the power of c.orporate action .. Such as has been takenby the orator's' associates, does not now appear to be likely to deprive him of any of his legal or equitable rights. The motion is denied.
CO. OF IOWA.
(Circuit Court, D. Iowa, S. D.
McKAY AND JAUES NOLAR.l
RECEIVER OF HAlLWAy-BALE-ORDER OF
Where a railway reeeiver was discharged, and the sale of the property confinned to a newly-organized corporation, with the provision in the order of confirmation that tbe new company should pay all the debts of the receiver, and alI claims or liabilities pending in the foreclosure case, held, that the new company could not be permitted, after accepting the property, to question the validity of the order.
S.BfE-EQUITy-PAY)[ENT OF DEBTS OF RAILWAY.
It is a proper exercise of the chancery power of the court to surrender the trust property to the purChaser, retaining jurisdiction of the original case, and retaining the authority to enforce the payment of the debts and liabilities incurred by the court's receiver in the operation of the railway.
In Equity. A. McKay and James Nolan recovered judgments for InJuries received by them as employes of the receiver of the Central Hailroad Company of Iowa. They each filed their petition of intervention in the original foreclosure proceeding in which the receiver was appointed, asking that their judgments be made liens upon the railway. Both cases were by agreement submitted and argued together. John F. Lacey, for intervenors. H. E. J. Boardman, J. H. Blair, and A. C. Daly, for the Central Iowa Railway Company. J. The Farmers' Loan & Trust Company, trustee, foreclosed, by proceedings in this court, a mortgage upon the property and franchises of the Central Railroad Company of Iowa. Receivers ",ere appointed to manage the property and operate the road pending the litigation, ",hich ",as protracted. There ",as a decree of foreclosure rendered in 1875, but as the case went to the supreme court on appeal ",ith supersedeas, it ",as not until some time in 1879 that there ",as a sale under the decree, and an approval and confirmation of the same by the court. In the decree confirming the sale, and directing the delivery of the property to the purchaser, the Central Iowa Rail",ay Company, the follo"'ing order appears:
';.And it is further ordered that the lawful debts contracted by the receiver dnring the litigation, and the costs and expenses of such iitigation,
FARMERS' LOAN &
TRUST CO. V. CEXTRAL R. CO. OF IOWA.
do constitute and are herehy m:ule a first and paramonnt lien upon all saitl ploperLy, money, credit, and all ;lliditiolls thereto, tLl all uther I;ens, al1(\ to the title acquired by the purchaser at the fureclLlsnre sale, and uy the conveyance to the Central Iowa Railway Company. And since it is not desirallle to further continue said property uneler the control of the receiver, for the purpose of making net earnings for the Imyment of saill· dellts, custs, anel expenses, anel the creditors having bcen notitiell, and making lIO valid ur satisfactory objection thereto, it is further onlered and decreell Lhat all said claims, alit! all claims pending in this court, deuts, and liahilities', inclmling" the claims of attorneys and others, heretofore referred to speehl master Hagel's, and reported on hy him, and still pending on exceptions, shall be presented to the said Central Iowa Hailway Company for aeljllstmcnt and settlement, allll the sait! Central Iowa Hailway ComlJany are ordered and elireeterl to pay the said elebts, costs, and expenses, anel the creelitors entitled thereto arc hereby required to accept payment thereof, with interest at the 'rate 0[7 per cent. per annum in one year from the elate hereof. And for the purpose of enforcing' the payment thereof, if need be, this court will and dOGS retain jurisdiction of said cause for the lJurpose of enforcing said payment, and the lien herein provieled for, without other action or independent proceeding."
Undonbtedly this order is broad enough to protect the rights of the 11l'eSfmt plaintiffs, who had then pending in the foreclosure proce'3d. ing their several claims for damages resulting from personal injuries caused by tbe alleged negligence of the receivers. It.might be doubtful whether their clmms were covered bv the ,,'ords "lawful debts contractell by the receiYers," used in first clause of tIle order above qlIoted, but the second sentence of the order includes "all claims pendiug in this suit, debts, and liabilities," and retains jurisdiction of the cause for the purpose of enforcing payment thereof. These plainhad then tiled theil' claims in the foreclosure suit, so that they are clearly within the terms of the order. By the statutes of Iowa the.!' were entitled to liens upon the railroacl for the amount of their damages from the time of recovering judgment. It is evident that tlle court was unwilling to permit a sale of the property under the decree .of foreclosure, soas to deprive them of all remedy before they could have a hearing. The purpose of the above-quoted order was to turn oyer the railroad to the new company and permit them to take its management into their own halllls, but without prejudice to the rights of these plaintiffs and others wlw were then in court, seeking in the foreclosure suit to enforce claims as against the property in the hands of the receivers. They were to have just such rights as against the property then in the hands of the receiver, and in the custody of the court, as they would have had if the court had declined a decree or order of sale in advance of the hearing upon the claims of all the parties to the suit. It was to oblige the purchaser, the present respondent, that a sale and delivery were ordered in advance of the settlement of the rights of some of the parties to the suit. The court had taken control of the railroad property and franchises, and had appointed receivers to manage the business and operate the road. These receivers, through their agents, had by negligence injured some persons, and had by contract become indebted in their official capacities to
others. They were not personally liable, but the property in their hands was liable, and could be reached by suit in form against them. That property the court was asked to turn over to the purchaser in advance of the adjustment and settlement of those claims. It would have been inequitable in the extreme if this had been done without any provision for the protection of the rights of the claimants; and it would be a strange result if we were obliged now to hold that the effort to protect such rights by the order above quoted had proved futile, and that the cuurt had, by turning over the property, deprived the claimants in advance of a hearing of the means of enforcing their judgments when obtained. It is, however, insisted by respondent's counsel that the original decree of foreclosure made no provision for these claims, and that it was not within the power of the court to embody the above-quoted order in the decree confirming the sale and ordering a delivery of the property to the purchaser. In other words, it is insisted that the order relied upon is void. It may have been voidable, but it is clearly not void. The court had jurisdiction of the parties and of the property, with power to make a conditional order of confirmation. The court was not bound to confirm the sale and relinquish control of the property without making provision for pending claims. It had full authority to make such provision. Whether it was necessary to file a supplementary bill and allege the fact of the filing of these claims suusequently to the rendition of the decree of foreclosure, if such was the fact, is a question of no consequence now, for it is not one of jurisdiction, and the most that could be maintained is that the court erred in that respect. The respondent did not raise the question at the proper time. No appeal was entered. The order was acquiesced in by the respondent. It accepted the property; took its title under the very decree it now calls in question. It cannot now be heard upon questions of mere form, and which go only to the regularity of the proceedings. Decree for complainants.
MATTHEWS v. MUlleRIso::; and others.(Circuit Courl, E. D . .i.Yorth Carolina.
June Term, 1883.)
A married woman may be honnd by an estoppel, even where she has no power to hind herself by a contract. hut a married woman, who iR under a disability to contract, cannot be estopped hy in th" nature of Ii contract. To estop a married woman from alleging a claim to land, there must be some posIReport d by J. W. I1insdale, Esq., ortlle Raleigb, :Xorlh Carolina, bar.