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could be levied on the defendant's forbidden. These features of the act property.”

manifest the interest of Congress to A distinction is to be noted, how- be that under no circumstances was ever, between the provisions of the act the property of the carriers to be suband those of the proclamation of the ject to levy, and that the right of President of December 26, 1917. In litigants to bring actions and have the former the prohibition as to ex- judgments rendered as such right ecution is positive, while in the latterthen existed was preserved and prodiscretion appears to be vested in the tected against future executive interDirector General of Railroads. This ference which was plainly forecast in distinction is commented on in El Paso the proclamation of December 26th." & S. W. R. Co. v. Lovick (1919)

So, also, in MCGREGOR V. GREAT Tex. Civ. App. 210 S. W. 283, as NORTHERN R. Co. (reported herewith) follows: "But if this intent and ante, 1635, the court said: “It does meaning of the act cannot be readily not follow, of course, that the Railroad ascertained from the words used, it Administration might voluntarily pay nevertheless becomes apparent when such judgments

as proper considered in connection with the an- claims arising during Federal contecedent proclamation of the Presi- trol." dent, dated December 26, 1917. In And in Dahn v. McAdoo (1919) 256 this proclamation the President or- Fed. 549, it is said: "If judgment shall dered that, except with the written be recovered against the Director Genassent of the Director, no attachment eral, no process shall be issued upon by mesne process or on execution such judgment that will interfere should be levied on or against any of

with the possession of the property the property used by any of the trans

under his custody; but he may provide

for the payment of such judgment portation systems in the conduct of their business as common carriers;

from the income or other funds under but that suits might be brought by

his control, or the Congress may other

wise provide for its payment, as it and against the carrier and judgments rendered as hitherto until and

may see fit." See also Louisville & N.

R. Co. v. Mink (1918) 180 Ky. 294, 202 except so far as the Director might,

S. W. 879. by general or special orders, other

Execution by attachment or garwise determine. There are two features of the act which obviously relate

nishment is within the meaning of the to that portion of the proclama

statute, and such process may not be

issued against a public utility during tion. The first is the provision with

the time of Federal control. reference to actions at law, suits in

In Dooley V. Pennsylvania R. Co. equity, and rendition of judgments. The second is: 'But no process, mesne

(1918) 250 Fed. 142, it was held that or final, shall be levied against any

traffic balances which go to make up property under such Federal control.'

the working or liquid capital of a railIt is significant that whereas, under

road company are not subject to garthe proclamation, suits might be nishment during Federal control, bebrought against such carriers and cause “the tying up such fund judgments rendered as hitherto, until would clearly be detrimental to the and except as the Director might, by successful operation of a railroad sysorder, otherwise determine, the act it- tem." self expressly stipulated that actions The rule has been extended to the at law and suits in equity might be agents operating and employed in the brought against such carriers and actual conduct of the business. Thus judgments rendered as then provided it has been held that the salary of a by law, and that whereas, under the railroad employee is not subject to proclamation, mesne process or exe- garnishment at the suit of a creditor cution could be levied with the prior when the railroad is under Federal written assent of the Director, under control. Dickens v. Bransford Realty the act of Congress it was absolutely Co. (1919) – Tenn. 210 S. W. 644,

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wherein it was said: “Under Public 88 10 and 11 of the act, as well as the
Act No. 107 of the Sixty-fifth Con- entire spirit and purpose of the act.
gress, approved March 21, 1918 (Act No court, either state or Federal, can
March 21, 1918, chap. 25, 40 Stat. at interfere with or control the discre-
L. 451, chap. 25, Comp. Stat. SS 31154a- tion of the Director General as to the
3115åp, Fed. Stat. Anno. Supp. 1918, p. operation of these properties, and any
757), and under previous statutes and action directly interfering with his
the proclamation of the President, the possession and control of the prop-
railroads of the country, including the erty is specifically forbidden by Con-
defendant Nashville Terminals, are gress.”
now merely agencies or instrumen- So, in St. Louis-San Francisco R. Co.
talities of the United States govern- V. State (1918) Okla. – P.U.R.
ment. While it is true Public Act No. 1918C, 596, 170 Pac. 1146, an order of
107 of the Sixty-fifth Congress, above the Corporation Commission requiring
referred to, very broadly authorized the railroad company to remove its
suits against such common carriers, depot in the city of Miami, and to re-
still their liability to suit is not great place it by a modern structure in keep-
er than that of the various municipal ing with recent progress and present
corporations of this state. Such lia- conditions at that place, was set aside
bility, however, should be confined to and the case continued until the fur-
their own creditors. Since it is the ther orders of the court. In the opin-
settled policy of this state to hold im- ion it was said: "Since the submis-
mune from garnishments all munic- sion of this case the government of the
ipalities and other governmental agen- United States has become engaged in
cies, we think such protection must be the prosecution of a war with the Im-
accorded to defendant Nashville Ter- perial Government of Germany and
minals, as it is now operated. More- its ally, Austria-Hungary, and, under
over, § 10 of the act of Congress above its constitutional powers in times of
referred to expressly provides that war, has taken charge and control of
‘no process, mesne or final, shall be all the railroads in the United States,
levied against any property under including that of appellant, and is now
such Federal control,' and this would engaged in the management and
doubtless preclude proceedings by at- operation thereof, and the court knows
tachment and garnishment."

judicially, as everyone knows, that it Any order either directing or re- will require the utmost conservation straining, or an injunction, temporary of the resources and energies of this or permanent, has been held to be as country, and will require vast stores much an interference with the pos- of supplies and materials such as will session and control of the Director be required to comply with the order General as if the roadbed were levied appealed from to carry on the prosecuupon by attachment or execution. tion of the war to a successful ter

A suit in equity to restrain the Di- mination, and that the revenues of the rector General of Railroads from re- railroads, their rolling stock, and the moving certain officials and property

services of their employees will be from one town to another is within

taxed to the utmost in the speedy and the provisions of the Act of March 21,

efficient transportation of troops, mu1918. Nueces Valley Town-Site Co. v.

nitions, and other war supplies. MatMcAdoo (1919) 257 Fed. 143, wherein

ters of this kind must and will have it is said: "Should the state court precedence over matters of private prevent the Director General from convenience and local ambition, and transferring his employees from one should not be permitted to interfere point to another, and from regulating with the successful accomplishment of their duties, it would, to that extent, its aims by the government of the be to take the control, possession, use, United States." and operation of the properties out A similar state of facts arose in of the hands of the Director General, Chicago, R. I. & P. R. Co. v. State in contravention of the terms of both (1919) Okla. -, P.U.R.1919D, 443,

180 Pac. 250, and following the ruling affairs of the respondent does not exin St. Louis-San Francisco R. Co. v. cuse it from performing any duty owState (Okla.) supra, the court held ing the state. It is also to be noted that continuance must be had until that General Order No. 50 applies to further orders.

causes of action arising subsequent But a contrary view was taken by to December 31, 1917. It follows that the court in Commercial Club v. Chi- the General Order has no application cago, St. P. M. & O. R. Co. (1919) to this case." Minn. -, P.U.R.1919D, 417, 171 N. W. It is to be noted also that the statute 312. This was on appeal from a de- and Presidential proclamation were cree affirming an order of the State not intended to include, nor do they Railroad and Warehouse Commission, prohibit, the issuance of an attachdirecting the railway company to ment for the purpose of obtaining juerect a new railroad and passenger risdiction over defendants, prelimindepot at St. James, Minnesota, and ary to a trial of the issue. Such a writ

a it was held that the Act of Congress is not a process of execution, either of March 21, 1918, had no bearing on mesne or final. See L. N. DANTZLER the controversy.

LUMBER Co. v. TEXAS & P. R. Co. (reIt has also been held that a pro- ported herewith) ante, 1669. ceeding to compel the performance of But the Director General, to be ena duty required by the state is not titled to the protection of that clause within the contemplation of the stat- of the act approved March 21, 1918, ute, and judgment will be enforced. which provides that no process, mesne In Re Morris Ave. Bridge (1919) 105 or final, shall be levied against any Misc. 659, 174 N. Y. Supp. 682, where, property under Federal control, must in granting a peremptory writ of man- be in legal possession of such propdamus to the city of New York, direct- erty. Hence it has been held that ing the New York Central Railroad property which consists of several Company to repair the bridge carry- tracts or lots in a city and adjacent ing Morris avenue over its tracks at thereto, not necessary to the daily 156th street, the court said: “The running of a railroad, is not within respondent further urges in opposition the provision of the act. United to this motion that it should be denied, States R. Administration V. Burch because the railroads are not now in (1918) 254 Fed. 140. In that case the possession of and operated by the re- court refused to restrain the defendspondent, but are under Federal con- ant, who, as sheriff, had levied on and trol and operated by the Director Gen- advertised for sale certain parcels of eral of Railroads. Reference is made land belonging to the Atlantic Coast to General Order No. 50, issued by the Line Railroad Company, on the ground Director General. It does not seem that the lots did not appear in any that the order has any application. It wise to be the property or land essenrelates to actions at law, suits in tial or necessary to the performance equity, and proceedings in admiralty, of the transportation duties

duties and based on contract, and actions in tort, operations of the railroad, saying: and provides that such suits, actions, “The present case presents the case and proceedings shall be brought of a creditor holding a final judgment, against the Director General, and not which should normally be paid forthotherwise. It is also stated that the with, and with the right to the credrule shall not apply to actions, suits, itor, if the same be not paid, to enor proceedings for the recovery of force payment out of any property of fines, penalties, or forfeitures. This the judgment debtor liable to judgspecial proceeding is not an action, ment execution. To hold that the railnor is it based upon contract or tort, road company is by these statutes put but is a proceeding to compel the per- in a position where it is not bound to formance of a duty required by stat- pay any of its debts until the possesute. The fact that the Director Gen- sion of its property is restored to it, eral has control or management of the although it may receive the rentals in the meantime, might mean that, while process could be levied upon it. The the railroad company would still con- only question thus for the court is tinue to be in possession of the rents whether or not, under the terms of the and profits and other results flowing statutes of the United States, the comfrom the property, its creditors, who plainant in this case is legally in are entitled to payment therefrom, possession of the property, so as to enmight be greatly injured by their in- title him to the benefit of the exempability to collect payment for an in- tion given by the act from the levy definite period. The case before the of final process. It does not appear to court, however, does not depend upon the court that the property is propany inability or unfortunate position erty of which, under the terms of the that the railroad is placed in, because statute, the President was authorized its property has been taken possession to take possession. If the President of by the government, or at least so was not authorized to take possession, much of its property as is necessary then he could not authorize the Secrefor use for transportation purposes.

tary of War or the Director General Were the railroad company to file a to take possession, and any possession bill in equity, stating that all of its taken by them would be unlawful and property had been taken possession of would in no wise devest the rights of by the government by virtue of these other parties. The complainant being acts, and that it had no property or thus not in legal possession of this funds which could be applied to the property, and the property being, in payment of this debt, and that a cred- the opinion of this court, not property itor ought not to be allowed by the of which he could legally take possescompulsory process of judgment and sion, under the terms of those statexecution to sell away the property of utes, it is not property which, under the railroad company, and deprive it the terms of those statutes, is exempt of its legal title, when, through the from the levy of final process; and it action of the government, it was pow- follows from that, that the injunction erless to make payment, it might pre- should be refused." sent a question calling for the inter

This holding has been followed in position of an injunction from a court

Schumacher v. Pennsylvania R. Co. of equity until the railroad company

(1919) 106 Misc. 564, 175 N. Y. Supp. should be in a position to use its funds

84, where the court said: "If all the to meet the claims of its creditors.

property of a railroad company were In other words, if the railroad com

in fact taken under Federal managepany were in a position to claim that

ment and control, it might be argued the effect of these statutes was a com

that such corporations would be fully pulsory statutory moratorium, it

protected by the clause quoted. ($ 10.) might be in a position, in view of the

We do not think the Act of August 29, great injury and injustice worked to

1917, or that of March 21, 1918, conit by permitting a creditor to assert

templates that all property of such his legal rights under execution,-it

corporations should be taken over by might be in a position to have an in

the Federal government. Indeed, the junction. That is not the case, how

very language of the clause seems to ever. The Atlantic Coast Line Rail

assume that the company may possess road Company is not before the court. property other than such as is taken The Atlantic Coast Line Railroad

over by the government, for the exCompany asks no injunction. The in- emption from levy and sale under junction is sought on behalf of the execution is limited to 'and property Director General appointed by the under such Federal control,' and such President's proclamation upon the sin- only. Had Congress intended to exgle ground that he is legally in pos- empt all the property of a carrier from session of this property, and that, be- levy and sale, it would have so plaining in possession of this property, ly said in the statute enacted. We then under the terms of § 10 of the may almost take judicial notice of the Act of the 21st March, 1918, no final fact that railroad companies, or many

of them, do own and possess other owned by the carrier for the satisfacproperty than that employed in the tion of judgments obtained pursuant transportation of passengers and to the provisions of g 10. Nowhere freight. Many of them have large in the statute are we able to find any holdings of the stock and bonds of

provision forbidding the judgment subsidiary companies. Many, if not creditor from pursuing the usual remall, in addition, owned considerable

edies for the collection of his claim, sums of money on hand and in bank

saving from the particular properties as the result of their operation. The taken 'under Federal control.' In time Federal government took into its pos

the various transportation systems session and control none of this class

taken over by the government will of property, and all this class of prop

doubtless be returned to the various erty can be reached by judgment cred

railroad companies which own them, itors in appropriate proceedings to satisfy valid judgments against the

and it is pertinent to ask whether uncorporation. Not only did the stat

satisfied judgments against the carute not authorize the government to

rier corporations might not be colassume control of the class of prop

lected by execution against the property referred to, but an examination

erty returned. Such property would of the President's proclamation of De

then cease to be under 'Federal concember 26, 1917, shows that, as a mat

trol,' and the prohibition against procter of fact, the government only as- ess against such property would cease sumed control and management of the to operate.” physical properties of carriers used This limitation is also recognized in by them in their transportation sys- MCGREGOR V. GREAT NORTHERN R. Co. tems. We mention these facts for the (reported herewith) ante, 1635, wherepurpose of showing that the protection in it is said: “Judgments obtained against levy and sale under execution give rise to the same remedies as as to property 'under Federal control formerly, except that their transpordoes not prevent the judgment credi- tation facilities are not subject to levy tor from reaching any other property and seizure."

W. M. C.

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