctrine OF foreclo-
sure proceedings Judge Hanford says:
"a mortgage may also be foreclosed
in court having no jurisdiction OF the
person of the mortgagor by proceeding
in the rem, if it had jurisdiction OF
the res. Proceedings may be OF a
double nature; that is to say, both IN
persona and in rem. This argues
nothing, for the elementary principle
that purely personal Judgment is not
valid against a person who has not
been by due process or his voluntary
appearance brought within the juris-
diction of the court which pronounced
it remains in full vigor; and proceed
ings in rem are impossible in court
having no jurisdiction of the res. Now,
as the custody, control and operation
of aerailroad, through receivers, must
be pursuant to proceedings in rem, jur-
isdiction thereof cannot be acquired by
distant court, although it may have
jurisdiction to foreclose the mortgage
! nv snit in persOnam.