St. Louis, Cape Girardeau & Ft. Smith Railway Company v. State of Missouri Merriam

On the 20th day of July, 1893, in the supreme court of the state of Missouri, Edwin G. Merriam filed a petition for a writ of prohibition. In said petition the relator set forth that the St. Louis, Cape Girardeau & Ft. Smith Railway Company was a corporation organized under the laws of the state of Missouri; that it had made, on September 1, 1881, a mortgage on part of its railroad to one Leo Doyle, as trustee, to secure an issue of bonds amounting to $100,000; that on July 18, 1881, the same company had made to Leo Doyle, as trustee, a mortgage on another part of its road to secure an issue of $170,000 of its bonds. The petition also alleged that the relator was the holder of $27,000 of the bonds secured by the mortgage of September 1, 1881, and $49,200 of the bonds secured by the mortgage of July 18, 1881.

The petition further stated that default had been made in the payment of interest on said bonds, and that, after such default, the relator, on the 3d day of March, 1893, filed in the circuit court of Stoddard county a bill of complaint, in behalf of himself and all others similarly situated, against the said railway company, said Leo Doyle, trustee, and certain junior incumbrancers, and asked for the appointment of a receiver, and for a decree of sequestration and foreclosure, and other relief. The petition further alleged that on the presentation of said bill of foreclosure on the 3d day of March, 1893, the circuit court of Stoddard county appointed one Eli Klotz as receiver, and authorized him to take possession of the railroad and property of the said railway company, and manage and operate the same.

The petition further stated that on the 4th day of March, 1893, a pretended suit was instituted in the name of the said St. Louis, Cape Girardeau & Ft. Smith Railway Company in another court,-the Cape Girardeau court of common pleas,-and that such court appointed Louis Houck, the president of the railway company, and the owner of a majority of its stock, receiver of the said company's road and property, and that at the time of the filing of the petition he held possession as such receiver.

The petition further alleged that in the suit so instituted in the circuit court of Stoddard county process had been duly issued and served upon the defendant railway company on the 8th day of March, 1893, and upon Leo Doyle on or about the 9th day of March, 1893. The petition then set forth certain proceedings in the said circuit court of Stoddard county, in which George Houck, a brother of Louis Houck, was, on March 6, 1893, temporarily appointed judge in place of John G. Wear, who was prevented by sickness from attending court, and that said George Houck, as said judge, made an order early on the 13th day of March, 1893, discharging said Eli Klotz as receiver; and that afterwards, on the same day, the said John G. Wear reconvened said court, and reappointed and confirmed the said Klotz as receiver, and that subsequently, on the 24th day of July, 1893, the said Judge John G. Wear again reappointed and confirmed the said Eli Klotz as receiver. The petition further states that the said Leo Doyle, in disregard of his duties as trustee in the said mortgages, acted with the said railway company and with the said Louis Houck, and was represented in said suits by counsel employed at the instance of said Houck.

The petition further averred that the Cape Girardeau court of common pleas was about to issue receiver's certificates to the amount of $250,000, and to make them a lien on the property of the company prior to the lien of the mortgages securing the bonds held by the relator.

As relief the petition asked that a writ of prohibition should issue, directed to Alexander Ross, judge of the Cape Girardeau court of common pleas, and the other respondents, prohibiting him and them from pursuing and holding the pleas aforesaid, and from taking any further cognizance of the said suit before them touching the premises, and directing said court of common pleas to surrender to the proper jurisdiction of the circuit court of Stoddard county the said property of the said railway company. The record discloses that the said Alexander Ross, judge of the Cape Girardeau court of common pleas, the railway company, Louis Houck, Edward Hiddon, the Mercantile Trust Company, and Leo Doyle filed answers or returns to said petition, and that there was filed a stipulation that certain facts might be considered as proved, and so treated by the court.

On December 4, 1893, the supreme court, after hearing, granted the writ of prohibition (25 S. W. 947), and the writ was accordingly issued, commanding the Cape Girardeau court of common pleas to cease from entertaining any further pleas or taking any further action in said so-called suit, entitled the 'St. Louis, Cape Girardeau and Ft. Smith Railway Company against Leo Doyle and others,' in said court, and that the said railway company, and the said Houck, as president thereof, as well as receiver thereof, and the other respondents, cease from further prosecuting pleas therein. Said writ also directed the said Louis Houck to turn over all the property of said railway company that had come into his hands as receiver de facto thereof, under the orders of the Cape Girardeau court of common pleas, to the receiver de jure thereof, who had been or might be appointed by the circuit court of Stoddard county, in which the suit of the said relator was pending, and that he account therefor as such receiver, under the supervision of the said circuit court of Stoddard county.

The respondents filed a petition for rehearing, in which they set forth, among other things, that part of the writ of prohibition which commanded Houck to turn over the property of the railway company which had come into his hands as receiver under the appointment by the Cape Girardeau court of common pleas to the receiver appointed by the circuit court of Stoddard county, and averred, in respect to the same, that 'that part of the order above quoted is in violation of article 5 of the amendments of the constitution of the United States, which provides that no person shall 'be deprived of life, liberty, or property, without due process of law,' and of the provisions of the first section of the fourteenth amendment of the constitution of the United States, which provides that no state shall 'deprive any person of life, liberty, or property without the due process of law, nor deny to any person within its jurisdiction the equal protection of the laws." The motion for rehearing was denied, and to the judgment granting the writ of prohibition a writ of error was allowed.

John F. Dillon, Winslow S. Pierce, and Harry Hubbard, for the motion.

John W. Noble, opposed.

Mr. Justice SHIRAS, after stating the facts in the foregoing language, delivered the opinion of the court.