12 S.D. 234 | S.D. | 1899
This is an action by judgment creditors to set aside certain mortgages made by the defendant corporation, and to subject its property to the payment of their judgments. A receiver of all the corporation’s property was appointed, upon the application of the plaintiffs, and from the order making such appointment defendants appealed.
Before the application for a receiver was heard, the action was, by consent, dismissed as to Bennett, trustee. The application was heard upon the verified complaint, verified answer, and certain affidavits. From these it appears that when the action was begun the plaintiffs Swander and Congdon Hardware Company had recovered j udgments against the defendant corporation for the sums of $553.85 and $1,292.50, respectively, whereon executions had been issed and returned unsatisfied. The mortgages sought to be set aside cover all of the corporation’s property, both real and personal, and purport to secure debts aggregating §50,000. The principal issue presented by the pleadings is whether or not the mortgages were executed for the purpose of hindering, delaying, and defrauding credi
A receiver may be appointed by the court in which an action is pending, or by the judge thereof, after judgment, in proceedings inaidoi execution, when an execution has been returned unsatisfied, but courts of equity should be exceedingly slow in taking from Cue corporate authorities — the creations of legislative will — the property of the corporation, the management of its business and the distribution of its assets, and thereby accomplish indirectly that which the court could not do directly. Comp. Laws, § 5015; Smith, Rec. § 223. In this case the receiver was wholly unnecessary, and his appointment was improper. After Bennett's judgment was withdrawn, the amount of plaintiffs' claims was less than 12,000. To secure these claims, there was $100,000 worth of realty, upon which plaint