100 Mich. 164 | Mich. | 1894
On October 15, 1891, the Owosso & Corunna ^Street-Railway Company issued its bonds in the sum of 140,000, payable in 20 years, with interest at 6 per cent., payable semi-annually. To secure the payment of the bonds it executed a mortgage upon its property, franchises, and effects to Matthias L. Stewart and Charles D. Stewart, trustees, which provided that, if the company should be in default in the payment of interest, and should remain in default for six months, the trustees
On July 10, 1893, Alexander Ralph and others presented to the circuit court for the county of Shiawassee, in chancery, a petition setting forth the execution of the mortgage aforesaid; that the petitioners were the owners of bonds issued as aforesaid of the par value of $16,000; that said company had not observed the covenants in said mortgage expressed; that a portion of the earnings of said company had been diverted, and had not been properly applied to the legitimate running and equipment expenses of said road; that said road was not being kept in. good order; that said company was allowing debts to accumulate against it; that it claimed to have borrowed $1,600 from defendant Williams, and to have given a note therefor; that, in default of payment of such note, Williams had brought suit against it, and recovered judgment for $1,800; that in June, 1893, execution was issued upon such judgment, which was levied upon the property of the company, and said Williams threatened a sale under said levy; that in December, 1892, the city of Owosso levied a tax upon the property of said company of $74.12; that, failing to pay said tax, the said city had seized upon two of the cars of said company, and had advertised the same for sale; that the township of Caledonia had levied a tax of $48.84 upon the property of said companjq but the same had not been paid; that said city of Owosso had assessed the property of said company in the sum of $38 for taxes of 1893, which was unpaid; that, claiming to be unable to pay the
A subpoena was issued and served upon Gourlay, Snow, Hough, Williams, and the Stewarts, and also upon Edwin
Upon the same day upon which the petition was filed! a motion was entered for the appointment of a receiver. On July 18, John E. Nolan, representing that he was the owner of 260 shares of the stock of said company, and bonds of the par value of $7,000, asked to be admitted as a party defendant. An order was accordingly made, and the hearing on the motion for the appointment of a receiver was postponed until August 7, 1893. Nolan appeared by his solicitor, and on August 7 filed an answer. Nolan’s answer sets up that he became the owner of the stock and bonds held by him May 25, 1893, and that he is the owner of the majority of the stock in said company; but the answer does not deny any of the allegations respecting the execution of the bonds and mortgage aforesaid, the. failure to pay the accrued -interest thereon, the existence-of the floating debts, judgments, levies, and liens, or the-fact that the company is without officers, without a board of directors, or that the .said trustees have filed their resignations and refused to perform said trust, or that the-common council of the city of Owosso was about to repeal' the ordinances granting the franchise. The hearing on the motion for the appointment of a receiver was adjourned from time to time until October 14, 1893, when a receiver was appointed, authorized to effect a loan for the purposes stated in said petition, and he did actually procure certain motors for use of said road.
After the hearing of the motion for the appointment of a receiver, the court, on September 13, filed a written-
“The undisputed facts stated in the bill and admitted by counsel for the respective parties who appear tend to show an extremely chaotic condition of the affairs of the corporation; that it is without a president, vice-president, or treasurer, and the trastees have signified their intention to resign their trust, but there are no officers to accept their resignation; that the interest on the bonds remains unpaid, and there is a floating debt of some two or three thousand dollars; and that the motor power is inadequate. Under these circumstances, a receiver should be appointed.”
On December 13, 1893, John E. Nolan moved the court to set aside the order appointing the receiver, for the reason—
“That said court had no power or authority to assume the management of the business of said company, nor to vest such power and authority in its receiver; and that said court had no power to appoint such receiver, with the power given him by such order, on an interlocutory application ex parte; and said order was improvidently made, and the court had no jurisdiction to make the same.”
Said motion was founded on the pleadings, files, and records, and was noticed for December 21, 1893. This motion, for some reason, went down, and thereupon the receiver negotiated a loan, and issued receiver’s certificates for the amount thereof. On January 4, 1894, after the term of office of the circuit judge who made the appointment had expired, and before his successor in office, Nolan renewed his motion, and the same was granted. This is an application for a mandamus directing the circuit judge to restore the order vacated.
The parties in court when the receiver was appointed represented all the bonds except $1,000, and the holder of that $1,000 was made a party defendant December 7, 1893, and, so far as appears, was content with the order