Texas Ry Co v. Johnson

• Decision Date: 03 January 1894
• Docket Number: No. 138,138
• Parties: TEXAS & P. RY. CO. v. JOHNSON
• Court: U.S. Supreme Court

151 U.S. 81

14 S.Ct. 250

38 L.Ed. 81

TEXAS & P. RY. CO.

v JOHNSON.

No. 138.

January 3, 1894.

[Syllabus from pages 81-82 intentionally omitted]

Statement by Mr. Chief Justice FULLER:

This was an action commenced by T. R. Johnson in the district court of Marion county, Tex., September 14, 1888, against John C. Brown, and amended December 17, 1888, by making the Texas & Pacific Railway Company a party defendant. On January 14, 1889, plaintiff filed his first original amended petition against said defendants, wherein it was alleged that the defendant Brown was on December 15, 1885, duly appointed by the circuit court of the United States for the eastern district of Louisiana receiver of the Texas & Pacific Railway Company and all of its property in the states of Texas and Louisiana; that he qualified as such receiver December 16, 1885, and entered upon and exercised and performed his duties as such from that date until October 31, 1888, inclusive; and that during that time he operated and managed the property of the defendant corporation in all its parts in said states as a common carrier of freight and passengers, and into and through certain enumerated counties of the state of Texas. The petition, after stating the circumstances of the accident, and the ground of liability in that respect, further averred that the receiver was discharged by the court appointing him, October 31, 1888, under an order of October 26, 1888, and that he delivered to the railway company all of its property, consisting of the corpus of said railway, and all the earnings and income then in his hands as receiver, unexpended, and all the lands belonging thereto, and all improvements and betterments which had been added to the property by him.

The provisions of this order requiring that the property should be so delivered subject to the liabilities of the receiver were specifically alleged, and their legal effect, and that of the acceptance of the property, averred; and it was further stated that under the laws of the state plaintiff was entitled to a lien on the property for the satisfaction of his claim. Reference was also made to an order of May 31, 1888, relating to the termination of the receivership June 1, 1888, and averring that after that date the road was continuously operated by the company.

The plaintiff further alleged that the receiver was originally appointed at the instigation and by the consent of the railway company, and for its benefit; and that the property in his hands from December 16, 1885, to June 1, 1888, inclusive, was operated and managed by him for the benefit of the defendant company and its property as originally intended; and that the property on June 1, 1888, was redelivered to the defendant corporation, greatly improved in valuc, without any sale or foreclosure, and without any third parties acquiring any title thereto or interest therein of any kind. It was finally averred that 'the said Brown, as receiver, and under orders and direction of said court and by consent of all parties interested, including defendant company, during the time above mentioned applied all the receipts, earnings, and income of said railway under said receivership, after the payment of current expenses, to the permanent improvement of said property to the betterment thereof, and to the purchase of large and valuable additional property for the use and operation of said road, amounting in the aggregate to the sum of three million dollars, all of which money and property is now in the possession of the defendant company as its own, and under the conditions heretofore set out. Wherefore the plaintiff brings this suit, and prays for citation to defendants according to law; and on final trial for judgment against the defendant John C. Brown, simply establishing the claim of plaintiff against the receivership under his management, and against the Texas and Pacific Railway Company for his damages, fifty thousand dollars, and to fix upon the said property of the said defendant company in the state of Texas a lien to satisfy the judgment rendered herein, for costs, and such other relief as plaintiff may be entitled in law or in equity.'

The answer of the defendant Brown set up that at the time the plaintiff was injured he was in the exclusive possession of the railway company as receiver, appointed by the circuit court of the United States for the eastern district of Louisiana in the suit of the Missouri Pacific Railway Company against the Texas & Pacific Railway Company, operating said road under and in conformity to the orders of said court, and he was so in possession and operating said road in Sep- tember, 1888, at the date this suit was commenced; that on October 26, 1888, the judge of the circuit court of the United States for the eastern district of Louisiana made an order in the cause of Missouri Pacific Railway Co. v. The Texas & Pacific Railway Co., discharging defendant as receiver, and said discharge was to take effect, and did take effect, on October 31, 1888, and the receiver was ordered to deliver, and did deliver, all the property in his hands as receiver to the railway company, October 31, 1888, in strict compliance with the order of the court; that the railway company took and received the property subject to and charged with all traffic liabilities due to connecting lines, and all contracts for which the receiver might be held liable, and also subject to any and all judgments which had been theretofore rendered in favor of interveners in said cause, as well as such judgments as might thereafter be rendered by the court in favor of interveners who should file interventions therein prior to February 1, 1889; that he had complied fully with the order of the court, and delivered the property to the railway company, and had been fully and finally discharged; and he prayed to be dismissed, with his costs.

The railway company demurred on the ground that the petition showed no cause of action against it, and also answered, stating that at the time the plaintiff was injured he was not in the employment of this defendant but of the receiver; that the receiver was discharged October 31, 1888, by an order entered and filed on the 26th of that month in said cause; that on October 31 and November 1, 1888, the receiver delivered to this defendant all the property held by him as receiver, and fully complied with the order of court discharging him, and the railway company received and accepted the property charged with all traffic liabilities due to connecting lines, with all contracts by which the receiver might be held liable, and with the payment of any and all judgments which had theretofore been rendered in favor of interveners in the case of Missouri Pacific Railway Co. v. The Texas & Pacific Railway Co., in the United States court for the eastern district of Louisiana, as well as such judgments as might be rendered in favor of interveners who might intervene in said cause prior to February 1, 1889, and free from any and all other demands or claims. The answer also contained a general denial.

The cause was tried January 18, 1889, and resulted in a judgment of dismissal as to defendant Brown, and a verdict against the defendant railway company in the sum of $15,000, upon which judgment was entered in the following language: 'It is further ordered and adjudged by the court that the plaintiff, T. R. Johnson, do have and recover of and from the defendant the Texas and Pacific Railway Company the sum of fifteen thousand ($15,000) dollars, with 8 per cent. interest thereon from date, together with all costs in this behalf expended as between plaintiff and said defendant, for which let execution issue.'

A motion by the railway company for a new trial was made and denied, and it moved to reform the judgment so that it should be entered up as against the company, to 'be paid in due course of the administration of the property of the Texas and Pacific Railway Company in the United States circuit court for the eastern districe of Louisiana, at New Orleans, and that no execution issue from this court to collect said judgment.' This motion was overruled, and the company excepted, and thereupon appealed to the supreme court of Texas, by which the judgment was affirmed. The opinion of that court will be found reported in 76 Tex. 421, 13 S. W. 463. The company applied for a writ of error, which was allowed, and the case duly docketed in this court.

Upon the trial of the cause there was read in evidence on behalf of the plaintiff the petition of Brown, receiver, filed May 31, 1888, in the receivership case, for discharge as receiver, and the order of the court made on said petition, and filed May 31, 1888. By this petition the receiver represented that the objects contemplated by the different bills filed in the causes named in the title had been accomplished, and all parties had agreed that 'after the settlement with the receiver, and the payment of costs and other liabilities, or provision for such payment fully made,' the receiver should be discharged and the causes dismissed; and that his accounts were in condition for final settlement up to the 1st of May. Petitioner asked the court to have an accounting with him as receiver, and, when final settlement was made, and petitioner fully indemnified against matters unsettled growing out of the receivership, that the property now in his hands 'be turned over to the proper officer of the Texas and Pacific Railway Company.' He further represented 'that a large number of suits are pending in the courts of Texas and Louisiana against him as receiver for alleged torts connected with the conduct of the railway in its operation, and there are also judgments for small amounts before justices of the peace, aggregating about $12,000, for damages to stock, and for property burned by sparks from engines. There are also a considerable number of claims pending in this court by proceedings in...