acts were strictly limited to those of a representative of a corporation, he could not do. He may file exceptions to the report of a referee appointed to take proof of claims, and for that purpose represents not only the corporation, but he stands as a trustee of its funds for all creditors, and may intervene to see that no injustice is done to any one.' "In Whittlesey v. Delaney, 73 N. Y. 571, it was held that, a corporation having become insolvent, its receiver, as the representative of creditors, has the capacity to make the objection that a judgment against the corporation by confession was not obtained in such a manner as to be binding upon the corporation. To the same effect is Stokes v. Pottery Co., 46 N. J. Law, 237. "In Carbon Co. v. McMillin, 119 N. Y. 46, 23 N. E. Rep. 530, 7 L. R. A. 46, it was held: 'It is claimed that no action could have been maintained by the trustee representing the trust combination against the Brush Electric Light Company to recover the purchase price of the carbons, for the reason that the illegality of the combination would have constituted a good defense. Assuming this predicate, it is asserted that the receiver stands in the same position, and that his title is subject to the same infirmity, as that of the combination which he represents. Without considering the assumption upon which his proposition is based, it is a sufficient answer to the proposition asserted "that the receiver unites in himself the right of the trust combination and also the right of creditors, and that he may assert a claim as the representative of creditors which he might be unable to assert as a representative of the combination, merely." The general rule is well established that a receiver takes the title of the corporation or individual whose receiver he is, and that any defense which would have been good against the former may be asserted against the latter. But there is a recognized exception which permits the receiver of an insolvent individual or corporation, in the interest of creditors, to disaffirm dealings of the debtor in fraud of their rights. Assuming that the trustee could not have recovered of the Brush Electric Light Company for the reasons suggested, it would be a very strange application of the doctrine that no right of action can spring from an illegal transaction which should deny to innocent creditors of the combination, or to the receiver, who represents them, the right to have the debt collected, and applied in satisfaction of their claims.' To the same effect are Moise v. Chapman, 24 Ga. 249, and Hamor v. Engineering Co. (C. C.), 84 Fed. Rep. 393. In the latter case it is said: "The receivers, representing both the creditors and the defendant, have the right to assert any defense to which the creditors, in contradistinction to the defendant, are entitled.' "In Insurance Co. v. Swigert, 135 Ill. 150, 25 N. E. Rep. 680, 12 L. R. A. 328, it was said (page 167, 135 Ill., page 685, 25 N. E. Rep. and page 333, 12 L. R. A.): We understand the rule to be that, where a receiver is appointed for the purpose of taking charge of the property and assets of a corporation, he is, for the purpose of determining the nature and extent of his title, regarded as representing only the corporate hody itself, and not its creditors or shareholders, being vested by law with the estate of the corporation, and deriving his own title under and through it; and that for purposes of litigation he takes only the rights of the corporation such as could be asserted in its own name, and that upon that basis only can he litigate for the benefit of either shareholders or creditors.' The opinion in the last-mentioned case then proceeds to discuss the power of a receiver, and holds that, so far as the title of the property is concerned, the power of the receiver is solely and only a power with reference to the corporation. The opinion then further holds (page 177, 135 Ill. page 688, 25 N. E. Rep. and page 336, 12 L. R. A.): 'But, so far as his powers are derived from a statute, or from a lawful decree of court, and the powers do not involve rights which, at the time of his appointment, were vested in such owners, he is not merely their representative, but is the instrument of the law, and the agent of the court which appointed him. Such right and authority as the law and the court rightfully give him he possesses, and in respect to such right he is not circumscribed and limited by the right which was vested in and available to the owners.' "In Knights v. Martin, 155 Ill. 486, 40 N. E. Rep. 358, the court said (page 489, 155 Ill., and page 358, 40 N. E. Rep.): This was a motion to quash an execution issued upon a judgment confessed in vacation, and to set aside the judgment. Shortly after the judgment was confessed, the judgment debtor executed to appellee a deed of assignment of all his property for the benefit of his creditors. The motion was made in the name of the judgment debtor and his assignee, but before decision the debtor formally withdrew the motion as to himself, and it was afterwards prosecuted by the assignee.' The motion was denied. The court then further say: 'Appellants contend that appellee was not a proper party to make this motion, which was made under section 65 of chapter 110 of the Revised Statutes. The assignee takes the same interest and title in the assigned estate that his assignor possessed, and his title will be subject to all the equities that existed in respect thereof in the hands of the assignor, and he may do whatever his assignor might have done in respect of the assigned property if no assignment had been made. We are of the opinion that the relationship of the assignee to his assignor and to the assigned estate is such that he may be considered a proper party to make this motion, notwithstanding the rule that no one but a party to a judgment or execution can move to set aside a judgment or quash the execution.' * "The receiver in this case was appointed under the provisions of section 25 of the act with reference to corporations, which statute authorizes him to close up the business of the corporation, and do all things necessary to that end, to sue in all courts, etc. The decree under which he was appointed directed: That any and all officers, agents, attorneys, servants, and employees of said defendant, and any and all parties having in their possession or under their control any of the property or assets of the defendants; immediately surrender all such property and assets to the receiver hereinbefore named, and that they, and each and all of them, refrain from in any manner intermeddling with said property, or withholding possession thereof from such receiver; and they, and each of them, are hereby enjoined from any and all attempts to withhold or conceal any of said property from said receiver, and from contracting any liabilities in the name or on behalf of said defendant Illinois corporation, or of using its name for any purpose or in any proceeding; and all parties having any claims against said defendant Illinois corporation are hereby directed to present the same in this proceeding for adjudication.' It is absolutely necessary, in closing up the business of a corporation, as provided by the foregoing provision of the statute, that there must not only be a collection of the debts owing to it, but there must be a determination as to the debts due from the corporation, before the court can equitably distribute the funds of the corporation in the payment of debts. In this case, having in view the proper distribution of the funds of the corporation, the court, by its decree, specifically directed that all persons should refrain from interfering with the property or withholding possession thereof from the receiver, and that the defendant and others should be 'enjoined from any and all attempts to withhold or conceal any of such property from said receiver, and from contracting any liabilities in the name or on behalf of said defendant, or using its name for any purpose or in any proceeding.' The officers of this corporation, until this decree, were prevented from the execution of promissory notes, and from doing any act increasing the liability of this corporation, by which the assets in the hands of the receiver should be diminished or destroyed. * "The circumstances under which the promissory note for which this judgment was rendered was given are strongly indicative of fraud and collusion. The judgment is prejudicial to the estate in the hands of the receiver. By it the estate would be diminished, and the amount in the hands of the receiver for the payment of valid claims would be greatly lessened. One of the appellees is the chief stockholder in both of the corporations. As a stockholder in the corporation in whose favor a judgment was rendered, he becomes the chief beneficiary by that judgment, and through his action there is effected a change in the character of the estate coming to the hands of the receiver and for his own benefit. To hold that the receiver, in such a case, should not be permitted to appear and contest a judgment collusively entered into, would be denying him the power of properly closing out the business of the corporation, collecting its assets, and distributing the estate to those equitably entitled thereto. We are of opinion that, where there is fraud and collusion in obtaining judgments against a corporation for which a receiver has been appointed, the effect of which judgments will be to diminish the estate in the receiver's hands, or which should properly come to him, or which would prevent its proper distribution to those equitably entitled thereto, the receiver has such a standing in court with reference to the estate that for the purpose of closing out the estate he may appear and collect what is properly owing to the corporation, and defend not only the corporation, but protect its creditors and stockholders from collusive and fraudulent judgments." LIABILITY OF MUNICIPAL CORPORATIONS FOR NEGLIGENCE IN THE EXERCISE OF PRIVATE OR MUNICIPAL POWERS. Sec. 1. General Rule Stated.-While the municipal corporation in performing or omitting to perform a duty imposed upon it as an agent of the State in the exercise of strictly governmental or State functions is not liable to private action, on account of injuries resulting from the wrongful acts or negligence of its officers or agents,' yet with unanimity the courts declare that where such officers or servants are in the exercise of power conferred upon the city for its private benefit or pecuniary profit and damage results from their negligence or misfeasance, the municipality is liable to the same extent as in the case of private corporations or individuals.2 In so far as cities exercise powers not of a governmental character, "voluntarily assumed powers intended for the private advantage and benefit of the locality and its inhabitants, there seem to be no sufficient reason why they should be relieved from that liability to suit and measure of actual damage to which an individual or private corporation exercising the same powers for purposes essentially private would be liable." Notwithstanding the 1 Hill v. Boston, 122 Mass. 344, 23 Am. Dec. 332, 50 Cent. L. J. 84 et seq. 2 Murtaugh v. St. Louis, 44 Mo. 479; Keating v. Kansas City, 84 Mo. 415; Carrington v. St. Louis, 89 Mo. 208; Ulrich v. St. Louis, 112 Mo. 138; Donahoe v. Kan. sas City, 136 Mo. 657; Welsh v. Rutland, 56 Vt. 228, 48 Am. Rep. 762. 3 Per Stayton, J., in Galveston v. Posnainsky, 62 rule in Michigan has long obtained that municipalities are not usually responsible in damages for the neglect of persons in public office, unless made so by statute, at an early day the supreme court of that State established the principle, in recognition of the private character of the municipal corporation, that where a city is engaged in making a work which is its private property as a municipality, and not a mere public easement, and done under city employment or contract, it is responsible for injuries caused by neglect in its process of construction, as it is for any such action as directly injures private property. Sec. 2. Liability Growing Out of Management of Property.-Municipal corporations are to be regarded as artificial persons, owning and managing property, and in this capacity they are chargeable with all the duties and obligations of other possessors of property and must respond in damages for all their torts connected therewith, in like manner as natural persons or private corporations. But it should be noted that as relates to the management of property concerning governmental, as distinguished from municipal affairs, the adjudications are decidedly conflicting; however, this want of harmony is chiefly confined to the management of highways, and drains and sewers established to promote the public health. The tendency of the later cases is to consider that the duty of these bodies to keep property under their control in a safe condition as a private rather than a public or governmental duty, and hence they are ordinarily held liable for injury to others growing out of their omission to do so, notwithstanding the property in question is not private corporate property from which the city is deriving profit, but strictly public or governmental, producing no revenue to the local corporation. The earlier Tex. 118, 13 Am. & Eng. Cor. Cases, 484, quoted with approval in 15 Am. & Eng. Ency. Law, 1141; 2 Dillon, Munic. Corp. § 980. 4 Detroit v. Blackeby, 21 Mich. 84, approved in O'Leary v. Board, etc., 79 Mich. 281, 285. 5 Detroit v. Corey, 9 Mich. 165, approved 79 Mich. 285; Ashley v. Port Huron, 35 Mich. 296; Defer v. Detroit, 67 Mich. 346. 6 See Cooley on Torts, 619, 620; Ashley v. Port Huron, 35 Mich. 296; Rowland v. Kalamazoo County, 49 Mich. 553, where at page 560 it is said than an examination of the authorities will show that "municipal corporations, in the care and management of their property like an individual, are in duty bound to produce no injury to others." cases, and some of the later ones, hold that these corporations are liable in the management of the property only when it is controlled for corporate profit or pecuniary advantage to their inhabitants; denying all liability for negligence in the management of public or governmental property. By almost unanimity of decision the principle is sustained that municipal corporations must respond in damages for injuries resulting from their negligent management of property under their control if such property is held for pecuniary profit, although it may be used principally for governmental purposes. Thus, if, in repairing a building belonging to the city, and used in part for municipal purposes, and in considerable part also as a source of revenue to the corporation, the agents and servants of the city dig a hole in the ground adjoining, and negligently leave it open and unguarded, so that a person rightfully walking on a path leading by the building, although not a public highway, falls into such hole, and is injured, the city will be liable to an action at common law for the injury. The doctrine as to liability for negligent management of property has been farther extended in a recent Oregon case where it was held that the fact that waterworks of a city were built under authority imposed upon it by the legisla ture, and under the direction and supervision of a committee appointed by the legislature, will not exempt the city from the general rule which imposes upon municipal corporations needing and operating such works liability. for injuries to private individuals through their negligent construction or operation." The weight of authority unites in supporting the rule of responsibility whenever the violated duty is itself municipal, although it may concern or be related to governmental affairs. Thus, in a recent New York case, it has been held that the duty imposed by statute on the city to remove dirt from its streets and ashes and garbage from abutting residences is a quasi-private duty, and therefore the city was held liable for the wrongful acts of its serv 7 Hill v. Boston, 122 Mass. 344, 23 Am. Rep. 332; Eastman v. Meredith, 36 N. H. 296; Ham v. New York, 70 N. Y. 459. 8 Oliver v. Worcester, 102 Mass. 489, 3 Am. Rep. 485. 9 Esberg Gunst Cigar Co. v. Portland, 33 Oreg. 43 L. R. A. 435. See Mayor, etc. v. Bailey, 2 Denio (N. Y.), 433; Darlington v. Mayor, etc., 31 N. Y. 164; Barnes v. District of Columbia, 91 U. S. 540, 552; Wright v. Holbrook, 52 N. H. 120, 13 Am. Rep. 12. ants while engaged in such service. 10 This case regards the duty as an essentially private one, resting originally on the individual property owner, and assumed by the municipality merely for the convenience and advantage of its citizens. This view would seem to be consistent with the historical development of the assumption of such duties by municipalities, and the result appears to be in accord with the general tendency shown by recent cases to broaden the liability of public corporations for the tortious acts of their agents. But in a recent Tennessee case, through the negligence of the driver, a sprinkling cart in the service of the city struck the plaintiff's buggy and injured the plaintiff, it was held that the city was not liable, as its servant was engaged in a governmental duty of the city in promoting the public health." Things done for pecuniary profit by the city are regarded as strictly municipal duties. 12 Hence, the city is liable for negligence of its ice boat engaged in towing a vessel for the city's gain.13 So there is liability for negligence in the construction and repair of an electric lighting plant.14 And liability exists also for negligent management of real estate producing revenue to the city.15 So, also, when the city owns a wharf, and receives and charges wharfage for its use, it is bound the same as a private individual to use ordinary care and diligence in keeping it free and safe from obstructions, and is liable in an action at common law for damages done to a vessel by reason of neglect of such duty.16 10 Quill v. Mayor of New York, 55 N. Y. Supp. 889, denying Davidson v. New York, 54 N. Y. Supp. 57. Contra: Love v. Atlanta, 95 Ga. 129. 11 Connelly v. Mayor of Nashville, 100 Tenn. 262, 46 S. W. Rep. 565. This case is denied in Quill v. Mayor, etc., 55 N. Y. Supp. 889, 892. Maxmillian v. New York, 62 N. Y. 160, negligence of ambulance driver; Burrill v. Augusta, 78 Me. 118, negligence of hook and ladder company. See Lafayette v. Allen, 81 Ind. 166, where a city was held liable to an engineer who was put to work on a defective fire engine. When city is liable for damages caused by the erection of a pest house, see Clayton v. Henderson (Ky.), 44 L. R. A. 474. County liable for a nuisance resulting in injury caused by a small pox hospital. Haag v. Vanderberg County, 60 Ind. 511, 28 Am. Rep. 654. City not liable for negligence of boiler inspector. Mead v. New Haven, 40 Conn. 72. 12 2 Dillon, Munic. Corp. § 985. 13 Philadelphia v. Garagrin. 17 U. S. App. 642. 15 Worden v. New Bedford, 131 Mass. 23, 41 Am. Rep. 185; Jones, Neg. Munic. Corp. § 38, and cases; Bailey v. New York, 3 Hill (N. Y.), 531. 16 Petersburg v. Applegrath, 28 Gratt. 321, 26 Am. 22 The city must keep its docks, wharves and piers suitable for use," although it may not receive pay on its own behalf for their use.18 Municipal corporations have been held liable for the negligent management of gas works,19 of waterworks, 20 of sewers, 21 of cemeteries,2 of public markets, and of other property.24 However, a city is not liable in damages for injuries inflicted upon a person by the fall of a market house caused by a wind storm of unprecedented force and violence, in the absence of negligence.25 And finally it is generally held that when a special power or privilege is conferred upon or granted to a municipal corporation, to be exercised for its own advantage or emoluments, and not as a mere governmental agency, it is liable to the same extent as an individual or a private corporation for negligence in managing or dealing with the property rights or franchises held by it under such grant.26 Rep. 357; Pittsburg v. Grier, 22 Pa. 54, 60 Am. Dec. 65; Mersey Docks & Harbour Board v. Gibbs, 11 H. L. Cas. 686; Seaman v. New York, 80 N. Y. 239; Kennedy v. New York, 73 N. Y. 365, 29 Am. Dec. 169; Jones on Neg. Munic. Corp. p. 71, note 2. 17 Jones, Neg. Munic. Corp. § 39. 18 Mersey Docks & Harbour Board v. Gibbs, 11 H. L. Cas. 686. Wilkins v. Rutland, 61 Vt. 336, holds that where a city maintains a system of waterworks for the double purpose of supplying the inhabitants with water for private purposes and providing against fire there is municipal liability for any negligence in that portion of the system supplying individuals for hire. 19 Western Savings Society v. Philadelphia, 31 Pa. St. 175, 72 Am. Dec. 730; Kibele v. Philadelphia, 195 Pa. St. 41; San Francisco Gas Works v. San Francisco, 9 Cal. 453. 20 Stoddard v. Winchester, 157 Mass. 567; Brown v. Atlanta, 66 Ga. 71; Aldrich v. Tripp, 11 R. I. 141, 23 Am. Rep. 434; Stock v. Boston, 149 Mass. 410; Hand v. Brookline, 126 Mass. 324; Wilkins v. Rutland, 61 Vt. 336; Grimes v. Keene, 52 N. H. 330, 335; Powers v. Fall River, 168 Mass. 60; Lynch v. Springfield (Mass.), 54 N. E. Rep. 871. Contra: Mendel v. Wheeling, 28 W. Va. 233, 57 Am. Rep. 665. 21 Murphy v. Lowell, 124 Mass. 564. 22 Toledo v. Cone, 41 Ohio St. 149, holding that the principle of respondeat superior applies to municipal corporations where the acts of their servants or agents refer to powers and duties ministerial in their nature and character. 23 Barron v. Detroit, 94 Mich. 601, 34 Am. St. Rep. 366; Suffolk v. Parker, 79 Va. 660, 52 Am. Rep. 640; Littlefield v. Norwich, 40 Conn. 406; Savannah v. Cullens, 38 Ga. 334; Weymouth v. New Orleans, 40 La. Ann. 344. 24 Cowloy v. Sunderland, 6 H. & N. 565, injury resulting from negligence in managing a wringing ma chine kept in a public wash house. 25 Flori v. St. Louis, 69 Mo. 341. 26 Esberg Gunst Cigar Co. v. Portland, 33 Oreg. 43 Sec. 3. Ground of Liability Stated.-Under the adjudications it is thus manifest that responsibility growing out of the management of property may be based on either of the two grounds: First. That the municipal corporation is managing property. As the corporation is in full control of the property, in like manner as the individual and private corporation, it should be required to so manage it as not to cause damage to others, and all who, in the exercise of due care, are damaged by reason of the negligent management of such property should be given the right of private action against the corporation, otherwise they are denied legal protection in this respect. Although the property may be governmental, as that term is used, and be nonproductive to the city, the duty to properly care for it should in all cases be regarded as private as distinguished from public. Second. Where damage grows out of the negligent management of property in connection with public work of a local or purely municipal character liability exists. In actions of this character municipal corporations have sought to avoid responsibility by attempting to show that the neglected duty in the particular case was legislative or judicial as distinguished from ministerial. But this doctrine is to be reasonably applied, and the city, under the guise of it, will not be allowed to cause damage, as, for instance, in maintaining a nuisance.2 27 So, under cover of the doctrine, the city will not be exonerated where damages result from a flagrant misuse of discretion, as in the adoption of a defective plan for public work. 28 L. R. A. 435, 440. The mere happening of an accident causing injury is evidence of negligence whenever the thing causing the injury is under the control of defendant, and the accident is such as in the ordinary course of things does not happen if those who have the management use proper care. Esberg Gunst Cigar Co. v. Portland, 33 Oreg. 43 L. R. A. 435. For some cases as to presumptions from accidents resulting in injury, see Shafer v. Lacock (Pa.), 29 L. R. A. 254; Judson v. Giant Powder Co. (Cal.), 29 L. R. A. 718; Ryder v. Kinsey (Minn.), 34 L. R. A. 557; Scott v. London & St. K. Docks Co., 3 Hurlst. & C. 596; 1 Shear. & Red. Neg. §§ 59, 60; Thomp. Neg. 1230; Mullen v. St. John, 57 N. Y. 567, 15 Am. Rep. 530; Warren v. Kauffman, 2 Phil. 259; Huey v. Gahlenbeck, 6 Am. St. Rep. 790. 27 Speir v. Brooklyn, 139 N. Y. 6, 21 L. R. A. 641, 36 Am. St. Rep. 664; Cohen v. New York, 113 N. Y. 532; Stanley v. Davenport, 54 Iowa, 463; Little v. Madison, 42 Wis. 643. 28 Ashley v. Port Huron, 35 Mich. 296, 24 Am. Rep. 552; Defer v. Detroit, 67 Mich. 346; Seifert v. Brook Sec. 4. Liability for Negligence in Constructing Public Works and Failure to Keep in Repair-Sewers and Drains.-The city will be held liable for damages directly resulting from the careless or unskillful manner of constructing public work,29 as, for example, a sewer,30 and when it is completed the ministerial duty to use ordinary care to keep it in repair and free from obstruction so that its capacity may be used and enjoyed is mandatory.31 "The work of constructing sewers is ministerial, and when the corporation undertakes this work it is responsible in a civil action for damages caused by the careless or unskillful performance of the work.''82 And a city authorized by its charter to establish sewers cannot escape liability for its negligence on the ground that it did the work directly through the superintendent of its streets when its charter provided that it should be done by contract to the lowest bidder. 33 Where the superintendent of the streets of a city, having charge of the construction of a sewer, provides all material for bracing the sides of the work and directs the manner of placing them, and the work is done accordingly, and a laborer, while working in the trench, is injured because of defective bracing, such negligence is that of the city and not of a fellow-servant, though a foreman was in immediate charge of the work.34 "So it is the duty of corporations to keep sewers in repair, and if they are negligently permitted to become obstructed or filled up, so as to cause the water to flow back and do injury, there is a liability on the part of the corporation having control over them.''35 This rule "seems to be the general, if not uniform, doctrine on this subject. The sewers of the city are its private property; lyn, 101 N. Y. 136, 54 Am. Rep. 664; Pye v. Mankato, 36 Minn. 373; New Jersey Soule v. Passaic, 47 N. J. Eq. 28; Terre Haute v. Hudimet, 112 Ind. 542; Spangler v. San Francisco, 84 Cal. 12. 29 Boulder v. Fowler, 11 Colo. 396. 30 Frostburg v. Duffy, 70 Md. 47. 31 Woods v. Kansas City, 58 Mo. App. 272, 279; Stew. art v. Clinton, 79 Mo. l. c. 612; Foster v. St. Louis, 71 Mo. 157; Taylor v. St. Louis, 14 Mo. 20. 32 Per Wagner, J., in Thurston v. St. Joseph, 51 Mo. 1. c. 519; Donahoe v. Kansas City, 136 Mo. 657; Roll v. Indianapolis, 52 Ind. 547. Compare Child v. Boston, 4 Allen (Mass.), 41, and Barry v. Lowell, 8 Allen (Mass.), 127. 33 Donahoe v. Kansas City, 136 Mo. 657. 34 Donahoe v. Kansas City, 136 Mo. 657. 35 Per Wagner, J., in Thurston v. St. Joseph, 51 Mo. 1. c. 519. |