In re Receivership of New Iberia Cotton Mill Co.
| Decision Date | 02 March 1903 |
| Docket Number | 14,551 |
| Court | Louisiana Supreme Court |
| Parties | In re RECEIVERSHIP OF THE NEW IBERIA COTTON MILL CO., Limited |
Appeal from judicial district court, parish of Iberia; T. Don Foster, Judge.
In the matter of the receivership of the New Iberia Cotton Mill Company, Limited. Rule by Walter M. Gates on the Receiver to file inventory and statement of liability. Rule dismissed and petitioner Walter M. Gates appeals. Reversed.
Walter J. Burke & Bro. and Weeks & Weeks, for appellant.
Broussard Dulany & Broussard, for appellee.
The Iberia Cotton Mill Company, Limited, having become involved in difficulties and debts, one of the creditors applied for the appointment of a Receiver.
About the time this application was filed, the Board of Directors of the Company adopted a resolution reciting the difficulties of the company and averring it to be no longer a going concern, and concluded with the declaration that it was the sense of the Board a Receiver was necessary to preserve and administer the assets of the corporation for the benefit of all concerned.
In answer to the application for the appointment of a Receiver, the President of the company, pointing to the resolution adopted by the Board of Directors, joined in the prayer for such appointment.
Whereupon, an order was made appointing Jas. A. Lee Receiver, with powers restricted to administration and preservation of the property of the corporation, and to the collection of debts, rights, stock subscriptions and other credits outstanding in favor of the corporation, including the authority to sue and be sued.
He was required to give bond and security in the sum of five thousand dollars.
He gave this bond and took the oath of office as Receiver.
A month later, without having caused an inventory to be taken and an appraisement made of the property and effects, rights and credits of the corporation, and without presenting to the Court any schedule of its liabilities, the Receiver applied to the Court for an enlargement of his powers and especially solicited the power to sell at public auction all the real and personal property of the corporation.
He averred, in this connection, the insolvency of the corporation, the insufficiency of the assets to meet the obligations outstanding, and the necessity of selling the property in order to realize funds to meet debts.
In another pleading, filed on the same day, he set forth it appeared to him expedient and necessary, as a means towards obtaining the best results for all parties in interest, that all the real estate of the corporation, consisting of the Cotton Mill plant, machinery, buildings, etc., together with twenty-one acres of land upon which the Mill is situated, should be sold at public auction for cash to the highest bidder, after due advertisement, etc., and within the then next fifty-five days.
These applications were duly entered upon the Receiver's Order Book in the Clerk's office, and pending the time allowed for opposition thereto, Walter M. Gates appeared and opposed the granting of the power solicited to sell the real and personal property of the corporation.
He set forth that he was a holder of stock in the company and, therefore, a party in interest.
He averred that the company had outstanding and due it in stock subscriptions and bills for goods and merchandise sold, and other assets, an amount in excess of what is necessary to meet its liabilities, including the expenses of the Receivership, and the same could, by proper effort, be collected.
He represented that the Receiver should, before applying for power to sell the property of the corporation, and, indeed, as preliminary to his administration of the affairs of the corporation, cause to be made an estimative inventory of its property, rights and assets, and should file in Court a schedule of its liabilities, and that these things had not been done.
He asserted that, if properly managed, the company's indebtedness could be liquidated out of the rights and credits due to it, and that its property, intact, could be again placed in the hands of the stockholders free from debt and a going concern. But that if the application of the Receiver be granted and the sale of the property be had, it will wreck the corporation, render it more difficult to collect the assets, and needlessly terminate the existence of the corporation.
At the same time he filed this opposition, Gates took a rule on the Receiver...
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State ex rel. Leake v. Harris
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