270 F. 613 | W.D. Wash. | 1920
This is an action commenced by the plaintiff against the defendants, alleging corporate relations of the three several defendants with the principal place of business respectively at Seattle and Olympia and the corporate capacity of the United States Shipping Board Emergency Fleet Corporation. It is denominated “a suit in equity.” It alleges, in substance, that the defendant United States Shipping Board Emergency Fleet Corporation', the capital stock-of which is owned by plaintiff, wa-s the agent of the plain
It is stated “that it is necessary and desirable in the interest of all of the creditors of the corporation that a receiver shall be appointed to take charge of the property and assets of the defendants Sloan Shipyards Corporation, Anacortes‘Shipbuilding Company, and Capital City Iron Works, and to dispose of their assets and fjieir property for the benefit,of creditors and all persons interested therein.” Prayer is made “that this court may appoint a receiver or receivers of all the property and assets of the defendants, * * * with full power and- authority to collect, recover and receive and get in all tire same and dispose of said assets and property and distribute the same among creditors under the direction of this honorable court.”
The defendants, except the Shipping Board, jointly move to dismiss for the reason: First, that the complaint does not set forth facts sufficient to constitute a cause ■ of action; second, that the plaintiff is not a proper party to the said action, and that there is a mis-joinder of' parties plaintiff; third, that the court is without power or jurisdiction to appoint a receiver in the above-entitled action; fourth, that there is a'misjoinder of parties defendant.
The defendant United States Shipping Board Emergency Fleet Corporation appears “and admits each and eveiy allegation of fact in said bill alleged.”
The plaintiff relies upon subsections 5 and 6, § 741, Codes of Washington, which provides for the appointment of receivers “when a corporation * *■ * is in imminent danger of insolvency, * * * ” and “in such other cases as * * * in the discretion of the court, it may be necessary to secure ample justice to the parties,” and upon Scott v. Neely, 140 U. S. 106, 11 Sup. Ct. 712, 35 L. Ed. 358, in which it is contended the Supreme Court held that federal courts will enforce new equitable rights created by said statutes, provided such enforcement does not impair any right conferred or conflict with any inhibition imposed by the Constitution or laws of the United States.
The Supreme Court, in Hollins v. Brierfield Coal & Iron Co., 150 U. S. 371, 14 Sup. Ct. 127, 37 L. Ed. 1113, held that a simple contract creditor of a corporation whose claim has not been reduced to judgment, and who has no express lien upon its property, has no standing in a federal court of equity to obtain the seizure of the debtors property through a receiver and its application to the payment of such debt. In this case, at page 379 of 150 U. S., at page 128 of 14 Sup. Ct. (37 L. Ed. 1113), the court says:
“It is the settled law of this court that such creditors cannot come into a court of equity to obtain a seizure of the property of their debtor, and its application to the satisfaction of their claims; and this notwithstanding a statute of the state may authorize such a proceeding in the courts of the state. The line of demarcation between equitable and legal remedies in the federal court cannot be obliterated by state legislation.”
In Scott v. Neely, supra, cited by plaintiff, the claim was impressed as a lien upon property which was the main purpose of the suit, while in the instant case facts are stated which may give the plaintiff a lien upon certain property described in the complaint by reason of the allegations as to execution of a mortgage thereon, but the right of lien seems to be waived.
If the plaintiff desires to amend the complaint and seek foreclosure of its mortgage lien, permission will be granted.