Great Western Mining & Manufacturing Company, in his possession, that, in connection with the floating of the loan of $300,000 in the year 1889, upon the property of the Great Western Mining & Manufacturing Company, situate in Lawrence county, Kentucky, certain stockholders and officers of said company combined to obtain for themselves, and did so obtain, proceeds resulting from the sale of said bonds in the sum of $75,000, which money belonged to, and should have been paid into, the treasury of said company.

"Your receiver says that he finds shares of capital stock of the Great Western Mining & Manufacturing Company were issued at the instance of, and through the action of, certain of said stockholders and officers of said company, to the amount of $150,000, which said stock was distributed among said stockholders and officers; that, as your receiver is informed and believes, there was no consideration for the issue and distribution of said stock; that the said stock was sold by said stockholders, so as aforesaid receiving it, to the defendant, The Great Western Mining & Manufacturing Company, and, by means of said sale, moneys to the amount of $75,000 were abstracted from the treasury of said company; that the issue and distribution of said capital stock was, as your receiver believes, a mere device or instrumentality to abstract said moneys from the treasury of said company; that said company, as your receiver believes, has a valid claim against said persons to recover said moneys; that some of said parties are solvent and able to repay said moneys, and proceedings should be taken to recover it for said company and its creditors.

"Your receiver further says that he has discovered from the books of the company that apparently, by reason of the inattention and negligence of the board of directors of the said Great Western Mining & Manufacturing Company, and apparently by reason of the mismanagement and misappropriation of the funds of the company, by certain members of said board, that the said company has been greatly damaged, and its assets depreciated in value in a large amount, the exact sum of which is unknown to your receiver, and that said losses should now be made part of the said company's assets; and that the same is, in the opinion of your receiver, a valid claim against the said board of directors, and that proceedings should be taken to recover the same for the said company and its creditors.

"Wherefore your receiver prays the direction of your honorable court as to his duty in the premises."

"This cause coming on to be heard upon the application of L. C. Black, receiver herein, asking for instructions as to his duty in the matters and things set forth in the said application, and wherein said receiver represents to the court that, in certain transactions connected with the floating of a loan of $300,000 upon the property of the Great Western Mining & Manufacturing Company, apparently $75,000 was withdrawn by certain stockholders and officers of the said company, whereas the same should have been paid into the treasury of the said company; and wherein said receiver further represents that apparently certain stock was issued to the stockholders and officers of the said company without consideration, and that apparently, by reason of the inattention and negligence and mismanagement of the board of directors of the said company, and the misappropriation of the funds of the said company, said company has been greatly damaged and its assets depreciated.

"And it appearing to the court that it will be for the advantage of the said company that suit shall be instituted against the stockholders and directors of the same for the recovery of the sums so represented to be lost, it is, therefore, directed that said receiver proceed in his own name as receiver, or in the name of the company, as he may be advised, to recover said sums."

Mr. Harlan Cleveland for petitioner. Messrs. Brainard Tolles and Julien T. Davies for respondents.

Mr. Justice Day delivered the opinion of the court:

The theory of the complainant's case seems to be that the transfers of the stock of the defendant and other directors and stockholders, paid for out of the proceeds of the bonds, in view of the allegations of the bill as to the condition of the company, and the purposes in view by the defendant and associates, amounted to a breach of duty upon the part of the defendant and other directors, and a conversion to their own use of the property of the company, for which they should be held to account in an action brought by the company, through its receiver, under the order of the circuit court of Kentucky. The particulars of the suit in which the receiver was appointed are not very fully set forth, but enough appears to show that he was appointed in a suit to adjudicate and enforce liens, and subject the property to the payment of the claims of creditors. In the brief of the learned counsel for complainant, it is styled a "general creditors' and foreclosure suit." It does

Upon this application the court made the not appear that, by order of the court or following order: otherwise, there has been any conveyance of

Mr. Justice Wayne, who delivered the opinion of the court in Booth v. Clark, stated, among others, the following reasons for refusing to recognize the powers of a receiver in foreign jurisdictions:

"We think that a receiver could not be admitted to the comity extended to judg ment creditors without an entire departure from chancery proceedings as to the manner of his appointment, the securities which are taken from him for the performance of his duties, and the direction which the court has over him in the collection of the estate of the debtor, and the application and distribution of them. If he seeks to be recog nized in another jurisdiction, it is to take the fund there out of it, without such court having any control of his subsequent action in respect to it, and without his having even official power to give security to the court, the aid of which he seeks, for his faithful conduct and official accountability. All that could be done upon such an application from a receiver, according to chancery practice, would be to transfer him from the locality of his appointment to that where he asks to be recognized, for the execution of his trust in the last, under the coercive ability of that court; and that it would be difficult to do, where it may be asked to be done, without the court exercising its province to determine whether the suitor, or another person within its jurisdiction, was the proper person to act as receiver."

the property and assets of the company to | creditor himself might have done, where his the receiver, nor has the corporation been debtor may be amenable to the tribunal dissolved, and the receiver made its succes- which the creditor may seek." sor, entitled to its property and assets. The minute books of the company, in evidence, do not show any authority by the corporation for the filing of this bill in the name of the Great Western Mining & Manufacturing Company or otherwise, although meetings were held after the appointment of the receiver. Nor is our attention called to any statute vesting the title of the corporation in the receiver. So far, then, as the receiver is concerned, his right to prosecute the action must depend upon his powers as such officer of the court and the order of the court, set forth in the statement of facts, authorizing him to bring suit against the stockholders and directors for the purpose of realizing the assets, either in his own name or that of the corporation, as may be proper. This condition of the record brings up for consideration at the threshold of this case the question of the extent of the power of the receiver to maintain this action under the order of the court, either in his own name or that of the company. As to the power of the court to authorize the receiver to sue, we think the case is ruled by Booth v. Clark, 17 How. 338, 15 L. ed. 170, in which case the authority of the court to authorize a receiver appointed in one jurisdiction to sue in a foreign jursdiction was the subject of very full consideration. In that case it was held that a receiver is an officer of the court which appoints him, and, in the absence of some conveyance or statute vesting the property of the debtor in him, he cannot sue in courts of a foreign jurisdiction upon the order of the court which appointed him, to recover the property of the debtor. While that case was decided in 1854, its authority has been frequently recognized in this court, and as late as Hale v. Allinson, 188 U. S. 56, 47 L. ed. 380, 23 Sup. Ct. Rep. 244, it was said by Mr. Justice Peckham, who delivered the opinion of the court:

"We do not think anything has been said or decided in this court which destroys or limits the controlling authority of that case."

In that case the following language, as to a receiver's powers, from Booth v. Clark, 17 How. 338, 15 L. ed. 171, is quoted with approval:

"He has no extraterritorial power of of ficial action; none which the court appointing him can confer, with authority to enable him to go into a foreign jurisdiction to take possession of the debtor's property; none which can give him, upon the principle of comity, a privilege to sue in a foreign court or another jurisdiction, as the judgment

It will thus be seen that the decision in Booth v. Clark rests upon the principle that the receiver's right to sue in a foreign jurisdiction is not recognized upon principles of comity, and the court of his appointment can clothe him with no power to exercise his official duties beyond its jurisdiction. The ground of this conclusion is that every jurisdiction, in which it is sought, by means of a receiver, to subject property to the control of the court, has the right and power to determine for itself who the receiver shall be, and to make such distribution of the funds realized within its own jurisdiction as will protect the rights of local parties interested therein, and not permit a foreign court to prejudice the rights of local creditors by removing assets from the local jurisdiction without an order of the court, or its approval as to the officer who shall act in the holding and distribution of the property recovered. In Quincy M. & P. R. Co. v. Humphreys, 145 U. S. 82, 36 L. ed. 632, 12 Sup. Ct. Rep. 787, the powers of a receiver were under consideration, and the following language was quoted with approval (p. 98, L. ed. p. 637, Sup.

Ct. Rep. p. 792): "The ordinary chancery | receiver, the court might direct the calls or receiver, such as we have in this case, is assessments upon delinquent shareholders clothed with no estate in the property, but who had not paid for their shares, thereby is a mere custodian of it for the court, and using the authority the directors might by special authority may become an officer have exercised before the appointment of the of the court to effect a sale of the property, receiver. In that case, a receiver appointed if that be deemed necessary for the benefit by the circuit court of Cook county, in Illiof the parties concerned." There are excep- nois, under the direction of that court tional cases, such as Relfe v. Rundle (Life brought an action in the name of the Great Asso. of America v. Rundle), 103 U. S. 222, Western Telegraph Company, an Illinois 26 L. ed. 337, in which the entire property corporation, by its receiver, against Purdy, of the insolvent company was vested in the a citizen of Iowa, to recover a sum alleged superintendent of insurance of the state, to be due from him upon an assessment where his authority did not come from the upon his stock subscription, and it was held decree of the court, and his right to sue was that the Illinois court might make the asmaintained. In Hawkins v. Glenn, 131 U. sessment and calls necessary to collect the S. 319, 33 L. ed. 184, 9 Sup. Ct. Rep. 739, stock which would be binding in another it appeared that Glenn had derived title by court. The jurisdiction of the Iowa court assignment and deed, and he was permitted was not called in question in the state court to sue. In the case now before us it does of Iowa, where the original action was not appear that the receiver had any other brought, nor was the question of jurisdictitle to the assets and property of the com- tion raised in this court, or passed upon in pany than that derived from his official re- deciding the case. While not detracting lation thereto as receiver under the order from the authority of that case as to the of the court. In such a case we think the matter decided, we see nothing in it to indoctrine of Booth v. Clark is fully appli- dicate that, had the question herein presentcable. It is doubtless because of the doc- ed been made, it would have been decided trine herein declared that the practice has otherwise than herein indicated. become general in the courts of the United States, where the property of a corporation is situated in more than one jurisdiction, to appoint ancillary receivers of the property in such separate jurisdictions. It is true that the ancillary receiverships are generally conducted in harmony with the court of original jurisdiction, but such receivers are appointed with a view of vesting control of property rights in the court in whose jurisdiction they are located. If the powers of a chancery receiver in the Federal courts should be extended so as to authorize suits beyond the jurisdiction of the court appointing him, to recover property in foreign jurisdictions, such enlargement of authority should come from legislative, and not judicial, action.

Nor do we think the jurisdiction is established because the action is authorized to be instituted by the receiver in the name of the corporation. Such actions subjecting local assets to a foreign jurisdiction and to a foreign receivership would come within the reasoning of Booth v. Clark. If a recovery be had, although in the name of the corporation, the property would be turned over to the receiver, to be by him administered under the order of the court appointing him.

It is urged that jurisdiction in this case is sustained by the case of Great Western Teleg. Co. v. Purdy, 162 U. S. 329, 40 L. ed. 986, 16 Sup. Ct. Rep. 810, in which it was held that the assets and affairs of an insolvent corporation being in the hands of a

There are numerous and conflicting decisions in the state courts as to the rights of a receiver to sue in a foreign jurisdiction upon principles of comity, which it is not necessary to review here. In this court, since the case of Booth v. Clark, 17 How. 338, 15 L. ed. 170, we deem the practice to be settled, and to limit a receiver who derives his authority from his appointment as such, to actions, either in his own name or that of an insolvent corporation, such as may be authorized within the jurisdiction wherein he was appointed.

We think the Circuit Court of Appeals was right in holding that the Circuit Court had no jurisdiction of this action.

This view of the case renders it unnecessary to consider the other questions made in the record.

Rev. Stat. § 5242, U. S. Comp. Stat. 1901, p. | judgment of the court below, answered the 3517, affords in suits in the state courts.' first question in the affirmative and the second question in the negative. The case was then brought to this court upon writ of error.

2. No right to attachment against a national bank before judgment in a suit in a state

court is given by the act of July 12, 1882, § 4 (22 Stat. at L. 163, chap. 290, U. S. Comp. Stat. 1901, p. 3458), making the jurisdiction for suits by or against national banks the same as the jurisdiction for suits by or against banks not organized under any law of the United States.†

3. Jurisdiction over the person or property of a national bank is not acquired by the issue of an attachment out of a state court before

judgment, which, by reason of U. S. Rev. Stat. § 5242, is beyond the power of the court.

[No. 229.]

Mr. James W. M. Newlin for plaintiff in error.

Messrs. Percy S. Dudley and George B. Woomer for defendant in error.

Mr. Justice Day delivered the opinion of the court:

We deem the answer to the first question already determined by the decision of this court in Pacific Nat. Bank v. Mixter, 124

Submitted April 25, 1905. Decided May U. S. 721, 31 L. ed. 567, 8 Sup. Ct. Rep. 718.

IN

29, 1905.

'N ERROR to the Court of Appeals of the State of New York to review a judgment which affirmed the judgment of the Appellate Division, First Department, of the Supreme Court of that state, which, on appeal from the judgment of a Special Term of the Supreme Court held in and for the County of New York, denying a motion to vacate an attachment against a national bank, reversed such judgment and vacated the attachment. Affirmed.

The right of Congress to determine to what extent a state court shall be permitted to entertain actions against national banks, and how far these institutions shall be subject to state control, is undeniable. National banks are quasi-public institutions, and for the purpose for which they are instituted are national in their character, and, within constitutional limits, are subject to the control of Congress, and are not to be interfered with by state legislative or judicial action, except so far as the lawmaking power of the government may perSee same case below in Appellate Divi- mit. Section 5242 of the Revised Statutes sion, 67 App. Div. 75, 73 N. Y. Supp. 514,of the United States (U. S. Comp. Stat. and in Court of Appeals, 173 N. Y. 314, 66 1901, p. 3517) is as follows: N. E. 16.

Statement by Mr. Justice Day: The plaintiff, who was the owner of a claim against the defendant, the People's National Bank of Lebanon, Pennsylvania, commenced an action in the state of New York by levying an attachment upon the funds of the defendant in that state, upon the ground that it was a foreign corporation. The defendant, appearing specially for that purpose, moved to have the attachment vacated upon the ground that it was prohibited by the Revised Statutes of the United States. At special term the motion was denied; the appellate term reversed the judgment of the special term, and vacated the attachment. The court of appeals answered two questions certified to it by the appellate division, and affirmed the judgment of that court. The two questions propounded are as follows:

"1. Is the defendant exempt from attachment before judgment under § 5242, U. S. Rev. Stat. U. S. Comp. Stat. 1901, p. 3517? "2. Are the rights claimed by plaintiff, to attachment against the defendant before judgment, and to the jurisdiction thereby acquired, preserved and given by § 4 of the act of Congress of July 12, 1882 ?"

"All transfers of the notes, bonds, bills of exchange, or other evidences of debt owing to any national banking association, or of deposits to its credit; all assignments of mortgages, sureties on real estate, or of judgments or decrees in its favor; all deposits of money, bullion, or other valuable thing for its use, or for the use of any of its shareholders or creditors; and all payments of money to either, made after the commission of an act of insolvency, or in contemplation thereof, made with a view to prevent the application of its assets in the manner prescribed by this chapter, or with a view to the preference of one creditor to another, except in payment of its circulating notes,-shall be utterly null and void; and no attachment, injunction, or tion shall be issued against such association or its property before final judgment in any suit, action, or proceeding in any state, county, or municipal court."

The language of the latter clause of this section would seem to be too plain to admit of discussion as to its meaning. It in terms forbids the issuing of an attachment, injunction, or execution against a national bank or its property before final judgment in any suit, action, or proceeding in any state, county, or municipal court. This was The court of appeals, in affirming the the view taken by this court in Pacific Nat.

Dig. Banks and Banking, §§ 1067-1069.

*Ed. Note.-For cases in point, see vol. 6, Cent.
+Ed. Note. For cases in point, see vol. 6, Cent. Dig. Banks and Banking, §§ 1068. 1069.

Bank v. Mixter, 124 U. S. 721, 31 L. ed. 567, 8 Sup. Ct. Rep. 718. The origin of § 5242, and its growth from previous enactments, were pointed out by Mr. Chief Justice Waite, who delivered the opinion of the court in that case:

"It is clear to our minds that, as it stood originally as part of § 57 [13 Stat. at L. 116, chap. 106], after 1873, and as it stands now in the Revised Statutes, it operates as a prohibition upon all attachments against national banks under the authority of the state courts. . . It stands now, as it did originally, as the paramount law of the land, that attachments shall not issue from state courts against national banks, and writes into all state attachment laws an exception in favor of national banks. Since the act of 1873 all the attachment laws of the state must be read as if they contained a provision in express terms that they were not to apply to suits against a national bank."

Since the rendition of that decision it has been generally followed as an authoritative construction of the statute holding that no attachment can issue from a state court before judgment against a national bank or its property. Freeman Mfg. Co. v. National Bank, 160 Mass. 398, 35 N. E. 865; Planters Loan & Sav. Bank v. Berry, 91 Ga. 264, 18 S. E. 137; First Nat. Bank v. La Due, 39

"That any association so extending the period of its succession shall continue to enjoy all the rights and privileges and immunities granted, and shall continue to be subject to all the duties, liabilities, and restrictions imposed, by the Revised Statutes of the United States and other acts having reference to national banking associations, and it shall continue to be in all respects the identical association it was before the extension of its period of succession: Provided, however, That the jurisdiction for suits hereafter brought by or against any association established under any law providing for national banking associations, except suits between them and the United States, or its officers and agents, shall be the same as, and not other than, the jurisdiction for suits by or against banks not organized under any law of the United States, which do or might do banking busi ness where such national banking associations may be doing business when such suits may be begun. And all laws and parts of laws of the United States inconsistent with this proviso be and the same are hereby repealed."

There is nothing in this section enlarging the right of attachment against national banks. Before the passage of this section circuit courts of the United States had jurisdiction of suits against national banks because they were corporations of Federal origin. It was the purpose of this legislation to deprive such banks of the right to invoke the jurisdiction of the Federal courts simply upon the ground that they were created by and exercised their powers under the acts of Congress. Petrie v. Commercial Nat. Bank, 142 U. S. 644, 35 L. ed. 1144, 12 Sup. Ct. Rep. 325; Continental Nat. Bank v. Buford, 191 U. S. 119-123, 48 L. ed. 119, 120, 24 Sup. Ct. Rep. 54. It regulated the jurisdiction of the courts to entertain such actions against corporations of this character, and had nothing to do with the kind and character of remedies which could be had against them. Certainly there is nothing in the act repealing the prior provisions of § 5242, above quoted.

Minn. 415, 40 N. W. 367; Safford v. First Nat. Bank, 61 Vt. 373, 17 Atl. 748; Rosenheim Real-Estate Co. v. Southern Nat. Bank (Tenn. Ch. App.), 46 S. W. 1026; Garner v. Second Nat. Bank, 66 Fed. 369. It is argued by the plaintiff in error that the decision in the Mixter Case, 124 U. S. 721, 31 L. ed. 567, 8 Sup. Ct. Rep. 718, should be limited to cases where the bank is insolvent; but the statement of facts in that case shows that, at the time when the attachment was issued, the bank was a going concern and entirely solvent so far as the record discloses. The language of Chief Justice Waite, above quoted, is broad and applicable to all conditions of national banks, whether solvent or insolvent; and there is nothing in the state, which is likewise specific in its terms, giving the right of foreign attachment as against solvent national banks. We find nothing in the case of Earle v. Pennsylvania, 178 U. S. 449, 44 L. ed. | bank, jurisdiction is obtained of it by the 1146, 20 Sup. Ct. Rep. 915, which qualifies the decision announced in the Mixter Case. We therefore conclude that the Mixter Case is applicable here, and the decision therein announced meets with our approval.

The answer to the second question involves a consideration of the act relating to national banks of July 12, 1882, § 4 (22 Stat. at L. 162, chap. 290, U. S. Comp. Stat. 1901, p. 3458), which is as follows:

It is further insisted that, whether or not the lien is absolute upon the property of the

issuing of the attachment; but we cannot take this view. There was no personal service in the court of original jurisdiction, and the attachment being without the power of the court by reason of the terms of the Federal statute, no jurisdiction was acquired in the case, either over the person or property of the defendant. We see no error in the judgment of the Court of Appeals of New York, and the same is affirmed.