Connecticut River Banking Co. v. Rockbridge Co.

• Citation: 73 F. 709
• Parties: CONNECTICUT RIVER BANKING CO. et al. v. ROCKBRIDGE CO.
• Decision Date: 12 December 1895
• Court: United States Courts of Appeals. United States Court of Appeals (4th Circuit)

73 F. 709

CONNECTICUT RIVER BANKING CO. et al. v. ROCKBRIDGE CO.

United States Circuit Court, W.D. Virginia.

December 12, 1895

Letcher & Letcher, for complainants.

Winburn & Batchelor, for exceptants.

PAUL District Judge.

The question presented for decision in this case is raised by exceptions to the report of the master filed in this cause. On the 26th day of February, 1894, on application of the plaintiffs, who are holders of certain mortgage bonds of the defendant, in which application a number of general creditors of said defendant company joined, receivers were appointed to take charge of the property of the company. The receivers each were required to execute bonds as such officers, the decree providing:

'And before said J. Lewis Bumgardner and F. T. Glasgow receivers, shall be authorized to act under this decree they shall each execute and file before the clerk of this court their bonds, with approved personal security, and to be approved by this court, in the penalty of ten thousand dollars, each separately, payable to the United States of America, and conditioned for the faithful discharge of his duty under this and all future orders and decrees of the court in this cause.'

In the same decree an injunction order was entered, restraining the officers and agents of the said company--

'From exercising any rights or control over the property, assets books, and papers of the said company, and from interfering in any manner whatever with the control and management of the receivers over and with the same.'

And in the same decree it is also adjudged, ordered, and decreed that:

'All persons who are or claim to be creditors of the said company are hereby enjoined and restrained from instituting any suit or suits against the said company; and, in case any such suit or suits has or have been heretofore instituted against the said company, the further prosecution of the same is hereby enjoined and restrained.'

In the same decree the cause was referred to a special master to take an account and make a report showing-- First, the property and assets of the said Rockbridge Company; second, the debts and liabilities of the said company, and the order of their priorities. The special master's report was filed on June 3, 1895. It shows the property owned by the defendant company, the liens thereon, and the general or unsecured debts. Among the debts reported in the unsecured class, and as not being liens on the real estate of the defendant company not covered by the deed of trust or mortgage, are two judgments,-- one in favor of Annie E. Temple, and the other in favor of William E. Bain. These judgments constitute the basis of the exceptions to the master's report. Following is the ground of exceptions of both exceptants:

'Because the commissioner finds, in his report, that the judgment reported in favor of William E. Bain against the defendant Rockbridge Company has no priority on the property owned by said defendant, and not embraced in deed of trust securing the mortgage bonds held by the plaintiff and others; said judgments having been obtained in the circuit court of Rockbridge county on the 1st day of March, 1894.'

To sustain this exception to the master's report, the exceptants show, from the record, this state of facts: At the time the decree was entered appointing receivers, to wit, on the 26th day of February, 1894, actions were pending in the circuit court of Rockbridge county, Va., on the claims of said Annie E. Temple and William E. Bain against the defendant company. That a term of that court commenced on the 1st day of March, 1894, at which term the said judgments were obtained. That on the fifteenth day of the term, to wit, March 15, 1894, these judgments became final, and, in their operation, related to the first day of the term, to wit, March 1, 1894. This effect, it is claimed, is given to the judgments by sections 3287 and 3576 of the Code of Virginia (Ed. 1887), which provide as follows:

'Sec. 3287. Every judgment entered in the office in a case wherein there is no order for an inquiry of damages, and every nonsuit or dismission entered therein shall, if not previously set aside, become a final judgment, if the case be in a circuit court, of the last day of the next term, or the fifteenth day thereof (whichever shall happen first).'

'Sec. 3576. * * * Where a judgment has relation in law to the commencement of the

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