Court Opinion

ID: 6315593
Source: CourtListenerOpinion
Date Created: 2022-02-18 20:31:49.006572+00
Date Added: 2024-06-11T09:01:40.942793
License: Public Domain

Green, J.,
It is scarcely necessary to add anything to what has been so well said by the learned court below. The proceeding is aimed directly against the bonds in question, and of course assails necessarily the rights of the persons who hold them. The trustees hold their office for the benefit and protection of the bondholders, but cannot be regarded as their representatives for all purposes. Of course, if they were, if the relations between them were such as to constitute the trustees general agents or attorneys in fact in all matters relating to the bonds, so that service of process in adverse proceedings would be binding upon the bondholders when made only upon the trustees, the contention of the appellant might be sustained. But there is nothing in that relation which makes them general agents for the bondholders as to all matters affecting *697the bonds. The right of the latter to own the bonds and to defend their ownership, and to defend the validity of the bonds, is a right which is personal to the owners of the bonds. Whenever that right is assailed, they have an undoubted right to protect themselves and their title, in their own persons and by their own counsel. It may be conceded that, for many purposes, the trustees do represent the bondholders, and, wherever they do, the latter are bound by their acts. The authorities cited by the appellant do not reach to the position that, in a proceeding such as this, which attacks the very validity of the bonds, the trustees may be substituted as defendants and process served on them so as to obligate the bondholders by all the consequences of an adverse proceeding and judgment. In the absence of clear and satisfactory authority for a ruling to that effect, we are unwilling to take such a step. It is true, the appellant may be subject to some inconvenience in ascertaining who are the holders of the bonds, but that difficulty is not insuperable; as against the consequences which might result from allowing an adverse judgment to be taken against persons who had no notice, and have never had a day in court, it is not to be considered.
Decree affirmed.