Shaped Seamless Stocking Co. v. Snow, Church & Co.

Daly, P. J. The receiver’s motion was made under the pro-vision of the Code: “ In case of a transfer of interest or devolution of liability, the action may be continued, by or against the original party ; unless the court directs the person to whom the interest is transferred, or upon whom the liability is. devolved, to be substituted in the action, or joined-with the original party, as the case requires.” Code, § 756. The City Court denied the application of the receiver on the ground that the attorney for the plaintiff had a much larger interest in the prospective recovery in the action than the plaintiff, or its receiver, and that the interference of the receiver whose appointment it was believed the defendant’s attorney was instrumental in effecting, might be injurious to the interest of the plaintiff. As the granting or refusing of the motion for substitution seems to be discretionary with the court, there is nothing to review on this appeal. It is argued, however, by appellant that, while it may be within the discretion of the court to refuse substitution where the transfer of, interest is voluntary, the right to substitution is absolute where the devolution of interest is by law, as in the case of the appointment of a receiver, and the transfer of all plain [320] tiff’s property to him. The Code makes no such distinction, nor is any case to he found which observes it. On the contrary, the section quoted requires that the action shall proceed in the name of the original party, unless the court orders otherwise. The case is not the same as where, by the death of a party, the action abates until revived against the heirs or personal representa^ tives because no person is before the court to prosecute or defend, as in Requa v. Holmes, 16 N. Y. 193, cited by the appellant. This corporation plaintiff is still in existence, the receiver not hav- ■ ing • been appointed in a proceeding to dissolve it, but in a proceeding, to sequestrate its property to satisfy a creditor. Platt v. McMurray, 63 How. 149, and Yieller v. Brown, 1 Law Bulletin, 49, are relied upon by the appellant, but-the former went. no further than to hold that it was not improper to substitute an assignee in bankruptcy as a party, and in the latter no opinion appears to have been written. In cases of bankruptcy of the party the substitution of his assignee in bankruptcy is invariably granted, as without him the action becomes thereby defective. Requa v. Holmes, above, and cases cited. - I find no authority for holding that the rule in cases of bankruptcy applies to a party and his receiver in cases of sequestration under the Code. The substitution of one receiver for another is not indispensable^ but the case may proceed in the name of the original plaintiff. Hegewisch v. Silver, 140 N. Y. 420. Order affirmed, with costs. McAdam and Bischoff, JJ., concur. Order affirmed, with costs.