Riffle v. Sioux City & Rock Springs Coal Mining Co.

BpaRd, Chiee Justice. The plaintiff in error, A. T. Riffle, brought this action in the district court of Sweetwater county as a stockholder in the Sioux City and Rock Springs Coal Mining Company, a corporation, against said company and other defendants alleged to be officers or persons pretending to be officers of the company; and alleging that said parties were unlawfully and wrongfully assuming to act as such officers and.were fraudulently and unlawfully conducting the affairs of the company and were fraudulently issuing the stock of the company without consideration and in general were so conducting the affairs of the company as to deprive the plaintiff and other stockholders of their interest in the company and render their stock therein of no value, and praying that the defendants might be enjoined from further managing the affairs of the company until it should be determined who were the lawful officers of the company, and for other and general relief, or that a receiver be appointed to take charge of the books and records and property of the company pending the action. It appears that the company is a corporation organized under the laws of this state, but having its principal office and place of business in Sioux City, Woodbury county, Iowa; and that prior to the commencement of this — 451 — action a similar action had been commenced in the district ■court of Woodbury county, Iowa, and that a temporary injunction had been issued by that court and the defendant Beall appointed receiver. There is no claim that the company was insolvent or that the actions were for the purpose of winding up its affairs or to dissolve it. The property of the company in this state consisted of four hundred and forty acres of land to which it had title, and five hundred and twenty acres referred to as Forest lien scrip entries. On the presentation of the petition and order of the Iowa court to the judge of the district court of Sweetwater county, an order was made similar to that entered by the Iowa court' and appointing John Hay of Sweetwater county receiver. Hay soon thereafter resigned, his resignation was accepted and he was discharged as such receiver. Whereupon Beall, the Iowa receiver, applied to "be appointed receiver in this state, which was done. Rater, in the progress of this somewhat remarkable case, Bogenreif, one of the parties to the action, applied for and was appointed joint receiver with Beall. These receivers filed an unverified report setting up a large amount of alleged indebtedness created by them against the company and asked for an order of the court authorizing them to sell certain property of the company for the purpose of paying said claims. In their application they ■particularly described the property they desired to sell, which was the four hundred and forty acres, but made no reference to or mention of the other lands or other property. The judge of the court fixed a time for hearing the application and directed notice of the time and place of such hearing to be given to the parties interested. At the time so fixed none of said parties appeared, and it is contended by counsel for plaintiff in error that no notice as ordered was ever given; and we do not find among the original papers certified to this court any proof of the giving of such notice. However, the order of the court directing the sale of the property recites that it appeared to the court that such notice had been .given. Thereupon the court entered an order directing the — 452 — sale of the entire property, including the land above mentioned, but not referred to in the application. The plaintiff in error sought to have the order set aside, which the court refused to do. The making and entering of the order of sale, the refusal of the court to set it aside and numerous other orders and rulings of the court have been assigned as error. In fact, the case has been argued here as though the case had been tried and determined and that this was an appeal and trial de novo in this court. Many of the matters so argued seem to be at issue and undetermined in the action which is still pending and has never been brought to trial. A bill of exceptions was filed in this court, and the defendants in error have moved to strike it from the record on the ground that it was not presented for allowance to the court or judge within the time allowed by law. The statute sec. 4595, Comp. Stat, 1910, provides: “The party objecting to the decision must except at the time the decision is made; and time may be given to reduce the exception to writing, but not beyond the first day of the next succeeding term.” It has been held that the time for presenting a bill of exceptions to the court or judge for allowance can not under the statute be extended beyond the first day of the succeeding term. (Smith D. Co. v. Casper D. Co., 5 Wyo. 510-14, 40 Pac. 979, 42 Pac. 213.) In the present case the order of the court allowed the plaintiff in error sixty daj's within which to present a bill. That carried the time several days beyond the first day of the next term, and while the bill was presented to the court on the fifty-ninth day after the date of the order, it was not presented until the fourth day of the next succeeding term. That was too late. The motion to strike the bill of exceptions must, therefore, be granted. The bill of exceptions being stricken from the files eliminates from the record and from pur consideration all questions presented except the question of the jurisdiction of the district court to make the order of sale which it did make. The defendants in error who have appeared and filed briefs — 453 — have moved to dismiss the proceeding on the ground of a defect of parties defendant in error. It appears that all parties to the action in the district court or parties to the proceeding in which the order was made are made parties here. Persons not parties to the proceeding in the district court are not affected or concluded by the order; and it does not appear that any objection was there raised that the necessary parties were not all before the court. “Persons, however, who were not parties in the original action are not necessary parties to the proceedings in error.” (Burdick, New Trials and Appeals, sec. 174.) “Persons who were noc parties in the district court are not affected by its judgments, and are not necessary parties to the proceedings in error for a reversal of such judgments.” (Barton v. Hanauer, 4 Kan. App. 531, 44 Pac. 1007; County Commissioners v. Harvey et al., 5 Okla. 468, 49 Pac. 1006; Patten, Lane, Merriam & Co. v. Powell & Brother, 16 Ia. Ann. 128; Hoard v. Hoard’s Adm’r., 41 Ala. 590; The Littleton Sav. Bk. v. The Osceola Land Co., 76 Ia. 660, 39 N. W. 201; Wood v. Slandenmayer, 56 Kan. 399, 43 Pac. 760.) It is also contended that the order is not a final order and not reviewable here. It has been held by this court that an order discharging or sustaining an attachment is a final order and subject to review before judgment. (Birst Nat’l. Bk. v. Moorcroft Ranch Co., 5 Wyo. 55, 36 Pac. 821; Anderson v. Mathews, 8 Wyo. 307, 57 Pac. 156.) And in the latter case it was said that the appointment of a receiver was a special proceeding and that such appointment or the vacation of the receivership may affect substantial rights and are subject to review on error. In Anderson v. Englehart, 18 Wyo. 196, 105 Pac. 571, it was held that an order denying a motion to dissolve a temporary injunction is reviewable as a final order affecting a substantial right made in a special proceeding. We think an order directing the sale of the property of a corporation by a receiver appointed for the purpose of protecting the property pending the action may equally affect the substantial rights of the parties and is reviewable-on error. — 454 — The motion to dismiss the proceedings in error is denied. The only question on the merits presented by the record properly before us goes to the jurisdiction of the court to-make the order. The receivership being for the sole purpose of preserving the property pending the action, the only purpose, in the absence of special circumstances, for which any of the property could be properly sold would be to pay the expenses of the receivership in caring for and protecting the property, and so much only should be sold as would be necessary for that purpose. In this case, as we have before stated, the receivers reported certain claimed indebtedness and applied for an order to sell certain specific property described in the application. Assuming that the parties were notified of the application as ordered by the court, it may well be that they had no objection to the sale of that particular property; but to order a sale of other and additional property, not included in the application, might be quite objectionable. Under the application the court, in the absence of the parties, was limited to making an order for the sale of the property described in the application; and beyond that it was without jurisdiction. The order directing the sale of the Forest lien scrip or the interest of the corporation in the five hundred and twenty acres of land which had been entered with such scrip was beyond the issue tendered by the application and void. To constitute jurisdiction three things-are essential: “First, the court must have cognizance of the class of cases to which the one to be adjudged belongs.. Second, the proper parties must be present. And, third, the point decided must be, in substance and effect, within the issue. * * * A judgment upon a matter outside of the issue must, of necessity, be altogether arbitrary and unjust, as it concludes a point upon which the parties have not been heard.”' (Falls v. Wright, 55 Ark. 562, 18 S. W. 1044, 29 Am. St. Rep. 74.) In Reynolds v. Stockton, 140 U. S. 254, 11 Sup. Ct. 773, 35 L. Ed. 464, the court said: “We are not concerned in this case as to the power of amendment of pleadings lodged in the trial court, or the effect of any — 455 — amendment made under such power, for no amendment was made or asked. And without amendment of the pleadings, a judgment for the recovery of the possession of real estate, rendered in an action whose pleadings disclosed only a claim for the possession of personal property, cannot be sustained, although personal service was made upon the defendant. The invalidity of the judgment depends upon the fact that it is in no manner responsive to the issues tendered by the pleadings.” Quoted in Gille v. Emmons, 58 Kan. 118, 48 Pac. 569, 62 Am. St. Rep. 609. To the same effect see Jones v. Davenport, 45 N. J. Eq. 77, 17 Atl. 570; Seamster v. Blackstock, 83 Va. 232, 2 S. E. 36, 5 Am. St. Rep. 262; Stewart v. Anderson, 70 Tex. 588, 8 S. W. 295; Munday v. Vail, 34 N. J. L. 418; Kleber’s Void Judicial and Execution Sales, sec. 244; Bailey on Jurisdiction, sec 7. As the order of the district court authorized and directed the sale of property other than that applied for and beyond the issues tendered by the application, it was erroneous and should have been set aside as having been made in excess of the jurisdiction of the court. The order of the district court directing the sale of the property is reversed and the case remanded for further proceedings. Reversed. Scott and Potter, JJ., concur.