89 A. 452 | N.H. | 1914
The theory upon which third parties are admitted to defend against litigation is well settled in this jurisdiction. "The procedure, from the time of making the motion for leave to appear to the end, is governed by the court as justice requires." Martin v. Wiggin,
This is a proceeding in rem against certain property of the Salem Company. Its original object was to obtain possession of the property and foreclose the plaintiff's claim upon it. It is not a bill for winding up the corporation, nor for a general sequestration of its assets. It is important to note these features of the situation at the outset, for much of the argument has gone upon the assumption that the proceeding was of the latter class. The fact that the property is substantially all that the mortgagor owns does not alter the situation. The property was taken and is held by the receiver because it was mortgaged, not merely because it was owned by the Salem Company. From this it follows that authorities for the proposition that in a proceeding to liquidate the assets and make distribution to general creditors, such creditors may appear and make defences, are not in point.
Nor does the fact that a receiver has been appointed increase the rights of general creditors. The situation is the same, so far as their rights are concerned, as it would be if the mortgagee had taken possession and was merely asking for a decree of foreclosure.
What right have unsecured general creditors of a mortgagor to appear and insist that defences to the mortgage shall be made? So far as has been ascertained, no right of the sort, either legal or equitable, either absolute or permissive in the discretion of the court, has ever been recognized in this state. In all the cases it has appeared that the creditor had secured a lien upon the property, *148
as by an attachment. Hodgdon v. Libby,
The only exception to this rule having the support of the authorities generally is that where it is alleged that the foreclosure is collusive, general creditors should be permitted to defend. Louisville Trust Co. v. Railway,
The intervenors have no interest in the property which entitles them to be heard in their own right. But it is urged that they ought equitably to be permitted to make such defences as would be open to the mortgagor. If this be conceded, they are no better off. The fact that a mortgage of chattels is not executed and recorded as required by statute is not a defence to its foreclosure, either on the part of the mortgagor or his assignee in insolvency, who represents the general creditors. Hodgdon v. Libby, supra; Adams v. Lee,
The same conclusion must be reached as to the mortgage of after-acquired property. If such a conveyance was not authorized by the statute (Laws 1905, c. 111), it was at least a valid contract for a common-law pawn and good between the parties in any event. Pierce v. Emery,
But while there can be no sale, there can be a contract for a sale. Gilman v. Hill,
Another defence made is that the votes authorizing the mortgage were passed at a stockholders' meeting held outside the state of the corporation's domicile, and therefore the mortgage was not properly authorized. "On equitable principles, the corporation itself may be estopped from denying the validity of its acts done outside the state of its incorporation. There is no apparent reason why the doctrine of estoppel may not be held to apply to such corporate acts, if invalid, as well as to any other, where the corporation receives the benefit of its ultra vires contracts." 1 Thomp. Corp., s. 504; Galveston etc. R. R. v. Cowdrey, 11 Wall. 459. There is every reason why this doctrine should be applied in the present case. The corporation has received the full value promised for its acts and ought not to be permitted to now deny their validity. Trust Co. v. Company,
Decree for the plaintiff.
All concurred. *150