Tracy v. First National Bank of Selma

Tracy v. First National Bank of Selma. Right of appeal.—Receiver. An appeal lies from all order refusing to vacate an attachment, where it is asked as a matter of strict right. But the receiver of an insolvent corporation has no right to take an appeal from such order, until he has been made a party, by order of tire court. Appeal from the general term of the Supreme Court, in the first district, where an order denying a motion to vacate an attachment had been affirmed. This was an action by Buford A. Tracy against the First National Bank of Selma, in Alabama, to recover the amount, of certain checks drawn by the defendant upon the Ocean National Bank of New York, amounting in the aggregate to $8500. The plaintiff procured an attachment to be issued, which was levied upon a sum of money standing to the credit of the defendant in the Ocean Bank. The defendant was a national bank, organized under the act of congress of 3d June 1864, and as a depository of the United States government, had received public funds, amounting in the aggregate to $75,000. On the 12th April 1867, a treasury draft for $75,000, was presented at the defendant’s counter, at Selma, Alabama, and payment refused, for want of means to pay the same. On the 15th April, without knowledge of such refusal, the plaintiff received from the defendant the eight several checks upon which this suit was brought; which were presented to the Ocean Bank, on the 27th, but, in pursuance of instructions from the treasury department, payment was refused ; due notice of which was given to the defendant. On the 29th, this suit was commenced, and the funds of the defendant in the Ocean Bank were duly attached therein. On the 15th April 1867, the Bank of Selma was taken possession of “ by the military authorities of the United States,” and its assets remained in such custody until about the 1st May, when one Mr. Cadle was appointed receiver of the bank under legal proceedings; who at once entered upon the performance of his duties. On the 14th August, the receiver applied to the special term for an order requiring the plaintiff to show cause why the Receiver should not be made a party to the proceedings, and why the warrant of attachment should not be vacated. Upon the hearing, it was ordered, that the motion to vacate the order of attachment be denied, but no notice was taken of that part of the order asking that the receiver be made a party to the proceeding. The order so made was affirmed by the general term, whereupon, the receiver appealed to this court, and the plaintiff moved to dismiss the appeal, on the grounds: 1. That the receiver had no standing in court, to authorize him to bring an appeal: 2. That the order was not appealable: 3. Upon the merits. Smith, for the motion. Chittenden, contra. Also reported in 5 Irans. App. 14. [MAJORITY — Hunt, C. J.] Hunt, C. J. I am of the opinion, that the objection that this order is not appealable to this court, is not valid. The receiver insists, that as a matter of law and of strict right, the attachment in this case was illegal, alleging that the defendant is not a foreign corporation, within the statute, and also, that the cause of action did not arise in this state, and also, that the priority of the United States’ claim renders the attachment invalid. He bases his objection upon strict law and a claim of right, conceding that he cannot control or influence the discretion of the court below. In such ease, the order has frequently been held to be appealable to this court. (King v. Platt, ante 155; People v. New York Central Railroad Co., 29 N. Y. 418; Wakeman v. Price, 3 Id. 334; Buffalo Savings Bank v. Newton, 23 Id. 161.) In the first two cases, the appeal was sustained', and in the last two, it was not sustained, on the ground I have mentioned. The objection that the receiver has no status in court, I regard as fatal. The action was commenced against the bank,, before the appointment of a receiver, and, so far as the papers show, is still in progress under that title. .There is no *legal objection to its continuance in that form, until final judgment is obtained, and such is the common practice in this state. Under §§ 121, 122 of the Code, it was competent to the receiver to apply to make himself a party, either on the ground that all the interest of the defendant had become vested in him, or that the rights of all parties could not be properly settled, unless he should be made a party to the action. He made such an application, but, for some reason, unexplained in the papers, took no order on that branch of the case. There is no ground upon which the receiver can directly interfere in such a case, by giving notice of a motion and conducting an appeal, whether we concede the right of the plaintiff to continue his suit against the defendant in its own name, or whether it be conceded, that upon the dissolution of the corporation, the receiver became the necessary party defendant, as the legal successor of the defendant. A motion to dissolve an attachment, like any other motion in a suit, can only be made by a party to the same. (In re Griswold, 13 Barb. 412; Ketchum v. Ketchum, 1 Abb. Pr., N. S., 157; Isham v. Ketchum, 46 Barb. 43.) During the life of a defendant, all motions on the part of a defendant must be made in his name. Upon his death, or upon the dissolution of a corporation (where the suit is not continued against it by name), an exec - utor or a receiver must be appointed, and must apply to the court to be made a party to the suit, asking an order that the same may be continued in his name. In neither case, can he appear or move, until such order is obtained. He is a stranger to the proceedings. The receiver had no status in court to make the motion below, or to appeal to this court. (Thacker v. Bancroft, 15 Abb. Pr. 243.) The appeal is dismissed, with costs. Appeal dismissed. The learned judge proceeded to discuss the merits, but there was a difference of opinion upon some of the points ; and the case was decided upon th® express ground that the receiver had no standing in court.