Merriam v. St. Louis, C.G. & Ft. S. Ry. Co.
Decision Date | 23 June 1896 |
Citation | 36 S.W. 630,136 Mo. 145 |
Parties | Merriam v. St. Louis, Cape Girardeau & Fort Smith Railway Company et al., Appellants |
Court | Missouri Supreme Court |
Appeal from Iron Circuit Court.
Reversed and remanded.
M. R Smith for St. Louis, Cape Girardeau & Fort Smith Railway Company, appellant.
(1) The act of 1895 is remedial and should be liberally construed. (2) The motion to revoke as a matter of law unquestionably challenges the sufficiency of the record to authorize the appointment of a receiver, and in that respect questions the correctness of the court's action, although of a discretionary character. 2 Beach, Mod. Eq. Prac., sec. 720 notes 2 and 3, and sec. 936, notes 3 and 4. Tysen v Railroad, 247; Kerr on Receivers, p. 8, and note (S); Pounder v. Tate, 96 Ind. 331; Naylor v. Sidner, 106 Ind. 184; Miller v. Lehman, 87 Ala. 519; Taylor v. Sweet, 40 Mich. 736; Hodges v. McDuff, 69 Mich. 76; Turnbull v. Lumber Co., 55 Mich. 397. (3) There should never have been a receiver appointed by the judge of the circuit court of Stoddard county, under plaintiff's original petition for the defendant railway company, for the reason that the mortgages securing plaintiff's bonds did not cover the entire road (but only twenty-six miles thereof), and because he in no manner had any rights or liens, by virtue of the consolidated mortgage that covered the whole road, and further, because he was not a party to such consolidated mortgage. Railroad v. Whitaker, 5 S.W. 451; Union Trust Co. v. Railroad, 4 Cent. L. Journal, 585; Farmers' Loan, etc., Co. v. Railroad, 27 F. 147; 2 Jones on Mort., sec. 1520, and note (2). Chicago v. U.S. etc., Co., 57 Pa. St. 91. "The plaintiff must show that he has some clear right to the property, or some lien upon it, or that the property constitutes a special fund, to which he has a right to resort for the satisfaction of his claim." Mays v. Rose, 1 Freeman's Ch. 718; Williamson v. Railroad, 1 Biss. (U.S.) 205; Tysen v. Railroad, 8 Biss. (U.S.) 247; Owen v. Homan, 4 H. L. Rep. 997. The plaintiff, in his suit, sues only for himself and others similarly situated, and wants possession of the whole property, but not for all the creditors of the defendant railway company. This he could not do, however, unless he had been a holder of consolidated bonds. Gibert v. Railroad, 33 Gratt. (Va.) 586. (4) No receiver should have been appointed under the original petition, for the defendant railway company's railroad and property, as prayed in his petition, for the reason that it could not be done without injustice to other and larger creditors, and for the reason that it was not apparent that plaintiff did not have an adequate remedy at law, and this the plaintiff virtually concedes in his amended petition. It is clear that plaintiff was in no danger of losing either his interest or principal, as the security was ample for twice the amount of his indebtedness, and so far as he was concerned, there was no necessity of the appointment of a receiver. Farmers' Loan, etc., Co. v. Railroad, 53 F. 182; Turner v. Railroad, 8 Biss. (U.S.) 315. Had plaintiff desired merely to collect his interest, he could have secured a judgment and made a special charge against the road. Farmers' Loan, etc., Co. v. Railroad, 53 F. 84. And sequestered the rents and profits. Waite on Insolvent Corp., secs. 182, 308, 317; Roberts v. Stoner, 18 Mo. 484; Overton v. Railroad, 10 F. 866; Tysen v. Railroad, 8 Biss. (U.S.) 247; Railroad v. Soutter, 2 Wall. 523. (5) The amended petition filed by plaintiff on the eleventh day of June set up a different state of facts from the one set out in the original petition, and was not an amendment thereof, but was a complete substitute therefor, and thereby completely changed the ground or cause of action from the one set up in his original petition, and for such reason the defendant railway company's motion to strike said amended petition from the files of the case should have been sustained, and this is a question for review on this appeal. Sears v. Mo., etc., Co., 56 Mo.App. 122; Scovill v. Glasner, 79 Mo. 452; Lumpkin v. Collier, 69 Mo. 170. (6) It is clear that the cross bill filed by the trust company was not germane to the matters set up in the original bill. The cross bill should grow out of the matters set up in the bill. A mere auxiliary of it. Boland v. Ross, 120 Mo. 214; Krueger v. Ferry, 41 N.J.Eq. 435; 1 Beach, Eq. Pract., sec. 433; R. R. Signal Co. v. Union S. & S. Co., 43 F. 331; May v. Armstrong, 3 J. J. Marsh. 260; Daniel v. Morrison, 6 Dana, 186; Field v. Schieffelin, 7 Johns, Ch. 250; Gallation v. Cunningham, 8 Cow. 361; Walden v. Bradley, 14 Pet. 156; Gage v. Mayer, 117 Ill. 632; Andrews v. Holsen, 23 Ala. 219.
R. B. Oliver for Doyle, co-appellant.
(1) The jurisdiction of the Cape Girardeau circuit court was not only the first to attach to the entire railroad by reason of being the first filed and the first served on all the defendants, but it was the first and only court that had jurisdiction by seizure and possession of the res. South Mo. Lumber Co. v. Wright, 21 S.W. 811; Gluck & Becker on Receivers, sec. 30, p. 66; Beach on Receivers, sec. 20, p. 21. (2) Merriam's original bill was for the sequestration of the railroad property for the purpose of paying the defaulted interest coupons on two divisions, or twenty-six miles of the railroad. It was not for the foreclosure of the mortgages and the sale of the property. Doyle's suit raised different controversies and had different purposes in view. Merriam wanted a receiver to sequester the road to pay his interest. Doyle wanted the whole road managed by a receiver, the mortgages foreclosed, the property sold, and the proceeds applied according to the priority of the different lien holders. Doyle's bill set out all of the mortgages and Louis Houck was appointed receiver under Doyle's bill, and as such receiver took actual possession of the property. In such case the court that first seizes the property acquires jurisdiction over it to the exclusion of the other. Beach on Modern Equity Practice, sec. 722, p. 706; Shields v. Coleman, 157 U.S. 168; East Tenn., etc., Co. v. Railroad, 49 F. 608; Wilmer v. Atlanta R. A. L., 2 Woods, 409. (3) But the sufficiency of Merriam's bill to authorize the appointment of a receiver had been successfully assaulted in the Stoddard circuit court. It was there affirmatively held that said bill did not state facts or present such an emergency as would authorize the appointment of a receiver. "When any fact has been directly in issue and judicially passed upon, it is res adjudicata, no matter what the nature of it, and can not be subsequently adjudicated." 21 Am. and Eng. Ency. Law, p. 252. "When a right or a fact has been judicially determined by a court of competent jurisdiction, the judgment therein, so long as it remains unreversed, shall be conclusive upon the parties." Chief Justice Shaw, Sawyer v. Woodbury, 7 Gray, 502; Denver v. Lobenstein, 3 Col. 216. The motion filed by this appellant in the Stoddard circuit court was a direct assault upon Merriam's original petition, and the order of said circuit court on said motion was tantamount to a judgment upon demurrer. O'Connor v. Koch, 56 Mo. 253; Austin v. Loring, 63 Mo. 19. (4) The appointment of a receiver rests upon the sound discretion of the court, to be exercised only as an auxiliary to the attainment of the ends of justice. Mays v. Rose, Freem. Ch. (Miss.) 718; Blondheim v. Moore, 11 Md. 364; Kerr on Receivers, 1; Bispham's Principles of Equity, sec. 577. First. The appointment of a receiver is reluctantly made and only upon the clearest proof of its propriety. 20 Am. and Eng. Ency. of Law, p. 16. Second. It must be a strong case which will justify this ultimate resort of a court of equity. The power will never be exercised while it is likely to produce irreparable injustice or injury to private rights, or where there exists any other safe or expedient remedy. Crawford v. Ross, 39 Ga. 49; Chicago, etc., Oil Co. v. U. S. Petroleum Co., 57 Pa. St. 91; Latham v. Chafee, 7 F. 526. (5) The circuit court of Iron county erred in not dismissing respondent's bill after the railroad company had made its plea of tender and payment, and asked said court, by repeated motions, to compel the respondent to accept the same and dismiss his bill. State ex rel. v. Ross, 31 S.W. 600; Phillips v. Bailey, 82 Mo. 639; Whalen v. Reilly, 61 Mo. 565; Railroad v. Soutter, 2 Wall. 510.
Martin L. Clardy for respondent.
(1) The act of the legislature of 1895 is inapplicable to this appeal. It was not intended that an appeal should lie from a mere interlocutory order; courts in construing statutes will look at their probable consequences. (2) The title of the act of 1895 does not meet the requirements of the constitution, article 4, section 28. (3) Even if the statute is constitutional and the appeal authorized, the inquiry of the reviewing court is confined to narrow limits. Naylor v. Sidener, 6 N.E. 345; Iron Hall v. Baker, 33 N.E. 1131; Roberts v. Bank, 37 P. 26. (4) The appointment of Klotz as receiver was proper and warranted by the law applicable thereto. (5) The property being a unit the objection is not well taken that the circuit court of Stoddard county had no jurisdiction to appoint a receiver for the reason that the mortgages securing plaintiff's bonds did not cover the entire road. (6) There is no material difference between the first and the amended petitions. The amendment was allowable. Lumpkin v. Collier, 69 Mo. 170; Scovill v. Glasner, 79 Mo. 449; Bliss on Code Pleadings, sec. 429; Robertson v. Railroad, 21 Mo.App. 633; Stearns v. Railroad, 94 Mo. 317.
OPINION
In Banc.
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