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WILMER V. THE ATLANTA AND RICHMOND AIR LINE RAILWAY.

[No. 1.

Vol. III.] court having jurisdiction of the defendant can compel it to do all in its power to put the receiver in possession of the entire property. If other persons outside the territorial jurisdiction of this court have seized the property of defendant, the receiver may be compelled to ask the assistance of the courts of that jurisdiction to aid him in obtaining possession, but that is no reason why we should hesitate to appoint a receiver for the whole property. We think the courts of other jurisdictions would feel constrained, as a matter of comity, to afford all necessary aid in their power to put the receiver of this court in possession.

Finally, it is objected that the superior court of Fulton County, Georgia, and the United States circuit courts of South Carolina and North Carolina, respectively, have taken jurisdiction of the property of the company within their respective states, and their receivers are in possession, and this court ought not to interfere by the appointment of a receiver of its own.

The record shows that the bill in this case asking this court to undertake the administration of this trust property, and to take possession of it by its receiver, was filed on 30th of October, 1874. It is shown that service was made upon the defendant corporation on the 31st of the same month, and notice of the motion now on hearing was served on the same day. It further appears that on the 5th of November, upon the application of the complainants, and upon the showing that there appeared to be danger of irreparable injury from delay, a judge of this court directed that, upon the execution of a bond by complainants with sufficient sureties in the sum of five thousand dollars, conditioned according to law, a restraining order issue enjoining and restraining the Atlanta & Richmond Air Line Railway Company, its officers and agents, from handing over or delivering possession of said railway or its appurtenances, or any of its other property, to any person except a receiver appointed by this court in this suit.

The bond was given by the complainants as required by the court, and the restraining order was issued, and on the 9th of November served on the Atlanta & Richmond Air Line Railway Company.

The case in Fulton superior court was not filed until November 10, and no prayer was made for a receiver until Garner, a defendant in that case, applied for one in his answer, which was filed on November 20. The suits in the United States circuit courts of South and North Carolina were not commenced until the 16th of November.

Upon this state of facts, which court first acquired jurisdiction of this trust property?

Is actual seizure of the property necessary to the jurisdiction of the court? In my judgment it is not. In this case I think the jurisdiction. of the United States circuit court for the Northern District of Georgia first attached to the property, because the suit in that court was first commenced and service of subpoena made, and because,

(1.) One of the main objects of the suit was to obtain possession of the property, and such possession was necessary to the full relief prayed by the bill, and

(2.) Because, by the service of the restraining order enjoining the defendant company from delivering possession of the trust property to any

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WILMER V. THE ATLANTA AND RICHMOND AIR LINE RAILWAY.

[No. 1.

person except a receiver appointed by this court in this cause, the court acquires constructive possession, and from the moment of the service of the restraining order the property was in gremis legis. I think these positions are sustained by the authorities.

I subjoin a reference to a number of cases, in all of which the subject under consideration is discussed, and in some of which the precise point is decided and the views above expressed sustained: Smith v. McIver, 9 Wheat. 532; Wallace v. Mc Connell, 13 Peters, 151; Peck v. Jenness, 7 How. 624; Williams's Adm'x v. Benedict, 8 How. 107; Wiswell v. Sampson, 14 Ib. 52; Taylor v. Carroll, 20 Ib. 583; Green, Adm'r, v. Creighton, 23 Ib. 90; Freeman v. Howe, 24 Ib. 457; Chittenden v. Brewster, 2 Wall. 191; Memphis v. Dean, 8 Ib. 64; Taylor v. Taintor, 16 Ib. 370; New Orleans v. Steamship Co. 20 Ib. 392, 393; Atlas Bank v. Nahant Bank, 23 Pick. 489; Wadleigh v. Veazie, 3 Sumner, 165; Ex parte Robinson, 6 McLean, 355; Bell v. Ohio Life & Trust Co. 1 Bissell, 260; Bell v. The New Albany Banking Co. 2 Ib. 390; Ex parte Jenkins & Crosson, 2 American Law Register, 144; Parsons v. Lyman, 5 Blatchford, 170; Stearns v. Stearns, 16 Mass. 171; Connor v. The Mayor, 25 Barb. 513; Clepher v. The State, 4 Texas, 242; Thompson v. Hill, 3 Yerger, 167; Bank v. Rutland Railroad Co. 28 Vermont, 478; Merrill v. Lake, 16 Ohio, 405; Ex parte Bushnell, 8 Ohio State, 601; State v. Yorbro, 1 Hawks, 78; Gould v. Hays, 19 Ala. 448.

Especial attention is called to the cases of Wiswell v. Sampson, 14 How. Chittenden v. Brewster, 2 Wall. and Bell v. The New Albany Banking Co. 2 Bissell, supra.

An examination of the cases cited will show that actual seizure of property has not been considered necessary to the jurisdiction of the court in a case where the possession of the property is necessary to the relief sought. The commencement of the action and service of process, or according to some of the cases the simple commencement, of the suit by the filing of the bill, is sufficient to give the court jurisdiction, to the exclusion of all other courts.

In this case not only was the suit begun and process served before the commencement of any other suit, but the defendant railway company was actually enjoined by the order of this court from yielding possession of the trust property to any one except a receiver appointed by this court in

this case.

In my judgment this restraining order gave this court constructive possession of the trust property, and a subsequent seizure of the same by any person on the order of any court whatever in a suit subsequently begun was a contempt of the process and jurisdiction of this court.

If this court, upon the bill filed in this case, has the power to take possession of the entire property granted by the trust deed, as we have already decided it has, then the filing of the bill, asking this court to take possession of and administer the trust property, and the service of process, excluded the jurisdiction of all other courts to take possession of and administer the same property or any part thereof.

Other questions than those noticed in this opinion have been argued at the bar, but it is not necessary to decide them in passing on this motion.

WILMER V. THE ATLANTA AND RICHMOND AIR LINE RAILWAY.

[No. 1.

Vol. III.] I am of opinion that this court has jurisdiction to appoint a receiver for the entire property covered by the trust deed, and to administer the property for the benefit of all persons interested in the trust; that the jurisdiction of this court over the entire trust property attached before that of any other court; that all parties necessary to the hearing of this motion are before the court; that the bill and the evidence submitted establish a proper case for the appointment of a receiver, and the facts brought to the knowledge of the court imperatively demand its intervention: the interest of all parties require that our jurisdiction, being thus exclusive over the subject matter, should be exercised, and that the motion for the appointment of a receiver for the whole trust property should be sustained.*

In pursuance of the foregoing opinion the court on the 19th of December, 1874, appointed John H. Fisher, Esq., receiver for the entire property covered by the deed of trust executed by the Atlanta & Richmond Air Line Railway Company. Fisher gave bond, as required by the order of the court, but was unable to get possession of that part of the trust property lying in Georgia.

On the 24th of May, 1875, he applied to the United States circuit court from which he received his appointment, then being held by Mr. Circuit Justice Bradley and Mr. District Judge Erskine, for a writ of assistance to enable him to get possession of so much of the trust property as lay within the Northern District of Georgia.

Upon this application the following opinion was delivered.
Messrs. A. T. Akerman & L. E. Bleckley, for the motion.
Messrs. P. L. Mynatt & N. J. Hammond, contra.

BRADLEY, Circuit Justice. This is a bill filed on behalf of first mortgage bondholders of the Atlanta & Richmond Air Line Railway Company, praying for a sale of the railway and appurtenances, and for a receiver to take possession of the property, pending the suit. A receiver (Mr. John H. Fisher) was appointed by Judge Woods, on the 9th of December last. On proceeding to take possession of the property, the receiver found a large and important portion of it, to wit, the depot and terminus in Atlanta, and the railway line in Fulton, and some other counties in Georgia, in the possession of one Lemuel P. Grant, as a receiver appointed by the superior court of Fulton County, a court of the State of Georgia, having equity jurisdiction. Grant refused to surrender possession, and Fisher, under an advisory order of Erskine, District Judge, applied to the superior court of Fulton County, for an order directing its receiver to surrender the property. This application was also refused. Fisher, the receiver appointed by this court, now applies by petition for a writ of assistance, to put him in public possession of the property, and for an attachment as for a contempt against Grant, and other officials, and directors of the railway company, charged to be in complicity with him,

Since the foregoing opinion was delivered, Mr. Circuit Judge Drummond, in the case of the Union Trust Company of New York v. The Rockford, Rock Island & St. Louis Railroad Company, has reiterated his opinion expressed in Bell v. The New Albany Banking Co., supra, holding that where one of the objects of a suit

was to obtain possession of property for administration, the court in which the suit was first commenced by service of process acquired jurisdiction over the property to the exclusion of the court in which a subsequent suit was commenced, but which first actually seized the property.

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for conspiring to keep the property out of the possession of the officers of this court. To this petition several answers have been filed by the parties implicated, and the question is thus presented whether this court can, and if it can, whether it will take the property in question out of the possession of a receiver appointed by a state court. Under ordinary circumstances, such a proposition would not be listened to for a moment. But the complainants and the receiver of this court rely on the special circumstances of the case as taking it out of the ordinary rule. Those circumstances may be briefly stated as follows."

The bill in this case was filed October 30, 1874, and a copy and notice of motion for injunction and receiver were served on the railroad company the next day. On the 5th of November, Judge Erskine granted a restraining order, which, on the 9th of the same month, was served on the company, and on Grant, then a director of the company, appointed on behalf of the city council of Atlanta, of which he was a member. On the 11th, it was served on Bufort, the president, and on Sage, the general superintendent, and was brought to the notice of Garner, a director. As before stated, the application for a receiver was not decided until the 9th of December, 1874.

Meantime other proceedings had taken place in the state courts, and especially in the superior court of Fulton County, which produced the complications that have arisen.

In December, 1866, one Samuel B. Hoyt, recovered a judgment in the Fulton County court against the Georgia Air Line Railway Company (of which the Atlanta & Richmond Air Line Railway Company is the legal successor by change of name), for the sum of $1,000 and costs, and a fieri facias was duly issued under the laws of Georgia, not only in Fulton County, but Guinnett, Habersham, and Hall counties, and several levies were made on the railroad line, in April, August, and September, 1874, and the road was sold in distinct parcels to one William A. Russell. The sales were severally made in June, September, and October, 1874. On the 5th of November, Russell transferred his interest to Garner, a director as above stated, for the whole line of railroad in Fulton, Guinnett, and Hall counties. Garner was put into possession by the sheriff on the 9th of November, 1874. On the next day, the 10th, the Atlanta & Richmond Air Line Railway Company, by its managing director, P. A. Welford, filed a bill in the superior court of Fulton County against Hoyt, the judgment creditor, Russell, the purchaser at sheriff's sale, Garner, the assignee, &c., to prevent their proceeding to take possession of the road. On the 20th of November, Garner filed a cross-bill in the same court, asking for the appointment of a receiver, which resulted in the appointment of Grant, on the 21st, and his taking possession on the 26th of the same month. Grant had resigned his position as a director of the company on the 11th of November.

It thus appears that the bill in this court was filed before that in the superior court of Fulton County, but that a receiver was first appointed by that court, and that he was in possession when the appointment of receivers was made by this court. It also appears that the object of the two suits was different; in this court it being the foreclosure of the mortgage, and the sale of the property to satisfy the same; the possession sought

Vol. III.] WILMER U. THE ATLANTA AND RICHMOND AIR LINE RAILWAY.

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being auxiliary to the main purpose; in the state court the object was to set aside the proceedings and sale, under the judgment of Hoyt; and to prevent Garner from keeping possession of the road. On the 2d of January, 1875, the complainants in this court filed an amended bill, making parties of Hoyt, Russell, Garner, and Sage, and alleging, that the proceedings in the superior court of Fulton County were collusive and intended to frustrate the proceedings of this court.

But suppose that the allegations of the amended bill are true, can this court arrest proceedings in a state court, on the ground of their collusiveness? Must not the state court itself be applied to? We cannot assume or entertain the proposition that the state court will not do justice in matters within its jurisdiction. We are bound to suppose that it will not allow a collusive use of its process to be made by parties, but that it will set aside and declare null all such fraudulent proceedings.

Then the question remains pure and simple, does the priority of commencing suit in this court for the foreclosure and sale of the mortgaged premises, give the court constructive possession of the property, so as to nullify the subsequent possession taken by the state court, the respective objects of the two suits being different?

It is too well settled to admit of controversy, that where two courts have concurrent jurisdiction of a subject of controversy, the court which first assumes jurisdiction has it exclusive of the other. But where the objects of the suits are different, this rule does not apply, although the thing about, or in reference to which the litigation is had is the same in both cases. Thus an action of debt on a bond, an action of ejectment on the mortgage given to secure it, and a bill in equity to foreclose the equity of redemption, may be pending at the same time unless prohibited by some statutory regulation. The land mortgaged may be seized in execution by the sheriff in an action at law, even while the ejectment or the bill to foreclose is pending. A bill to foreclose is a personal proceeding, although it has reference to a specific thing, Its object is to put an end to an existing equity, and to procure a sale of the mortgaged premises. Possession may be taken in the course of the proceeding; but until it is taken, can it be said that the property is sacred from the touch of other persons or courts ?

The present case, then, is resolved to this. Had the Fulton County court power to appoint a receiver, and place him in charge of the property, whilst a bill to foreclose was pending in this court? or was it an interference with the jurisdiction of this court?

It is perfectly evident that the controversy before that court is a different one from the controversy before this court. There it is a question of the validity of a sale under execution, and of the possession given by the sheriff in pursuance thereof; and that question arises between the Atlanta & Richmond Railway Company and the assignee of the purchaser. Here it is a question of the rights of bondholders, under a mortgage given by the Atlanta & Richmond Air Line Railway Company, and the company, and arising between the bondholders and the company, and its officers and employees.

The controversy not being the same, nor the parties the same, there is no conflict of jurisdiction as to the question or cause. But, inasmuch as

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