Weems v. Lathrop

| Tex. | Jul 1, 1874

Gould, J.

The first and principal question is, whether the appointment of Brooks as receiver expired at the next term of court after it was made. Ordinarily the appointment of a receiver continues during the pendency of the suit, until the decree is rendered. In the forms of such orders, at least in some of them, no time is expressed. (Edwards on Receivers, 563, 381-2; Williamson Nilson, 1 Bland, 428-438).

Such being the general rule, growing out of the fact that the reasons for the appointment usually continue to operate until the case is tried and decided, it follows that where the term of his office is intended to be limited, that intention should be expressed. In this case, that part of the order which makes the appointment, .and where we would naturally look for the limitation, not only fails to express any such purpose, but in its terms makes the appointment according to the prayer of the petition, which was for a receiver “ to take possession of “ said trust negroes, now remaining on said plantation, and to “ hire out the same from year to year, until the termination of “ this cause.’' It is true that the order proceeds to instruct the receiver to hire the slaves for a year, and to report his actions at the next term of the court, and it is argued that this shows the intention that his office should not extend beyond that term. It is usual and proper to embody in the order instructions for the guidance of the receiver, and to which he looks to see the nature and extent of his duties and authority. But we think the inference unauthorized, that the term of office does not extend beyond the period of time to which the original instructions extend, or rather the time at which the officer is required to report. In due time instructions were given for another year. That they were given by consent of parties certainly does not make them any less the instructions of the court to its officer.

It is argued that the temporary notice of the appointment is to be inferred from the fact, that it was made at chambers, before answer, and so far as the record shows, without notice. If, in fact, there was no notice or consent, it was irregular to make the appointment, unless the case was one of urgency, where irreparable injury might result from delay (Kerr on Rec., p. 137; 1 Dan. Ch. Pr., pp. 1734—5), or where defendants, or some of them, were out of the jurisdiction of the court. Verplanck v. Ins. Co. (2 Paige, 448). That the appointment was made as it was, shows, that in the opinion of the judge by whom it was made, the circumstances of the case justified it, but can assuredly have but slight weight in constructing the order. The question before us is not whether the order was erroneous or not, but what is its true meaning : and we are satisfied that it conferred on Brooks the office of receiver whilst the suit was pending, unless he was sooner discharged.

It is contended that under his instructions the receiver had no power to collect the notes which be took for the hire of the slaves. The order does not in terms confer such authority. The usual and better practice is, to give such instructions as leave no ambiguity as to the duties and authority of the receiver. The nature of the office and of the duties expressed in the order, are perhaps such as to justify the conclusion that Brr '-" was authorized to receive payment of notes taken by am yable to himself, and remaining in his hands at maturitj JBut whether he had such authority or not, if, as alleged, he ; collect and thereby place it out of his power to account fa ne notes, otherwise than by producing the money, and fa ,d to do so, it is clear that he did not faithfully discharge hi» duties as receiver, and his sureties are liable on their bond.

It is further objected that the receiver Lathrop had no authority to sue on the bond of his deceased predecessor Brooks, because an order of court was not first obtained authorizing such suit. The record shows, however, that the suit was brought in the same court where the original cause was pending, and tliat previous to the trial, that court made an order approving his action in bringing suit on the bond, and instructing him to proceed with its prosecution; and this was alleged in an amended petition. Any defect'of authority which may have affected the original petition was cured by the subsequent order and amendment. It is not deemed necessary, therefore, to pass upon the general question of the authority of a receiver to institute a suit, more especially a suit on the bond of a former receiver, without first obtaining an order to do so. The liberality of our practice, admitting even of amendments setting up new causes of action, would leave it only a question as to the costs previous to the amendment.

But it is said that the executrix of Brooks (whose estate is alleged to be insolvent) and his securities had the right to have his accounts passed before the court, and to turn over the property and have the bond canceled. If they had applied to be allowed to do so, doubtless the privilege would have been accorded and liberal terms conceded to them. Hot having done so, it would seem that the court had no means of ascertaining what was due from Brooks. As he was dead, the ordinary remedy of proceeding against the receiver for contempt of court was impracticable, and under these circumstances it has been held the remedy is against the sureties on their bond (Ludgater v. Channell, 3 Mac and Ger. (49 Eng. Ch.), 175; Kerr on Receivers, 239, 240).

The objection that Lathrop was not a party to the bond has no force. Under the order of the court he represents all parties interested in having the bond enforced, and had the right to sue in his own name. Ho authority to use the names of others was required.

We have disposed of the questions argued in appellant's brief, and regard them as decisive of the case. Whilst in doing so we have endeavored to follow the rules and decisions of Courts of Equity, it is proper to observe that the difference in the organization of our courts makes these rules often inapplicable under our practice. We" have no statute regulating th'e subject of receivers. Though the authority of the courts to appoint them has been long recognized, yet the record in this case shows that the practice in making such appointments, and in calling the officer to account, is unsettled and loose. Appellee Lathrop was appointed without at first any designation of his duties. Brooks appears to have acted for at least ten or eleven years without ever having been called to pass his accounts, and without any instructions as to the investment of moneys. On the trial of this case the court withdrew from the jury the consideration of any other matters than those occurring in 1859 and 1860. Appellee, however, makes no complaint on this point. He was allowed interest on the amounts due for those years, although no order of court had been made requiring the payment of the money into court. The absence of such an order would be no excuse to the receiver under the English Equity rules, requiring him to account. (Potts v. Leighton, 15 Vesey, 273.) Bo exception was taken at the trial or fn the motion for new trial to the charge of the court on the subject of interest. If the point were properly before us, we cannot say that it was erroneous to charge interest against . the receiver under all the circumstances of the case.

The judgment is affirmed,

Affirmed.