Court Opinion

ID: 6518657
Source: CourtListenerOpinion
Date Created: 2022-07-19 18:29:03.214377+00
Date Added: 2024-06-11T15:55:05.586859
License: Public Domain

TYSON, J.
Before entering upon a consideration of the two controlling questions in the cause, we will first dispose of the other assignments of error insisted upon in argument.
There can be no doubt but that the appellee assumed .control and possession of the property for which he was sued in the law court by the respondent, appellant, as receiver under the decree of the court appointing him, and that he sold it as such in obedience to the orders of that court; that he did not take possession o'f or exercise any acts of ownership over or concerning it under any claim, right or title as an individual. The decree adjudging the pleas of the respondent insufficient was nullified upon the granting by the chancellor of the motion for a rehearing. The decree appointing the receiver cannot be assailed in this proceeding because erroneous or improper. “It is not competent for any one to interfere with the possession of a receiver on the ground that the order appointing him ought not to have been made. It is enough that it is a subsisting order. Actual notice of the appointment of a receiver is sufficient to render any interference with him a contempt; a formal notice is- not necessary.”—20 Am. & Eng. Encyc. Law, 142. There is n,o pretense in this case but that respondent knew of the complainant’s appointment, the taking possession by him of the property in controversy and tlie sale of it by him as receiver. Of these facts he had not only actual notice, but formal notices were served upon him under the directions of the court. Indeed, he went so far as to appear before the register on one occasion in obedience to the mandate of one of the orders of the court and make the statement under oath that he claimed this property, but declined to propound hi-s claim or to state the facts upon which he predicated his claim or founded his alleged title to it.—20 Am. & Eng. *665Encyc. Law, 142 and notes; also p. 136 and note 2; Russell v. East Anglian R. Co. 3 Macn. & G. 104; Richards v. The People, 81 Ill. 551.
While the property here in controversy is not 'Specifically named in the bill filed for the appointment of the receiver, the prayer of the bill is that the court “take charge of the affairs and business of defendant corporation; that the property of the corporation may be preserved and managed, held- together and operated under the orders of this court as-an entirety until such time as your Honor shall see fit or until it may appear to be to the best interest of all concerned, that said property shall be sold or otherwise disposed of for the satisfaction of the debts of said defendant, and that a decree may be rendered authorizing a sale of the entire property of said corporation for the payment of its debts,” etc.; * * * that ’“a receiver may be appointed of said Henderson Steel & Manufacturing Company, who shall be charged with the duty of carrying on its business and operating its plant and furnace, and who shall be placed in possession of 'all the property, real and personal, of said defendant hereinbefore set out, to collect and sue for its ehoses in action, etc.; that said receiver when appointed may be authorized to work up the material on hand and buy other material, and to' sell the manufactured product,”- etc.; * * * “that the receiver may be authorized to do any and all things under the orders of this court, and its guidance and direction, that may conduce to the interest of said corporation and its stockholders and creditors; and that the receiver may be authorized to negotiate a sale of the entire property, subject to the approval of this court.”
We.have made this lengthy quotation for the purpose of answering, what we think is -a technical and unwarranted objection to that part of the decree of the court appointing the receiver in which the receiver is ordered “to receive and hold all the property both real and personal, rights, ehoses in action and franchises of said Henderson Steel and Manufacturing Co., 'and also its revenues from every source and the right to collect the same and to operate said furnace plant and to manufacture iron and steel.” The objection proceeds upon *666the proposition that the court was confined in its decree in respect to ordering its receiver to take possession of the property of the defendant' corporation, to only such property as is specifically named in the bill. That the words in the prayer of the bill “hereinbefore set out” limited the right of the chancellor to deal only with such property as was specifically described. We do not think they are susceptible of such construction when construed in connection with the entire context of the bill and the clear and unmistaken purpose sought to be accomplished by it. The order of the chancellor to the receiver to take possession of all the property of the corporation was clearly within the purview and scope of the bill in conformity -with its prayer. ■ The chancellor in making the decree did not exceed the jurisdiction invoked by the bill, and it was the duty of the receiver to obey its ■mandates. In doing so, he was simply performing this duty as an officer of the court and cannot be held personally liable for any act done by him within the scope of the authority conferred upon him.
This brings us to a consideration of the vital question in this case, and out of this question incidentally springs the other, which we will consider later. It is, was the property in controversy in the possession of the defendant corporation at the date of the appointment of the receiver or to state it, as it is presented by the pleadings, did the property belong to the appellant at the time the receiver was appointed and was he in possession of it? If this question is answered in the negative, it follows of necessity that it belonged to the corporation and was in its possession, for the very obvious reason that the appellant, as we shall see, claims to have derived title and possession from it, on the day the bill was filed for the appointment of the receiver and on the day preceding the rendition of the decree appointing him. The written evidence of transfer of title to the property appears to have assumed the form of a resolution passed by the board of directors of the Henderson Steel and Manufacturing Company which is in these words: “That whereas this *667company is indebted to tbe American National Bank in about- the sum of fifty-two hundred ($5,200) dollars ■which said indebtedness is long past due, and whereas there is no money in the treasury with which to pay the same and whereas said bank has been indulgent in not pressing the payment of said claim, therefore, be it resolved, that the said Henderson Steel and Manufacturing Company do hereby bargain, sell, convey and deliver to J. A. Montgomery, for -said American National Bank, the following personal property, to wit:
150 tons Pig Iron at 10-50..................$1,575 00
10 tons Eubor-an Magnesite at $20.......... 200 00
30 tons of Styrian Magnesite at $35.......... 1,050 00
10 ferro manganese at $80................. 800 00
1 lot I. Beams............................ 900 00
1 lot valves.............................. 330 00
1-14 foot elevator........................ ' 280 00
2 tons merchant iron..................... 65 00
Total..............................$5,200 00
now on -the yards of said company at its plant near Henderson Station on the line of the North Birmingham Railway Company, in Jefferson county, Alabama, in part satisfaction -and payment of' said debt, and that the possession of the same be actually turned over to said J. A. Montgomery for said bank and a bill of sale of same be delivered to him.”
It appears from this resolution that Montgomery was to take the property for the bank, that the amount to be paid for it or the amount of the credit the Henderson Steel and Manufacturing Company was to be allowed by the bank on the note is not stated, that the property was valued at $5,200, but was to be taken in part payment only of the banks indebtedness which is shown by the record to be $5,141.70, evidenced by a note in that sum of date May 28,1890, and payable four months after date; and that it was contemplated that a bill of sale was to be given.
It may well be doubted whether any title passed to Montgomery under -this resolution. ' There is certainly room for this contention. For, if anything remained to be done by either party to the transaction before deliv*668ery of the property, for example the agreement on the part -of the bank to credit its debtor, the corporation, with a specified sum upon the note, the title did not vest in Montgomery.—Allen v. Maury, 66 Ala. 17; Hudson v. Weir, 29 Ala. 291.
But aside from this, it affirmatively appears that no authorized agent of the bank was present when this resolution was adopted and the bank never accepted the benefit of its provisions. A sale of necessity involves a contract, an agreement, which, of course, involves mutuality. ' Without mutuality, a meeting of the minds, there can be no contract—no sale. Montgomery, it does not appear, was authorized to bind the bank. He could not become a purchaser of this property for it without some authority to bind it. It never ratified, so far as appears from the record, his acts in directing another for him to take possession of the property or in any manner recognized the obligation imposed by the resolution upon it of allowing a credit for the value of the property. Had it done so, its debt against the corporation would have been extinguished, if the $5,200, the value of the property as shown by the resolution, was the sum agreed to be credited. On the contrary, it appears that the bank never had any knowledge of the passage of the resolution and that after its adoption, the bank brought a suit against some of the endorsers upon the note, in each of which it obtained a judgment. That upon these judgments about $2,680 was paid by some of the endorsers and that they were sold and transferred by the bank to one Bogan, as trustee, he paying therefor about $2,500.
There is some dispute as to whether Montgomery ever undertook to assume possession of the property. He does not himself claim to have actually done so in person. He says that he directed one Gogin to do so and that he furnished to him a list of the property on the day the resolution was passed. That afterwards he went to the yards of the corporation and found the most of it marked in his name and that he had several conversations with Enslen before and after he was appointed receiver about the property being in his posses*669sion. This, however, is denied by Enslen. It is very certain -that Montgomery never moved the property from the yards and grounds of the corporation, and that it was just where it had always been when the decree was entered directing Enslen, the receiver, to take possession of it. But it is unnecessary to decide this disputed question of fact, under our view of the case. Montgomery simply assumed to act in respect to whatever he may have done towards taking possession of the property as the agent of the bank. The bank not being bound by the terms of the resolution, Montgomery acquired no title to the property, therefore no right to its possession. It follows that Enslen, in obeying the orders of the court in taking possession of it and selling it, did nothing more than he should have done. And that he is entitled to be protected in the discharge of his duties as an officer, complying, as he did, with the mandates of the court with respect to this property. This being true, the' suit brought by Montgomery in trover against Enslen, without leave of the chancery court, was properly restrained.—Beach on Receivers, § 653; High on Receivers, § 256; 20 Am. & Eng. Ency. of Law, 248-250; Porter v. Sabin, 149 U. S. 479.
It is immaterial that the suit sought to be enjoined only seeks to obtain a judgment for a money demand and not for the specific property.—Barton v. Barbour, 104 U. S. 126.
Affirmed.