133 Ga. 85 | Ga. | 1909
A. T. Hamilton brought an equitable petition against the Etna Steel & Iron Company and T. N. Barnsdall for an accounting, injunction, and receiver. In his petition the plaintiff alleged himself to be a minority stockholder of the Etna Steel & Iron Company, and also the owner of certain bonds of the company, and complained of certain acts of Barnsdall, the president of the company, and owner of a majority of its stock, as amounting to maladministration and intended to force the sale of the minority stock on very disadvantageous terms. It was also averred that the other directors of the company surrendered the management of the company’s affairs to Barnsdall, and that the physical properties were so neglected that their value was being rapidly depreciated. On February 20, 1908, the judge passed an ex parte order, enjoining the defendants as prayed, appointing J. M. Hunt as temporary receiver of all the property of the corporation, and requiring the defendants to show cause why the receivership should not be made permanent. The defendants answered the petition on the rule to show cause; and after hearing evidence the court, on April 28, 1908, revoked the appointment of the temporary receiver, and ordered him to restore
It requires no demonstration to show that so much of the court’s order as taxed the fees of the receiver and his counsel against Barnsdall is without authority of law. The receiver did not have possession of any of his property, and the charge can not be even viewed as in the nature of compensation for preserving property in custodia legis. The plaintiff failed in his case against this defendant, voluntarily dismissed his suit, and he can not call on him to share the burden of the costs of his own unsuccessful litigation.
Nor do we think, under the facts of the case, that the fees of the temporary receiver and his counsel should be paid out of the corporate assets of the Etna Steel & Iron Company. The general rule is that where a court improperly appoints a temporary receiver on an ex parte order, and afterwards sets aside and vacates the appointment, the receiver can not have his compensation paid from the property of which he had temporary possession. Ford r. Gilbert, 42 Or. 528 (71 Pac. 971); Pittsfield National Bank v. Bayne, 140 N. Y. 321 (35 N. E. 630); Alderson on Receivers, §§95, 611. As was said in the case of Weston v. Watts, 45 Hun, 219, “to take a person’s property from him by an unauthorized proceeding and place it in the hands of a receiver, and then subject him to the expenses of the proceeding, would be very transparently
Judgment reversed.