76 Neb. 594 | Neb. | 1906
Lead Opinion
In July, 1901, Charles S. Joslin and Suviah Joslin, as trustees under the will of John J. Joslin, deceased, procured the appointment of a receiver in an action to foreclose a mortgage, wherein they were the plaintiffs and Dora E. Williams et al. were defendants.. Upon appeal to the supreme court the order appointing the receiver was vacated and the petition for the appointment dismissed. Joslin v. Williams, 3 Neb. (Unof.) 194. In that proceeding the Fidelity and Deposit Company of Maryland was surety on the bond of the applicants for the appointment. The receiver made report to the district court showing the collection of rents amounting to $257.60, and disbursements to the amount of $143.41, including his fees, and the remainder, by direction of the court, was paid over to the clerk subject to the order of Dora E. Williams, and that fund still remains in the custody of the court; and thereupon Dora E. Williams brought suit against the Joslins and their surety on the bond for
Tbe principal questions presented for determination in tbis court may be summarized, first, as to tbe effect of tbe order approving tbe report of tbe receiver and directing tbe disbursement of funds upon plaintiff’s claim for damages by reason of tbe wrongful appointment; and, second, as to tbe measure of damages. It is urged on bebalf of tbe defendants that tbe order confirming the report of thé receiver and directing the disbursement of funds in his hands amounts to an adjudication of tbe rights of the plaintiff. This contention cannot be sustained, except upon tbe theory that tbe plaintiff was compelled to litigate in that action her right to tbe damages involved in tbis action; and it would seem that a bare statement of tbe proposition ought to be sufficient to dispose of that question. Tbe accounts of the receiver are not involved, nor was there involved in the accounts of tbe receiver any question of damages which might arise by reason of bis wrongful appointment.. Tbe appointment of a receiver adjusts and determines tbe right of no party to tbe proceedings, and grants no final relief, directly or indirectly. Vila v. Grand Island E. L., I. & C. S. Co., 68 Neb. 233. Tbe discharge of tbe receiver and tbe settlement of bis accounts was a necessary result of the appointment, and was, of course, conclusive as between tbe parties litigant and tbe receiver himself, but did not have tbe effect of determining the question of damages as between tbe litigants, any more than the dissolution of an injunction or tbe discharge of an attachment would determine tbe question of damages in actions where relief by injunction or attachment is sought.
By section 269 of the code, it is provided that every order appointing a receiver shall require tbe applicant to give a good and sufficient bond, conditioned to pay all
At the trial the plaintiff Avas permitted to prove, over the objections of the defendants, the rental value of the premises during the period when the receiver collected the rents and profits, and the value of the services of counsel employed in her behalf in procuring the vacation of the order appointing the receiver. It is urge'd that the rental value of the premises was not a proper measure of damages under the allegations of the petition, and that attorney’s fees in procuring the vacation of the order
Furthermore, it is insisted that in the appellate proceedings from the order appointing the receiver counsel for plaintiff presented the case upon the theory that the property was the homestead of the plaintiff, whereas the appellate court finally put the decision upon the ground that the plaintiff’s right of possession was by reason of the provisions of section 17, ch. 36, Comp. St. 1901. That course of reasoning does not impress us with very much force. The fact remains that the plaintiff contended that the character of the property was such as to prohibit the appointment of a receiver. That contention was sustained in the appellate court, although upon a ground different from the one urged. That would not militate, however,
“The law of the state, and the bond given by Haverly and his sureties as well, provided that if it should be finally decided that this receiver was wrongfully appointed, then that Haverly would pay Mrs. Elliott all damages which she might sustain by reason of the appointing of such receiver. The word ‘all’ does not mean some, nor a part, but means the whole, the entire damage, every item of injury.”
The rule there stated is justified by the language of the statute, and, to say the least, is a common sense rule.
It is contended that the court erred in denying an offer on the part of the defendants to put in evidence the report of the receiver and the order of the district court thereon. In view of the conclusion already reached, however, we must hold that the objection to the introduction of this record was properly sustained.
In the answer of the defendants a counterclaim is set out for costs paid by the defendants in the foreclosure proceedings, which were adjudged against the plaintiff. It appears that upon the trial of the foreclosure proceedings on its merits the district court found for the defendants in that proceeding and dismissed the plaintiff’s petition. Upon appeal to the supreme court that decree was reversed at the cost of the appellee, amounting to $21. It was adjudged by the decree of foreclosure that, in default of the payment by the defendant of the amount found due on the mortgage, with interest and costs of suit (alleged to amount to $127.71, including the item of $21, costs in appellate court), the property should be sold as upon execution for the satisfaction thereof, and this, it is said, is a personal judgment against the plaintiff, which she has not satisfied, although the costs were paid out of the proceeds of the sale of the mortgaged property. No de
In the instructions to the jury given by the court on its own motion, the court advised the jury as to the allegations of the petition and of certain admissions contained in the answer, but neglected to state that the answer contained a general denial. It is complained that the instruction is erroneous and prejudicial. That the instruction is open to criticism may he conceded. In vieAv, however, of the other instructions to the jury, we do not think that the failure to call the attention of the jury to the general denial was prejudicial. The court instructed the'jury that the burden of proof was on the plaintiff to establish the allegations of her petition by a preponderance of the evidence. This instruction was certainly as favorable to the defendants as the pleadings would justify, and necessarily had the same effect as a statement from the court that the allegations of the petition were denied.. In instruction No. 3 the court said: “You are further instructed that the court did not permit evidence to be introduced in support of the cross-demand or other defense to said bond, alleged in the answer of said defendants, for the reason that, as a matter of law, said allegations in said answer are not a defense to this action upon this bond in controversy, and you will therefore not consider the same.” This instruction is also open to criticism because of the use of the words “or other defense,” but, in view of the state of the record, cannot be said to have been prejudicial. All of the rulings of the court in the matter of the introduction of evidence, to which our attention has been called, were proper; and all offers of evidence on behalf of the defendants which were excluded on objection Avere properly excluded, and no prejudice to the defendants could possibly arise out of the instructions complained of..
In defining the elements of damage for which the plaintiff was entitled to recover, they were stated thus by the
By the Court: For the reasons stated in the foregoing opinion, the judgment of the district court is
Affirmed.
The following opinion on rehearing was filed May 24, 1907. Judgment of affirmance adhered to:
This is an action on a bond given by the plaintiffs in a foreclosure suit to obtain an order appointing a receiver to take possession of the mortgaged premises, collect the rents and profits thereof pending the litigation, and apply them to the satisfaction of the mortgage debt. The plaintiff herein had judgment in the court below, which was affirmed by our former decision, ante, p. 594. The case has been reargued to the court on a rehearing, and the question now is, shall we adhere to our former judgment?
It appears that the bond in question was given under the provisions of section 269 of the code, and was conditioned : That the plaintiffs in that suit should pay to the defendant, plaintiff herein, all damages which she might sustain by reason of the appointment of the receiver, if it should be finally decided that the order ought not to have been granted. By the judgment of this court it was finally decided that the order should not have been made, and that branch of the foreclosure suit was dismissed and the pro: ceeding wholly terminated. Joslin v. Williams, 3 Neb. (Unof.) 194. It further appears that the plaintiff herein was the surviving mortgagor of the house and lot, the subject of the foreclosure suit, which was her homestead, and was therefore entitled to the undisturbed possession, use and enjoyment thereof until after sale and confirmation finder decree of foreclosure; that the receiver took charge of the property over the plaintiff’s objection, deprived her
It is contended by the defendants that the. plain tiff is not entitled to recover the rental value of the premises in question during the time she was wrongfully deprived of her right to the possession thereof, for the reason that from the nature and character of the receivership proceedings the possession of the receiver was her possession; that he was her receiver, and not the representative of the plaintiffs in the foreclosure suit. In support of this contention counsel quote from Wiswall v. Sampson, 14 How. (U. S:) *52, *65, as follows:
“The effect of the appointment is not to oust any party of his right to the possession of the property, but merely to retain it for the benefit of the party who may ultimately appear to be entitled to it; and when the party entitled to the estate has been ascertained, the receiver will be considered his receiver.”
An examination of the case from which the above quotation is taken shows that it was an action in ejectment. The plaintiff .claimed title through an execution sale of the real estate in question based on a judgment at law; while the defendant claimed title through a sale made by a master in chancery in an action to set aside a conveyance of the real estate as fraudulent, and subject it to the payment of a judgment upon which an execution had been issued and returned unsatisfied. It appears that in the equity proceeding a receiver was appointed to take charge of the property after the rendition of a decree adjudging the conveyance fraudulent as to creditors and ordering that the property he subjected to the payment of the judgment or judgments in question. There was no contention that the -receiver was not rightfully appointed, and the
Again, it would seem clear that before a receiver could be said to be the receiver of any party, especially of a party opposing his appointment at all stages of the proceedings, he must have been rightfully appointed. In the case at bar the plaintiff never' acquiesced in the appointment of the receiver, but on the other hand protested against such appointment, and took the proper steps to reverse the order of the district court in that behalf. She was successful; and the rule invoked that the receiver who was wrongfully appointed must he accepted by her as her receiver is so absurd we cannot give it our approval. It seems to us that this case is ruled by Haverly v. Elliott, 39 Neb. 201. There the plaintiff owned and conducted a confectionery store, and manufactured and sold ice cream and soda water. She also owned a stock of confections and a miscellaneous lot of furniture and fixtures used in her business. One Haverly held a lien against this property and brought suit in equity to foreclose it. He obtained the appointment of a receiver, who took possession of the plaintiff’s property and place of business, held them for some days, and then sold the property to pay the Haverly lien. It having been finally decided that the order appointing the receiver ought not to have been granted, the plaintiff sued Haverly and his sureties on the bond given to obtain the appointment of such receiver. We held that the value of her interest in the property sold by the receiver at the time he took possession of the same, and the actual loss she sustained by the suspen
Again, a party could not lawfully be required in such a case as this to expend any of the money which she was entitled to receive as the rental value of the premises in improvements or repairs thereon of any kind. Of course, it might not be for her interest to make repairs on the property. Unless the debt was paid she was only entitled to the use and enjoyment of it until sale and confirmation, after which she would be required to surrender all her rights to the purchaser. She was not required to improve the property or to repair the same for the benefit of such purchaser; and this is especially so because of the fact that, whether the premises brought much or little at the sale, no deficiency judgment could have been rendered against her. So the amount of the receiver’s fees and the costs of that proceeding, together with the money expended for repairs out of the rentals of the property, were wrongfully taken from her and converted to another’s use. It is insisted, however, by counsel for the defendants that the approval of the account of the receiver, and his discharge by the order of the district court, was binding on the plaintiff to the extent, at least, of compelling her to receive the small remainder which he paid into court in full compensation for her interest in the mortgaged premises' while she was wrongfully
Lastly, the defendants contend that they were entitled to recover' of the plaintiff the costs in the foreclosure proceeding, or a part of them, on their cross-demand in this case. It is urged as a reason for the contentiomthat a large part of the costs in that proceeding was advanced by them, and that the court erred in denying them the right to recover the costs so advanced. This contention cannot be sustained. The decree of the district court in the foreclosure case provided that out of the proceeds of the sale of the mortgaged premises the costs should be first paid, and that the remainder of such proceeds, should be applied to the payment of the amount found due the plaintiffs therein. So the plaintiff herein was not made personally liable for any part of the costs, and no personal judgment could have been rightfully rendered against her therefor. As we understand it, it is not now contended that she can be compelled to pay any part of,, the costs of the foreclosure proceedings by execution or otherwise, and we fail to understand how the value of her right of possession of the premises in question during the pendency of the foreclosure proceedings can be diminished by requiring her to pay any part of the costs of that action.. We are ashed, however, in case we adhere to our former decision, to make some order with reference to the disposition of the money deposited in court by the receiver, so that the plaintiff may not have double rent from the property in question. It would seem that this
For the foregoing reasons, our former judgment is adhered to.
Affirmed.
Dissenting Opinion
dissenting.
The defendant in the foreclosure proceedings, who is now the plaintiff in this action, was entitled to the possession and use of the premises while the foreclosure proceedings were pending. Of this use and possession she was deprived by the appointment of a receiver. It was finally determined that the receiver ought not to have been appointed. The condition of the plaintiffs’ bond given upon the appointment .of the receiver has therefore been broken and the plaintiff is entitled to recover thereon. The question is as to the measure of damages.
When a court of competent jurisdiction, and with jurisdiction of the parties and to determine the necessity and propriety of a receivership, makes an order appointing a receiver, the receiver so appointed is an officer of the court.. He is such officer of the court not only in the ordinary sense, but also in a special and peculiar sense. The actions of the receiver are the actions of the court. He performs those actions under the general orders of the court, and they are as much the acts of the court as though there had been a special order for the performance of each individual act, so far as the receiver acts only within the scope of the order appointing him. When it is finally determined that the order appointing the
A court is not to be held to be a trespasser because of an error of judgment in exercising a lawful jurisdiction, and the officer of the court executing that order cannot, for the same reason, be held to be a trespasser. • A receiver acting under the orders of the court made within its jurisdiction is generally considered to be the receiver for all parties to the litigation. If under the orders of the .court he falces possession of property belonging to a party to the litigation, he holds that property under the orders of the court for the party to whom it belongs, to be delivered to that party when the rights of the parties are determined. And in this case, when this receiver under the orders of the court took possession of the property in controversy, the plaintiff in this case was at all times in legal right entitled to have that property returned to her by the receiver, and in that sense the receiver held the property for her and was her receiver. When it was determined that the receiver ought not to have been appointed this plaintiff was entitled to an order upon the ■ receiver to return the property to her, and of course she was entitled to an order to return the proceeds of that .property which had accrued while in the hands of the receiver; and so when the receiver held the rentals of this property, he held them for this plaintiff as her receiver, and, when he ceased to be receiver, ought to have returned these rentals to this plaintiff. This is all
The improvements made upon the property by the receiver ought not to be charged to this plaintiff. These improvements, no doubt, enhanced the value of the property and so benefited the defendants and not the plaintiff. The plaintiff does not get the property, but only the use thereof until the title passed to the defendants under the foreclosure sale. It is not claimed that the rental value during the time plaintiff was entitled to
The costs paid out by the receiver ought not to be charged to this plaintiff. No doubt this plaintiff, and all other parties to the suit in which the receiver was appointed, are bound by the final adjustment of the receiver’s accounts by the court. This settlement of the receiver’s accounts shows that these costs were occasioned by the appointment of the receiver. The appointment was wrongful; and that unnecessary costs would be caused by this appointment, and this plaintiff damaged thereby, must have been within the contemplation of the principal and sureties on the bond in suit when the bond was given. If the plaintiff had paid these costs she could, of course, have recovered the amount on this bond. So far as the plaintiff has failed to get the value of the use of the premises that she would or might have received if no receiver had been appointed, she has been damaged by the appointment.
Under the judgment of the district court in this case, as affirmed by 'the majority opinion, the plaintiff recovers the full amount of the rental value of the property, and the money that is paid into court by the receiver goes to the defendants. If the law had been strictly observed upon the trial, the plaintiff would have been allowed to take the money paid into court by the receiver, and that amount would have been deducted from the damages she would otherwise have been allowed to recover. Possibly, this error might require a reversal of the judgment, and, if so, the costs of this court would fall upon the defendants, and they would be allowed a retrial of the plaintiff’s claim of damages. Apparently the result would be sub