Winans v. Gibbs & Starrett Manufacturing Co.

The opinion of the court was delivered by Horton, C. J.: It appeared upon the trial that the Gibbs & Starrett Manufacturing Company was a corporation organized under the laws of the State of Pennsylvania; that on the 1.1th day of December, 1882, Ered. W. Ames was appointed receiver for the corporation by the court of common pleas of Crawford county, in Pennsylvania. Under the appointment, Ames was receiver of the property and assets of the corporation, wheresoever the same were situated, and he had all the rights, powers, and privileges, and was subject to all the duties and liabilities of a receiver, according to law and the rules and practice in courts of equity. The trial court instructed the jury that — “There has been introduced in evidence a decree or judgment of the court of common pleas of Crawford county, Pennsylvania, appointing a receiver for this company. I say to you, as a matter of law, that this action may still be prosecuted in the name of the corporation in this jurisdiction, the Gibbs & Starrett Manufacturing Company, notwithstanding the appointment of this receiver.” It is contended that, as the statute of this state gives the receiver, under the control of the court, power to bring and defend actions in his own name, to take and keep possession of the property, to receive rents, collect debts, and vests in him [780] the only power for these purposes, he is the only person who is authorized to sue for and collect debts due the estate; that the corporation he represents has lost all control over the property — lost the right of possession, the right of its management in every respect; that it cannot maintain any action to collect debts due, any more than a stranger can. (Civil Code, § 257.) It is the established doctrine of the supreme court of the United States, sustained by the weight of authority in various states, that the receiver has no extra-territorial jurisdiction or power of official action, and cannot, as a matter of right, go-into a foreign state or jurisdiction and there institute an action for the recovery of demands or debts due to the person or estate subject to his receivership. (Booth v. Clark, 17 How., U. S., 322; High, Rec., § 239.) While the courts have generally denied the receiver extra-territorial right of action as a question of strict right, it has frequently been recognized as a matter of comity. (High, Rec., § 241.) If Ames, the receiver of the corporation, under direction of the court which appointed him, had commenced this action in Anderson county to recover, as receiver, upon the note sued on, we think he should have been permitted, as a matter of comity, to maintain the same. But the action was not commenced by the receiver; it was brought in the name of the corporation, the original party in whose favor the action accrued. The receiver, having been appointed by a Pennsylvania court, is not controlled by the statute of this state relating to receivers. Under the decisions of the court of Pennsylvania, the receiver can only sue in the name of the original party, not in his own name. (Yeager v. Wallace, 44 Pa. St. 294.) The appointment of a receiver in Pennsylvania did not destroy the corporation, and, in view of the decisions limiting the power of a receiver in bringing actions, the instruction given by the trial court was a correct exposition of the law. This action was properly brought in the name of the corporation in whose favor it accrued. As it appears from the testimony of Winans that the note [781] was given for the consideration of a span of horses, and as the consideration was not insufficient, or in any way failed, the warranty of machines had no application. Before the note was delivered or accepted by the corporation, the payment was guaranteed by Winans in writing. The consideration to the makers, alone would be sufficient to support the guaranty. (Fuller v. Scott, 8 Kas. 25; Briggs v. Latham, 36 id. 205; Daniel, Neg. Inst., §1759; Brandt, Guar., §7; Tiedeman, Com. Paper, § 417, and cases therein cited.) Even if the guaranty was given in accordance with the contract between Winans and the manufacturing company, there would have been a sufficient consideration to support it. (Standley v. Miles, 36 Miss. [7 George] 434.) The other alleged errors do not need comment. The judgment of the district court will be affirmed. All the Justices concurring.