56 How. Pr. 23 | N.Y. Sup. Ct. | 1878
The plaintiff, as assignee, brings this action to recover for services, alleged to have been performed by-certain attorneys and counselors at law, for the defendant, during the years 1873, 1874 and 1875.
The first defense set forth in the answer is, in substance, that the Northern Pacific Railroad Company was duly incorporated under an act of. congress, approved July 2, 1864, and that by a joint resolution of congress, the company was authorized to issue its bonds “ for the construction of its road and to secure the same by mortgage and for other purposes ” and was also authorized to issue its bonds, to aid in the construction and equipment of its rohd, and to secure the same by mortgages on its property and its right of property of all kinds, &c., including its fra/nchise as a corporation. It is then averred that on or about the first of July, 1870, the said" last named company under the authority of said joint resolution, made a mortgage to certain trustees, of the properties, rights, liberties, and franchises, of the said Northern Pacific Railroad Company, to secure the payment of its bonds, &c. It is also averred that the said last named Northern Pacific Railroad Company having become insolvent and having failed to pay the interest on its bonds, which became due on the 1st of July, 1874, and on the 1st of January, 1875, a suit for the foreclosure- of said mortgage was commenced in the circuit court of the southern district of New York, and that a receiver was appointed in said cause of all the property, real, personal and mixed of said' company, and said company executed a deed qf conveyance of said property to said receiver on or about May 1st, 1875. That on the 12th day of May, the said circuit court, made its final decree in said cause, that the property, rights and franchises of the said Northern Pacific Railroad Company be sold under the ’
The answer then avers that on the 12th of August, 1875, “ the said property, rights and franchises, being all the property, rights, liberties and franchises of and belonging to said Northern Pacific Railroad Company of every kind and description, incl/udi/ng its franchise to be a corporation,” were sold pursuant to said decree, to certain parties named in the answer, being a committee appointed by the bondholders in pursuance of a plan of reorganization, adopted at a meeting of said bondholders, for the use and benefit of all' holders of said bonds who should assent to said plan, that the said sale was afterwards confirmed by said court, and the said masters by them deed and the receiver and trustees by their respective deeds, also approved by the court, conveyed all said property, rights and franchises to the said purchasers, for the use and benefit of all the holders of said bonds who should assent to, and comply with, the provisions of said plan.
It is further alleged that on the 29th day of September, 1875, the said bondholders organized as a corporation, by electing from them number a board of directors, who on the next day met and elected a president, vice-president, secretary and treasurer, under said acts and joint resolutions of congress, and thereby became and still are the corporation mentioned in the first paragraph of this answer, by the name of “ The Northern Pacific Railroad Company, the defendant on whom
By demurring to this answer the plaintiff admits the allegation, that all the property, rights, liberties and franchises of, and belonging to, said Northern Pacific Railroad Company, of every kind and description “ m eluding its franchises to be a corporation,” were sold pursuant to said decree. This is averred as matter of fact, and the demurrer necessarily admits the fact. The plaintiff also admits that the said alleged sale was afterwards confirmed by the circuit court of the United States for the southern district óf New York, a court ^having jurisdiction of the subject-matter.
So, too, the plaintiff by demurring has admitted the fact that the defendant on whom process has been served, is the new organization known as the Northern Pacific Railroad Company. ■
In the face of these admissions, much of the argument made by the learned counsel for the plaintiffs, relative to the distinction existing between the franchises of a corporation, and the franchise to be a corporation appears to me to be inapplicable.
Again, by admitting that the process was served on the present company, I fail to understand how the plaintiff can contend that the defendant is a mere interloper, or that, in order to render the defense available, it should have been pleaded that process was not served on the old corporation. There is but one defendant named in the title of the action, and the corporation answering alleges that the process by which this action was instituted has been served upon it. The court cannot infer that process has been served upon another and separate organization of the same name. Indeed, if any inference is to be drawn it is that process has not been served on any other party, there being but one defendant, and it being admitted by the demurrer that process has been served upon the corporation which answers the complaint.
If I am right on this last point, without reference to the other points herein alone considered, it follows that the demurrer cannot be sustained.
Demurrer overruled, with costs to the defendants.
