Environmental Control Systems, Inc. v. Allison, No. 2--574A107
| Docket Nº | No. 2--574A107 |
| Citation | 161 Ind.App. 148, 314 N.E.2d 820 |
| Case Date | August 01, 1974 |
| Court | Court of Appeals of Indiana |
Page 820
et al., Appellants (Defendants Below),
v.
Donal ALLISON and Thomas Cassell, Appellees (Plaintiffs Below).
[161 Ind.App. 149] Daniel P. Byron, Michael K. Guest, McHale, Cook & Welch, F. Robert Lively, Indianapolis, for appellants.
Myron H. Budnick, Buschmann, Carr & Schabel, Indianapolis, Robert L. Sheaffer, Scheaffer & Yeager, Shelbyville, for appellees.
PER CURIAM.
This is an appeal from an interlocutory order appointing a Receiver, without notice.
Page 821
ISSUES
The sole issue to be determined in this appeal is whether the trial court erred in appointing a Receiver without notice for the assets of the defendant-appellant Environmental Control Systems, Inc.
We Reverse.
This is an appeal from an order appointing a Receiver without notice. We note appellees' failure to file a brief upon the merits and that therefore appellants are entitled to reversal upon a prima facie demonstration of error. 1
[161 Ind.App. 150] The applicable statute authorizing the appointment of a Receiver without notice is IC 1971 34--1--12--9, Ind.Ann.Stat. § 3--2602 (Burns' 1968 Repl.) and reads as follows:
'Receivers shall not be appointed, either in term or vacation, in any case, until the adverse party shall have appeared, or shall have had reasonable notice of the application for such appointment, except upon sufficient cause shown by affidavit.' (Our emphasis)
The plaintiffs' 'verified' Complaint and Petition for the Appointment of a Receiver Without Notice was not accompanied by any separate affidavit. The allegations of the plaintiffs' Complaint which are pertinent to the appointment of a Receiver are contained in pleading paragraph I of said Complaint and are as follows:
'2. The defendant corporation, Environmental Control Systems, Inc., is indebted to the plaintiffs for wages and commissions due for which demand has been made and payment denied.
'3. There are due and owing to plaintiffs at this time each individually the sum of $1,539.64, plus such additional wages and commissions as have been earned since the 1st of March, 1974.
'4. The plaintiffs have been informed by the defendants, Environmental Control Systems, Inc., through its officers and by defendant Peter Osterchrist, and defendant Larry Wist, and defendant International Trading Company, Inc., through its officers, and verily believe that the defendant, Environmental Control Systems, Inc., is insolvent and unable to pay its bills.
'5. Plaintiffs have been advised by the various defendants and verily believe that the present management of Environmental Control Systems, Inc. has increased the corporate debt of the defendant Environmental Control Systems, Inc. tenfold since their assumption of control of the board of directors of the company in July of 1974.
'6. Plaintiffs believe that the company is at the present time unable to meet its obligations as they become due, that its assets are being dissipated and removed from the state, and that an emergency exists for an appointment of a receiver without notice, and that the defendants individually, jointly and severally must be enjoined from the further [161 Ind.App. 151] dispersal of assets of the defendant corporation Environmental Control Systems, Inc., and that unless a receiver is appointed and income of the corporation marshaled immediately the assets of the company will be dissipated and the plaintiffs will suffer irreparable harm as minority stockholders and creditors of Environmental Control Systems, Inc., defendant herein.
'WHEREFORE, your plaintiffs pray that a receiver be appointed without notice for the interest of all creditors and stockholders of Environmental Control Systems, Inc., a defendant herein, to preserve
Page 822
and protect and property of Environmental Control Systems, Inc. and to protect the creditors and minority stockholders of said corporation; and further grant judgment for the plaintiffs for the amount of wages and commissions due them.'The verification of the Complaint is as follows:
'STATE OF INDIANA
COUNTY OF MARION SS:
'We, Donal Allison and Thomas Cassell, having seen and examined the foregoing Complaint and Petition for Appointment of Receiver Without Notice, affirm under the penalty of perjury that the foregoing representations are true and correct to the best of their knowledge.
s/Donal Allison
Donal Allison
s/Thomas R. Cassell
'Thomas Cassell
'Subscribed and sworn to before me a Notary Public in and for said County and State, this 1st day of May, 1974.
'My Commission Expires:
February 7, 1976'
s/Mary Jean Wollenweber
Notary Public
The appellants argue, and rightfully so, that the allegations of the Complaint and the purported verification thereof, [161 Ind.App. 152] merely alleging and verifying upon belief, are not sufficient upon which to base an order appointing a receiver without notice.
The early case of Henderson v. Reynolds (1907), 168 Ind. 522, 81 N.E. 494, is dispositive of the issue. In Henderson the appeal was from an interlocutory order appointing a receiver without notice. The verification of the complaint was that 'all the statements in the complaint are true to the best of his knowledge and belief.' The Court stated unequivocally:
'An affidavit that the statements in an application for a receiver or for a temporary restraining order without notice and like applications 'are true to the best of the knowledge and belief of the affiant,' or 'to the best of his information and belief,' is insufficient and is not admissible in evidence at the hearing of such application. Such application or petition, to be admissible evidence, must be verified in positive terms. Alderson, Receivers, §§ 113, 115; High, Receivers (3d ed.), § 112, p. 97; 2 Beach, Eq. Prac., § 729; 1 High, Injunctions (4th ed.), § 35; 2 High, Injunctions (4th ed.), §§ 1567, 1569, 1574, 1575, 1581; Gibson, Suits in Chancery, § 818; Siegmund v. Ascher (1890), 37 Ill.App. 122; Musbaum v. Locke (1893), 53 Ill.App. 242, 244; Grandin v. La Bar (1891), 2 N.Dak. 206, 213--216, 50 N.W. 151;...
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...148 Ind.App. 561, 268 N.E.2d 112; Hudgins v. Deeds (1969), 145 Ind.App. 418, 251 N.E.2d 478; Lewis v. Marhoefer Packing Co. (1969), [161 Ind.App. 148] 144 Ind.App. 220, 245 N.E.2d 685; Tonn and Blank, Inc. v. Curtis (1967), 141 Ind.App. 115, 226 N.E.2d 551; Shaffer v. Indiana Gas & Chem......
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...Com. v. W-W Associates, Inc. (1972), 152 Ind.App. 622, 284 N.E.2d 534; Environmental Control Systems, Inc. v. Allison (1974), Ind.App., 314 N.E.2d 820. [63 Ill.2d 133] Rule 41 of the State of Washington's Court of Appeals Rules on Appeal 'If the respondent (appellee) files no brief, the cau......
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...Adoption of Sheeks v. Alvarado (1976), Ind.App., 344 N.E.2d 872, 873; Environmental Control Systems, Inc. v. Allison (1974), Ind.App., 314 N.E.2d 820, Hazel argues that the trial court erred in permitting Donna Hunneshagen, a devisee under Phillip's will, to rebut stipulations of fact enter......
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Austin v. Sanders, No. 13S04-8604-CV-383
...of a receiver without notice, the verification may be deemed inadequate. Environmental Control Systems, Inc. v. Allison (1974), 161 Ind.App. 148, 155, 314 N.E.2d 820, 824. Presumably, a party seeking such extraordinary relief without notice should be held accountable in perjury; if the word......
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TRW, Inc., Ross Gear Division v. West, No. 2--1272A134
...148 Ind.App. 561, 268 N.E.2d 112; Hudgins v. Deeds (1969), 145 Ind.App. 418, 251 N.E.2d 478; Lewis v. Marhoefer Packing Co. (1969), [161 Ind.App. 148] 144 Ind.App. 220, 245 N.E.2d 685; Tonn and Blank, Inc. v. Curtis (1967), 141 Ind.App. 115, 226 N.E.2d 551; Shaffer v. Indiana Gas & Chem......
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First Capitol Mortg. Corp. v. Talandis Const. Corp., No. 47665
...Com. v. W-W Associates, Inc. (1972), 152 Ind.App. 622, 284 N.E.2d 534; Environmental Control Systems, Inc. v. Allison (1974), Ind.App., 314 N.E.2d 820. [63 Ill.2d 133] Rule 41 of the State of Washington's Court of Appeals Rules on Appeal 'If the respondent (appellee) files no brief, the cau......
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Miller's Estate, Matter of, No. 2--775A176
...Adoption of Sheeks v. Alvarado (1976), Ind.App., 344 N.E.2d 872, 873; Environmental Control Systems, Inc. v. Allison (1974), Ind.App., 314 N.E.2d 820, Hazel argues that the trial court erred in permitting Donna Hunneshagen, a devisee under Phillip's will, to rebut stipulations of fact enter......
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Austin v. Sanders, No. 13S04-8604-CV-383
...of a receiver without notice, the verification may be deemed inadequate. Environmental Control Systems, Inc. v. Allison (1974), 161 Ind.App. 148, 155, 314 N.E.2d 820, 824. Presumably, a party seeking such extraordinary relief without notice should be held accountable in perjury; if the word......