Above form with modifications approved by the District Court for Southern District of New York in the matter of "The Breakwater Construction and Engineering Co. Bankrupt." Issued under the equity powers of the Court for purpose of raising money to procure materials, labor, supplies, etc., upon presumption of necessity. Should be issued only when the preservation of the property in hands of the receiver presents urgent necessity therefor. Rochester Trust, etc., Co. v. Oneonta, etc., R. Co. (N. Y. App. Div.), 122 N. Y. Supp. 19. Rochester Trust, etc., Co. v. Rochester, etc., R. Co. (N. Y.), 60 N. Y. Supp. 409. "The Circuit Court of Appeals has expressly declared that a receiver of a private corporation cannot be authorized to issue certificates to carry on the business of the corporation and make them a first and paramount lien on the corpus of the trust estate. It was said that the rule authorizing the issuing of receiver's certificates and constituting them a paramount lien on the property is based on the public character of the company and is not to be extended to mere private corporation, but to those only of a quasi-public character." Beach on Receivers (2d Ed.), p. 448. Hanna v. State Trust Co., 70 Fed. 2. For the purpose of preserving the assets of the estate. In re Restein, 20 Am. B. R. 832, 162 Fed. 986. In re Erie Lumber Co., 17 Am. B. R. 689, 150 Fed. 817. As to loans made in excess of the amount receiver is authorized to borrow. In re C. M. Burkhalter and Co. (D. C., Ala.), 25 Am. B. R. 378, 182 Fed. 353. Certificates issued in excess of amount authorized are void even in the hands of innocent holders and will not be accorded priority of payment. General authority of receiver not sufficient to issue. Union Trust Co. v. Chicago, etc., R. Co., 7 Fed. 513. [Ed. Note.] Certificates should recite terms of the order upon which issued. In re Alaska Fishing and Development Co., 21 Am. B. R. 685. Receivers' certificates are not commercial paper and innocent purchasers are not protected but charged with notice of the terms of the order. Rights of lienholders. Fidelity Ins., etc., Co. v. Roanoke Iron Co., 68 Fed. 623. In re Clark Coal and Coke Co. (D. C., Pa), 23 Am. B. R. 273, revg. in part, s. c. 22 Am. B. R. 843. Form No. 151 ANSWER OF LIENOR TO RECEIVER'S PETITION TO ISSUE CERTIFICATES AS A PRIOR LIEN (Hagar and Alexander's Bankruptcy Forms [2d Ed.], No. 87.) Company, as trustee under the mortgage 19..., made by ... bankrupt, to said company, appearing herein specially for the purpose only of opposing the application of as receiver of the above named bankrupt, for leave to issue receiver's certificates to the amount of $..... and making same a first lien on the property and plant of the said alleged bankrupt, answers the petition of said receiver, as follows: I. It denies that it has any knowledge or information sufficient to form a belief as to any of the allegations contained in the paragraphs of said petition numbered .. II. Further answering said petition and as further and separate defense thereto, the Company, as trustee, shows and alleges: ..... 1. That it is a corporation duly organized and existing under and by virtue of the laws of the State of duly authorized to take and hold in trust the property conveyed to it by the mortgage hereinafter referred to. 19..., of which a 2. That by an indenture dated. copy is herewith submitted to the court, to which reference is hereby made as if the same were herein set forth at length, the bankrupt, conveyed to .... Company, as trustee, the property and franchises therein described, in trust for the equal pro rata benefit and security of all and every the holders of the bonds and interest coupons issued and to be issued under the said mortgage or deed of trust, and to enforce the payment thereof when payable in accordance with the true intent and meaning of the stipulations of the said indenture and of the said bonds and coupons, and without preference of the said bonds over any others thereof by reason of priority in the time of issue or negotiation thereof, or otherwise how soever. 3. That said indenture of mortgage constitutes a lien upon all of the property and franchises which said then owned and upon all the personal property which it thereafter acquired, to secure the issue of bonds therein described, and as such lien it was given and accepted in good faith and not in contemplation of or in fraud upon the bankruptcy laws of the United States, and for a present consideration and said mortgage or deed of trust was duly recorded according to law. 4.That said Company is not a party to the above entitled proceeding and respectfully urges that this court is without power to displace the lien of the said mortgage for the security of the bonds issued and outstanding thereunder by authorizing the receiver above named to issue receiver's certificates which shall be a lien upon all the property and assets of the company prior to the lien of the mortgage above referred, to. Form No. 152 RECEIVER'S CERTIFICATE (Hagar and Alexander's Bankruptcy Forms [2d Ed.], No. 88.) CERTIFICATE NO. Know all men by these presents: That I, pany of duly appointed as such receiver by an order of the District Court of the United States for the .... in certain proceedings in bankruptcy District of ... Company of am indebted to the bearer in the sum of one thousand dollars ($1,000), which I, the said ... as such receiver, or my successor or successors as such receiver or receivers (or trustee when appointed) of the property and estate of the ... Company of promise as such receiver, and not individually, to pay to the bearer on or before the day of .... at the office of the ..... Trust Company, No. ... .... 19... Trust .. street, in the city of with interest thereon from the day and date thereof at the rate of per cent. (......%) per annum, payable semi-annually, at the office of said Company upon presentation hereof at the said Trust Company, both principal hereof and interest hereon being payable only out of the property and estate of the ... Company of .... or the proceeds or the income thereof in the hands of the receiver or receivers aforesaid or any trustee in bankruptcy hereafter appointed. This certificate of indebtedness is issued by the said receiver pursuant to the order of the said District Court of the United States for the .. District of .... and is one of a series of like tenor and effect numbered consecutively from one to fifty, both inclusive, and is issued in the "Matter of the .... Company Bankrupt" of said District Court of the United States for the of .... pending in the .. District in accordance with the said order duly made and entered in the said District Court on the day of 19..., to which order reference is here made and which said order is hereby made a part hereof as though herein expressly incorporated. All and every of said certificates of indebtedness issued under the said order of the said District Court of the United States are equally secured without preference of the one over the other, by and in the manner set forth in said order of the District Court of the United States, and will be paid and provided for by the said District Court of the United States in and by a proper decree or order in the said matter. By the terms of the said order the earnings, income, profits, property and estate of the said .... Company of .... ..... in the custody of the said receiver, as well as his successor or successors in office or to hereafter come into the possession of a trustee when appointed in the said matter, are expressly charged with a lien upon the said property and estate, as by the terms of the said order will more fully appear, and the payment of said certificates shall be subject to the rights, claims and demands of the holders of the express liens, if any, upon the bonds of the Company of numbered ........ to secutively, both inclusive, issued in the sum of $..........., and secured by the certain mortgage or mortgages to the .... con Trust Company of .... as Trustee, or otherwise, to secure the payment of the said bonds and each and every of them as aforesaid, to the lien of which mortgages and the claims of the holders of the bonds secured thereby said certificates are expressly made subject, and that otherwise the said certificates shall have precedence and priority over all other liens, claims and demands against the aforesaid property and estate of the Company of And it is further understood and agreed that this certificate shall become due and payable .. (.....) months after the date thereof unless sooner paid by the said receiver pursuant to the order or decree of the said District Court, and in the event of its non-payment by the said receiver as aforesaid, may be enforced by the holder thereof in any proper action or proceeding. This certificate of indebtedness shall not become effective and valid until authenticated by the Clerk of the District Court of the United States for the ..... District of ..... under his seal by endorsement upon the back of this certificate execution by the said Clerk of the said Court. Neither I, the said. individually or as receiver, nor any other receiver or receivers in the trust aforesaid, undertake, incur or assume any liability whatsoever other than as receiver, to pay the said certificates and the interest thereon out of the earnings, profits, income, property and estate of the Com |