Muncy Creek Railway Co. v. Hill , 1877 Pa. LEXIS 204 ( 1877 )

Mr. Justice Woodward

delivered the opinion of the court,

Under the writ issued to him as sequestrator, Michael Steck took possession of the buildings, rolling-stock and equipments of the Muncy Creek' Railway Company on the 1st of March 1874. He appointed agents to operate the finished section of the road, and through them collected and took into his custody its receipts and revenues during the months of March and April. On the 1st of May 1874, officers employed by the corporation took the property into their hands, and have since retained it under the corporate control. While the right of the sequestrator to receive the earnings of the road has not been denied, the company have constantly insisted that they are entitled to the possession and management of their real and personal estate. The question is a narrow one, and has been raised by the petition of the sequestrator for an attachment against the persons who assumed the control of- the property on behalf of the company. A rule to show cause was granted, upon which, after hearing, the Common Pleas decreed the surrender of “ that portion of the Muncy Creek Railway which is so far completed as to be in running order, together with its turn-tables, engines, cars and other equipments” to the possession, control and management of the sequestrator, “for the purpose of collecting, receiving and taking custody of the receipts and revenues thereof.”

There is no doubt whatever that the action of the court would have been fully justified by the provisions of the 73d, 74th and 75th sections of the Act of the 16th of June 1836, if they had remained in force. By. the 73d section, after the return of an execution against a corporation unsatisfied, a writ was authorized “ to sequester the goods, chattels and credits, rents, issues and profits, tolls and receipts from any road, canal, bridge or other work, property or estate of such corporation.” The 74th section made it the duty of the sequestrator to “ take charge of the property and funds,” and to make due distribution of their proceeds. That a sequestrator, under the Act of 1836, was entitled to assume the control of the works and structures out of which revenue was derived, has been repeatedly settled by judgments of this court: Turnpike Co. v. Wallace, 8 Watts 316 ; Bevans v. The Turnpike, 10 Barr 179; and Beeler v. The Turnpike Co., 2 Harris 162. The idea of a transfer of possession is embodied in the etymological signification of the word sequestrate. Its original meaning was to give up for safe keeping. Throughout the civil law and common law precedents, process of sequestration against revenue or income has been treated as carrying with it the right to the possession of the property out of which the revenue or income issued.

It is competent, however, for the legislature to confine the process to stricter limits. And the peculiar language of the Act of the 22d of April 1858, indicates a purpose to modify and restrict in essential respects the remedy by sequestration as against a particular class of railroad corporations. It declared that so much of the Act of 1836 as related to the appointment of sequestrators in cases of judgments recovered against corporations should not apply to any unfinished railroad. The enactment was followed by this proviso: “ That nothing herein contained shall be so construed as to prevent a sequestrator from taking custody of the receipts and revenues of any portion of any such road that may be so far completed as to be in running order.” The difference between the phraseology of this act and that of the Act of 1836 is marked and significant. The effect of the later statute is to declare that “the goods, chattels and credits', rents, issues and profits, tolls and receipts” of an unfinished railroad shall not be sequestered, and that a sequestrator shall not “take charge of the property and funds” of such a railroad, but that he shall have power to “take custody of the receipts and revenues” of any completed section. The act was drawn with apparent care, and so as to anticipate and avert any implication to be founded on the confused employment of technical words. Property was “sequestered” under the Act of 1836. The Act of 1858 simply authorized the payment of income to a sequestrator for the benefit of the creditors of the corporation.

While it would be equally unprofitable and unnecessary to conjecture the motives for the legislative action, it is possible that the public interest was supposed to be involved in the completion of a railroad partly built, and that the maintenance of the corporate property under the control of a board of directors might be essential to that result. The attainment of this end can be made entirely consistent with the appropriation to creditors of the income derived from the finished road. No embarrassment can arise in carrying out the intention of the legislature, for there is ample inherent power in the Court of Common Pleas to enforce the performance of the duties equally of the directors and the sequestrator. In the decree that has been made, however, that power has been exercised in a wrong direction. It was the design of the Act of 1858 to give to the representative of the creditors the earnings of the completed portion of the road, but it was equally its design to preserve the corporate property within the .possession, management and control of the corporate officers.

The judgment of the Court of Common Pleas is reversed, and it is now ordered and adjudged that the rule to show cause why an attachment should not be issued be discharged, and that the petition of the sequestrator be dismissed.