FINCH, VAN SLYCK & McCONVILLE v. LE SUEUR COUNTY CO-OPERATIVE COMPANY

Minnesota Supreme Court1916-11-10No. Nos. 19,926—(75)

134 Minn. 376

Summary · law.co

Holding. The court dismissed both appeals because neither the plaintiff nor the receiver had standing to appeal the rehearing order. The plaintiff's claim was conclusive and unaffected by the order, and the receiver, as a neutral administrator of the trust, had no legal interest in the allowance or denial of other creditors' claims.

This case involved an appeal by Finch, Van Slyck & McConville and a receiver from a lower court order that vacated a judgment allowing claims against an insolvent cooperative corporation and scheduled a rehearing on those claims. A stockholder had moved to set aside the judgment allowing claims, and the motion was granted. Both Finch, Van Slyck & McConville and the receiver appealed this order.

The court dismissed both appeals, finding that neither party had standing to appeal. Finch, Van Slyck & McConville was not an aggrieved party because its underlying claim against the corporation and its stockholders had already been affirmed in a prior appeal and was conclusive; the rehearing order affected only other creditors' claims, not the plaintiff's interest. Similarly, the receiver lacked standing because it had no interest to protect in the outcome. The receiver's role in insolvency proceedings is neutral, representing the court in administering the trust without becoming an advocate for or against any creditor's claims.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Standing of creditor to appeal order affecting other creditors' claims
Standing of receiver to appeal in insolvency proceedings
Role and neutrality of receiver in administering insolvent estate

Procedural posture

This was an appeal from a lower court order vacating a judgment allowing claims against an insolvent corporation and ordering a rehearing, brought by both the judgment creditor and the receiver.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

majority opinion

Brown, O. J.

This proceeding was brought to enforce the statutory liability of the stockholders of the Le Sueur County Co-operative Association, an in solvent mercantile corporation. The matter was before us on a former appeal ivhen various questions were disposed of, including an order assessing the stock 100 per ’cent of its par value. 132 Minn. 9, 155 N. W. 754. During the pendency of the former appeal the court below made an order allowing a large number of claims against the corporation, which order was merged in a judgment of November 3, 1915. The opinion on the former appeal was filed on January 7, 1916. On February 12, 1916, one of the stockholders of the corporation moved the court, on notice served upon the receiver, to set aside and vacate the judgment allowing claims, and for an order fixing a date upon which a rehearing might be-had upon all the claims so allowed. The motion was supported by affidavits, and was opposed by plaintiff, Finch, Yan Slyck & McConville, a. corporation, and by the receiver. The motion was granted, and a time and place fixed for the rehearing of such claims, and from the order plaintiff and the receiver separately appealed.

Kespondent’s motion to dismiss both appeals must be granted.

Plaintiff’s claim, the basis of the proceeding, is founded upon a judgment which was affirmed by this court in Finch, Van Slyck & McConville v. Le Sueur Co. Co-op. Co. 128 Minn. 73, 150 N. W. 226. The judgment is conclusive of plaintiff’s claim, not only against the corporation, but also its stockholders. Oswald v. Minneapolis Times Co. 65 Minn. 249, 68 N. W. 15. This is conceded by respondent. Its claim therefore is not affected by the order, plaintiff is not an aggrieved party and is without the necessary foundation in support of its appeal. It is clear that it cannot contest the validity of the order as to other creditors, for it has no interest in their claims. Its appeal will therefore be dismissed.

It seems equally clear that the receiver has no interest to protect by opposing the rehearing order, and is therefore not aggrieved and cannot appeal. The receiver in proceedings of this kind represents the court in the administration of the trust imposed upon him, and stands indifferent as between the creditors asserting claims against the insolvent. He may in some respect represent the collective body of creditors in the protection of rights common to all, but in no case can he become an advocate in support of the allowance of claims presented by them. He may oppose fictitious or fraudulent claims, but it is clear that he cannot champion the claims of creditors, either singly or collectively. . For this reason the rehearing order does not concern him, nor involve any legal or other duty imposed upon him in the administration of the trust. If the order had opened the judgment allowing claims as to one, two or three creditors, and directed a rehearing thereon, the receiver manifestly could not be heard to complain. The fact that the order in question applies to all the creditors does not change the situation. And not being interested or aggrieved by the order he has no right of appeal. Medynski v. Theiss, 36 Ore. 397, 59 Pac. 871; Bosworth v. Terminal R. Assn. 80 Fed. 969, 26 C. C. A. 279; Bates v. Ryberg, 40 Cal. 463; State v. People’s State Bank, 22 N. D. 583, 135 N. W. 196; McColgan v. McLaughlin, 58 Md. 499; Knabe v. Johnson, 107 Md. 616, 69 Atl. 420; Dorsey v. Sibert, 93 Ala. 312, 9 South. 288.

Both appeals must therefore be dismissed. This precludes the consideration of any question involved on the record, either as to the sufficiency of the notice of the application for a vacation of the order allowing claims, or in any other respect.

Appeals dismissed.