48 Iowa 518 | Iowa | 1878
The authority of the receiver to issue the certificates owned by the South St. Louis Iron Company is not questioned. The only contested matter before us is as to his authority to issue and the'validity of those owned'by the plaintiff. A solution of this question requires a consideration, to some extent at least, of the nature and extent of the powers of a receiver, and the construction of the order of the court.
Counsel for the appellant insist that, if a court undertakes to build a railroad by an order* entered of record, and directs a receiver to superintend such construction, and authorizes him to do and perform all acts and things necessary to be done to build the road; to borrow money, make contracts, incur debts and issue certificates; that such- order would be subject to the same rules of construction as a like power granted by the board of directors to a superintendent of construction. The correctness of this proposition, thus broadly stated, admits of serious doubt.
Ordinarily the duties of a receiver of a railroad only “comprise the operation and management of the road, the payment of current expenses, and the application of the residue of the earnings and receipts to the extinguishment of the indebtedness, to secure which the receiver was appointed.
As to such matters the receiver, no doubt, possesses all the [ incidental and necessary power to effectuate the object of his / appointment, in the absence of any specific direction from the\ court. The details of the business intrusted to him must of ’■ necessity be left to his discretion. But he is uniformly ( regarded as an officer of the court, and, being such, the fund i! or property intrusted to his care is regarded as in the custody of the law, the “court itself having the care of the property by its receiver, who is merely its creature or officer, having no powers other than those conferred by the order of his appointment, or such as are derived from the established practice of courts of equity.” High on Eeceivers, § 1.
In construing the order it must be borne in mind it confers upon the receiver extraordinary and unusual powers, which, however, it will be assumed were necessary and proper for the preservation and protection of the property committed to his charge.
He was authorized to “put those portions of said line already constructed or partly constructed in good order and condition, and to this end he was empowered to borrow money and incur indebtedness which was made a ‘first lien’ on the entire line of said railroad, including the road-bed, right of way, rolling stock, taxes, income and earnings of said road, ” including all after acquired property.
Under such a grant we are constrained to believe the claimed right or power should appear in express terms, or possibly it would be sufficient if it appeared by necessary implication.
Now, while it is true the receiver is authorized to “do and perform all the acts and things necessary to be done and
As the certificates on their face state they were “issued under and by virtue of certain provisions of an order duly entered by the District Court of Clinton county, Iowa, on July 27, 1876,” the plaintiff is chargeable with notice of all such order contains. Whether under the order, the receiver
We conclude, therefore, that plaintiff is not such a holder as will cut off the equities existing between the original parties to these certificates.
Affirmed.