Mack v. District Court of Second Judicial Dist. in and for Washoe County, Department No. 2

• Decision Date: 05 August 1927
• Docket Number: 2761.
• Citation: 258 P. 289,50 Nev. 318
• Parties: MACK et al. v. DISTRICT COURT OF SECOND JUDICIAL DIST. IN AND FOR WASHOE COUNTY, DEPARTMENT NO. 2.
• Court: Nevada Supreme Court

258 P. 289

50 Nev. 318

MACK et al. v. DISTRICT COURT OF SECOND JUDICIAL DIST. IN AND FOR WASHOE COUNTY, DEPARTMENT NO. 2.

No. 2761.

Supreme Court of Nevada

August 5, 1927

Petition for certiorari by Mary J. Mack and another against the District Court of the Second Judicial District of the State of Nevada, in and for the County of Washoe, Department No. 2 to review an order appointing Carl S. Wheeler receiver of D C. Wheeler, Inc., in the suit of D. M. Wheeler against D. C Wheeler, Inc., and to review an order denying petitioners' motion for permission to maintain a separate action against Carl S. Wheeler as receiver. Alternative writ issued, and defendant moves to quash. Case remitted to respondent court.

Green & Lunsford, of Reno, for petitioners.

Price & Hawkins, of Reno, for respondent.

SANDERS C.J.

This is a motion to quash an alternative writ of certiorari, issued out of this court upon the petition of Mary J. Mack and George S. Green, first, to review an order appointing Carl S Wheeler receiver of all the property and assets of D. C. Wheeler, Inc., a corporation, at the suit of D. M. Wheeler v. D. C. Wheeler, Inc., and others. Second, to review an order denying and overruling petitioners' motion for leave to institute, prosecute, and maintain a separate action against Carl S. Wheeler as receiver for the foreclosure of petitioners' chattel mortgage upon certain property in his hands as receiver of said corporation.

It is contended on the part of the petitioners that the court exceeded its jurisdiction in the appointment of said receiver in two particulars: (1) That the complaint in said action does not state facts sufficient to constitute a cause of action for the appointment of a receiver; (2) that the statute from which the court derived its authority to appoint a receiver, if applicable to the purported cause of action stated in the complaint of D. M. Wheeler v. D. C. Wheeler, Inc., et al. is violative of the Fourteenth Amendment to the Constitution of the United States.

It is contended in the first place that the petitioners were not parties to the receivership proceeding, had no notice or knowledge thereof, and, not being in a position to appeal from the order of appointment of the receiver, the writ should issue to review the question of the jurisdiction of the court to appoint a receiver. It is a well-established rule that the writ will not be granted to a stranger to the record, if the matter to be reviewed is a judgment or order of the court made or entered in a case litigated inter partes. 4 Cal. Juris. (Certiorari) § 51; 5 R. C. L. 255.

It is insisted that, the petitioners being owners and holders of a valid and subsisting chattel mortgage on personal property in the hands of the receiver, perishable in its nature and subject to waste and depreciation, the court exceeded its jurisdiction in refusing petitioners leave to sue the receiver for the foreclosure of their mortgage. It is held that where mortgaged property is placed in the hands of a receiver by the court at the suit and at the instance of some one other than the mortgagee, if the mortgagee wants foreclosure, his procedure is to intervene and ask for foreclosure in the court appointing the receiver. 1 Clark on Receivers, § 720. In the case of Irving National Bank v. District Court, 47 Nev. 86, 217 P. 962, it is held that the writ of prohibition should not issue where the petitioner has an adequate remedy by intervention, with right to appeal secured; and we see no reason why the rule should not be extended to the writ of certiorari, where the petitioner has an adequate remedy by intervention, with right of appeal secured.

It appears that the court's order appointing Carl S Wheeler, a director of D. C. Wheeler, Inc., as its receiver, contains a blanket injunction against the corporation from exercising any of its powers or from doing any business except by and through the receiver. Said order also enjoins and restrains all creditors of the corporation and all persons from suing the receiver except by petition in the receivership cause and with leave of court. The power of the court to appoint the receiver and to enjoin the corporation from exercising any of its powers except through its receiver was derived from section 94 of the General Corporation Law (St. 1903, p. 155), as amended by ...