Brinton v. Wood

Hoffman, Justice.

The case - on the defendants’ own showing, is an account adjusted between them and the -company, by which it is found indebted to them in the sum of $14,995.93. For this amount they have received transfers of securities in amount over $160,000. Such a circumstance, unexplained, would raise a violent presumption of fraud in the whole concern. It is met by statements that these securities are not probably of sufficient value to pay the demands.

Yet in January, 1859, Keeler, then president, presented a list of securities to the comptroller of New York, to the amount of $211,000, embracing many of those assigned, and made oath that they were owned in good faith, and *163were worth $140,000, and were, it was believed, first class liens. It is impossible, under such circumstances, to allow, a wholesale disposition of these securities, which must result in a ruinous sacrifice. On the other hand, the defendants should be allowed to collect such securities as may be available, either by suit or voluntary payment, giving security if required to account for the avails. Another course would be proper, but for some difficulties growing out of the position of the plaintiff. Unless he should be appointed receiver by this court, I cannot order the securities to be placed in his hands in giving security to pay„the defendants what may be due them. His right to sue in our tribunals, and eventually to obtain a judgment, is different from a position as an officer appointed provisionally to protect the property. He must be an officer of this court for such purpose. Whether he can ultimately sustain this suit is a point I do not now pass upon. (17 Howard U. S. Rep., 327.) I am not prepared to say that as to a defendant here, and property here, he cannot.

All that can now be done, as I think, is to retain the injunction, but with it a provision allowing the defendants to apply, whenever so advised, for leave to collect, receive or sue for any specified security of their assignor; or for leave to pay off prior liens and incumbrances, or any of them, or to compromise the same. They may also have liberty to apply for power to select any designated number of such securities, and to proceed to the collection thereof, giving security to abide the order of the court respecting the same, or the avails of the same, and surrendering the residue to such person as may be appointed to receive the same. The order to be settled on two days’ notice. No cost of this motion to either party.