Court Opinion

ID: 6585005
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:42:01.343018+00
Date Added: 2024-06-11T15:57:26.084067
License: Public Domain

Start, J.
The defendant was organized as a savings bank and trust company in 1871 under a special charter granted in 1870, and did business as such until February 1, 1898, when, upon application of the inspector of finance, the court of chancery appointed a receiver to take charge of the assets of the defendant; and the cause comes to this court by appeal from the order of that court, that, upon the dissolution of the corporation, the debts of the creditors specified in the charter as preferred in case of the dissolution of the corporation be first paid out of the assets in the hands of the receiver. The corporation has not been dissolved, and this court will not pass upon the rights of its creditors, in case the corporation is dissolved, in advance of such dissolution. Turner's Estate v. Lyman, 64 Vt. 167. V. S. 4123, provides that the provisions of law applicable to insolvent banking associations shall regulate proceedings against insolvent trust companies, and the final distribution of their assets. V. S. 4106, provides that the words “trust company” shall be construed to include savings bank and trust company.
This suit was instituted and a receiver appointed under the law applicable to insolvent banking associations, and the assets in the hands of the receiver must be distributed under that law. The law relating to the distribution of the assets of an insolvent banking association, V. S. 4062, provides that the assets of the association that come into the control of the receiver shall be applied: (1) To the payment of the costs of the proceeding. (2) To the payment of the circulating bills or notes of the association which are proved as provided in this chapter. (3) To the payment of money deposited with the association by savings banks or savings institutions existing under the laws of this State, but not exceeding the amount which such banks or institutions are allowed by law to deposit with such association. (4) To the payment of other creditors. The creditors of each class shall be paid pro rata and no creditors *348of any class shall be paid until the creditors of the preceding classes have been paid in full. These are the only provisions of law-for the distribution of the assets of a trust company in the hands of a receiver, appointed under the law applicable to insolvent banking associations, and the assets in the hands of the receiver in this cause must be distributed in accordance with these provisions. In the statement of facts, the several classes of debts which it is claimed are preferred, are specified, and it does not appear that there are any circulating bills or notes, or that there are any debts in favor of savings banks or savings institutions. Therefore, the assets remaining in the hands of the receiver, after paying the expense of the receivership, must be applied pro rata to the payment of such debts of the corporation as have been proved and allowed in this cause and remain unpaid.

Decree reversed and cause remanded, with mandate.