Greeley v. Provident Sav. Bank

• Decision Date: 23 February 1891
• Citation: 15 S.W. 429,103 Mo. 212
• Parties: Greeley v. The Provident Savings Bank et al.; Haeussler, Exceptor, Appellant
• Court: Missouri Supreme Court

15 S.W. 429

103 Mo. 212

Greeley v. The Provident Savings Bank et al.; Haeussler, Exceptor, Appellant

Supreme Court of Missouri, First Division

February 23, 1891

Appeal from St. Louis City Circuit Court. -- Hon. G. W. Lubke Judge.

Affirmed.

H. A Haeussler and J. O. Broadhead for appellant.

(1) The averments of bill gave the court no power or authority to appoint a receiver or take jurisdiction in the matter by taking the bank's assets out of the hands of the board of directors or its trustees. No court could, at instance of a stockholder, take a corporation out of the hands of its directors and place it in the hands of a third party on such a showing, and it was error for the court to decline to hear appellant on that question. Haines v. Carpenter, 1 Wood, 266; Middleton v. Dodswell, 13 Vesey, Jr 266; Daniel Eq. Prac., p. 1736. (2) Under the statute, the assets of the Provident Savings Bank, if insolvent, passed to the directors as trustees, and should have been administered by them in such capacity without the intervention of a receiver or incurring the expense here objected to. R. S. 1879, sec. 744. (3) The amount of the allowance as made was excessive, and not warranted either by law or what is called the evidence. Jones v. Keene, 115 Mass. 170; French v. Gifford, 31 Iowa 428; Hinckley v. Railroad, 100 U.S. 153; Commissioners v. Savings Inst., 11 R. I. 557; Cowdry v. Railroad, 1 Wood, 346; Martin v. Martin, 12 P. 234; Beach on Receivers, 767; High on Receivers, 787. (4) The burden of showing what the services of receiver and his attorney were worth, and what service they had in fact rendered, was improperly thrown upon appellant, and from judgment of court no one can tell upon what theory or basis the allowances were made, whether by year, by month or by motions presented or cases tried. (5) The court admitted improper evidence in regard to what has been done by the city courts, as to allowance of fees in matters of assignments, in order to govern its action in this matter. (6) The court improperly refused to allow to appellant his costs paid and counsel fees for services rendered in protecting the estates, from the allowance proposed to be made on a per-cent. basis. (7) The costs and expenses should be taxed against plaintiff and not against the estate. (8) When a statute like in case at bar (R. S. 1879, sec. 744) provides for an administration of an insolvent bank, by its directors as trustees, a court even of general equity jurisdiction is excluded from acting. If trustees do not act they can be cited and removed, and trustees appointed in their stead, and that is all. The statutory method must be pursued.

Boyle, Adams & McKeighan for receiver.

(1) The action of the court in the appointment of the receiver cannot be reviewed in this collateral proceeding. Block v. Estes, 92 Mo. 324; Cox v. Volkert, 86 Mo. 505; High on Receivers, sec. 203; Packet Co. v. Davidson, 13 Mo.App. 561; Rosenheim v. Hartsock, 90 Mo. 365; Dollarhide v. Parks, 92 Mo. 188; Hardin v. Lee, 51 Mo. 244; Yates v. Johnson, 87 Mo. 217; Richards v. People, 81 Ill. 550; Barbour v. Bank, 45 O. S. 133; Beverly v. Brooks, 3 Gratt. 187; Railroad v. Railroad, 46 Vt. 795; Freeman on Judgments, secs. 23, 25, 28; Bank v. Reilly, 8 Mo.App. 546; Neal v. Hill, 16 Cal. 145; R. S. 1889, sec. 2195; City of St. Louis v. Gaslight Co., 11 Mo.App. 237; 87 Mo. 223. (2) If the action of the court in the appointment of the receiver were now reviewable, it would be found correct. R. S. 1889, sec. 2193; State ex rel. v. Gambs, 68 Mo. 289; Cox v. Volkert, 86 Mo. 505; Packet Co. v. Davidson, 13 Mo.App. 505; Lawrence v. Ins. Co., 1 Paige Ch. 587; Coal & Mining Co. v. Edwards, 103 Ill. 475; Murray v. Vanderbilt, 39 Barb. 147; Patten v. Transit Co., 4 Abb. Pr. R. 143; Bent v. Priest, 86 Mo. 482; Cook on the Law of Stock & Stockholders, sec. 648; Dodge v. Woolsey, 18 How. (U.S.) 341; Stevens v. Davison, 18 Gratt. 819; Thompson's Liability of Officers & Agents of Corporations, secs, 382-385; Morawetz on Private Corporations, secs. 384, 386, 389, 397, 399 and 402; High on Receivers, sec. 293; Cook on Stock and Stockholders, secs. 632, 661; Blatchford v. Ross, 54 Barb. 42; R. S. 1879, sec. 906; R. S. 1889, sec. 2784; R. S. 1879, sec. 918; R. S. 1889, sec. 2760; R. S. 1879, sec. 730; R. S. 1889, sec. 2510. (3) There being no president or quorum of directors they could not act as trustees under our statute to wind up the affairs of the corporation or otherwise take care of the assets or property of the bank. In addition to that there was on the fourteenth day of July, 1886, no dissolved corporation within the meaning and purview of the statute. R. S. 1879, sec. 744. (4) This court cannot review the action of the trial court on the question of the allowance to the receiver and his counsel, for the reason that, by direction of the appellant, all the evidence before the court below is not brought here. Goode v. Crow, 51 Mo. 212; Roberts v. Bartlett, 26 Mo.App. 617, and cases there cited; Sleet v. Gilmore, 28 Mo.App. 657. (5) The allowances to the receiver and his counsel were fully warranted by such part of the evidence as is now before the court, and the trial court's determination is entitled to the greatest consideration. Beach on Receivers, sec. 774. (6) There was no error in the court's requiring the objectors to introduce their evidence first, and no error in the rulings on the evidence by the court below. Goode v. Crowe, 51 Mo. 214; Russell v. Berkstresser, 77 Mo. 417; Morey v. Stanley, 54 Mo. 419. (7) Appellant is estopped from claiming, as he does in his brief, that this estate should be wound up by the directors as trustees, and because it was not so wound up that the receiver is not entitled to any compensation. (8) Under the pressing necessity, as disclosed by the averments of the bill, there was no error in the original provisional appointment of the receiver upon the verified bill, and, if there was any such error, the same was cured by the confirmation of that appointment and continuation of the receiver by the final decree of the court, rendered after all the parties were in court and heard in the case.

OPINION

Sherwood, P. J.

The chief question presented by this record is the allowance made to the receiver and his counsel for services rendered in settling, collecting and winding up the affairs of the Provident Savings Bank, which had become insolvent, the cashier having absconded with the funds of the bank. The receiver was appointed provisionally, July 14, 1886, and gave, in response to the order of the court, a bond in the sum of $ 1,000,000. In the execution of his trust, he collected the sum of $ 979,249.06.

The exceptor herein, some months after the provisional appointment, and after the entry of the final order confirming such provisional appointment, purchased the claims of seven depositors in the insolvent bank, and upon this basis secured one allowance of about $ 1,000, on which he has been receiving his pro rata of dividends from time to time as made without objection.

On the twenty-fifth day of November, 1887, the receiver filed his final report, in the concluding portion of which he stated: "Your receiver further reports that no allowances have heretofore been made to the receiver for his compensation or for the compensation of his counsel in this proceeding; that after deducting from said sum of $ 150,614.88 proper compensation as aforesaid and also the court costs in this proceeding, which have not yet been paid in full, and after deducting a further sum sufficient to insure the receiver against liability by reason of the intervening petition of H. Clay Sexton as aforesaid, the balance thereof can now be distributed to the creditors of said bank as a third dividend.

"By reason of the fact that this court is familiar with the administration of this trust from the beginning to the end, and familiar with the character and quantity of the services rendered by the receiver and his counsel, your receiver respectfully submits to the court to determine and fix an aggregate amount which shall cover the compensation for himself and for his counsel.

"Your receiver further reports that the total allowances heretofore made in favor of creditors of said bank have been so far reduced by operation of the several orders of court requiring payments in full and settlements that the aggregate amount thereof now outstanding and entitled to participate in the third dividend is $ 849,003.64."

Thereupon the court, with the view of calling the attention of the creditors to the matter, on the same day made the following order, to-wit: "And now at this day comes the receiver in this cause, William H. Thompson, Esq., and files and submits to the court his report and account to this date as such receiver, which being seen by the court it is ordered that the hearing and the consideration of said report and account be and the same now is set down for Saturday, December 3, next at ten o'clock A. M., in room number 1 of this court. And it appearing to the court that said receiver has not for himself nor for his counsel, Messrs. Boyle, Adams & McKeighan, charged any sum on account of or for the services of said receiver and of his said counsel in this cause, but has submitted said matter to the court, it is, therefore, now by the court also ordered that, upon the hearing of said account as aforesaid, all parties in interest in this cause may show cause why the said receiver and his said counsel may not be allowed together for all their services, joint and several, rendered in this cause including also the distribution of the sum or sums of money now in the hands of said receiver a commission equal to that allowed by the statute of this state fixing the commissions of executors...