Riggs v. Burnrite Coal Briquette Co.

• Decision Date: 21 January 1924
• Citation: 295 F. 516
• Parties: RIGGS v. BURNRITE COAL BRIQUETTE CO.
• Court: U.S. District Court — District of New Jersey

295 F. 516

RIGGS v. BURNRITE COAL BRIQUETTE CO.

United States District Court, D. New Jersey.

January 21, 1924

Merritt Lane and Joseph L. Smith, both of Newark, N.J., for complainant.

McCarter & English, of Newark, N.J. (George W. C. McCarter, of Newark N.J., of counsel), for defendant.

LYNCH District Judge.

Receivers for the defendant corporation were appointed by this court in May, 1922. Under various orders of this court they have ever since conducted the business of the corporation. They have contracted debts, borrowed money on receivers' certificates, paid taxes, and discharged many other duties incidental to their management and control of that business. The order appointing the receivers was not appealed from. Nor were any of the orders relating to the operation of the business by the receivers questioned by appeal. In this court the point of lack of jurisdiction to make these appointments or orders was never raised or argued.

In December, 1922, this court made an order in certain contempt proceedings, which was appealed. Upon the argument thereof in the Circuit Court of Appeals, the question of the jurisdiction of this court to appoint receivers was for the first time raised and argued by counsel-- counsel who had not appeared in the cause prior to these contempt proceedings. As a jurisdictional question may be raised at any time, the Circuit Court of Appeals very properly considered that question. It decided that this court had no jurisdiction to appoint receivers of a solvent foreign corporation. 291 F 754. The point raised by appeal was not even referred to. The opinion of the Circuit Court of Appeals, and its mandate directed this court to dismiss the bill, but both were silent with respect to any terms or conditions of dismissal.

The receivers, who in good faith and under court orders had entered into obligations, thereupon appealed to this court for protection. They insisted that, before the property of the corporation should be taken from them, they should be permitted to account and have provision made for unpaid obligations entered into, fees, allowances, etc. The defendant replied that the mandate of the Circuit Court of Appeals should be promptly carried out by a dismissal of the bill, without accounting or adjustment of any kind, prior to such action. This court, being perplexed, petitioned the Circuit Court of Appeals for further instructions in the premises. The petition, after setting forth facts, concluded as follows:

'I therefore, as aforesaid, being uninstructed by your honors in the premises, and desirous of fully carrying out the

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