Baird v. Lefor

• Decision Date: 31 December 1924
• Parties: BAIRD v. LEFOR et al.
• Court: North Dakota Supreme Court

52 N.D. 155

201 N.W. 997

BAIRD

v.LEFOR et al.

Supreme Court of North Dakota.

Dec. 31, 1924.

Syllabus by the Court.

An order overruling an objection to the jurisdiction of a judge to hear and determine a cause is not appealable under the provisions of section 7841, C. L. 1913.

Chapter 137, S. L. 1923, is a constitutional enactment. State of North Dakota v. First State Bank of Jud et al. (N. D.) 202 N. W. 391, followed and approved.

The designation of a district judge to hear and determine actions for the liquidation of insolvent banking corporations, under the provisions of chapter 137, S. L. 1923, is not a designation to hear and determine actions brought by or against any receiver appointed by such judge pursuant to the provisions of said chapter 137. Such actions stand in the same position as any other actions, in so far as the provisions of law relating to the venue thereof, or the judges who shall sit in the trial of the same, are concerned.

Chapter 137, S. L. 1923, provides a mode of procedure for the liquidation and winding up of insolvent banking corporations in accordance with well-established equitable rules, and, by providing for the appointment of a receiver by the court, does not create a civil office within the meaning of that term as used in section 39 of the Constitution.

A receiver, appointed under the provisions of chapter 137, S. L. 1923, is not the holder of a “civil office” within the meaning of that term as used in section 39 of the Constitution providing that “no member of the Legislative Assembly shall, during the term for which he was elected, be appointed or elected to any civil office in this state, which shall have been created, or the emoluments of which shall have been increased, during the term for which he was elected; nor shall any member receive any civil appointment from the Governor, or Governor and Senate, during the term for which he shall have been elected.”

Additional Syllabus by Editorial Staff.

Receiver is not public officer, but is officer of court in sense of agent or representative in holding property over which court may acquire jurisdiction and in disposing of it.

An “office” is a right to exercise a public or private employment and to take the fees thereof, whether public, as those of magistrates, or private, as of bailiffs, receiver, and the like.

Appeal from District Court, Burleigh County; Chas. M. Cooley, Special Judge.

Suit by L. R. Baird, as receiver of the Farmers' State Bank of Belfield, against Adam A. Lefor and others. From order overruling defendants' objection to jurisdiction of trial court and order overruling demurrer to supplemental complaint, defendant named appeals. Appeal from order overruling objection to jurisdiction dismissed, and order overruling demurrer affirmed.Simpson & Mackoff, of Dickinson, for appellant.

Zuger & Tillotson, of Bismarck, for respondent.

NUESSLE, J.

This appeal raises questions touching the constitutionality and effect of chapter 137, S. L. 1923. The primary matters of fact necessary to an understanding of the case and the points involved are as follows: L. R. Baird, the plaintiff, was appointed as receiver of banks in process of liquidation, under the provisions of chapter 137, supra, by Hon. Chas. M. Cooley, one of the judges of the First judicial district of the state of North Dakota. Judge Cooley was designated by this court, under the provisions of section 18 of chapter 137, supra, to hear and determine actions to liquidate and wind up the affairs of insolvent banks within the state. The act in question consolidates and fixes the venue of such insolvency proceedings in Burleigh county in the Fourth judicial district. The defendant Lefor had been receiver of the Farmers' State Bank of Belfield in the Sixth judicial district, appointed under the provisions of chapter 53, S. L. 1915. The instant action was brought in Burleigh county by Baird against Lefor for an accounting of this receivership. Lefor demurred to the complaint, The demurrer came on for hearing before Judge Cooley in Burleigh county. Lefor then objected to the jurisdiction of Judge Cooley to hear the cause on the ground that he was not one of the regularly elected judges in and for the Fourth judicial district, and had not been designated or requested to hear and determine the same. This objection was overruled. Thereupon the hearing proceeded and the demurrer also was overruled. The defendant then perfected a double appeal to this court, first, from the order overruling his objection to Judge Cooley's jurisdiction, and, second, from the order overruling the demurrer. The defendant here contends, first, that Judge Cooley was not authorized to hear and determine the cause; second, that chapter 137 is unconstitutional and void; third, that though such chapter 137 be constitutional, nevertheless the appointment of the plaintiff Baird is void, under section 39 of the Constitution of North Dakota; and, lastly, that the complaint does not state facts sufficient to constitute a cause of action for an accounting.

[2] In the case of State of North Dakota v. First State Bank of Jud et al.,¹ just decided, this court passed upon the constitutionality of chapter 137, S. L. 1923. In that case, the statute was held to be constitutional. We know of no reason why we should recede from the conclusion there arrived at. On the contrary further consideration has but tended to strengthen us in that conclusion. Incidentally, in that case, the question of jurisdiction, as raised in the instant case, was also determined.

[1] The defendant here first seeks a review of the order of the district court overruling the objection to the jurisdiction of Judge Cooley. Section 7841, Comp. Laws 1913, enumerates the orders from which an appeal may be taken. The plaintiff urges that the order sought to be appealed from is not within those thus enumerated. We are of the opinion that this position is well taken. If the order is within the purview of section 7841, supra, it must be under the fourth subsection thereof, which provides that an order is appealable when it involves the merits of an action or some part thereof. We cannot see, however, how the order here complained of can be said to involve the merits of the action. The order is not appealable.

[3] We deem it proper, nevertheless, to call attention to the holding in the case of State v. First State Bank of Jud, supra, wherein, in discussing the effect of chapter 137, supra, it is said:

“It is, we think, too clear for controversy that the Legislature, in fixing the venue of actions (in chapter 137), intended to deal and dealt only with actions for the liquidation of insolvent banking corporations. The provisions in the act relating to venue have reference to such actions and such actions only, and there was no intention to make any changes in the existing laws as regards the venue of suits by or against a receiver of an insolvent banking corporation.”

The effect of this holding is, of course, that the designation of Judge Cooley by this court was not a designation to try and determine actions that might be brought by or against any receiver appointed by him pursuant to the provisions of chapter 137. Such actions stand in the same position as any other actions, in so far as the provisions of law relating to the venue thereof or the judges who shall sit in the trial of the same are concerned. Thus, it follows that the designation of Judge Cooley to hear and determine actions for the liquidation of insolvent banking corporations, under the provisions of chapter 137, S. L. 1923, was not a designation to hear and determine actions brought by or against any receiver appointed by him pursuant to the provisions of said chapter 137.

[4][5] We are chiefly concerned on this appeal with the second ground urged by the defendant in support of his demurrer; that is, that the appointment of the plaintiff Baird as receiver of banks in liquidation was and is void under section 39 of the Constitution by reason of the fact that the plaintiff was a member of the state senate at the time that chapter 137 was enacted and whose term had not expired at the time of the appointment. Section 39 of the Constitution reads as follows:

“No member of the Legislative Assembly shall, during the term for which he was elected, be appointed or elected to any civil office in this state, which shall have been created, or the emoluments of which shall have been increased, during the term for which he was elected; nor shall any member receive any civil appointment from the Governor, or Governor and Senate, during the term for which he shall have been elected.”

Thus, the determinative questions are as to whether the receivership, contemplated under the provisions of chapter 137, is a civil office within the meaning of that term as used in section 39 of the Constitution, and whether, if it is such an office, it was created or its emoluments increased by the act in question.

The preamble to chapter 137 recites the conditions existing and which in the legislative judgment gave rise to the necessity for the enactment of that chapter. The whole state was suffering from the ills consequent in agricultural communities on the deflation following the war. There had been bank failures in every section. Nearly all of the insolvent institutions were in the hands of administrative receivers designated by the bank examiner, under the provisions of chapter 53, S. L. 1915. The legislative intent and purpose appears clear and plain to insure the speedy, efficient, and economical liquidationof the large number of state banks then insolvent. In the legislative judgment the emergency was such, and so affected the general public welfare, as to warrant the exercise of original jurisdiction by this court. The legislative thought was that by superseding the many administrative receivers by one general court receivership, the ends and purposes it aimed at could be best attained....