Neams v. Donaldsonville Foundry & Machine Works, Ltd.

Citations

• 104 La. 544

Syllabus

<p>Syllabus.</p> <p>The business of the corporation was going to ruin. Two of the stockholders petitioned for the appointment of a receiver, and asked, in accordance with a resolution of the board of directors, for the appointment of petitioner whose name was mentioned. He was appointed. Two of the creditors of the corporation attacked the appointment on various grounds.</p> <p>1st. — Because the receiver appointed is a stockholder and has an interest opposed to that of the creditors.</p> <p>(a) Interest of a stockholder is not necessarily an objection. In protecting his own interests in a proper manner, he must protect that of the creditors and other interested parties.</p> <p>2nd. — Because the receiver has been a negligent stockholder and has not, heretofore, protected his own interests as a stockholder.</p> <p>(a) Stockholders are not supposed to assume management and direction of the corporation. Bad management of the officers, with which they had nothing to do, is not to be charged to them.</p> <p>3rd. — Because the receiver resides in another parish and at some distance from the works of the corporation. ,</p> <p>(a) The law, in matter of the appointment of a receiver, does not seem to contemplate parish lines as an objection. That issue is not raised by the pleadings. ' As relates to distance (of the receiver’s domicil) the court will not assume beforehand that it will be a continuing interference with proper management. Under the law, the District Court is to have an eye to the proper operation of the defendant corporation. The court’s agent has been selected with that object in view. Without a, preponderance of proof of error in naming a receiver, the appointment will not be annulled.</p> <p>4th. — The opposing creditors have raised a number of issues regarding the irregularity of the proceedings.</p> <p>(c) They have admitted the necessity of appointing a receiver, and thereby cured all defects, if any existed, to the proceedings looking to the appointmen