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out first having obtained them, they are taxes, regulations prescribed as conditions precedent or and though it is a license in form, it is a mere subsequent to engaging in a business and enforctax receipt.
ing them by penalties are not licenses. It was such a misnomer, in the judgment of the Thus see 2778 of Revised Statutes, requires forsupreme court, to call such law " a license law," eign express and telegraph companies to return that congress, in 1866, amended it in that respect and pay a per centage tax on receipts in addi. by striking out the word "license" and inserting tion to the tax on property. By Sec. 2843, if "special tax.". Thus, by the change of one these taxes are not paid the companies in default word, the act became in name what it was de- were forbidden to do business in the state. clared to be in legal effect, a tax law, because the No one would call this a license statute, but a 80-called license conferred no authority to engage mode of enforcing the payment of the taxes due. in the traffic, and therefore was not a license The case of Youngblood v. Sexton, 32 Michigan, law.
is important, as coming from a state having a This court, in direct conflict with this high constitutional provision similar to ours. It is authority, holds, that although the act of 1882 directly in point and cannot be explained away. confers no authority to traffic (Sec. 15), yet it is The statute was a graduated specific tax on the in legal effect a license, because a bond is required traffic, with the usual provisions for its colleoto secure the tax.
tion, and it was made a misdemeanor to neglect This decision, in 5th Wallace, is affirmed in to pay the tax, and a penalty was imposed for strong terms in Home Ins. Co. v. City Council, each offense. 93 W. S., 116. It was the case of ordinance of The statute was held, Cooley, J., announcing the city of Augusta, in Georgia, providing for an the opinion, to be a ta.t and not a license
. It is annual license tax on insurance companies." souglit to avoid the force of this case by drawing prior to the passage of this ordinance the insur- a distinction between the Michigan statutes and ance company had complied with the state law, our own by claiming that under the Michigan and held a certificate of authority to do business the business is not prohibited if the tax not in the state, then this ordinance was passed im- paid, while in ours it is. This is untenable. In posing a “license tax," and the company sought ; the one, non-payment of the tax when due is a to enjoin the collection of the license tax on the misdemeanor, and no bond is required; while in ground, among others, that the city could not re- the other, failure to give the bond, which is quire a second license, as it would impair the obli- merely security to pay the tax, is made the misgation of the contract with the state, evidenced demeanor, and failure to pay the tax only subby the certificate of authority from the state. jects the person to an action on the bond.
The Supreme Court of Georgia, in the same In the one case a person is punished for not case, 50 Ga., 360, has held, that this license was paying the tax, while in the other he is punished not such, but a special tax and conferred no au- for not giving the bond to pay the tax when due. thority to do business
Legal accumen would be exhausted in making The case was carried to the Supreme Court of a distinction. The power, by discriminating the United States on this question, and that taxes, as well as by fines, penalties and forfeitcourt again unanimously held that such a tax ures, to provide against vicious and criminal was not a license, but a valid tax imposed by the practices, including the evils resulting from the city; and after repeating what was said 'in 5 traffic in intoxicating liquors, such as the vice, Wallace, adds: “In the ordinance in question pauperism and crime it causes, is, as I believe, the tax is designated 'a license tax,' but its pay- à part of the legislative power of the state that ment is not made a condition precedent to the ought not to be frittered away or crippled. Free right to do business. No special penalty is pre
trade in this traffic has never been adopted as scribed for its non-payment,and no second license the policy of this state. On this point I adopt is taken out. Had the ordinance been otherwise in with hearty approval the language of this court, these particulars, we have seen, viewing the subject in in Miller v. Gibson, 3 Ohio St., 486, 487, per the light of the License Tax Cases, that the result would Thurman, Judge, who says: “The idea apparhave been the same."
ently contended for, that the constitution recog: In view of the foregoing cases, it can hardly nizes an uncontrollable, illimitable right to sell be said of them that they shed no light on the intoxicating liquors, is manifestly erroneous. question before us." I think they shed a flood There is no such right in respect to any comof light directly on the question. Neither can modity, however harmless, for if there were, it be said of them, "that the ordinance and leg- how could the various inspection laws, the laws islation under consideration (in those cases), relating to markets, the license laws, the Sunday was different from the legislation involved here." law, &c., be sustained? A power of regulation, The fact that there was no anti-license clause, is a power to provide against evils incident to trafwbolly immaterial, as the question there was, as fic, a power to protect community against the it is here, what is the meaning of the word fraude or dangerous practices of trade, is, in a license, and does a prohibition under penalties greater or less degree, vested in every governagainst carrying on business until a tax is paid ment, and certainly the people of Ohio are not impart a license? Such pre-eminent authority wholly without this protection. If, to guard as these cases are ought not to be ignored. against these evils, some restraint upon the traffic itself
Numerous statutes might be cited to show that is necessary, it may be lawfully imposed, the fact
being always borne in mind, and always acted Douglas, Trustee, duly executed, acknowledged upon, that the power is a power to regulate, and and recorded, to secure $1,000,000 in bonds of the not to destroy. To this power, intoxicating company, with interest coupons attached at 8 liquors are expressly subjected by the constitup per cent., payable semi-annually. By virtue of tional provision I have quoted: but were that a contract, the company had the right to cross the provision stricken out of the constitution, the power Newport bridge and make connection with like would yet subsist : and for the same reason that roads in Ohio. it might be declared unlawful to sell poison to a One of the conditions of this mortgage was, child, or a dagger to a madman, it might be that if default was made and continued for more made an offense to sell intoxicating drinks to a than ninety days in the payment of any semiminor or a drunkard ; and for the same reason annual instalment of interest, then the princithat any other common nuisance might, by law, pal evidenced by the bonds should become due. be abated, the business of a common tippling
On the 25th of July, 1874, said Douglas as house might be subjected to that fate."
Trustee commenced a suit in the Louisville
Chancery Court, making the proper parties, alRECEIVER IN CHANCERY-ATTACH- leging the foregoing facts, insolvency of the MENT-COMITY BETWEEN STATES. company and insufficiency of the assets to pay
the mortgage debts, and praying for the appointSUPREME COURT OF OHIO.
ment of a receiver, on the ground that the en
tire property including that in controversy was THE MERCHANTS' NATIONAL BANK OF LOUIS- insufficient to earn a net income sufficient to VILLE
pay the interest on the bonded debt of the com
pany which was insolvent. John McLEOD, RECEIVER.
By a cross-petition in that suit, filed by one
May 30, 1882. Norvin Green, Trustee, it appears he was a trusIn a suit in chancery pending in a Kentucky Court, wherein the trus- tee under a prior deed of trust in the nature of a toes of an insolvent railroad corporation sought to enforce their rights mortgage on the same property to secure $3,000, under certain mortgages of the road and its equipment, the conditions
000 in bonds. of which had been broken, an application was made for the appointment The condition of this mortgage was, that if of a receiver to take charge of and operate the road.
default be made for more than sixty days in · Pending this application, certain rolling stock covered by the mortgages the payment of interest, then it should be lawwas temporarily in Ohio, and while bere was seized in attachment by an ful for said trustee to enter and take possession unsecured Kentucky creditor. The entire property was insufficient to
of all the property embraced in the deed of pay the debts secured by the mortgages, or to earn income to pay the in
trust. terest. The order of the court appointing the receiver, made subsequent
In his cross-petition Green also seeks the apto the seizure in attachment, ordered bim to take possession of all the property, including that scized, and authorized him to sue in bis own
pointment of a receiver and for the protection of Dame as such receiver, whenever necessary to perform his duties. Held:
his rights. That the mortgages covered the rolling stock, though temporarily in
Pending these applications for the appointthis state, and the receiver might, under the comity between states, by an
ment of such receiver, the plaintiff in error, a action brought in this state in his own name, assert his right to the pos- corporation of the State of Kentucky, doing bussession thereof, where such right is not in conflict with the rights of our iness in Louisville and within the jurisdiction own citizens, nor against the policy of our laws.
of the court where said suit was pending, comError to the District Court of Hamilton menced an action in the Court of Common Pleas County.
of Hamilton County, Ohio, against said railroad The original action was brought by Samuel company as a foreign corporation, and caused an Gill, Receiver of the Louisville, Cincinnati & attachment to be issued and levied on certain Lexington Railroad Company, against the cars, part of the equipments of said road included plaintiff in error and Geo. W. Zeigler, Sheriff of in said mortgages which was temporarily in Hamilton County. Gill having died, the action Cincinnati, having crossed the Newport bridge was revived in the name of John McLeod, the to deliver passengers and freight and return. successor of Gill, as such receiver.
This action and attachment was commenced The object of the action was to enjoin the de- September 15, 1874. fendant from detaining or holding two passenger On the 21st of September, 1874, upon the mocars and one baggage car, and to compel a re- tion of Douglas, trustee, under the second mortstoration of them to plaintiff
, and for other gage, and Green, trustee under the first, the relief.
breaches of the conditions of said mortgages beOn the 1st day of April, 1870, the Louisville, ing admitted, the court appointed said Gill reCincinnati & Lexington Railroad Company. ceiver of all the property of the company, in; which was the owner of a line of railroad from cluding the cars seized by attachment, and Louisville to Lexington, and from Lexington directed him to take charge of the same. This Junction on said main line to the Cincinnati receiver was duly qualified, and the railroad and Newport bridge in Newport, and from An- company was ordered to surrender to him its chorage Station on said main line to Shelby, road and all its equipments and property, and be ville, all in the State of Kentucky, mortgaged was ordered to take possession of the same and the same with all its rolling stock, equipments use and operate the road until the further order and franchises by a deed of trust to George L. of the court. The order invested him with the "same powers as are conferred on the president with all the powers they, as well as the corporaand directors of the company under its charter.” tion possessed in the premises.
He was authorized to bring and defend all ac- The temporary removal of the cars into Ohio tions in his own name, as receiver, as he may be by the company pending the application for a advised by counsel to be necessary or proper in
receiver did not divest the mortgages of any the discharge of the duties of his office. He was rights to possession of the property, nor impair further authorized to take possession of all the power of the court over it. rights of the company across the Newport and The rights of the mortgagees.under this mortCincinnati bridge, to and from the depot in Cin- gage will be determined by the lex loci contractus, cinnati under a contract for that purpose. when such contract is not contrary to tbe policy
On appeal to the district court the injunction of our laws, nor in conflict with the rights of our prayed for was made perpetual, to reverse which own citizens. In such a case our courts will by judgment these proceedings in orror are prose- the law of comity enforce the contract and give cuted.
it an extra territorial operation. Thus the mortJOHNSON, J.
gagee of chattel property under the laws of New There is no bill of exceptions, hence if the York may assert his rights against the mortfact stated in petition, which are put in issue,gaged property found in Ohio. Kanaga v. Tayentitled the receiver to the relief prayed and lor, 7 O. St. 134. granted we must presume those facts were proved This property at the time it was seized in atsufficient to warrant the judgment.
tachment was in possession of the the mortgagor, These facts are, in brief, that there were two and was temporarily in Ohio under a contract mortgages on the railroad and its cquipments in
with the Cincinnati & New port Bridge Co., but cluding the cars in controversy, the conditions the right to the possession was in the trustees unof which had been broken, the company was in
der these mortgages. If instead of procuring the solvent, the property was insufficient to pay the appointment of a receiver they had in person mortgage debts or to earn enough to pay the in- asserted their right to the possession under the terest thereon.
conditions of the mortgage, no one doubts that In this condition of thiugs, the trustees ap
their right was paramount to the seizure under
the attachment. plied to a court of chancery in Kentucky, having jurisdiction of the subject matter for the
The right of the trustecs under these mortappointment of a receiver. 'Pending this appli- gages, which are valid by the laws of both cation, the plaintiff in error, a citizen of Ken
states, can be asserted in Ohio as fully as in Kentucky and within the jurisdiction of the court tàcky: The only limitation being that the courts before whom the application was made, came to
of Ohio, while allowing the comity of suit Ohio, and by attachment founded on an unse
on a contract not in contravention of our laws cured claim against the railroad company seized
or public policy, will protect the rights of our own cars covered by the deeds of trust, and now
citizens, and will not allow the principles of claims priority over the right of the receiver.
comity to defeat or impair these rights. Fuller Atter this, the court in Kentucky made the
v. Steiglitz, assignee, 27 O. St. 355 ; Bank of Auappointment of a receiver, and clothed him with
gusta v. Earle, 13 Peters, 591; Shortwell v. Jew
ett, 9 Ohio, 180; Oliver v. Townes, 14 Martin the powers stated. He was to take possession (Lå.) 93 ; Gaulundet v. Hall, 35 N.Y., 657; Wharof the road, its equipments, franchises, &c., and to
ton Confict of Laws; Story on Conflict of Laws, operate the same. He was vested with power to
Sec. 244, 259. sue in his own name as receiver in all actions advised by counsel, necessary or proper in the
The validity of these mortgages and of the discharge of his duties. This power to possess clearly stated in New port & Cin. Bridge Co. v.
appointment of the receiver of this corporation is himself of the property of the road, and to oper- Douglas, receiver, 12 Bush. 673. The extent of ate the same, extended across the Ohio river over the Newport bridge to a connection with the
the powers of the receiver to operate and control Ohio roads at that point, and for that purpose
the road and its earnings under this appointinvested him with the same powers as the pres
ment are then fully settled. ident and directors of the company had under
Counsel for plaintiff in error concede the ex
tra territorial rights of the owner of property, or its charter to make connections with roads in this State.
of the mortagee thereof, to maintain an action
in the courts of a sister state, when the case The conditions of both mortgages having been comes within the exception stated, but deny that broken, the right to the possession of the mort
a receiver has any such power. The claim is, gaged property as by the laws of Kentucky that the receiver acquired no title to the propVosted in the trustees under the terms of the erty in controversy, and had no power to bring deeds of trust.
an action in the State of Ohio, the order of the The right which the company had, to run its Louisville Chancery Court having no effect outcars over the Newport bridge into this State, side of the State of Kentucky. Let it be assumalso vested in the trustees, and on their motion ed as settled by all the authorities that the order was conferred on the receiver. Instead of asserting of the Kentucky court sitting in chancery did in person, this right, the trustees secured the not operate to confer or divest any title to propappointment of a receiver and had him clothed | erty outside of that state. That is probably also true as to the title of property within that ers thereby conferred, without express authority state. The receiver, when appointed by the for that purpose.
2 Daniels Ch. 1751. Note court of chancery, did not acquire the title to 7, in brackets. Wray v. Jamison, 10 Humph. the property, but only the right under orders of 186. Baker v. Cooper, 57 Maine 388. High v. the court to possess and operate the same, as the Receivers sec. 210. trustees under the, mortgages might have In the case before us the order of appointment done, or as the court might direct..
authorizes the receiver to bring all necessary. Stripped of all collateral matters, the question proper actions in his own name as such, under is: has the receiver in such a case the legal ca- advice of counsel. pacity to possess himself of the property em- So far as the court had power to do so it has braced in these mortgages ?
by a general order clothed the receiver with the The general principle is: "that the possession right to bring this action. If the allegations of the of the receiver is that of all parties to the petition are true, and in this proceeding we suit, according to their titles. As between the must assume that they are, the action was a necowner and incumbrancers it is for some purposes essary and proper one, and was advised by counthe possession of the incumbrancers, who have sel who represents the receiver. This right to obtained or extended the receiver; as between sue in his own name is not controverted when the owner whose possession has been displaced applied to an action in Kentucky, but the claim and a third party it is the possession of the is that the authority to do so is confined to acformer.” High on Receivers, Sec. 134, Note 1. tions brought in Kentucky. In other words,
Thus in Horlock v. Smith, Law Jour. N. S. that this right cannot; by the comity between vol. 2 p. 157, where a receiver was appointed of states, bc exercised in a sister state. property mortgaged to A, and continued to hold
As the mortgage was valid in Ohio, and the over after his discharge it was held, that the pos-property was insufficient to pay the debt, the session of the receiver after such discharge equity of redemption on which the attachment was the possession of A.
wils levied was valueless. The attaching credThe general proposition is well established itor acquired no right or interest by the seizure, that the receiver is the officer or agent of the paramount to the mortgagee's. court appointing him, for the benefit of whoever Had it appeared that an interest in the propmay be ultimately determined to be entitled to erty was acquired by the seizure, a chifferent and the property. n the case at bar, the fact was somewhat difficult question would have been established, that the right of property was in presented, namely: would the Ohio court retain the receiver, for the benefit of the incumbrancers, the property until this interest was ascertained on whose motion he was appointed, and there- and protected ? If the attaching creditor was a fore, as between them and the owner, or the un- citizen of Ohio, the principle that our courts secured creditors, the possession is that of the would protect its own citizens would seem to apincumbrancers. Thus it was held in Angel v. ply, but treating the mortgages as valid, no such Smith, 9 Vesey 337, that when the rights of interest existed, or could
interest existed, or could be acquired by the levy the parties are ultimately determined, the pos- of the attachment, as the property was insuffisession of the receiver for the whole period, by cient to pay the debts secured by the mortgages. relation dates back to the time of the appoint- Independent of the rights of any citizen of ment, though pending such determination, it be Ohio, will comity allow the receiver to maintain deemed the possession of the court for all parties an action in Ohio, which he could bring in Keninterested.
tucky? Again, the possession of the receiver and his We think that upon both principle and auright to possession are exclusive. No one, not thority such an action may be maintained. The even the trustees under these mortgages, could nature of the union between the states, as meminterfere with this right. Having procured his bers of a common government, the vital interappointment and placed the property in the cus- ests which bind them together, should lead us to tody of the court, they would be estopped from presume a greater degree of coniity in commerasserting in person the right to enter upon and cial, as well as political affairs, than we should use the property reserved to them in the condi- be authorized to presume between states, wholly tions of their mortgages.
foreign to each other. Without authority of the court, no one has the In Hurd, Receiver, v. The City of Elizabeth, right by execution, or otherwise, to interfere with 41 N. J. L., 1, it was held, that a receiver apthe receiver's possession. High on Receivers, Sec. pointed by a court of New York, clothed with 135 to 156, and cases cited.
authority to take the designated property wherAgain, the authority to bring action is derived ever situate, may sustain a suit for such property from the court appointing him, which may be in the courts of New Jersey. conferred either by a general order or by special That was an action in that state to recover monorders in particular cases. 2 Daniels Ch. Prac. eys due a New York bank, of which the plaintiff 1751, Note 7. Davis v. Gray, 16 Wall 216-219. was appointed receiver by a New York court.
This is according to the weight of authority, There, as here, the right to sue outside of New though there are many well considered cases York was denied. holding that a receiver had the right to sue by It is said there are dicta that go to the extent virtue of his appointment and the general pow- of this claim, but the correct rule is stated to be :
“That a receiver cannot sue or otherwise exer- which had been awarded to him in 1848. Clark cise his functions in a foreign jurisdiction, when- was adjudged a Bankrupt in 1843, and this claim ever such acts, if sanctioned, would interfere with against Mexico, which was then existing, passed the policy established by law in such foreign to his assignee. It was held in Clark v. Clark, jurisdiction.
17 Howard, 315, that this claim belonged to the “ It could not be exercised in such foreign jur- assignee in bankruptcy. The controversy in isdiction to the disadvantage of creditors resi- this case was, therefore, one between Clark's asdent there, because it is the policy of every gov- signee in bankruptcy, and Booth, receiver, under ernment to retain in its own hands the property the creditor's bill of Camara filed in New York, of a debtor until all domestic claims against it as to which was entitled to collect from the have been satisfied.”
United States the amount awarded to Clark by The distinction is drawn between the case of the commission under the treaty between the a receiver acting under the inherent force of his United States and Mexico. It was held that the appointment alone, and a case where, by the assignee in bankruptcy, by virtue of his office, terms of his appointment, he is directed to gath. had the best right to the fund. There were no er the assets wherever found. The power of the liens or vested rights of the judgment creditor court to confer such authority on a receiver is to his debtor's claim or chose in action. The renot limited to property found within the state ceiver only acquired an authority to sue for and where he is appointed. It is not necessary that reduce to possession this claim. This authority the property should be within the jurisdiction of had no extra territorial force as against the asthe court.
signee in bankruptcy, who represented all credThus the courts of England have appointed itors alike, and who by the acljudication in receivers to manage landed property in India, bankruptcy, became invested with the right to Canada, China, Ireland, Italy, the South Ameri- choses in action wherever found. can states and other places. 2 Daniels' Ch. * Unlike the present case, there was no lien or 1731, and cases cited.
mortgage, or other vested interest in the receiy. So on principles of comity, the aid of a New er. So far we have taken no notice of the fact Jersey court was extended to a foreign receiver that the litigating parties are both citizens of to obtain possession of property, as against the Kentucky. The plaintiff in error has no right officers of a corporation of which he was receiv- to invoke that protection against the principles er, who may be endeavoring by fraud or subter- of comity, which this state would accord to her fuge to withhold it. Bidlack, Receiver, v Mason, own citizens. Wharton Conflict of Laws, Secs. 26 N. J. Eq., 230.
364-369. In such case it is said held, “where The principle announced in Hurd v. Eliza- questions as to extra territorial property arise beth, supra, which is a late and well considered between foreign assignees and foreign creditors, case, is in our judgment supported by reason domiciled in the same state, the foreign law to and authority. A few of the cases are: Pond which such parties are subject will be upheld. v. Cooke, 6 Reporter (Conn.) 516; Hunt v. Co- Ibid. Sec. 369, and note. lumbian Ins. Co. 55 Maine 297–8; Ex parte Nor- In Rhode Island Bank v. Danforth 14, Gray wood, 3 Bissell 504; Gray, Receivers, v. Davis, 1 123, that a mortgage on chattels in Massachusette Wood, 420, affirmed in Davis v. Gray, 16 Wal- by a Rhode Island mortgagor to a mortgagee relace, 203; Runk et al., Receiver, v. St. John, 29 siding in the same state, would be sustained in Barb., 585; Barclay v. The Quicksilver Mining the courts of Massachusetts as against an attachCo., 6 Lan. 25; Willets v. Waite, 25 N.Y. 577; ment in Massachusetts by a Rhode Island credPeterson v. The Chemical Bank, 32; Pugh v. itor. The court say, all the parties are citizens Hunt, 52 Howard (N.Y.), 22 ; Graydon v. Church, of Rhode Island, and a valid mortgage there will 7 Mich., 36.
transfer the property in Massachusetts. If this Great reliance is placed on the remarks of Mr. were not the rule, it would enable a Kentucky Justice Wayne in deciding the case of Booth v. creditor of an insolvent debtor, by an attachClark, 17 Howard, 334, where it is said, “that ment in Ohio, to defeat an assignment made in the receiver's right to the possession of the prop- Kentucky for the equal benefit of creditors, and erty is limited to the jurisdiction of his ap- thereby secure a priority over others, and even pointment." This and other remarks of the ever a valid mortgage. learned Judge are termed dicta, when applied to Judgment affirmed. [To appear in 38 O.S.] cases like the present. ' In Hurd v. The City of Elizabeth, 41 N. J., Low 1. Ex parte, Norwood VIRGINIA MILITARY LANDS IN OHIO. 3 Bissel, 512. Booth v. Clark was correctly decided upon the facts before the court. One Cam
[Norvill's Case concluded.] ara recovered a judgment in the court of New York against Člark, and upon a return of no Meanwhile the lands had been sold for taxes, or by goods on which to levy, had Booth appointed re- order of probate cnurts and otherwise. Where the parties ceiver in 1842, to reach equitable assets and
to the original entry had omitted to obtain legal titles
and the period in which legal titles might have beon obchoses in action of Clark to satisfy his judgment. tained, had passed and nearly a generation of time had In 1851 Booth, as receiver, filed a bill in the Cir- subsequently intervened, and the land had long been in cuit Court of the District of Columbia, seeking peaceful possession and actual occupancy under 108
sessory rights, and titles derived through the tax sales to reach a claim upon Mexico in favor of Clark, or judicial proceeding, or by purchase from the holders