Court Opinion

ID: 9305851
Source: CourtListenerOpinion
Date Created: 2022-12-02 17:16:53.558301+00
Date Added: 2024-06-11T17:13:54.069839
License: Public Domain

Pardee, J.,
(after stating the facts as above.) 1. The Central Trust Company of New York is the party plaintiff in the suit in which the intervention is filed, and had-a direct interest when the receiver’s certificates were issued. The record shows that, by proceedings subsequent to the decree, the said trust company has no longer any interest in the validity of the receiver’s certificates forming the subject of this intervention. No relief is asked against or affecting said trust company. It maybe dismissed .without prejudicing the rights or remedies of the other parties. Jacob G. Chamberlain, the receiver, is alleged to have issued said certificates, and is charged with having in his hands funds sufficient and applicable to pay the same, and direct relief is prayed against him.
2. If it be true that the principal of the said receiver’s certificates, which form the basis of this intervention, is not yet due, still the interest thereon is due, and the intervention can be maintained therefor.
8. The demurrer appears to present a proposition that, as the receiver was not in possession of, nor operating, any line of railway, and as the suit pending was not for the foreclosure of any railway mortgage, there was no authority in the court to authorize the issuance of, nor in the receiver to issue, receiver’s certificates which should constitute a lien on the prope-rty in the possession of the court; and, particularly'-, a lien prior in right to the two mortgages which were the subject of the foreclosure suit. Counsel have submitted no argument on this proposition, nor cited any authority. It seems to me that if the proposition is sound, which is not granted by any means, the real defendants in this intervention, the purchasers at the foreclosure sale, are estopped from setting it up. Receiver’s certificates were issued by consent of the parties; by the same consent they' were made a prior lien on the property' in the posses-, sion of the court; moneys obtained thereon were used for the preserva.tion and improvement of the property; and the property was sold and purchased with the clear understanding and agreement tíiat the valid outstanding receiver’s certificates constituted á prior lien which the purchasers assumed and undertook to pay.
*5314. It is contended that, as it is a well-sett]ed principle that a pleading is to be taken and construed against the pleader, and that, as in this intervention, the intervenor refers to the records of the court in the case in which he intervenes, and, particularly, to a certain decree modifying-the main decree in the case, that thereby he admits the facts alleged upon which the modifying decree was based. 'Phis is the only ground of demurrer upon which counsel- have submitted any argument. An examination of the record shows that the decree was modified upon the ex parte application of Chamberlain, the receiver, setting forth that Lho five certificates, which are the basis of this intervention, had been disposed of by one Charles 1). Woodson, without his authority, and that the proceeds had not come to his hands: and thereupon the decree was modified in regard to the terms of sale, as follows:
“ 1'iiat there be stricken from the said decree these words: ‘ And expressly subject to the receiver’s certificates heretofore authorized to be issued by said Jacob (h Chamberlain, the receiver, to an amount not exceeding one hundred and iiity thousand dollars, ($150,000.00;) ’ and that, in the place and stead of said words, there be inserted these words: 1 And expressly subject to the receiver’s certificates heretofore authorized to be issued by said Jacob Gb Chamberlain, the receiver, to an amount not exceeding one hundred and twenty-five thousand dollars, ($125,000.00,) and that the twenty-five thousand dollars of said receiver’s certificates, disposed of by said C. D. Woodson, the same being five certificates of five thousand dollars ($5,000.00) each, and numbered 8, 0, 10, 11, and 12, dated October 10, 1889, and set forth in the "Schedule 11” ol’ said decree, be not included in said amount of one hundred and twenty-five thousand dollars, ($125,000.00,) but that the purchasers of said property at the sale under said decree take the same subject to the right to resist the payment of said five certificates so disposed of by said Woodson; and that the validity of said five certificates be adjudicated in this court upon a proper case to lie made by the parties in interest.’ ”
The intervention asserts that this modification of the decree was made subsequent to the time that the intervenor’s rights had attached and accrued, and it was necessary and proper for the intervenor, who. untier the terms of the aforesaid modified decree, was given the right to intervene in this cause, to state the basis of his rigid to intervene, and thereby to refer to the order of court made as aforesaid, but to hold that, by intervening and referring to his authority therefor, he admits the truth of the statements contained in the ex parte statement of the receiver upon which, the order was made, is to hold that he admits away his entire case, and this in direct opposition to the express and sworn averments of ids intervention. The case seems to turn upon the fact whether or not the proceeds of the five receiver’s certificates sued upon by the intervenor came to the hands of the receiver. The decree throwing a cloud upon intervenor’s rights gave him authority to intervene and assert them. It would bo a vain tiling to give him such rigid if coupled with a condition that, in order to exercise it, he must admit as truth a state of facts which kills his case. The purchasers of the property referred to in the intervention took the same with the express understanding that the receiver’s certificates held by the intervenor had been issued under orders of the court importing a lien on the property they, purchased, and were *532outstanding; and, further, might be presented as a valid indebtedness of the receiver. They were granted the right, and they assumed the burden of contesting their validity. In their interest the contest was •restricted to this court. The intervention fairly presents the case for them to contest. The demurrer will be sustained, so far.as the Central Trust Company of New York is concerned, but be overruled as to the other defendants, who will be required to answer the said intervention by the rule-day in February, 1891.