The Hawaiian gazette., 1896-03-20

G urt has no jurisdiction to make the
appointment, because there was no
suit brought or pending to which the
appointment of a receiver was aux
Hilary. But Is this objection true?
The petition sets forth and the evil
dence seems to show that the defend
aut is corporation that is iDsolyent
and that there is no one 20 take charge
OF it property or affairs, practically
that it has been abandoned. Iu is
further alleged that by careful man.
agement it, affairs might be so wound
up as to save property, preve mt loss
aud destruction ami enable il to meet
its obligations. While there may be
lack of defniteuess in the prayer
for relief, its object is readily seen
10 be that OF saving the properly
u the corporation for the pur-
pose of paying IT'S debts. Toe appoint
meut OF a receiver /, clearly auXilliars
10 this. Certainly this il very strong
showing for equitable interference
And when as is shown 10 be the case
here corpora ion is hoprlessIy insol-
vent and unable TO carry out objects
for which 1t IL crested, the directors
must be regarded as trustees OF the
property for the benefit o, the cred-
tors aud stockholders, aud it is then
their duty TO wind up the IF irs Of
the corporation for the benefit Uf ali
concerned; and when further as is the
case here the majority of the directors
are absent from the country aud all of
them neglect To take any Steps toward
the execution of tbeir trusT AMI the
majority of the stockholders also are
hampered by provisions OF their chart
er and by laws aud perhaps partly in
consequence OF this and partly in con
sequence of lack of interest neglect to
take such steps a. may be possible for
all interests, Court of Equity may
very properly appoint receiver to do
that which should be done but is
neglectet to be done by the quasi
trustees
Beach on Receiver. Sec. 404;
l MOfawetz on Private Corpora
tions, Secs 2S4 5
1t may be noted here that none of
the authorities cited by either counsel
conflict with the above views, but on
the contrary those in point are in sup
port of them.
There seems to be mistake with
regard to the position of the plaintiff
in this matter. This is not a creC-
itor's bill in any sense, and there i,
no Necessity that 1t should he such.
TIE relief asked is not, that assets
witch cannot be reached by law
should be put in position by Court
of Equity to become subject to eXecu-
ton. 1t is on tue other hand an APP
plication to save property from des-
tructiOn in manner peculiarly within
the jurisdiction OF a Court of Equity,
in which a Court OF Law wound be
not only helpless but the result of
proceedings a. desired by Mcdonald
ADD Alb Hin would, on the showing
made by tue evidence, result in the
probable destruction of at least three
fourtiis Of the prop rty to which cre'i-
it0rs must look for the satisfaction of
their claims.
There may be some doubt whether
the receiver should be appointed at
the instance of mere gem raj creditor
as was done in this case. IL appeared,
however, IN eyidznc- that the peji-
tiouer was also a stakeholder iu the
defendant corporation, and that the
holders OF most of the stock consented
to the appointment of a receiver, and
expressed the opinion that this woulo
be for the int crest of all concerned.
The petition may be amended ny an
allegation that the petitioner is also u
stakeholder.
The prayer also would better be
amended so as to show more clearly
the main object of the bill, the only
particular prayer as de from that for
process at present being for the ap
pointment of receiver. Such amend !
meUts may be made upon terms to be
named by the Circuit Judge.
The remaining questions before this
Court which arise upon the various
appeals are upon matters which are |
within the discretion OF the Circuit |
Judge. THIS discretion does not appear
to have been exercised improperly or
without due consideration of the in
terests of all concerned.
The decree appointing q receiver is /
sustained or condition that such 1
be made, and the appeals /
are dismissed
Hartwell, ThurstOn and Stanley for
plaintiffs A. @. NJ. Robertson aud |
w. A Kinney, for appellants.
Dated Honolulu, Februar, q, 1896 .