"The bill in this case was filed in 1931 by Local No. 373 of the International Association of Bridge, Structural and Ornamental Ironworkers (hereinafter called 'the local'), and some fifteen of the individual members of said local, against the said International Association (hereinafter called 'the International'), and William Pope (a Vice President of said International), and a number of other individual members of the local.
"The relationship of the local to the International is in general that of the usual type in labor unions, a large number of local unions of men in that trade, throughout the country (each local having property and funds of its own and a constitution and government of its, own), being coordinated under the government of a national or 'parent' organization which also has a constitution to which the locals and the individual members are subject, and which issues charters to the locals.
"The details of the allegation of the bill are more fully set forth in the conclusions heretofore filed herein on the determination of the order to show cause, and need not here be repeated. Briefly it set forth that William J. Buckley (one of the complainants), had been regularly elected by the Local as its business agent in the place of the previous agent Thomas J. Kelly (one of the defendants); that shortly thereafter the International, with the help of Pope, against the will of the membership of the Local and without any right or warrant, had assumed to suspend all further meetings and self-government of the Local, insisted that Kelly and not Buckley was and would be the business agent of the Local, and took over to itself, and away from the Local, the entire management and control of the Local's property and affairs; that the officers and the majority of the Executive Committee of the Local, who are also defendants individually, had yielded to and acquiesced in this action of the International and were acting in accordance with the orders of Pope and the International instead of the Local.
"The bill prayed restraint against the defendants' incurring any obligations on behalf of the Local, and against their disposing of any of the Local's property or funds; against Kelly's acting as, or holding himself out to be, the business agent of the Local; and against the International and Pope interfering with or suspending the meetings of the Local, or interfering with the power of the membership of the Local to manage and control its property, or recognizing Kelly as business agent of the Local.
"Order to show cause why the appropriate restraint pendente lite should not be issued and a receiver appointed to take over the property and funds of the Local and receive dues payable by the members, was advised by Vice Chancellor Fielder, with interim restraint. After argument on the hearing on this order to show cause, the conclusions hereinbefore mentioned were filed herein, adjudicating that 'the acts of the International and Pope in suspending the meetings of the Local and interfering with the Local's management and control of its property and affairs were illegal and without right or warrant, and would be restrained pendente lite; that the appointment of a receiver did not appear to be then necessary or advisable; and that the question of Kelly's election or incumbency of the office of business agent of the Local was one for the Courts of law instead of this Court.
"No draft of order in accordance with these conclusions was ever presented to the Court for entry; and the cause continued under the restraint in the original order to show cause and without any subsequent step
being taken therein, until the year 1933, when some of the defendants moved to dismiss the bill for want of prosecution. This motion was denied, and complainant directed to speed the cause, (although again no order was presented for entry), and the case was set down for, and duly came on to, final hearing.
"At the final hearing, leave was asked and granted, (on motion on notice) for complainants to file a supplement to the bill, which sets forth that since the filing of the bill, the Local and other complainants and other members of the Local, conceiving the attempted suspension of its meetings by the International to be void, have continued to hold their regular meetings and conduct their regular business, except the administration of the funds of the Local which is alleged to have remained in the possession and control of the defendants; that certain named persons had been regularly chosen as officers of the Local; that defendant Kelly had been expelled from membership by the International, and was therefore disqualified from membership in, or agency for, the Local; that the defendant John Reichardt has been in possession and control of the funds, property, books and records of the Local since the filing of the bill, but has refused to give to complainants or any members of the Local any information as to what moneys he has received, or disbursed, or has on hand, and charging that Reichardt has improperly diverted funds of the Local; and praying for the appointment of a receiver for the funds, property, books and records of the Local, with power to examine and ascertain what funds were or should have been received by Reichardt and how they have been disbursed, and that the defendants be required to account for and pay over to the Local and its regularly constituted officers all funds and property in the possession and control of defendants or chargeable to them.
"The solicitor for the defendants Reichardt, Fennell, John Kelly and Crancich stated that those defendants did not contest complainants' suit or the supplement to the bill, and consented to the entry of decree pro confesso against them.
"The solicitor for the defendants Hansen, Hackett, Heenan and Johnson admitted the allegation of the supplement as to Kelly, and that Reichardt had been in possession and control of the funds of the Local at the time the bill was filed, but put complainants to their proofs on the other allegations. "The solicitor for the defendants International and Pope admitted the allegations as to Kelly, and as to Reichardt's possession and control of the funds; denied that they had had any possession or control of complainants' funds or property, and denied that Reichardt was the agent of the International; and put complainants to their proofs on the other allegations.
"All these answers were spread on the stenographer's official record of the hearing, and formal answers to the supplement were filed subsequently by the defendants International and Pope, but not by the other defendants.
"At this final hearing, it was made to appear to the Court that the defendant Reichardt, who had been acting as treasurer and secretary of the Local, at and before the attempted suspension by the International, and had continued to have and receive funds and property of the Local subsequent to the filing of the bill, had disobeyed an order of this Court for examination of his records in advance of trial, and had disobeyed and ignored subpoena ad testificandum to appear as a witness and produce his records at the hearing, and had admitted defalcation or shortage in his accounts to the extent of some $15,000.00. Accordingly, in addition to the institution of proceedings in criminal contempt against Reichardt, an order was thereupon entered upon oral consent of the solicitors of all parties, appointing Mr. John J. Lenehan, one of the solicitors of this Court, as Receiver to take possession of all funds, property, books and records of the Local; and examine or cause an examination to be made to ascertain and determine what funds and property of the Local were possessed by Reichardt at the time of the filing of the bill, and what had been received by him, or should have been received by him, subsequently, and what disposition had been made thereof by the said Reichardt; and to ascertain and determine the status of the accounts of the several members of the Local with the Local and with the International and between the Local and the International; and to collect and receive and receipt for the dues payable by the several members of the Local.
"In October, 1933, the Receiver filed report as to the funds and property which had come to his possession, and as to the result of the examination of the status of the accounts as aforesaid, which report was duly confirmed without objection after notice of
hearing to all parties. This report showed that the Receiver had taken over and had on hand funds of the Local as follows:
