Court Opinion

ID: 8854736
Source: CourtListenerOpinion
Date Created: 2022-11-26 17:26:11.41708+00
Date Added: 2024-06-11T17:05:37.071960
License: Public Domain

At the same time the justices filed the following opinions:
The parties in the above causes, namely, the Farmers’ Loan & Trust Company, the Northern Pacific Railroad Company, the second mortgage bondholders, represented by Johnston Livingston, chairman, and the reorganization committee of bondholders, represented by E. D. Adams, chairman, have presented to us a petition setting forth the general history of these causes, and asking that such order be made in the respective circuits to which we are assigned as will secure the operation as an entirety of the property of the railroad company covered by the mortgages in which the Farmers’ Loan & Trust Company is trustee, and such other orders in the premises as to us shall seem meet. And said application has been heard by us in chambers of the city of Washington, under an agreement in writing between said parties that we should do so.
We are of opinion that proceedings to foreclose a mortgage placed by a railroad company upon its lines extending through more than *31one district should, to the end that the mortgaged property may be effectively administered, be commenced in the circuit court ol the district in which the principal operating offices, are situated, and in which there is some material part of the railroad embraced by the mortgage; that such court should be the court of primary jurisdiction and of principal decree, and the administration of the property in the circuit courts of other districts should be ancillary thereto. But in view of what has transpired in these foreclosure proceedings,— especially in view of the fact that a portion of the line of road owned by the ‘Northern Pacific Railroad Company was and is within the state of Wisconsin, and that at the time of the filing of the creditors’ bill (in which the trustee in the mortgage was a coplaintiff) the Northern Pacific Railroad Company was operating its road through the Eastern district of Wisconsin, although that part of its line so operated belonged to another company, and was under lease to the Northern Pacific Railroad Company for ninety-nine years, — and in view of the further fact that the railroad company entered' its appearance, and assented to the act of the circuit court for the Eastern district of Wisconsin in taking- jurisdiction, and as such exercise of jurisdiction has been recognized by the circuit court in. every district along tin; line of the Northern Pacific Railroad, and by all parties, for the space of about two years, during which time many orders in the course of administration have been entered, we are of opinion that the circuit court for the Eastern district of Wisconsin has jurisdiction to proceed to a decree of foreclosure which will bind the mortgagor company and the mortgaged property, and ought, therefore, to be recognized by the circuit courts of every district along the line of the road as the court of primary jurisdiction; and that proceedings in the latter court, while protecting the rights of local creditors, should be ancillary in their character, and subordinate to the proceedings in the court of primary jurisdiction. In expressing these views, we are not to be understood as passing upon the proposition advanced in argument, but not necessary to be here considered, that it is competent for a circuit court of the United States, by consent of parties, to foreclose the mortgage of a railroad, no part of which is within the territorial jurisdiction of such court.
BROWN, Circuit Justice.
In view of the doubts suggested regarding the jurisdiction of the circuit court of the United States for the Eastern district of Wisconsin to foreclose the mortgage in this case, and of the further fact that the business offices of this company have been, and still are, at St. Paul, I think the circuit court for the district of Minnesota should be treated as the court of primary jurisdiction, and that we should also assume the appointment of receivers. But, as the whole object of the hearing before the justices assigned to the four circuits in which the property of the road is located is to secure harmony of action, I have concluded to waive my personal views, in deference to the opinion of my brethren, and to accede to the recognition of the circuit court for the Eastern district of Wisconsin as the court of primary jurisdiction.