16 N.J. Eq. 117 | New York Court of Chancery | 1863
The bill in this case was filed on the twenty-third of October, 1861, and an injunction thereupon issued against the defendants as an insolvent corporation, restraining them from exercising their corporate powers.
On the twenty-ninth of October, 1861, receivers were appointed, by whom the affairs of the company are being settled, and who now ask the direction of the court in the disposition of the funds in their hands.
The company was incorporated under the provisions of the act of 1849, authorizing the establishment of manufacturing companies, and of the supplements thereto. Nix. Dig. 492. By the forty-second section of the act, it is provided that, “ in case of the insolvency of any company formed under the provisions of this act, the laborers in the employ of said company shall have a lien upon the assets thereof for the amount of wages. due to them respectively, which shall be paid prior to any other debt or debts of the company.” At the time of filing the bill and issuing the injunction, the company was indebted to about forty laborers in the sum of $2208.07. Of these laborers, only twelve were in the actual employ of the company at the time of filing the bill. The others had ceased working for the company at various times, from and after the twenty-third of March preceding. It is insisted on the one hand, that they are all entitled to priority in payment over the other creditors of the company; and on the other, that those laborers alone are entitled to priority, who were in the employ of the company when the proceedings in this cause were instituted, and the business of the company restrained. By the terms of the act, the lien upon the assets of the company, and consequent priority in payment, is not given to laborers to whom the
The act respecting insolvent corporations, under which these proceedings were instituted, looks to the suspension of the ordinary business of the company, or some overt act by which its insolvency may be ascertained and declared. The court cannot, upon an inquiry of this nature, undertake to investigate the financial ability of the corporation at previous periods, founded upon mere failure to meet its engagements,
The apprentices of the company are entitled to their wages without regard to the time that they were last actually laboring for the company. There is no evidence that they were discharged or released from their indentures prior to the act of insolvency. Their legal rights cannot be affected by the refusal or inability of the company to furnish them with employment.
It appears from the receivers’ report, that large expenses have been incurred in repairs to the real estate, and to the machinery covered by mortgages and executions, and in employing watchmen for the safe keeping of the property, both real and personal. It is proper, therefore, that it should be referred to a master, to ascertain and report what, and to what an amount of the said expenses and disbursements shall be paid from the fund raised from the sales of machinery and personal property encumbered by said mortgages and judgments. The receivers’ accounts will also be referred to a master, with directions to examine, and, if necessary, to restate the same; and also to report what will be a reasonable and just compensation to bo allowed to the receivers.