Coope v. Bowles

By the Court, Leonard, P, J. Neither the statements of the complaint nor the evidence adduced at the trial give the court jurisdiction to declare the assignment from DeAgreda, Jove & Co. to Charles S. P. Bowles, void, or to set it aside. No authority is stated in the complaint, or proven in the case, which will authorize the court to direct a receiver to prosecute an action for such a purpose. It is alleged that the'-.receiver was appointed in supplementary proceedings. That4^ not enough. The judgment and other facts necessary to maintain supplementary proceedings are wanting. A simple contract creditor cannot maintain an action to set aside an assignment for the benefit of creditors. Beceivers are appointed by the court with the like powers with the plaintiff in this case in various other kinds of actions, as in actions between partners, &c.; but the receiver must state in his complaint the equity of the parties whose rights, under the order of the court appointing him, he represents, to maintain the action which he attempts to prosecute. A receiver, in general, is not clothed with any right to maintain an action which the parties, or the estate which he represents, could not maintain. He must show a cause of action existing in both parties, and that by the appointment of the court, lawfully made in a matter where the court had [95] jurisdiction, the power has been conferred on him in his representative capacity, as receiver, to prosecute the action. The complaint and the proofs are wholly defective in these joarticulars. The judgment has not cured it. The assignment was declared void because it was not executed by all the members' of the firm personally. The firm consisted of four members; two were here and executed for themselves and also as attorneys for the others who were absent from the state. I think it was sufficiently proven that DeAgreda held a power of attorney from one of the absent members, Mr. Jove, authorizing him to do any act in connection with the business of the firm in his discretion. The proof was entirely defective in showing a sufficient power of attorney from the other absent member, Mr. Ponte. The evidence of ratification as to Ponte is also insufficient, but as to Mr. Jove there can be no doubt that he was satisfied with the act of his partners here and ratified it. It is not necessary to pursue the examination of the facts found by the referee, or his conclusions of law, unless it be as a guide to the court in this case, should there be any future trial. It must be conceded that the assignment cannot be supported, unless due authority for its execution by the absent members of the firm, or its subsequent ratification, is proven. Whatever moneys of the estate were paid for expenses, or to the creditors under the assignment in good faith, before the commencement of this action, should be allowed to the assignee, if the assignment should finally be held invalid. Payments to himself or to his own firm would not come within this principle. The referee, it appears, settled the decree and directed its entry by the clerk, but no judge of the court has directed the entry of judgment. The question is one of regularity merely, and is not a ground of reversal on appeal from the judgment. The question can properly arise only on a practice motion at special term to set it aside for irregularity. The powers of the referee to hear and decide are terminated when he has [96] made his report, with the exception that he can settle the form of the case and the findings of fact and conclusions of law. The judgment should be reversed, and a new trial ordered, with costs of the appeal to the appellant; with leave to the respondent to apply at special term to amend his complaint. [New York General Term, May 4,1865. Leonard, Olerlee and Geo. G. Barnard, Justices.]