Virginian-pilot. (Norfolk, Va.) 1898-1911, 1899-04-19
COURT DECISIONS.
Notes Of Cases Recently Decided,
Which are of Interest to
Our People.
DIGESTED BY W. B. MARTIN,
Exclusively for Virginian-Pilot.)
MERRILL ". NATL. BANK, &c.

MERRILL v. NATL. BANK, &c.
Supreme Court of the United States.
February 20, 1899.
A SECURED CREDITOR OF AN IN
SOLVENT BANK is ENTITLED TO
PROVE AND RECEIVE DIVI-
bends ON HIS WHOLE DEBT.
WITHOUT REGARD TO HIS COL
LATERALS OR AMOUNTS PAID
ON THEM. PROVIDED ONLY
THAT THE SUMS RECEIVED
FROM DIVIDENDS AND COLLAT-
ERALS DO NOT EXCEED HIS EN-
TIRE DEBT.
y This was n suit in chancery by the
National Bank of Jacksonville against
Merrill, Receiver of the First National
Bank of Palatka. which had become in
solvent and for which Merrill had been
appointed receiver by the Comptroller
OF the Currency. When this bank fail
Cd the National Bank of Jacksonville,
the plaintiff, had a claim of some Slo-
600 for money loaned the-insolvent bank
and to secure which that bank had as
signed to the plaintiff certain collateral
notes. The question was whether the
plaintiff was entitled to dividends on
the full amount Of its claim, or must
the amounts received by it on the COL
laterals be first deducted and dividends
paid only on the balance. The lower
court held the plaintiff entitled to div.
idend5 on his whole claim and the re-
ceiver appealed.
The court says:
The inquiry on the merits is. gene
rally speaking. whether a secured cred
ltor OF an insolvent national bank may
prove and receive dividends upon the
n cfn Of 1n
time of the declaration Of insolvency,
without creditinG either his colaterals,
or collections made thcrcfrom after
such declaration. subject always to the
proviso that dividends must cease
when, from them and from coilatcrals
realized, the claim has been paid in
full. Counsel agree that four different
rules have been applied in the dstri-
button of insolvcnt estates. and state
them as follows: Z" The fourth rule
Is that ordinarily laid down by the
Chancery Courts. to the effect that, as
the trust created by the transfer OF
tho assets by operation of law or other
wise Is a trust for all creditors, no cred
itor can eQuitably be compelled to sur
render any other vested right he has
in the assets OF his debtor in order 10
obtain his vested right under the trust.
1t is true that. in equity. n creditor
having lien upon two funds may be
ic'luii GU ~ tNuduSl Ollc VI tntIn IN llu
of creditors who can only resort to the
other: but this will not be done when
IT trenches on tho rights or operates
to the prejudice of the party entitled
TO the double fund. And it is well cs-
tablished tina. in marshalling assets.
as respects creditors. no part of his
security can he taken from Il secured
creditor until he is completely satisfied.
III short the secured creditor is not 20
be cut III from his right in the common
fund because he has taken security
which his co-creditors have not. or
course. he cannot go beyond payment,
and surplus assets. or so much of his
dividends as arc unnecessary to pay
him must be applied to the benefit OF
the other creditors: and. whiie-the un-
secured creditors are entitled to be
substituted as far as possible to the
rights of secured creditors. the latter
are entitled to retain their securities
until the Indebtedness due them is ex-
tinguishol.
Our conclusion is that the claims of
creditors are to be determined as OF
the date of the declaration of insnl-
vency. irrespective of the question
whether particular creditors have Sc
curity or not. When secured creditors
have received payment in full, their
rient TO dividends. and their right to
retain their securities cease, but coll
lections therefrom are not otherwise
material. Insolvency gives unsecured
creditors no greater rights than they
had before. though. through redemption
or subrogation or the realization of n
surplus. they may be benefited. The
case was rightly decided by the Cir
cult Court OF Appeals. Affirmed.
PHILLIPS v. SOUTHERN r. co.
Supreme Court of North Carolina.
March Z, 1899.
A PERSON COMING TO A STATION
TO TAKE A TRAIN is a PASSEN
GER, ALTHOUGH HE HAS NOT A
TICKET, IT HIS COMING IS WITH
IN A REASONABLE TIME BE-
FORE THE DEPARTURE OF THE,
TRAIN.
a RULE OF A RAILROAD COM
PANY TO OPEN IT'S WAITING
ROOM THIRTY MINUTES BEFORE
DEPARTURE OF TRAINS, AND
THEN TO CLOSE IT IS REASON
ABLE.
The plaintiff intending to take the
next train on defendants road to Hot
Springs, In Madison county, entered the
detendants waiting room at Asheville
ABOUT O'Clock at night. with the inien-
ton or remaining there until the de-
parture OF the next train on defendants
road for Hot Springs. which would
leave 1:2o o'clock of the next morning.
He was informed by defendants agent.
In charge OF the waiting room that, ac-
cording to the rules OF the company she
must close the room. and that he would
nave TO get out. The plaintiff protested
against this and refused to leave. But
when the clerk OF DEFENDANTS baggage