New York & Western Union Telegraph Co. v. Jewett , 6 N.Y. St. Rep. 656 ( 1887 )

Yan Brunt, P. J.:

I entirely fail to see bow the court has now any power to enter judgment in this (supposed to be) summary proceeding against the receiver, who has been, discharged from bis office by the court. It is because a receiver is the servant o£ the court, and because the funds in bis bands and property in bis custody are in the possession of the court, that the summary jurisdiction can be exercised. The moment that the receiver is discharged and released from the obligations of bis office, all right upon the court to proceed against him, upon the application of any claimant summarily ceases, and be is no longer subject to their jurisdiction, except such jurisdiction is required in the ordinary methods available to all suitors. It is ui’ged that such a rule, if applicable to the case at bar, would wort a great hardship because the petitioner bad no notice of the application for the discharge of the receiver, and that they cannot now bring an action because the statute of limitations has attached to their claim. This objection is not by any means insuperable, because if a proper reason is shown the courts may vacate the order discharging the receiver, and thus reinstate the petitioners to the position which they occupied prior to his discharge.

The case of Woodruff v. Jewett (37 Hun, 205) is no authority opposed to this view. In that case an action had been commenced against a receiver, and before the entry of the judgment the receiver had been discharged. The court held that as a judgment could only bind funds held by the defendant as receiver, a judgment entered could not do any harm, as no claim could be made against him individually thereon. The court had acquired jurisdiction by action, and such jurisdiction did not at all depend upon the fact of his being ieeeiver, an officer of the court, as in the case at bar; without a vacation of the order discharging the receiver, there seems to be no way by which the petitioners herein can enforce, by these proceedings, any claim they may have.

The learned counsel speaks of getting a judgment in these proceedings, but we have not been referred to any authority or practice which will authorize the entry of a judgment upon proceedings of this description. No relief could be obtained enforceable by an execution as upon a judgment; the only relief would be an order directing the receiver to pay out of the funds in his hands, the authority to make which seems to depend entirely upon the fact that the receiver is but the servant of the court, acting in its stead, and that all the funds and property in the hands of the receiver are in the custody of the court, and the court is administering a trust which has devolved upon it.

For those reasons, I think that the order appealed from must be affirmed, with costs.

Lawrence, J., concurred.

Judgment affirmed with costs.