Wehrs v. Sullivan

• Decision Date: 09 March 1909
• Citation: 116 S.W. 1104,217 Mo. 167
• Parties: HERMAN H. WEHRS v. WILLIAM B. SULLIVAN, Appellant; WILLIAM L. WATKINS, Receiver
• Court: Missouri Supreme Court

116 S.W. 1104

217 Mo. 167

HERMAN H. WEHRS v. WILLIAM B. SULLIVAN, Appellant; WILLIAM L. WATKINS, Receiver

Supreme Court of Missouri

March 9, 1909

Appeal from St. Louis County Circuit Court. -- Hon. Jno. W McElhinney, Judge.

Affirmed.

Robert F. Walker and Thos. C. Hennings for appellant.

(1) The St. Louis Circuit Court had no jurisdiction to entertain the bill of intervention of Supervisor Watkins. State ex rel v. Renick, 157 Mo. 292; Lovitt v. Russell, 138 Mo. 474; State ex rel. v. Wells, 113 Mo. 42; Jackson v. Railroad, 89 Mo. 104; Danforth v Lowe, 53 Mo. 217. (2) Only by a direct proceeding in equity can a judgment be set aside after the term has passed at which it was rendered. Smith v. Hauger, 150 Mo. 437. (3) The statute under which the supervisor and the court assumed to act in appointing Watkins receiver is penal in its nature and should be strictly construed. Sec. 3, Laws 1903, pp. 110-113; K. C. L. & G. Co. v. Kansas City, 200 Mo. 159. (4) The statute under which the supervisor and the court assumed to act should be strictly construed because it is in derogation of the common law. Johnson v. Fleutsch, 176 Mo. 452; Zartman v. Reid, 99 Mo.App. 4155. (5) The statute under which the supervisor and the court assumed to act prescribes that the supervisor shall, in having himself appointed receiver of co-operative companies, proceed under the law for the winding up and dissolution of Building & Loan Associations. His appointment is invalid because he ignored the Building and Loan Law and proceeded in equity. Section 1392, R. S. 1899, as amended Laws, 1901, p. 94. (6) The statute under which the supervisor and the court assumed to act also prescribes that the supervisor, in an action to have himself appointed receiver, shall proceed under the statute for the winding up and dissolution of insurance companies. This he did not do but proceeded under an attempted equitable intervention and his appointment was therefore unauthorized. Sec. 9, Laws 1903, p. 113; secs. 8021 and 8023-8027, R. S. 1899. (7) The provisions of the statute for the appointment of receivers of co-operative companies, Laws 1903, pp. 110-113, being purely of legislative creation, the supervisor in seeking to have himself appointed as such receiver is possessed of no power nor can courts adopt any procedure not expressly authorized by such statute. (8) The laws for the winding up and dissolution of Building & Loan Associations and for the winding up and dissolution of insurance companies are dissimilar and many of their provisions are conflicting. The supervisor, before proceeding in each case to have himself appointed a receiver, must determine under which statute he will proceed. This is an attempt to vest him with legislative discretion in the enforcement of the law, which renders it invalid. Sec. 1392, R. S. 1899, as amended Laws 1901, p. 94; secs. 8021, 8023-8028, R. S. 1899; St. Louis v. Packing Co., 141 Mo. 375; State ex rel. v. Ashbrook, 154 Mo. 375. (9) The court was unauthorized to entertain the bill in equity of the supervisor to have himself appointed receiver for the reason that the act does not contemplate, if valid and operative in other respects, that the supervisor shall be appointed receiver of a co-operative company which is not engaged in business and the affairs of which are being administered in a court of equity. Secs. 1, 2 and 8, Laws 1903, pp. 110-113. (10) There is nothing in the act (Laws 1903) preventing a court of equity from appointing a receiver for a co-operative company, and when the jurisdiction of such a tribunal once attaches, it will continue until the matter involved is finally adjudicated. Equity jurisdiction existed to appoint a receiver before the enactment of the law authorizing, under proper circumstances, the appointment of the supervisor as receiver, and such jurisdiction will continue after the enactment of this statute, unless it has been abolished by prohibitory statutory enactment. There is no such prohibitory statutory enactment. Herrington v. Utterback, 57 Mo. 519; Penn v. Penn, 39 Mo.App. 282. Where a court takes jurisdiction of the subject-matter it may retain jurisdiction until a complete disposition has been made of the case and adjust all equities arising therein. Reyburn v. Mitchell, 106 Mo. 365; Woodward v. Mastin, 106 Mo. 32; Jordan v. Harrison, 46 Mo.App. 172. (11) The Act of 1903 is invalid as a further attempted delegation of legislative power to the supervisor in vesting him with absolute and unrestricted power in prescribing the methods of business and terms of contracts which may be used. This is a discretionary power and not reviewable by any court. The functions of the supervisor are both legislative and judicial. This point was raised in regard to this law in State ex rel. v. Mer. Co., 184 Mo. 169, but was not passed on by the Supreme Court. St. Louis v. Packing Co., 141 Mo. 315; Barthet v. City of New Orleans, 24 F. 563; Tel. Co. v. Myatt, 98 F. 335; State v. Johnson, 61 Kan. 803.

OPINION

In Banc

FOX, J.

This cause is presented to this court upon appeal from an order of the circuit court of St. Louis county, Missouri, refusing to vacate an order appointing William L. Watkins as receiver of the Home Co-operative Company. This proceeding is but one branch of numerous legal contests concerning the assets of the Home Co-operative Company of the city of St. Louis.

The facts concerning this controversy are correctly and fully set forth in the recent case of State ex rel. v Reynolds, 209 Mo. 161, 107 S.W. 487. This appeal being simply from an order refusing to vacate the appointment of a receiver, it is not essential to reproduce in full all the orders made during the progress of this controversy. It will be sufficient to indicate in a general way the nature and character of this legal contest.

In July, 1905, one Herman Wehrs brought suit in behalf of himself and all other contract-holders and creditors of the Home Co-operative Company of the city of St. Louis, Missouri, against one William B. Sullivan and the Home Co-operative Company of the city of St. Louis, a copartnership, for the purpose of winding up its business and distributing its assets among its contract-holders and creditors. In that action plaintiff prayed for the appointment of a receiver and the usual order of injunction. On the 3d day of July, 1905, with the consent of the defendants, upon motion for that purpose, the circuit court appointed Francis A. Tillman, who was the choice of defendants, receiver in said cause, and enjoined the said defendant company and William B. Sullivan, their agents, employees and servants, from proceeding further with the business of said company. By said decree, which was entered by consent, the said William B. Sullivan and the other agents and employees of the said company were ordered to execute and deliver all deeds of conveyances of real estate belonging to said company, and to make all transfers and assignments, sufficient in law, to vest title in said receiver of all the assets and property of every kind and description and wheresoever situated and belonging to and in any way pertaining to the business of said Home Co-operative Company. Said deeds of conveyances, assignments and transfers were duly executed and delivered, as ordered, and the said William B. Sullivan was divested of all right, interest, title and claim in and to the assets and property of the said Home Co-operative Company of every kind and description.

The record discloses that there was no objection or exceptions preserved to the entry of this decree, and on October 3, 1905, a final decree was made and entered in said cause, which was made and agreed upon by the said William B. Sullivan and the said company. In said decree the court made the following findings:

"That the Home Co-operative Company was a copartnership composed and consisting of its contract-holders. That it was insolvent and had ceased to do business before the filing of said suit. That the said William B. Sullivan and his assignors never, at any time, occupied any other legal relation to said company than that of mere trustees or managers for said company, and, as such, conducted for it its business. It decreed and adjudicated that said co-partnership be dissolved. That the order of July 3, 1905, made and entered in said cause, be in all particulars confirmed and that said receivership and injunction, as therein granted, be confirmed and made permanent."

The record fails to disclose the preservation of any exception to the entry of said final decree and no appeal was taken from it.

At a subsequent term of said circuit court an order was entered of record ordering said William B. Sullivan and the contract-holders and creditors of said Home Co-operative Company, for which Tillman had been appointed receiver, to appear before the court on April 7, 1906, and show cause why the judgment or decree in said cause making the injunction permanent and confirming the appointment of Tillman as receiver of said company, should not be vacated and set aside. On April 7, 1907, the order to show cause was continued until April 11, 1906. At this time one William L. Watkins, Supervisor of Building & Loan Associations of the State of Missouri, filed what he termed an interplea, asking the court to vacate and set aside the judgment or decree heretofore rendered in said cause, to remove Tillman as receiver and appoint him, Watkins, as receiver.

On the 21st day of April, 1906, and at a subsequent term of said court, William L. Watkins, Supervisor of Building & Loan Associations of the State of Missouri, was substituted as receiver for said Francis A. Tillman, who was removed and later discharged as such receiver. In and by such decree all contract-holders and...