Court Opinion

ID: 6312552
Source: CourtListenerOpinion
Date Created: 2022-02-18 20:17:30.73882+00
Date Added: 2024-06-11T08:59:07.679833
License: Public Domain

The opinion of the Court was delivered by
Sergeant, J.
The equity powers of our courts 'in respect to individuals, are circumscribed within a limited sphere, as we had occasion to point out in the case of Gilder v. Merwin, (6 Wharton 522); but over corporations their equity jurisdiction is general and j unlimited: for by the 13th sectjon'of the Act of 16th June 1836, j the Supreme Court and the several Courts of Common Pleas have j the jurisdiction and powers of a Court of Chancery, as far as j relates to the supervision and control of all corporations, other h than those of a municipal character, and unincorporated societies / or associations and partnerships. This gives the court all the powers and jurisdiction of a Court of Chancery over corporations, i to be exercised in the ordinary mode in which a Court of Chancery i; acts, whether by bill, injunction or otherwise, as the equity of the i case may require. If, in the present instance, the funds of the ' _ State were held by the defendants as their trustee, and the State has a priority of payment out of the assets of the bank, in preference to others, then an injunction to prevent the defendants from applying those assets, otherwise than in discharge in the first instance of the claim of the State, would be a proper proceeding until a hearing and decree upon the prayer of the bill. I agree, as was intimated in Gilder v. Merwin, that such a jurisdiction is, in many respects, ill adapted to a court organized as this court is, with an interval of six months in its sessions here, and that in some cases, extreme hardship and inconvenience may result from it: this, however, is not a consideration for us, but for the legislature, in whom only is vested the power to change it.
The grounds on which this motion has been argued, would make it necessary for us to decide, whether, under the Acts of Assembly, which have been referred to, the bank, in relation to the funds of the State, deposited with them, stood in the light of a *194trustee bound to give the State a preference over other creditors by deposit, or merely in the light of a debtor, the State being in the same situation as other creditors. Had this objection been taken by the defendants at the time of making their answer, and had a motion to dissolve the injunction then been made, the case would have come before us free from some of the circumstances that now attend it. The defendants did not, however, in the former stages of this proceeding, make any objection to the process, but on the contrary, if they did not expressly assent, acquiesced in it as a measure rather desirable for themselves under the circumstances then existing. Though the injunction was issued on the 31st January 1842, no answer was affirmed to till the 17th of February 1842; nor was any motion made to dissolve the injunction until the 27th day of April, 1842. In the meanwhile the defendants consented to make payments on account of the commonwealth under the rule of court of the 14th day of February 1842. And on the 29th of March 1842, the legislature passed an Act of Assembly which has an important bearing on the question before us. By that Act it would appear that a compromise or arrangement was made between the defendants and the commonwealth during the pendency of this injunction, for the adjustment of the claim of the commonwealth to the moneys deposited in the bank on account of the State, which was the cause of the injunction ; and by the 9th section of this Act, a preference is expressly given to the commonwealth; and in return the commonwealth assents to an assignment by the bank. The terms and conditions of that assignment are stipulated, and privileges are conferred upon the bank. That Act has been carried into effect by a resolution of the stockholders to make an assignment according to the terms prescribed. It is true, the effort to go further and choose assignees has failed by reason of the imperfection of the language used in the proviso of the first section, as has been decided at the present term. But it by no means follows, that the whole Act falls to the ground as a dead letter; on the contrary, I perceive no l’easons why the other provisions of the Act should not be considered as in force and operation until some further legislation takes place on the subject; since all that is now wanting is to supply the deficiency in the first section, the mode of choosing assignees, which may be done, and it is to be presumed will be done, by the legislature, at the earliest opportunity, under the influence of the same motives that dictated the former arrangement, and which we have no reason to suppose are in any respect changed; and thus the whole object in view can be attained.
The other parts of the law, excepting merely those in the proviso to the first section that relate to the choice of assignees, and such matters as follow their appointment, seem to be sufficiently precise and intelligible.
Without therefore pronouncing what may be the ultimate decree *195of the court in the case on the prayer for relief, sufficient, we think, exists at present, to prevent the dissolution of the injunction.