Court Opinion

ID: 8336896
Source: CourtListenerOpinion
Date Created: 2022-10-17 22:45:29.725866+00
Date Added: 2024-06-11T16:45:32.234107
License: Public Domain

Titus, C. J.
(dissenting). — The question raised on this appeal relates to the service of a summons on the defendant in an action for damages for injuries sustained by the plaintiff while in the employ of the defendant, in January, 1891. The action was commenced by the service of a summons on Charles A. Brunn, formerly superintendent of the Western division of the defendant’s road, extending from Hornellsville and Jamestown to Buffalo. On July 25, 1893, in a suit brought in the United States circuit court for the Southern district of Rew York for that purpose, against the defendant, John King and John Gr. McCullough were appointed receivers of the defendant company, and were ordered immediately to take possession of the franchises, rights, and property of the company, to run, manage, and operate its property and railroads wherever situated and found, whether in this state or elsewhere, and to employ and discharge and fix the compensation of all such officers, attorneys, managers, superintendents, agents, and employes as may be needful to properly operate the road, and to pay all operating expenses; and said officers, agents, and employes were required to turn over to the receivers all the property of the company in their hands, and were enjoined from in any manner-interfering with the possession or management of its property. Under this order the receivers took immediate possession of all of the property of the defendant, and commenced the operation of the railroad, and have so continued up to the present time. It appears that the employes of the defendant at the time of the appointment of the receivers were not immediately dismissed, but were, including Division Superintendent Brunn, continued in the employ of the receivers, receiving their orders and pay from them, as they had before that time from the defendant. The defendant, as a corporation, has not since in any way interfered with the management of the business and the operation of the road, or with its property or assets. The summons in this case was served on Charles A. Brunn on the 26th of December, 1893, after the appointment of the receivers. He was at that time acting as division superintendent under the receivers, who had continued him in their employ. A motion was made to set aside the service of the summons on the ground that Brunn was not the managing agent of the defendant, within the meaning of section 431 of the Code of Civil Procedure. The court at special term denied the motion, and defendant appeals to this court from the order denying the motion.
If the question was whether the service of the summons on Brunn, as superintendent of the Western division, while the defendant still operated the railroad under its charter, was a good service, we should feel bound to follow the case of Brayton v. Rail*384road Co., 72 Hun, 602 ; 54 St. Rep. 763 ; and hold that the service on him was proper and sufficient, as that case involved that precise question, and was, we think, on principle and authority, correctly decided. Palmer v. Pennsylvania Co., 35 Hun, 369 ; affirmed, 99 N. Y. 679; Ruland v. Publishing Co., 10 N. Y. Supp. 913; Barrett v. Telegraph Co., 31 St. Rep. 465 ; Rochester, H. & L. R. Co. v. New York, L. E. & W. R. Co., 48 Hun, 190; 15 St. Rep. 686 ; Ives v. Insurance Co., 78 Hun, 32 ; 60 St. Rep. 495 ; Mullins v. Insurance Co., 78 Hun, 297; 60 St. Rep. 240.
The only question, therefore, which calls for any examination, is whether the service on Brunn, while temporarily in the employ of the receivers, is a good service on the defendant. It is claimed by counsel for the plaintiff that, inasmuch as Brunn was the division superintendent for the defendant prior to the appointment of the receivers, and so continued in the capacity by them, he is still to be regarded as the managing agent of the company for the purpose of making service upon it. A number of cases are cited in the plaintiff’s brief upon that proposition, but none of them seem to sustain the position taken, and I have been unable to find any case where the question has been directly passed upon. The only reason urged why the service on Brunn is sufficient is that he was continued by the receivers as division superintendent of the defendant’s railroad. While the appointing of a'temporary receiver does not operate to dissolve a corporation, Kincaid v. Dwinelle, 59 N. Y. 548, it suspends for the time being its right to manage the affairs of the company or to interfere with its property, and practically suspends its functions as a corporation. It may be sued by its creditors, and made liable as though no receivzr had been appointed. Hetzel v. Mining Co. 4 Abb. N. C. 40. But it ceases to have any control over its property. Its officers provided for by the statute continue, but, from the necessity of the case, its employes are deprived of any further right to interfere in any manner in the management of its affairs and cease to have employment under it. If the receivers, instead of continuing Superintendent Brunn in their employ, had engaged another person to act as superintendent, it could not be claimed, we think, that such person was still the managing agent of the defendant, so as to authorize the service of papers upon him as a representative of the corporation, From the fact that Brunn was at one time such agent of the defendant, it does not follow that he may served with process after he has ceased to represent the defendant as such agent. Beardsley v. Johnson, 121 N. Y. 224; 30 St. Rep. 691. Nor would it hardly be claimed that if Brunn had been removed, and then reappointed by the receivers, he could properly be served with a summons as managing agent of the corporation, within the meaning'of section 431 of the Code." How can it be said that he is still in the employ of the defendant, or it smanaging agent, simply because he was continued in the employ of the receivers ? No court has gone to the extent of holding that he is such a person as the Code describes, on which service must be made. Employes of the receivers are not in any sense in the employ of the defendant. Murphy v. Holbrook, 20 Ohio St. 137. The possession of the prop*385erty is in the receivers, and not in the corporation. It cannot be held liable for any act of the receivers. They are officers of the court, with full power, under the order appointing them, to manage the affairs and "property of the defendant, and to employ and discharge at pleasure agents and employes necessary to conduct the business of the corporation. The receivers are only responsible to the court which appointed them. Railroad Co. v. Fitch, 20 Ind. 498. A person or corporation in possession of and operating a railroad is liable for negligence of its employes, and not the corporation owning it. Weyant v. Railroad Co., 3 Duer, 360; Norton v. Wiswall, 26 Barb. 618. It seems to me, from an examination of the authorities, that Superintendent Brunn is in no sense in the employ of the defendant as its superintendent or otherwise, and that the service of the summons on him was not a service on the defendant ; that since the appointment of the receivers only such persons as compose the corporation, such as officers and directors, are within the meaning of the section of the Code providing for the service upon corporations.
The order of the special term should be reversed, with ten dollars costs and disbursements.