Forrester & MacGinniss v. Boston & Montana Consol. Copper & Silver Mining Co.

MR. JUSTICE MILE URN delivered the opinion of the court. This is an appeal from an order of the district court (in the form of a judgment) allowing the receiver- Thomas R. Hinds, $200,000 for compensation for his. services, and $31,116.30 for expenses as such receiver, and from an order denying a. motion for a new trial of the issues involved in the matter of the claim for such compensation and expenses. Two motions to. dismiss these appeals have been filed — one by the plaintiffs and one by the respondent, Thomas R. Hinds. — 183 — The appeal from the order denying the motion for a new trial is dismissed. There is no sncli appeal known, and no such motion lies. State ex rel. Heinze v. District Court, 28 Mont. 227, 72 Pac. 613. The motions for dismissal of the appeal from the judgment fixing the compensation and expenses.must be, and are, denied. Under the aiithority of the case just above cited, appeal lies from a. judgment fixing the compensation of a receiver. The notice of appeal shows clearly that an appeal was taken from the judgment fixing the compensation, and that an appeal was taken from the order denying the motion for the new trial asked for. There is not anything to show.that the bond on appeal was not sufficient and regular in form, and properly filed. The history of this receivership would fill a volume of considerable size, and we shall not attempt to narrate it here. We merely refer for such history to Forrester et al. v. Boston & Montana Consol. Copper & Silver Min. Co. 21 Mont. 544, 55 Pac. 229, 353; State ex rel. Boston & Montana Consol. Copper & Silver Min. Co. v. Second Judicial Dist. Ct., 22 Mont. 220, 56 Pac. 219; Id. 22 Mont. 241, 56 Pac. 281; Id., 22 Mont. 376, 56 Pac. 687; Forrester & MacGinniss v. Boston & Montana Consol. Copper & Silver Min. Co., 22 Mont. 430, 56 Pac. 868; Id., 23 Mont. 122, 58 Pac. 40; Id., 24 Mont. 148, 153, 60 Pac. 1088, 61 Pac. 309; and Id. 29 Mont. 397, 74 Pac. 1088. The receiver was appointed December 15, 1898. On account of certain stays ordered by the supreme court in the numerous proceedings he was free to act as such receiver not exceeding fifteen days; that is to say, part of December 15, and part of December 10, 1898, and from the 1st of April to the 13th, inclusive, 1899. lie was in actual possession of the property from April 8th to the 13th, inclusive, and no longer. On February 28th of the same year the defendants moved the district court to vacate the order appointing the receiver. As said in the opinion of this court in certain mandamus proceedings instituted to force the district court to take up, hear and determine — 184 — said, motion (22 Mont., at page 443, 56 Pac. 868), the couxfi’s treatment of said motion and its delay in hearing and determining the same, wex*e unjustifiable, unfair and oppressive. It is apparent that the coux't’s- delay in hearing and determiniixg that motion was at the instance of the plaintiffs. The motion to vacate was taken up on April 1st, and continued from time to time, and never was determined by the district court until it was coerced by this court. The hearing was completed April 6th, and the motion denied April 10th. On April 5th the defendants, by written notice served upon the plaintiffs, offered to do and perform everything that the plaintiffs endeavored to procure to be done, and to allow judgment to be entered against themselves in favor of the plaintiffs for all costs. Defendants promptly apjiealed from the order of April 10th overruling their motion to vacate the appointment of the receiver’, and on the 13th day of the same month this court, pending the appeal, ordered that all the property then iix possession of the receiver be turned back to the defendants upon their executing a satisfactory bond. (22 Moixt. 430, 56 Pac. 868.) This was done. On June 8, 1900, the order of the district court denying the motion to vacate the order appointing the x’eceiver was reversed (24 Mont. 153, 61 Pac. 309), for the reason that the defendants had remedied the evils complained of in the plaintiffs’ complaint, and there xvas no longer any just reason why a receiver should be had. Therefore, in one of the appeals, the appointment of the receiver in the first instance was held valid. There were not any services rendered by anybody whomsoever in the matter of the receivership after April 13th; still the x’eceiver claims compensation for a period of time extending from December 15, 1898, until the 18th day of July, 1900. He was in possession of the property not exceeding six days— from April 8th to 13th, inclusive. There is not iix the record sufficient information in refereixee to his personal expenses to enable this court to determine either as to their necessity, or whether the items of expense were incurred before or after the — 185 — time he properly should have been discharged on the motion of February 28th. Therefore it appears to us that the district court erred in allowing said expense account on the evidence adduced; and the other expenses, to-wit, $14,000 for “assistant receiver” (that is, superintendent, James T. Stanford, in charge of the defendants’ property at Great Falls) ; $1,000 for Austin Brown, metallurgist; $10,000 for W. Y. Pemberton, as counsel; $5,000 for J. B. McClernan, as assistant counsel; $500' for services of M.' M. Leiter, as counsel to Supt. Stanford; and $500 for J. J. Harrington, as bookkeeper (excepting, perhaps, part of the expense incurred for bookkeeper) f‘all appear to have been incurred after the 5th day of April, 1900, excepting, perhaps, the items as to W. Y. Pemberton and J. B. McClernan, there being nothing definite in the record to show when they were employed or what services they rendered, and are not expenses which on any just principles should be paid from the property of the defendants. In no event can fees be allowed for counsel to the superintendent or other employes of a receiver. It is not necessary to waste time or space in citing authorities to support the proposition that a defendant in a receivership proceeding should not have its property taken to pay the expenses of a receiver unlawfully and unjustly kept in office as an officer of the court, when justice requires his discharge. We merely refer to McAnrow v. Martin, 183 Ill. 467, 56 N. E. 168; Ogden City v. Bear Lake & R. W. & I. Co., 18 Utah, 279, 55 Pac. 385; Willis v. Sharp, 58 Hun. 608, 12 N. Y. Supp. at page 120; High on Beeeivers (2d Ed.), 796, and cases cited. We add that the evidence shows that until the “fore part” of April 1899, the receiver availed himself of the advice and counsel of the attorneys of the plaintiffs in the receivership proceedings. Even if the court had been right in refusing to discharge the receiver, and he had been justly in the possession of the said property, the allowance of a fee of $200,000 -would have been excessive, and abuse of discretion on the part of the court. The — 186 — allowance of such a fee under the circumstances, and in the light of the history of this case as narrated and referred to above, was gross abuse of discretion. Confiscation of the property of the defendant should not follow the appointment of a receiver. For remarks and facts which are very pertinent, we refer to the opinion of Judge Brewer in Central Trust Co. v. Wabash, St. Louis & P. Ry. Co., (C. C.) 32 Fed. 187. The receiver seems to rely somewhat upon certain acts of violence exhibited toward him by the defendants and their ¿gents as important reasons why he should receive, extraordinary compensation. He testified that the defendants resisted him, threatening him with injury, and offered to assault him, in order to prevent his taking possession of the property. When this violence was exhibited is not clear, but it seems to be charged as happening after April 1, 1898. It may be.that the defendants were in contempt of court in resisting the receiver, and it may he that the state of Montana should prosecute the agents of defendants for violation of the law against crime; .but wre do not understand that the property of the defendants should be taken to pay the receiver what the state might recover as a fine, or that Thomas R. Hinds, as a privaté citizen, might recover as damages in the proper suit. Inasmuch as the receiver should have been, in justice, discharged certainly as early as April 5, 1898, when the defendant offered, in writing, t'o do the very things that the plaintiffs prayed to have done by decree of court, we hold that he may be compensated in a reasonable sum for services rendered by him prior to said last-mentioned date, and be reimbursed for all proper and reasonable expenses incurred prior thereto, and that he receive nothing and be allowed nothing for any services or expenses alleged to have been rendered or incurred after that date out of the property of the defendants, excepting, possibly, a reasonable sum for services of a bookkeeper aiding in rendition of accounts to the court. ■ If it be conceded that, under the ¡present statute (Laws Second Extraordinary Sess. 1903, Chapter 1), we have authority — 187 — to review and determine this case de novo, we have to say that, owing to the meager evidence appearing in the record, it would be impossible for us to arrive at a just and satisfactory conclusion as to how much should be allowed the receiver for his expenses and compensation. The judgment of the district court appealed from is reversed. Reversed,.