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$ 299. [254.) (Amended 1849.) Existing suits. Proceedings upon claim of another party to property, or on denial of indebtedness to judgment debtor.

If it appear that a person or corporation alleged to have property of the judgment debtor, or indebted to him, claims an interest in the property adverse to him, or denies the debt, such interest or debt shall be recoverable only in an action against such person or corporation by the receiver; but the judge may, by order, forbid a transfer or other disposition of such property or interest, till a sufficient opportunity be given to the receiver to commence the action, and prosecute the same to judgment and execution ; but such order may be modified or dissolved by the judge granting the same, at any time, on such security as he shall direct.

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a. "The principle upon which the court directs property in controversy to be placed in the hands of a receiver, pending the litigation, is, that the party applying for a receiver has shown at least a probable interest in the property, and that there is danger of its being lost without such protection. The plaintiff charges, upon information and belief only, that the defendant (an alleged fraudulent assignee) is not the owner of property or effects of any description sufficient to pay his debts and liabilities. This allegation undenied, would be sufficient to show that the property was in danger, and required the appointment of a receiver. (Connah v. Sedgwick, 1 Barb. R. 210.) But the defendant's affidavits satisfactorily show that the plaintiff is mistaken in respect to the pecuniary condition of the assignee. There is, therefore, DO ground for taking the assigned property out of his hands before the rights of the parties are determined by the judgment of the court.” Per Harris, J., in Goodyear v. Betts, 7 Pr. R., 189.

b. The appointment of a receiver under this section should be by the same judge who ordered a reference to examine as to the property of the judgment debtor. No other judge out of court has the power, and this applies to county judges who make such orders. Smith v. Johnson, 7 Pr. R., 39; Hatch v. Weyburn, 8 ib., 165.

c. No person who has heretofore executed any assignment of any interest in any real estate, to any receiver, in pursuance of any order of the late court of chancery or supreme court in equity, his heirs or assigns, nor any person claiming by, from, or under them or any of them, shall be permitted to question the palidity of such assignment to said receiver, or any sale or conveyance made by him of the assigned property, by reason of the want of any power or authority in either of those courts to make such order, or to direct such sale and conveyance, providing said courts shall have acquired jurisdiction of the persons and subject matter of the suit, and shall have proceeded according to the rules of practice of said courts. This act shall not affect any suit or proceeding now pending in regard to any such assigned property, nor the title thereto of any purchaser in good faith for a valuable consideration. Laws of 1851, ch. 163, ss. 1 and 2 ; 2 R. S., 4 ed., 356, ss. 58, 59.

d. “A question has been made,whether a judgment creditor can, under the present practice, when the property of his debtor is in the hands of a third person, and is claimed by such third person, reach such person by an action brought directly for that purpose. The 299th section of the code declares, that when a person alleged to have property of a judgment debtor, claims an interest in such property, it shall be recoverable only in an action against such person by the receiver. It has been supposed that this provision rendered it necessary for the creditor, before proceeding to recover property alleged to have been fraudulently transferred by his debtor, to

procure the appointment of a receiver, and have the suit against the fraudulent assignee instituted by and in the name of the receiver. The lauguage of the provision, when taken by itself, is certainly broad enough to bear this construction. It declares that the interest claimed by such third person shall be recoverable only in an action against such person by the receiver. But I think it was intended that this provision should be confined in its operation to cases where proceedings supplementary to execution have been instituted. It had been provided that, in certain cases, the judge before whom the proceedings should be had, might, without the intervention of a receiver, make an order for the application of the debtor's property, whether in his own hands or that of another person, to the satisfaction of the judgment. The provision in the 299th section seems to have been intended as a restriction upon the power, so that it should only be exercised when the debtor's right to the property is undisputed. This, I think, is the fair meaning and true construction of this provision of the code. It is not in the way, therefore, of an action in the nature of a creditor's bill, for the purpose of having an assignment or other disposition of property by the judgment debtor declared to be fraudulent, and the property applied to the satisfaction of the judgment.” Per Harris, J., in Goodyear v. Betis, 7 Pr. R., 188.

Q. A receiver appointed under the provisions of this chapter cannot bring suit to set aside conveyances executed by the judgment debtor prior to the appointment of the receiver, on the ground that they were made for the purpose of hindering and delaying creditors. (Hayner v. Fowler, 16 Barb. 300.) Nor has such a receiver authority to bring suit to set aside as fraudulent a prior assignment made by the debtor of a bond and mortgage, or to receive the property so assigned as the property of the debtor. (Seymour v. Wilson, ib., 294.) The duty of such a receiver is confined to property of which the debtor had possession, power, or control, actually or constructively, in whole or in part, at the time of the appointment of the receiver. 1b. On a motion to restrain F, a third person, from disposing of property of the debtor, the motion was denied because the affidavit on which the motion was found. ed did not show that any order had been made under section 294, requiring F. to appear and answer, and per Bosworth J., “This seems to be necessary in order to make him a party to the proceedings (5 Pr. R., 16), and to enable the court to properly enjoin bim under section 299. Section 294 seems to proscribe the proceed. ings to be taken to authorize an order under section 299.King v. Tuska, 1 Duer, 635.

See note to sections 294, 298 of this code.

$ 300. [255.] (Amended 1849.) Existing suits. Reference by judge.

The judge may, in his discretion, order a reference to a referee agreed upon or appointed by him, to report the evidence or the facts.

6. In Hollister v. Shafford, 1 Code Rep. N. S., 120, Campbell, J., announced the practice of the superior court under this section as follows:

• The practice we have adopted, when judgment debtors, or persons alleged to have their property, are brought up for examination on an order of one of the justices, is now stated, that it may be more fully understood.

“ As a general rule, we will not order a reference for this purpose against the wishes of either party.' The examination must proceed at the chambers of the court, where the justice in attendance at chambers, or holding the special term, can see that no injustice is done to examinants attending without counsel, and can dispose of the legal questions arising, to the great saving of trouble and expense to the parties.

* As such examinations are usually conducted, his actual attention to them will be required only occasionally, and they will not interfere materially with his other duties.

" Whenever the parties agree to a reference, it will be ordered of course. So, when it becomes apparent that a difficult or protracted investigation must ensue, and the examinants have counsel, a reference will be directed."

a. Under the first clause of section 292, a county judge has the same power to appoint a referee as a judge of the supreme court. Conway v. Hitchins, 9 Barb. 378. And the conferring this power on the county judge is no violation of the constitution. Sale v. Lawson, 4 Sand. 718. The referee may be appointed without any previous notice to the execution debtor. Conway v. Hitchins, supra.

b. Where the proceeding is founded upon the transcript of a justice's judgment, it is the usual practice of the New York court of common pleas to appoint as referee the justice who rendered the judgment. Hough v. Kohlin, 1 Code Rep. N. S., 232.

c. But where it was suggested that the justice was connected in some money transactions with the plaintiff's attorney, a referee other than the justice was appointed. Ib.

d. The referee may, in his discretion, allow corrections or explanations to be made by any party to the examination, after the same has been concluded and signed. Corning v. Tooker, 5 Pr. R., 16.

e. A refereo appointed to report the facts is not at liberty to report the evidence at large. Dorr v. Noxon, 5 Pr. R., 29.

f. The referee should decide what effects are to be delivered to the receiver, and specify the same particularly. Dickerson v. Van Tine, 1 Sand. 724.

g. If the articles are ponderous, the referee should designate a time for the debtor to attend at the place where they are situate, and deliver the same to the receiver. Ib.

h. When the debtor is entitled to exemption, the referee should, in his direction for the delivery of the debtor's household furniture, specify and except, as otherwise designated, the furniture which is to be left with the debtor, as being exempt. Ib.

i. In Hatch v. Weyburn, 8 Pr. R. 166, the court, in effect, say that however proper in the then (1850) state of the law, might have been the decision in Conway v. Hitchins (9 Barb, 384), yet that the amendment made to section 292 in 1851, by omitting the words,“ or a referee appointed by a judge or the court," has so far altered the law, that now the order under section 292, must require the debtor to appear before the judge; and it is “quite clear from section 300, that it was contemplated that the defendant, at the time of the reference [being ordered), should be before the judge." See in note to s. 292, ante. In a subsequent case, Green 5. Bul. lard, 8 Pr. R., 316, Willard, J., referring to the case of Conway v. Hitchins, says, “I am not aware that the decision was ever questioned. The supreme court in the eighth district (Hatch v. Weyburn, supra) approved of this decision as applicable to the code of 1849, but think the change of the 292d section in the code of 1851, has restored the practice under the code of 1848, and taken indirectly from the judge the power of appointing a referee, until the defendant has been first required to appear before the judge, and has actually so appeared. The learned judge who delivered the opinion of the court, expresses the opinion, that the judge, before appointing & refereo, must first obtain

jurisdiction of the subject matter, and of the person of the defendant. I think the learned judge errs in saying that the alteration made to the code of 1849 by the code of 1851, restores the code of 1848. The 247th section of the code of 1848 prescribed, that the order of the judge should require the judgment debtor to appear, and make discovery on oath concerning his property before such judge, &c. * The 251st section (code of 1848] provided that, if the party or witness resided in the county, he should be required to attend before the judge ; if in any other county, before a referee, &c.; and in such a case, the examination should be taken by the referee and certified to the judge. Under this code (1848), it is plain that a reference could only be appointed for the examination of the defendant when he resided in a different county from the judge. The 255th section (code of 1848] provided for a reference generally, to report the evidence or the facts; but this was not probably intended to cover the cases embraced in section 251. The code of 1849 so altered the first paragraph of section 292, that the judge's order might re

quire the defendant, in the first instance, 'to appear and answer concerning his property,' before such judge, or a referee appointed by such judge. The 251st section of the code of 1848 was so altered (s. 296) as to require the party or witness to appear before the judge or referee, whether the party or witness resided in the same county with the judge or not. And it retained the 255th section of the code of 1848, as section 300, with a slight alteration, giving the judge power at his discretion to or. der a reference, and requiring the referee to report the evidence or the facts. In our opinion in Conway v. Hitchins, we treated the alteration in the first paragraph of section 292 as quite superfluous, and intimated that section 300 gave ample power to appoint a referee in that case. That case was decided in September 1850. In the revision of the code in 1851, that clause of section 292 was altered, and left as in the code of 1848 ; but the sections 296 and 300 were left as in the code of 1849. If it had been the intention of the legislature, by the restoration of the first clause of 8. 292 to the form it was under the code of 1848, to require the judge to summon the defendant to appear before himself, before a referee could be appointed, they should have altered section 296, and made it conform to section 251 under the cude of 1848. By leaving sections 296 and 300 as they were in the code of 1849, they left the power of appointing a referee as it stood under that code. Those sections are ample to confer the power of appointing the referee at the same time that the order for the examination is made. The learned judge in Hatch v. Weyburn, did not have his attention drawn to the identity of section 296 in the codes of 1849 and 1851. I think the learned judge also errs in supposing that the judge does not acquire juris. diction of the subject matter and of the person of the defendant until the defendant has appeared before the judge. The judge acquired jurisdiction, for all the purposes of the appointment of a referee, by the presentation to him of an affidavit containing the facts required by section 292 to be stated in it, and by the motion of the creditor for the order. (Barnes v. Harris, 4 Coms., 375; 1 Saund., 87, 90, n. 1.) The matter which the defendant is required by section 292 to do before the judge, viz., "answer concerning his property,' is precisely the matter proper to be inquired of before a referee, and which the referee, under sections 296 and 300, can take and certify to the judge."

a The referee must certify the examination or report the evidence or the facts to the judge who made the order and no other. Smith v. Fitch, 7 Pr. R., 40; Hatch v. Weyburn, 8 ib., 163.

b. The referee has no control over the person of the defendant. He cannot compel an appearance, nor punish him for a disobedience of orders. He must report to the judge who appointed him. Green v. Bullard, 8 Pr. R., 318.

$ 301. [256.] (Amended 1849.) Existing suits. Costs of proceeding.

The judge may allow to the judgment creditor, or to any party so examined, whether a party to the action or not, witnesses' fees and disbursements, and a fixed sum in addition, not exceeding thirty dollars, as costs.

c. The application for costs under this section, cannot be made until the proceedings have been terminated, and in favor of the party applying. Davis v. Turner, 4 Pr. R., 190.

d. This section does not apply to cases where no examination of the judgment debtor has taken place ; thus, where the judgment debtor procured the order to be set aside as irregular, before any examination under such order, the court said this section did not give the defendant costs, unless he has been examined. Engle v. Bonneau, 2 Sand., 679; 3 Code Rep., 205.

e. This section does not authorize an application by a witness for an order to be paid his fees; it authorizes only an application by a party so examined, not as a witness merely, but as a judgment debtor, or as a party to the proceedings under this section, to enforce the judgment. See observations of Willard, J., in Davis v. Turner, 4 Pr, R., 190.

a. The remedy for his fees, of one who is a mere witness, is against the party calling him; and he would not, it seems, be required to give evidence until his fees were paid. Ib.

6. The fees of witnesses are provided by 2 R. S., 400, s. 42. Thus, "Fifty cents for each day while attending any court or officer; and if the witness resides more than three miles from the place of attendance, travelling fees at the rate of 4 cents per mile, going and returning."

c. All the judges of the superior court held, that if on the examination of the debtor, no property or effects applicable to the judgment should be discovered, the creditor would be ordered to pay costs to the debtor, pursuant to section 301, unless the creditor can show some good reason for having required the debtor to submit to the examination. Anon. 1 Code Rep. N. S., 113.

$ 302. [257.) (Amended 1849-1851.) Existing suits. Disobedience of order, how punished.

If any person, party, or witness, disobey an order of the judge or referee, duly served, such person, party, or witness may be punished by the judge, as for a contempt. And in all cases of commitment under this chapter, or the act to abolish imprisonment for debt, the person committed may, in case of inability to perform the act required, or to endure the imprisonment, be discharged from imprisonment, by the court or judge committing him, or the court in which the judgment was rendered, on such terms as may be just.

The amendment of 1851 is the part in italic.

d. Under this section a judge has power to punish as for contempt, all disobedience of orders made by him in “proceedings supplementary to the execution." An attachment issued by him for such contempt may therefore properly be made returnable before him at his office. Re Smethurst, 3 Code Rep. 55 ; 2 Sand., 724.

e. Although the code gives to the judge the power of punishing disobedience to his orders, reference must be had to the revised statutes as to the mode in which that power is to be exercised. 2 R. S., 535. 16.

f. Under this statute, a judge, upon due proof, may, in his discretion, issue an attachment in the first instance, against the party accused, to appear and answer, or he may grant an order to show cause. In either case, copies of the affidavits upon which the application is founded, should be served with the attachment or order. It is not necessary that the party accused should first have an opportunity of being heard upou an order to show cause before an attachment can issue. The attachment is not used in such instances, for the purposes of punishment, after a final adjudication. It is only a mode of bringing the party before the court. 1b.

g. It seems, that in the first district, the ordinary practice is, to give notice of motion for an attachment, or obtain an order to show cause. Ib.

h. Whether the affidavits upon which an attachment is issued, are sufficient to warrant its issuing, is a matter that cannot be reviewed upon habeas corpus. Ib.

i. On the application for the attachment, the debtor will be heard by way of appeal from the decision of the referee ordering the delivery. Dicker son v. Van Tine, i Sand., 724.

See note to section 297.

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