A. H. Andrews & Co. v. Stanton , 18 Ill. App. 163 ( 1886 )

Wilson, J.

The only question we are called upon to consider in the present case is whether, under the facts as reported by the master, appe llant’s claim was cognizable in a court of equity or whether as held by the court below his only remedy was at law. We understand it to be the well established practice that parties having claims against a company or corporation, in the hands of a receiver, may come into court by intervening petition and have their claims adjudicated, or by leave of the court may institute suits at law therefor. The possession of the receiver is regarded as the possession of the court from which he derives his appointment, and the court will not allow any interference therewith nor tolerate any attempt to disturb him in his rightful possession without leave being first obtained for that purpose; High on Injunctions, Sec. 139. In Daniell’s Ch. Pr., page 1057, it is said, “ Where any person c’aims to be entitled to an estate or other property sequestered, lie should apply to the court to direct an inquiry whether the applicant has any and what interest in the property. This inquiry is called an examination pro inter esse suo.” And in Hunt v. Priest, 2 Dickens, 540, the mode of proceeding in such cases is stated thus: “After the examination, the other side hath liberty to examine witnesses to falsify the exam'nation * * Then an order is made to refer it to the master to look into the examination and depositions, and to certify whether the claimant hath made out any, and what, interest in the premises or in any, and what part thereof. The report the master makes is set down to be heard for directions, and the court pronounceth a final order,” citing Fawcett v. Fothergill, decided in the high court of chancery in 1699. And see Story Eq. Jur., Sec. 833; Noe v. Gibson, 7 Paige Ch. 513; Richards v. People, 81 Ill. 551.

For the purposes of our present inquiry it must be assumed that the receiver had in his possession an ascertained amount of royalties derived from the estate which the court, through him as its instrument, was administering; since the court, without passing upon the master’s report or inquiring into the merits of the case, vacated the order allowing the petitioner to intervene, upon the sole ground that his remedy was exclusively at law. We think it very clear that the court fell into an error. The money paid to the receiver for the desks furnished the board of education included and covered the royalties due from the Booth & Osgood Manufacturing Company to appellant, and was a trust fund in the receiver’s hands for appellant’s use. Under these circumstances there was no necessity or propriety in sending the petitioner to a court of law. The amount due him was already ascertained, and was aprima faaie correct. Had the claim been for an alleged tort or for unliquidated damages, the court might, in its discretion, have properly sent the case to a jury to settle the legal rights of the parties and ascertain the damages, retaining the case for ultimate disposal by the court. But the rights of the parties had already been settled by the master and there was no occasion-for a jury. The case is simply, in substance a proceeding to have the receiver decreed to be a trustee for appellant for moneys in his hands paid by the city by way of royalty for seats furnished the board of education. We are of opinion that the court below, sitting as a court of equity, had jurisdiction and ample authority to hear and determine the case.

The decree will be reversed and the cause remanded for further proceedings not inconsistent with this opinion.

Reversed and remanded.