It has been held that the entire property of a corporation is not in the custody of a court that has appointed a receiver over the assets of another corporation, which owns a majority of its stock and operates its railroad under a lease; and that consequently, a State court may appoint a receiver of the lessor, after the appointment by a Federal court of a receiver of the lessee and stockholder; 13 but this rule will not apply if the Federai court has extended the receivership to the interest of the lessor in the property.14

A stipulation staying proceedings in the Federal court, after a motion for a receiver has been made, does not justify the subsequent appointment of a receiver by a State court.15 Where, after the appointment of a receiver, the Federal court accepted a bond in lieu of the property and discharged the receiver, it was held that the State court might appoint a receiver; and that the Federal court could not subsequently appoint another receiver of its own to take the property from the possession of the State receiver; 16 but an appeal to a State court of review from the order appointing a receiver, and the filing of a supersedeas bond, which stays the proceedings, before the receiver has taken possession, does not authorize the appointment of a receiver by the Federal court; and such Federal receiver must surrender the property to the State receiver after the State order of appointment has been affirmed; although such appointment was in aid of a decree, an appeal from which, accompanied by a supersedeas, is still pending in the State court of review.17 It has been held: that the appointment by the Federal court of a receiver of the assets of a lessor does not oust the State court of jurisdiction to enjoin the directors from amending the lease; 18 and that after the Federal court has acquired jurisdiction of a bill praying the

13 Central R. & B. Co., v. Farmers' L. & Tr. Co., 56 Fed. 357.

14 Re Metropolitan Railway Receivership, 208 U. S. 90, 52 L. ed. 403.

15 McKechney v. Weir, C. C. A., 118 Fed. 805.

16 Shields v. Coleman, 157 U. S. 168, 39 L. ed. 660. But see Interstate Ry Co. v. Philadelphia, B. & T. St. Ry. Co., 164 Fed. 770.

17 Texas v. Palmer, C. C. A., 22 L.R.A. (N.S.) 316, 158 Fed. 705; aff 'd. Palmer v. Texas, 212 U. S. 118, 53 L ed. 435; Sullivan v. Algrem C. C. A., 160 Fed. 366; Stirling v. Seattle, R. & S. Ry Co., 198 Fed. 913.

18 Guaranty Trust Co. v. Northern Chicago St. Ry. Co., C. C. A., 130 Fed. 801.

removal of the trustee of a corporate mortgage, the appointment of another and the appointment of a receiver of the mortgaged property pending the suit, the State court cannot entertain proceedings for the appointment of a new trustee in accordance with the deed of trust.19 After the apointment of a receiver and until the termination of his receivership, his removal or discharge, no court, but that which appointed him, except in cases of bankruptcy, can interfere with the property placed in his custody.20 The unauthorized appearance of the Federal receiver in a State court does not divest the Federal court of its exclusive jurisdiction in this respect.21

22

A receiver appointed by a State court cannot, except possibly in a suit for the infringement of a patent, be sued without the permission of his court.2 And if he refuses to sue upon a claim belonging to his estate, it has been held that no person interested can bring a suit to collect the same without his joinder as a defendant by the permission of such court.23 Formerly a Federal receiver could not be sued without the permission of his court.24 The Judiciary Act of 1887 abrogated this rule; 25 but a judgment against him cannot be enforced without the permission of the Federal court.26

The appointment of a receiver of a corporation does not prevent a suit in another court against the subject of the receivership.27

But the court which appointed the receiver of the property may enjoin the prosecution in another of suits to foreclose liens upon the same.2 28 It has been held: that when a receiver has been

19 State Nat. Bank v. Syndicate Co., 178 Fed. 359.

20 In re Tyler, 149 U. S. 164, 37 L. ed. 689; Porter v. Sabin, 149 U. S. 473, 37 L. ed. 815; Security Trust Co. v. Union Trust Co., 134 Fed. 301.

21 Memphis Sav. Bank v. Houchens, C. C. A., 115 Fed. 96, 111.

22 Porter v. Sabin, 149 U. S. 473, 37 L. ed. 815; Rejall v. Greenhood, 60 Fed. 784; Ross v. Heckman, 84 Fed. 6. But see infra, $ 314.

23 Porter v. Sabin, 149 U. S. 473, 37 L. ed. 815; infra, § 314.

Fed. Prac. Vol. I-14

24 Barton v. Barbour, 104 U. S. 126, 26 L. ed. 672.

25 25 St. at L. 866, § 3, p. 436; infra, $314.

26 Porter v. Sabin, 149 U. S. 473, 37 L. ed. 815; Mo. Pac. Ry. Co. v. Texas Pac. Ry. Co., 41 Fed. 311, re-enacted in Jud. Code, § 66, 36 St. at L. 1087; infra, § 314.

27 Chicago, R. I. & P. Ry Co. v. Union Pac. R. Co., C. C. A., 254 Fed. 235. See infra, §§ 270a, 313,

314.

28 Oppenheimer v. San Antonio Land & Irrigation Co., Limited, C.

appointed of the property of a corporation, its mortgagee cannot without permission of the court which made such appointment take proceedings to foreclose a mortgage thereupon because of a subsequent default; 29 that the appointment by a State court of a receiver of a corporation pending a suit in a Federal court to set aside a chattel mortgage which it had fraudulently obtained was no bar to such Federal suit ; 30 that a Federal court may foreclose a mortgage upon property held by a receiver appointed by a State court in a suit to which the mortgagee was not a party; that in such foreclosure suit the Federal court can determine the claims of the holders of receivers' certificates issued under the order of the State court to a preference over the mortgage,31 and that where a suit was brought, in a Federal court, to foreclose a mortgage, prior to the institution of a suit in a State court in which a receiver was appointed, the Federal court might decree the foreclosure sale, notwithstanding the possession of such receiver. 32

It has been held: that upon a bill to set aside the decree of a Federal court, as fraudulent, a State court has no jurisdiction to review the acts of receivers appointed by the Federal court before such decree.33

Property in the possession of a statutory receiver not appointed by a court is not usually considered to be in the court's custody.34 Where the receiver of a national bank appointed by the Comptroller of the Currency refuses to sue to collect a cause of action due the bank, one of the stockholders may sue in a State court to collect such assets on behalf of the bank, and should make the bank and its receiver parties defendant.35 After the appointment by the Comptroller of the receiver of a bank, the State court may levy a writ of attachment against the bank and the receiver as garnishee. The State court then has jurisdiction to enter a judgment establishing the claim, but not to

C. A., 246 Fed. 934. See infra, $ 270a.

29 Slade v. Massachusetts Coal & Power Co., 188 Fed. 369.

30 Sims v. United Wireless Tel. Co., 179 Fed. 540.

31 Metropolitan Tr. Co. v. Lake Cities El. Ry Co., 100 Fed. 897. But see Wabash R. R. Co. v. Adel

bert College, 208 U. S. 38, 52 L. ed. 379; quoted, supra, § 52.

32 Bridgeport El. & Ice Co., v. Meader, C. C. A., 72 Fed. 115.

33 Kurtz v. Philadelphia & R. R. Co.. 40 Atl. 988, 187 Pa. St. 59.

34 In re Chetwood, 165 U. S. 443, 41 L. ed. 782.

35 Ibid.

order the receiver to make a payment out of the assets of the bank. It is the duty of the receiver upon the service of the writ to report the facts to the Comptroller, and it then becomes the duty of the Comptroller to hold any funds coming to his hands through the Treasury as the proceeds of the assets subject to any rights that have been adjudicated by the State court.36 In a proper case, an injunction may be granted to enjoin such a receiver from transmitting the assets to the Comptroller of the Currency.37

The apointment of a receiver or trustee by a Court of Bankruptcy in a case of which it has jurisdiction supersedes the authority of a receiver appointed by a State court although he was previously in possession of the property; but comity requires that, except in an extraordinary case, the receiver in bankruptey should apply to the State court for an order directing the delivery of possession to him before he institutes other proceedings for the same.38

A suit, in which a State court has appointed a receiver, may be removed to the Federal court.39 Where a Federal court has appointed a receiver in a case where a receiver was previously appointed by a State court, the proper remedy is an application by the State receiver, to the Federal court, for the delivery of the possession of the property to the applicant.4 40

§ 56. Controversies between State sheriffs and United States marshals; and those arising out of attachments, garnishee process and executions. A court, which, through its officers, has levied upon property under a common-law writ, retains the

36 Earle v. Conway, 178 U. S. 456, 44 L. ed. 1149; Earle v. Pennsylvania, 178 U. S. 449, 44 L. ed. 1146. 37 American Can Co. v. Williams,

C. C. A., 153 Fed. 882.

38 In re Watts and Sachs, 190 U. S. 1, 27, 47 L. ed. 933, 941; infra, $ 59.

39 In re Iowa & Minnesota Construction Co., 10 Fed. 401. Where, however, all the property of a foreign corporation had been placed in the hands of a receiver appointed by the State court, the Federal

court said, that a case instituted by attachment which had been removed thereto, should be remanded. Goldberg, Bowen & Co. v. German Ins. Co., 152 Fed. 831, 834.

40 Texas v. Palmer, C. C. A., 22 L.R.A. (N.S.) 316, 158 Fed. 705; Waters-P. Oil Co. v. Texas, 47 Tex. Civ. App. 162, 103 S. W. 836; State v. Port Royal & Augusta R. R. Co., 45 S. C. 470, 23 S. E. 363; People v. New York City Ry. Co., 57 Mise. (N. Y.) 114.

exclusive custody of the same until it abandons it. This rule applies to a judgment,2 and a fund in court 3 which are not subject to attachment or garnishee process,5 by any other court, until the fund is distributed. The entry of a final decree or order for the distribution, is not a relinquishment of the jurisdiction of the court; and checks prepared by the clerk of the court for mailing, in accordance with such an order, cannot be attached or made subject to garnishee process. It has been held, however, that the State sheriff may seize property, while still in the possession of the United States marshal, after an order by the Federal court directing its return to its owner; 8 that where the marshal, after levy under a writ of replevin, permitted the plaintiff's agents to pack the goods, to load them into a car, and to procure a shipping receipt and bill of lading for the same, these acts constituted a delivery to the plaintiff and a State sheriff might subsequently levy upon them under a writ of attachment issued by a State court; that, where a State sheriff had made no valid levy upon property by taking possession of the same, but merely had it pointed out to him, that did not prevent a subsequent seizure thereof by a marshal under process from a

$56. 1 Freeman V. Howe, 24 How. 450, 16 L. ed. 749; Krippendorf v. Hyde, 110 U. S. 276, 28 L. ed. 145; Summers v. White, C. C. A., 71 Fed. 106; De Galard v. Safe Deposit & Trust Co., 196 Fed. 981, a Federal suit in equity to obtain possession of bonds previously attached under process of a State court. When the sheriff held property under summary proceedings for a foreclosure under the Georgia statute, it was held to be in the custody of a State court. Tefft v. Sternberg, 5 L.R.A. 221 40 Fed. 2.

2 Menees v. Matthews, 197 Fed. 633; Mack v. Winslow, C. C. A., 59 Fed. 316, 319, 8 C. C. A., 134; and cases cited.

3 Corbitt v. Farmers' Bank of Delaware, 114 Fed. 602.

4 Ibid.

5 Mack v. Winslow, C. C. A., 59 Fed. 316, 319, 8 C. C. A., 134; Menees v. Matthews, 197 Fed. 633; and cases cited; Kantor v. Murchie, 210 Fed. 573; Swinerton v. Oregon Pac. R. Co., 123 Cal. 417, 56 Pac. 40. In Menees v. Matthews, 197 Fed. 633, the Federal court refused to stay an execution on its judgment because the circumstances tended to show collusion between the garnisher and the judgment debtors.

6 Corbitt v. Farmers' Bank of Delaware, 114 Fed. 602.

7 Swinerton v. Oregon Pac. R. Co. 123 Cal. 417, 56 Pac. 40.

8 Daniels V. Lazarus, 65 Fed. 718; Lazarus v. McCarthy, 32 N. Y. Supp. 833.

9 Animarium Co. v. Bright, 82 Fed. 197.