Court Opinion

ID: 6417190
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:57:01.770099+00
Date Added: 2024-06-11T15:51:36.648597
License: Public Domain

GbAT, J.
The defendants fail to bring themselves within the principle on which they rely for their defence. That principle is, that when property has been put by the decree of a court of chancery into the hands of a receiver, his possession is the possession of the court which appointed him, and any rights in the property can only be asserted by application to that court.
All the decisions cited for the defendants relate to property in which the person or corporation whose estate has been placed by the court of chancery in the custody of the receiver had a title. In such a case, the property in the hands of the receiver as an officer of the court is in the custody of the law, and cannot therefore be seized or sold on execution, or distrained for rent, without leave of the court which appointed the receiver. Wiswall v. Sampson, 14 How. 52. Russell v. East Anglian Railway Co. 3 Macn. & G. 104. Noe v. Gibson, 7 Paige, 513. Robinson v. Atlantic & Great Western Railway Co. 66 Penn. State, 160. And the question whether creditors claiming a paramount right, by mortgage or otherwise, in the property of the debtor, shall be permitted to enforce their rights by action at law against the receiver, is within the control of the same court, which may treat the bringing of such an action without its leave as a contempt of *511its authority; but leave to bring such an action, when applied for, is granted by the court of chancery as of course, unless it is clear that there is no foundation for the claim; and when the action is brought without applying for such leave, the possession of the receiver is not necessarily a valid defence at law, and the court'of chancery, if applied to for an injunction, may in its discretion allow the action to proceed to judgment and to be defended by the receiver. Bryan v. Cornish, 1 Cox Ch. 422. Anon. 6 Ves. 287. Angel v. Smith, 9 Ves. 335. Brooks v. Greathed, 1 Jac. & W. 176. Aston v. Heron, 2 Myl. & K. 390. Randfield v. Randfield, 3 De G., F. & J. 766.
The decree of a court of chancery appointing a receiver entitles him to its protection only in the possession of property which he is authorized or directed by the decree to take possession of. When he assumes to take or hold possession of property not embraced in the decree appointing him, and to which the debtor never had any title, he is not acting as the officer or representative of the court of chancery, but is a mere trespasser, and the rightful owner of the property may sue him in any appropriate form of action for damages or to recover possession of the property illegally taken or detained. Parker v. Browning, 8 Paige, 338. Paige v. Smith, 99 Mass. 395. Leighton v. Harwood, ante, 67.
In the present case, the order of this court sitting in chancery, appointing receivers of the property of the Boston, Hartford & Erie Railroad Company, did not authorize them to take possession of the property of any other person, and therefore afforded them no justification or protection for claiming or assuming possession of property in which that corporation never had any interest, and did not deprive the lawful owner of such property of the right to assert his title before a jury in an action at common jaw. Exceptions overruled.