McCarthy v. Peake — 18 How. Pr. 138

Majority

p. 138

SUPREME COURT.

McCarthy agt. Peake.

Headnote

Where two suits are commenced in different courts, and the subject of the action and the parties are the same in each, the court, which first acquires jurisdiction, should dispose of the whole matter.

Therefore, where two partners commenced a suit, each against the other, to close up the partnership, and to enjoin his partner from interfering with the partnership effects, one in the superior court, by procuring a temporary in-

" junction on the 14th of September, which, with the summons, was served on the 15th of Sept, about 3 P. H., and the other commenced in this court by obtaining an ex parte order for a receiver, who took possession of the properly on the 15th Sept., and afterwards, about 8 o’clock same day, the summons and injunction were served,

Held, that the action commenced in the superior court, by the allowance of an injunction, on the 14tli Sept., conferred on that court jurisdiction, and gave it priority. The appointment of a receiver was of no more weight than the allowance of the injunction—both were provisional remedies, and either would give jurisdiction.

Where an injunction is ample to protect the property from loss until a motion can be made for a receiver, it is manifestly improper to deprive a partner of the possession of partnership property without notice, and even without being served with a summons.

p. 139

New- York Special Term, September, 1859.

Motion to set aside injunction and to stay proceedings.

The parties to this action were partners. In consequence of differences between them, each party commenced proceedings to close up the partnership, and to enjoin his partner from interfering with the partnership effects. Peake commenced proceedings in the superior court, and McCarthy in this court. In the superior court a temporary injunction was granted on the 14th September, which, with the summons, was served on McCarthy on the 15th inst., about 3 P. M. In this court McCarthy commenced his action, and obtained, on an ex parte application, an injunction, and an order for a receiver, and the receiver took possession of the property on the 15th September, and afterwards, about 8 o’clock of the same day, the process-in the action and the injunction were served on the defendant. A motion is now made to set aside the injunction in this case, and to restrain further proceedings therein, mainly upon the grounds that the superior court had obtained jurisdiction of the parties and subject matter before the application to this court, and that the appointment of a receiver on an ex parte application before service of a summons was irregular.

The subject of the action, viz., the partnership effects, and the parties, viz., the two partners, are the same in both actions, and, under the decisions which have repeatedly been made in this court and the superior court, the court which first acquires jurisdiction of the case should dispose of the whole matter; and, after such jurisdiction is obtained, any other court, in which subsequent proceedings are taken for the same purpose, should, as well from feelings of amity as from a desire to avoid a conflict of jurisdiction, restrain the further prosecution of the second action. This rule, however, is not to be extended beyond the subject matter of both actions, and would not apply where other parties were made litigants.

The question, then, in this case is, which court first obtained jurisdiction of the case.

p. 140

By section 139 of the Code, it is provided that the court is deemed to have acquired jurisdiction, and to have control of all the subsequent proceedings, from the time of the service of the summons or the allowance of a provisional remedy. In the case of issuing an • attachment against a non.resident debtor, it has been held, that such jurisdiction was obtained at the time the attachment was issued. . In either case, whether the allowance of the injunction or the service of the summons is to be considered as conferring jurisdiction, it is clear that the action in the superior court has the priority. The injunction there was granted on the 14th, and in this court on the 15th September. The summons in the action in that court was served about 3 o’clock on the 15th, while the summons in the action in this court was served about 8 o’clock of the same day. The appointment of a receiver was of no more weight, than the allowance of the inj unction. Both were provisional remedies, and either would give jurisdiction of the case to the court in which the action was brought. In the present case it may well be doubted whether the appointment of a receiver before service of the summons, and without notice to the defendant, could be sustained. There are cases of a peculiar character where such an order may be .made, but the cases are of such a nature as to require immediate ¿ction, such as those in which the party to be restrained is an idiot or lunatic, or where for any cause the immediate action of the court is required to save the property from destruction ; but where an injunction is ample to protect the property from loss until a motion can be made for a receiver, it is, manifestly improper to deprive a partner of the possession of partnership property without notice, and even without being served with a summons.

As I am of the opinion that the superior court had jurisdiction of this mátter before any proceedings were taken in this court, this motion must be granted. The motion for a receiver and for an injunction by the court can' be obtained by the defendant from that court on putting in his answer, as well as, in this court, and the interests of both parties can be much better pro

p. 141

técted by either court in one action than by cross suits between the same parties, necessarily tending to produce a conflict of jurisdiction between the two courts.

As the receiver has expended money in protecting their property, and for other purposes connected with it, by order of the court, it is proper that he should be paid p and the motion is granted on condition that the defendant pay his expenses and compensation for the services rendered. The costs of this motion to abide event.