252 F. 365 | 6th Cir. | 1918
(after stating the facts as above).
“ * * * Having kept silent and permitted the expenditure of these moneys, the issuance of the receivers’ certificates, with the priority which was attempted to be given (appellant) cannot now be heard to complain. He knev that the other bondholders were putting up the money and were financing this enterprise; that they were attempting to preserve the plant and. make it worth something, and to put it in a condition where it might be sold. He kept silent, not only as to his ownership of this portion of the bonds, but also as to any objection that he had to that proceeding, and, in equity, I do not think that he can claim at this time the benefits of what he permitted others to do. * * * He had notice of all the orders for the issuance, and of the issuance, of the receivers’ obligations, and still he kept silent until the money had been expended and until the enterprise proved to be a failure, and then he seeks to have himself preferred to those who have borne the burdens. I do not think that a court of equity can lend its aid to such a contention.” “
We approve these findings and the conclusion of the court. The appellant’s silence explains the fact that he did not consent to the issuance of the receivers’ certificates; that is, as we interpret the course he pursued, he did not affirmatively consent; but, unless form is to usurp substance, his conduct is none the less binding upon him. True, it is urged that the evidence fails to show that appellant was aware of the facts ascribed to him in the opinion of Judge Sessions.* Presumably the appellant would have kept in touch with the acts of the receivers, since he admits that the interest accruing on his bonds was in default throughout the entire litigation. Testimony was introduced at the hearing of July 6, 1917, which tends to show that appellant • was conversant with the various proceedings taken and orders made during
2. Among appellant’s objections to the reports of the receivers it is stated, and made the subject of an assignment of error, that they made improvements and betterments of the property and incurred indebtedness without the approval of the court. These assertions are in effect refuted by what is shown in the statement of facts, and particularly by the findings of the court.
4. Several contentions are made, whish have neither fact nor assignment to justify them. One is, for instance, that there was “collusion between the trustee, Fernald & Co., and the receivers.” There was no issue tendered, and no testimony offered below, in relation to such a. charge. It is not suggested that Reynolds’ course was actuated by any improper motive, and yet appellant’s bonds are but part of the Reynolds honds. Appellant does not seem to appreciate the evidential effect of the concurrence of all the other interested parties in the very proceedings and orders which he alone challenges. Whatever rights he may have originally possessed, his long neglect to assert them, and the inevitable misleading effect of this upon the court and parties alike, must be held to estop him from claiming priority in virtue of the mortgage lien.
The order appealed from will be affirmed, with costs.
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