The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1898-01-18

interest 10 every dweller in the city,
while the water rights and land inter-
ests involved give it general import
ance.
The opinion of Judge Rolapp is of
great length, as the court enters into
an extensive review of the history of
the case. setting forth the contentious
of each side. and the grounds upon
which their claims are based. Coming
down to the receivership' proceedings,
the court says:
MATTER IN CONTROVERSY.
THE subject matter in this contro-
Versy IS the waterworks system and
water used in supplying the citizens of
Ogden With water, together with the
rentals produced therefrom. The sys-
TEN without the water, or the water
without the system, is of comparatively
little value: the one would simply
amount to pipes buried in the ground,
and the other would be unavailable for
its intended uses, and absolutely use
less during the greater portion of the
year. The two combined produce prop
erty, which is valuable, not only on
account OF the necessity for its exist
cree in that form, but also by reason
OF the rentals received therefrom- The
question, therefore, is: Whether that
property so produced, or the fund ere
ated thereby, is in danger of being lost,
removed or materially injured. 1t Is
true that the water and the water sys-
TEN, as such, could not be physically
removed, lost or materially injured; yet
that is not the only sense in which the
language used is applied. If the bene-
fits TO result from the plaintiffs recov-
cry in this action will be either wholly
lost or substantially impaired during
the Dende2cy of this action, then the
ny i= n
point receiver pendente lite.
In this case it fairly appears that
the defendant corporation. having pos
session o. the property, is insolvent
The fact that the nonresident defend
ants are not insolvent does not change
the matter, because it clearly appears
from the complaint that no personal
judgment can be taken against them,
there being no allegations that they
have taken the rentals claimed to be
due the city. The Insolvency of the
corporation in question, coupled with
the fact that none of the rents and
profits, except comparatively small
sum. are now in the hands of the cor
poration, but have been converted into
property upon which there is a lien
largely IN excess of its value, upon
which lien no interest has been paid
for years. and, therefore, may be fore
closed at any time, and when so fore
closed would not only consume the spe
cific property upon which the lien eX-
lists, but also all other property held by
the corporation, demonstrates that not
only the rentals already collected, but
also the rentals to be collected during
the tendency of this action, are in great
danger OF either being wholly lost or
materially impaired.
RIGHTS OF BONDHOLDERS.
at is useless to say that. because
the present stockholders are also its
bondholders. that therefore no fore
closure can take place, because the I'M
matUred bonds are negotiable instru-
ments which can readily be sold for
value. and such purchasers would have
a perfect right TO fOreclose on all the
property legally covered by the trust
deed. and secure judgment against the
corporation for any deficiency. and thus
consume the entire property. In fact,
in view Of the evidence disclosed on
this hearing, any bondholder, not also
a stakeholder. would at this very time
be entitled to the appointment of
receiver for all the property of the de-
PENDANT corporation. In view of the
pleadings and evidence in this case,
the contingency here suggested would
seem the most likely course to be pur-
sued. and then the beneficial effect re
sulting to the plaintiff from the recov-
cry of a judgment would be practically
lost If the city is entitled to the rent
ais resulting from the use of the water
supplied TO Ogden City, at all, it is
entitled TO them from Oct. p, 1890, and
in Withholding a receiver the court
would compel the plaintiff to still fur
Their permit the Illegal appropriations
by the defendants of the funds belong
ing TO the city. The risk of injury to
the respective parties is always taken
into consideration by the court in ap-
pointing a receiver, and while in this
case the plaintiff would sustain serious
injury, if, after a judgment, the rent
ais should have been lost, the injury
TO the defendant would simply amount
to the loss of the immediate use of the
net profits resulting from the operation
OF the waterwOrks. I must, therefore
find that there is danger of the prop
erty and fund being lost or materially
injured.
THE CITY'S INTEREST.
1.-The second question is: Whether
the plaintiffs interest in the property
or fund. or the proceeds thereof is