O'Mahoney v. Belmont — 37 N.Y. Super. Ct. 223

Majority

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JOHN O’MAHONEY, Plaintiff, v. AUGUST BELMONT and ERNEST B. LUCKE, Defendants.

Headnote

A receiver who has been appointed in an orderly and legal way and by a court having jurisdiction, and who has in good faith entered upon his duties as such, should be protected by the court in his proper action under the order while it is in force, and be fully allowed and indemnified out of the fund entrusted to Ms guardianship for legal charges and disbursements reasonably made and incurred, although the order should be afterwards reversed for error.

But in a case in which "the court was not empowered to appoint a receiver, and where an attempt was made, in a simple action for money had and received, to apply the provisional remedy of a receivership, and where there was neither allegation nor proof that there was the slightest danger of the fund or of the money sought to be recovered in the action being lost, or destroyed, or in any way jeopardized during the pendency of the action; the manner in which the appointment of the receiver was effected, and the part he took therein, affects seriously his position and claims.

If he intruded into the office, and obtained it by his own seeking, in violation of the rights of the defendants and by a breach of the rules and practice of the court, and the order for his appointment was made and entered through a breach of the stipulations of the parties and their counsel with each other, and without being asked for by either, and in opposition to their wishes, and before the case was actually submitted by the parties to the judge, and tM’ough the

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procurement of a stranger to the suit, who proved to be the counsel for the receiver, it cannot be reasonably claimed for him, that he is entitled to that consideration and favor with which the law regards receivers who are regularly and in the orderly and ordinary method of judicial procedure constituted as such.

This question arises upon the facts in the case. Upon whose application or urgency was this appointment ordered, or. who, taking advantage of the then condition of the proceeding, by deceit, fraud, or other bad faith obtained the order from the judge for tho receiver’s, appointments ? The inference that the counsel and attorney of the receiver obtained the same with full knowledge of all the facts and circumstances of the case, seems unavoidable. He was a stranger to the suit and proceeding and represented no interest involved therein, and had no right to take part in or. to seek to influence the proceedings in court (Attorney General n. Day, 2 Madd. 246).

He was informed and notified immediately after he had obtained the order and before its entry, by the plaintiff’s counsel, that the order was improperly obtained, that the case had not been submitted, and that neither of the parties wanted a receiver, and that negotiations were pending for a settlement between the parties. Here was a distinct notice to the receiver, through his counsel, of the condition of the case, and the opposition of all parties interested in the action, to any receivership. If the receiver proceeded further, after this notice, he did so at his own peril and risk. This was on July 16, and the receiver promised that the order should not be entered until July 19. But in defiance of the notice and by a breach of the promise of the counsel, the order was entered next day (July 17). From the rapidity with which the receiver and his counsel moved in the matter on the 16th and 17th, it would seem that they were equally familiar with the character and condition of the suit, and were anxious to get possession of the fund in suit before the action could be settled by the parties.

Subsequently the receiver and his counsel instituted severe and successful measures, against the wishes and protest of both parties, to obtain the possession of the fund. Although nominally taken in the action, it is apparent that they were not taken in the interest of the parties of the suit or any of them.

It cannot be that proceedings for the appointment of a receiver, thus initiated and completed, can give the appointee any just claim of which he became thus possessed to his charges, expenses, and disbursements.

A person cannot thus thrust himself into a receivership and obtain

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possession of a fund, which needs no protection, against the wishes and protests of all concerned, and afterwards fasten upon that fund the charges incident and consequent to his intrusion, for moneys paid out by himself, and for the services of the attorney and counsel, employed by him to inaugurate needless litigation, and to defend his position and acts.

The receiver has voluntarily placed himself in the position he occupies, and the order appointing him having been reversed, as also the order directing the money to be paid to him, and the action itself terminated by a judgment in favor of defendants, who were compelled to pay him the money, or fund, whatsoever loss the fund has suffered while in his hands, he must bear, and he will not be allowed to shift it from himself to the parties.

Before Van Vobst and Sbeib, JJ.

Decided April 4, 1874.

The complaint alleges substantially, that in the year 1865, the plaintiff deposited with the firm of August Belmont & Co., which firm is alleged to have been composed of the defendants, gold to the amount of nineteen ■ thousand five hundred and ninety-two dollars and forty-four cents, that the defendants drew four bills of exchange for the amount, payable in' pounds sterling. The bills were severally addressed to N. M. Rothschild & Sons, London, and were payable to the order of John O’Leary, sixty days after sight, and were delivered to the plaintiff. That the bills were drawn by Belmont & Co., at the plaintiff’s special request, and that he paid to them his money to the amount represented by said bills of exchange, and that they were delivered to him for a valuable consideration. That plaintiff endeavored to transmit the bills by mail to O’Leary, the payee, who was the mere agent of the plaintiff, that the bills were abstracted from the mail or were destroyed, and never came to the possession of O’Leary. That they had never been presented for payment, and were unpaid.

That the defendants have withdrawn the moneys placed by them to the credit of the bills with Rothschild & Sons, and now hold the same. Plaintiff avers

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that he has demanded the moneys of the defendants, and has executed and tendered to them a bond with good and sufficient surety, in double the amount represented by the bills, to indemnify and save them harmless against the same, and all claim thereon in favor of any person. That the defendants refused to receive the same or pay the money represented by the bills, or receive any bond unless the sureties would justify in the sum of five hundred thousand dollars.

The complaint contains a separate cause of action for moneys to. the amount of nineteen thousand five hundred and ninety-two dollars and forty-four cents, had and received to and for the plaintiff’s use.

The plaintiff demanded judgment against the defendants for damages in the amount of such money in gold or its equivalent in currency. That the money might be deposited in court. That a receiver be appointed to take charge of the money. That the bills, when found, be delivered up and payment cancelled. The complaint was0verified by the plaintiff on June 30, 1869, and was upon that day presented to one of the judges of this court, together with an affidavit made by Roger J. Page, the attorney for the .plaintiff, verified on the same day. Whereupon the judge made an order as follows:

TST. Y. SUPERIOR COURT. .

John O’Mahoney,

Plaintiff, agst.

August Belmont and Ernest B. Luche,

Defendants.

Upon the verified complaint in this action, also on reading the affidavit of the plaintiff’s attorney therein,

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and also on the service of this order upon the defendants herein. On motion of H. E. Tallmadge, of counsel for the plaintiff, it is ordered, that the defendants in the said action show cause before me, at chambers of this court, court-house at the city of ISTew York, on July 2, 1869, at 10 o’clock A. m., why a receiver herein should not be appointed to take charge of, and receive the gold or moneys deposited by the plaintiff with the defendants, in consideration of the bills of exchange mentioned, such bills alleged to be lost or destroyed, with full power to discharge the defendants from the same, and the payment thereof, upon the defendants’ paying into this court, or such receiver, the amount of gold so deposited by them, or its equivalent in the currency of the United States; that such receiver be so appointed with usual powers and directions, and that the plaintiff have such other or further order and relief in the premises as may be just and proper.

Dated June 30, 1869.

(Signed) JOHN H. McCUIW,

Justice Superior Court.

A copy of the complaint and order of June 30, were served on the defendant Lucke, on July 1. The defendant Belmont was absent from the country, and could not be served. Application was made by the defendants’ attorneys to postpone the hearing, and the same was by order adjourned until July 9, on which day the defendant Lucke answered the complaint. The answer denies the copartnership of the defendants at the time when the bills were issued, and sets up substantially that the bills of exchange were sold by August Belmont, in the usual course of his business, as a banker, across his counter. That at the time he drew the bills, the defendant, August Belmont, remitted the funds in gold to the drawees for the payment of the same, and that the bills would have been accepted and paid if presented. That the money has

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not been withdrawn, and still remains in the hands of the drawees. That defendants have never received any notice of protest for non-acceptance or non-payment of the bills, but are informed that no demand for acceptance or payment has been, in fact, made upon the drawees.

The defendant admits that the plaintiff proposed to give a bond of indemnity, if the money was paid to him, but alleges that he has not tendered a good and sufficient bond. The defendant says that he is not one of the drawers of the bills, and has no interest in them. He denies that the plaintiff or O’Leary ever had any money on deposit with him or the defendant Belmont, and claims that Belmont had discharged the duties imposed upon him as the drawer of the bills, and is under no liability to the plaintiff.

The answer further alleges that the bills came into the possession of O’Leary, to whose order they were payable. That O’Leary was afterwards duly tried and convicted in the United Kingdom of Great Britain and Ireland, before one of the courts of the kingdom having jurisdiction of the crime of felony, namely, of high treason. That the kingdom of Great Britain claims to be entitled to the bills and the money as forfeited to its use, and have given notice to the drawees of such claim, and notified them not to pay the bills to any person. That the bills were negotiable, and that the same are outstanding in the possession of some person or persons unknown. That the plaintiff is not possessed of same.

On July 9, to which time the hearing of the motion or the order to show cause had been postponed, the same came on to be heard before the judge who made the order. But when the defendants’ counsel had submitted his affidavits and papers, and made his argument in opposition, the plaintiff’s counsel, claiming to have been surprised by the facts produced by the defendants, asked that the motion might -remain open,

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and not be considered as submitted, until he could prepare and submit additional affidavits in support of the motion, and thereupon the judge, with the consent of the defendants’ attorneys, ordered the motion to stand over with leave to the plaintiff’s attorney to serve additional affidavits in support of the same, which affidavits were to be served by July 12, and the defendants were to have a reasonable time after the service of said additional affidavits, and up to Wednesday, July 21, in which to reply to same. The additional affidavits on the part of the plaintiff were not served until July 14, and their points, which were directed to be served, were not served at all. The excuse made by the plaintiff’s counsel for the delay was illness. On July 14, it was stated to the judge that the plaintiff’s additional affidavits had just been served, and that some little time would be necessary for the defendant to prepare rebutting affidavits, and that negotiations were on foot for a settlement of the controversy, to which the judge assented, and stated that no further action would be taken without notice to defendants’ attorneys. It was then plainly understood between the attorneys and counsel of the respective parties that the motion was not then submitted, and should not be until the plaintiff’s attorneys should have served upon the defendants’ attorneys their points, and until the defendants’ attorneys should have time, and up to July 21,do file rebutting affidavits.

In the meantime negotiations were pending between the attorneys of the parties for an abandonment of the motion for a receivership, and all hostile proceedings in the action. And it had been ágreeed between them that the plaintiff should furnish a satisfactory bond of ■indemnity, and that on its execution and delivery the defendants would pay to the plaintiff the money in controversy.

On July 16, the counsel for the plaintiff received a

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letter from James Henderson, an attorney and counselor at law, requesting him to call forthwith at his office. On going there Henderson informed the plaintiff’s counsel that the judge had appointed Thomas J. Barr receiver in the cause, and that he, Henderson, was counsel for the receiver. Henderson presented to the plaintiff’s counsel an order to this effect, which had not yet been entered, and asked the consent of the counsel thereto. The counsel informed Henderson that arrangements were being perfected for a settlement of the controversy, and requested him not" to enter the order. Henderson promised not to do so until Monday, July 19. The plaintiff’s counsel immediately informed the plaintiff and his attorney who approved. They did not want a receivership, and were going to give a bond and get the money in that way. Henderson was informed that the plaintiff’s case had not been submitted, and he was directed by the plaintiff’s counsel to the defendants’ attorneys.

nevertheless on July 17, an order was made and entered in the action appointing Thomas J. Barr, of the city of Hew York, counselor at law, receiver of the moneys and gold mentioned in the complaint.

Barr immediately filed the undertaking required of him as receiver. On July 17, the receiver called with Henderson, his counsel, on the defendant, Lucke, and demanded that the moneys and gold be delivered-to-him as receiver. Talmadge, the plaintiff’s counsel, learning that they were there for the purpose, directed the defendants not to pay over the money, and told Barr and Henderson not to receive it. Page, the attorney for the plaintiff,' also told them that the money must not be paid over. Barr and Henderson were both informed that the plaintiff did not want a receiver. Talmadge had seen Barr several days before at the superior court, and he told Barr that they did not want a receiver, but were going to give a bond of indemnity,

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The counsel for the plaintiff testifies that he does not know when the order, appointing a receiver was made, or when it was entered. That at the time he saw Henderson on July 16, he was standing with an order in his hand, and Page, the plaintiff’s attorney, writing to the attorneys of the defendants, expresses his surprise at the decision, and says that it was made in opposition to the stipulations between the parties and the attorneys. '

• The defendant, Lucke, did not pay over the moneys on the demand of Barr made on July 17, and on the same day the receiver made an affidavit of his demand on the defendant, Lucke, for the money, and the omission to deliver over the same, and by his counsel, Henderson, applied to the judge and obtained from him an order for the defendants to show cause on July 20, why they ahould not be punished for disobedience to the order.

On July 20, an order was made by the judge that, upon the defendants forthwith complying with the order made on July 16, appointing a receiver by paying to said receiver the sum of sixteen thousand seven hundred and thirty-eight dollars and seventy cents in gold coin, the defendants be purged of and from all contempt. And that in default thereof, on the part of the defendants, said Ernest B. Lucke stand committed to the common jail of the county of Hew York, until the said sum be paid to said receiver, and that a warrant issue to carry the order into effect. Whereupon the defendant, Lucke, paid over to Barr, the receiver, the sum of sixteen thousand seven hundred and thirty-eight dollars and seventy cents in gold and was discharged.

By his order of July 20, the judge directed that the receiver pay to the defendants’ attorneys two thousand five hundred dollars in currency, as and for counsel fees and disbursements incurred in the action,- and by an

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other order, dated the same day, but not filed until July 29, he directed the receiver to pay the plaintiff’s attorney one thousand dollars for expenses and disbursements in the action, and also to pay him the further sum of. one thousand five hundred dollars as and for counsel fees, and that the same be paid out of the funds in his hands as receiver. From each and all of these orders of July 16, and July 20, and from the order of the 20th, filed on July 29, an appeal was taken by the defendants to the general term of this court, and the same were severally, by order of the general term, made on November 14, 1870, reversed, and the complaint in the action, when the case was reached at the trial term of this court, dismissed by reason of the failure of the plaintiff to prosecute his action.

Afterwards, and on November 22, 1870, upon the application of the defendants’ attorneys, an order was made appointing a referee to take and state the accounts of said receiver. Upon said reference, the receiver presented. his account, in which he charges the funds in his hands, and seeks to be allowed, fifty dollars paid the officer detaining defendant Lucke, under the order of July 20; five thousand dollars paid the attorneys for the plaintiff and defendant, in pursuance of the order of July 20 and 29 ; the sum of four, thousand nine hundred and ninety-five dollars, for services rendered to him by James Henderson, his counsel. The receiver also claims commissions on the whole amount received by him from Lucke. By the report of the referee, the receiver was allowed ■ as disbursements the sum of fifty dollars paid to the officer who held the defendant Lucke, under the order to punish him.for the alleged contempt; the two sums of twenty-five hundred dollars each, paid the attorneys for the parties. He reduced the bill of Henderson, the receiver’s counsel, from four thousand nine hundred and ninety-five dollars, to the sum of six hundred and seventy dollars,

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which he allowed, and he also allowed the receiver commissions at the rate of five per cent-., amounting to the sum of one thousand one hundred and twenty-nine dollars and eighty-six cents.

The defendants excepted to the report of the referee making these allowances, and also to charge of interest on the moneys at the rate of five per cent, per annum, claiming that he should be charged at the rate of seven per centum.

The receiver also excepted to the referee’s report.

The exceptions to the referee’s report were heard at a special term of this court, where an order was made allowing all the defendants’ exceptions, and the exceptions of the receiver were overruled.

From which order this appeal is taken by the receiver. *

Samuel Jones, of counsel.

James Henderson, attorney for appellant.

Wm. W. McFarland, for respondent.

It cannot be well insisted that a receiver, who has been appointed in an orderly way by a court having jurisdiction, and who has in good faith entered upon his duties as such, should not be shielded in his proper action under the order, while it is in force, and be indemnified out of the fund entrusted to his guardianship, for legal charges and disbursements, reasonably made and incurred, although the order should be afterwards reversed for error. This action was against Belmont-and Lucke as copartners. They were charged in the complaint with having drawn the bills. Belmont was absent from the country, and not served with process. The defendant Lucke, who was served, and from whom

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the money was taken by the receiver, in his answer denied that he was a partner with Belmont at the time the money was paid and the bills drawn, and alleged that he had not become such until three years thereafter, He denied that he was one of the drawers of the bills, or had any interest in them, and averred that they were purchased of and were drawn by Belmont.

These considerations are referred to, however, not as conclusive upon the rights of the receiver, because it may well be claimed that the plaintiff’s complaint and affidavit disclosed facts uncontradicted, sufficient to give the court jurisdiction of the action by the service on the defendant Lucke, of the summons and complaint.

It is quite apparent, however, that the facts disclosed by the case before us, did not justify the appointment of a receiver.

The case shows that the moneys with which the bills were purchased had been forwarded to London to the persons on whom.they were drawn. But even had the moneys been returned to the drawer of the bills, as was claimed by. the plaintiff, but which was denied by the defendant Lucke, no ground appeared by the papers for interfering with the legal possession of same by the holders.

Their original and later possession. was lawful. There was no allegation or claim that the money was in danger of being lost, or would be in any jeopardy during the pendency of the action. The case, as made, was not within either class in which the court was empowered to appoint a receiver (Code, § 244.)

It was an attempt to engraft into an action for money had and received, the provisional remedy of a receivership. The manner, however, in which the appointment of the receiver was effected, and the part he took therein, affects seriously his position and claims.

If he intruded into the office by his own seeking, in violation of the rights of the defendants, and by a

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breach of the rules and practice of the court, and the order for his appointment was made and entered through a breach of the stipulations of the parties and their counsel with each other, without being asked for by either, and in opposition to their wishes, and before the case was submitted to the judge, and through the procurement of a stranger to the suit, it cannot be reasonably claimed for him that he is entitled to the consideration and favor with which the law regards receivers who are regularly and in the orderly method of judicial procedure constituted such.

The affidavits and papers leave no room for doubt that the order for his appointment was entered before the case had been fully submitted to the judge, and in direct opposition to the agreement and stipulation of the'attorneys for the parties.

Upon the presentation of the defendants’ papers in opposition to the motion made by plaintiff for a receiver, the plaintiff ’ s attorney, fearing that the facts disclosed by the defendants’ case would defeat the motion, asked for time to put in further affidavits. Leave was granted, but on the condition that the defendants should .have opportunity to reply to the affidavits by a day named. The case was not submitted; and before the day named, and before the defendants had an opportunity to make affidavits in rebuttal to the plaintiff’s further affidavits, the service of which had been delayed, the appointment of a receiver was made and the order entered.

The order recites that it was made after hearing H. E. Tallmadge, of counsel for plaintiff, yet Mr. Tallmadge has testified that when he handed in his additional affidavits to' the j udge, he made no application for a receiver, and the defendants’ counsel has testified that on the day the additional affidavits were served, July 14, he made known to the justice that the plaintiff’s replying affidavits had just been served, that some

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little time would be necessary to prepare rebutting affidavits, and that the justice stated that no further action would be taken without notice to him.

Tallmadge, who testifies that he drew almost all' of the papers for the plaintiff in the action, says that he does not know when the order appointing a receiver was made, or when it was entered. Roger J. Page, the attorney for the plaintiff, in a letter written to the defendants’ attorneys, under date of July 17, expressed surprise, and states facts showing that the order was made in" opposition to the stipulations of the parties, and offered to aid in reinstating the case according to the stipulations and understanding of the attorneys for both parties.

The question then occurs, upon whose application or urgency was the appointment ordered, or who, taking advantage of the condition of the proceeding, by deceit, fraud, or other bad faith, applied for, and obtained the order from the judge.

On July 16, James Henderson addressed a note to Tallmadge, the plaintiff’s counsel, requesting him' to call “forthwith,” at his, Henderson’s office.

Upon calling, he found Mr. Henderson standing with the order in Ms hands; it had not been entered. This was on July 16.

Henderson has given no explanation of the manner in which he became possessed of this original order, and the inference that he obtained it from the judge, under the facts and circumstances of the case seems unavoidable.

Henderson was a stranger in the suit and proceeding. He represented no interest involved. A receiver can only be asked for, or nominated by a party interested. As a stranger, he had no right to take part in, or influence the proceedings in court. In Attorney General v. Day, 2 Madd. 246, it is asked by the vice chancellor, “ Is it according to the regular course of the

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court for a person not interested to propose a receiver ? If so, persons from all quarters would besiege the court, great struggles and competitions would ensue. There is no color for saying that strangers can in such case come in before the master ; it would lead to indefinite importunities.” If not before the master, a stranger could not appear before the judge. But on July 16, when he had the order in his hands, Henderson was distinctly apprised by the plaintiff’s counsel of the facts which showed that the order was impropérly obtained, and made. If he did not know before, he was then informed that the case had not been submitted; that the parties did not want a receiver, and that negotiations were pending for a settlement of the controversy between all concerned.

Had the receiver himself been acting in good faith up to this moment, and before the order was actually entered, or filed, here was a distinct notice to him through his counsel, of the condition of the case, and the opposition of the parties to a receivership. If he proceeded further, he did so at his own peril and risk.

Henderson agreed that the order should not be entered until Monday, July 19. In defiance of the notice, and by a breach of his promise, the order was entered the next day. As the order was last seen in his hands, it could not have been entered without his knowledge and consent, and in the absence of any explanation from him, he must be deemed the procuring cause.

Henderson drew the receiver’s bond, which was filed before the demand was made upon the defendant Lucke for the money. From the rapidity with which they moved in the matter, on July 16 and 17, it would seem that both he and the receiver were familiar with the character and condition of the suit. It seemed a race to get possession of the fund, before the action could be settled by the only parties in interest. Tallmadge, the counsel for the plaintiff, testifies that he had seen

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Barr several days before' at court, and had told him that they did not want a receiver, but were going to give a bond of indemnity.

The first charge in the account produced by Mr. Henderson, before the referee, is for a retainer in the action as counsel, examining the pleadings and proceedings, and making copies of same. This is followed by a charge for drawing the receiver’s bond, and attending to its execution ; and the obtaining a certified copy of the order of the appointment, and serving same on the defendant Lucke. If the chronological order of the items in the account shows the times the services were rendered, it would seem thaj; the examination of the pleadings and proceedings by Henderson, was the service he first rendered. For this service he has charged five hundred dollars, which would indicate that the examination was a careful one. Such examination might have well disclosed to him, and the receiver, who is a counselor at law, that the case was not one for a receiver. In addition, as has already been observed, he had notice on July 16, that the parties did not want one, and also that the case had not been submitted. But besides all this, on July 17, when Mr. Henderson and the receiver called upon the defendant Lucke, and demanded the money, they were both distinctly notified of facts which showed the appointment to be improper, irregular, and to the prejudice of the parties ; a bond of indemnity satisfactory to the parties had been prepared, and the defendant was forbidden in the presence of the receiver, by the plaintiff’s counsel and attorney, to pay oyer the money to him. The reason assigned, being that they did not want a receiver. This direct notification, with what had previously occurred, might have reasonably caused the receiver to pause before taking the extreme measures, through his own counsel, Mr. Henderson, to punish the defendant Lucke for a contempt in not responding to his demand,

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which resulted in an order, and warrant, commiting him to the common jail of the county of New York, until the money should be paid,, and to escape which imprisonment, the defendant was obliged to pay to him the sum of money in question. Although purporting to be taken in this action, such proceeding was not taken in the interest of the parties to the. suit.

It cannot be that proceedings for the appointment of a receiver so initiated and completed can well give the appointee any just claim to subject the fund, of which he has so possessed himself, with the charges which he preferred on the accounting before the referee. They are wholly unreasonable and unnecessary. A person cannot thus thrust himself into a receivership, and get possession of a fund which is in no danger, is already in safe hands and needs no protection, and in opposition to the wishes and protests of all concerned, and then fasten upon the fund the charges incident to his intrusion, and for moneys paid thereout by himself, and for services to attorneys and counsel employed by him to initiate needless litigation and to defend his position.

The receiver has voluntarily placed himself in the position he occupies. The order appointing him has been reversed by the general term, as well as the order directing the payment of the moneys to him, and the action itself was ended when the case was reached at the trial term, -by a judgment in favor of the defendants for a failure of the plaintiff to prosecute the same.

Whatever loss the fund has suffered while in his hands the receiver should bear. He should not be allowed to shift it from himself to the parties.

It is no conclusive reason for allowance of these claims that the appointment was made by the order of the court. There is an underlying vice, which is shown in the manner in which.the order was obtained and entered, for which the apppintee must be held to be

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responsible. It would not answer to allow one to hold up for his defense, and urge as an indemnity for moneys paid, and as a ground for claims for services rendered and liabilities incurred, and which must be • considered unreasonable and unnecessary, an order so obtained. 1 ‘ JSfullus commodum cópese potest de injuria a sua propria.'1'1

And a judgment may be questioned if pronounced through fraud, contrivance or covin of any description ' (Broom Leg. Max. 335).

Of the disbursements claimed by the receiver two thousand • five hundred dollars was made to Mr. Page, the attorney, upon an order filed after the defendant had been made a party to the suit on his own motion, and was founded upon no distinct affidavit showing the services rendered or the reasons for this large demand, and this order has also been reversed by the general term. The claims interposed by Mr. Henderson, for services as attorney and counsel for the receiver, amount to the sum of four thousand nine hundred and ninety-five dollars. We think the judge at special term decided correctly when he disallowed all these claims, and held that the receiver was not entitled to compensation out of the fund in question. The learned judge says the fund was subjected to the order and to the moneys paid by the receiver himself, by an act wrongful against the defendants. “ If this wrongful act had not been done the fund would not have suffered depletion, from an order which should not have been made against the defendant.”

The order appealed from is affirmed, with costs.

Speib, J., concurred.