Helvey v. United State Building & Loan Ass'n

WILSON, J. From a judgment in favor of defendant, plaintiff has appealed.

Defendant is a building and loan association organized under the laws of the State of California. In an action brought against it in the United States District Court a receiver of all property and assets of defendant was appointed. During the course of the administration of the receivership proceedings the receiver, by authority and direction of the federal court, abandoned the judgments that are the subject of this action. Plaintiff claimed title to the abandoned judgments and brought this action to quiet title to them.

The court found the facts as above stated and as conclusions of law found that upon the abandonment of the judgments title revested in defendant association; that the judgments were not abandoned insofar as the association is concerned; that the judgments did not become publici juris and were not subject to ownership by the first claimant.

The action in the federal court was brought by a creditor of the association, as stated in the brief and which we take to be true, “because of its mismanagement, manipulation and the embezzlement of its funds” by a director of the association. It does not appear from the record before us that the association was insolvent. The appointment of the receiver in the action did not dissolve the corporation. Its right to do business was suspended during the period of receivership, but its corporate existence was not terminated. Upon the dissolution of the receivership proceedings and the discharge of the receiver, the corporation’s right to transact business was reinstated in the absence of a prohibitory order. The [649]record does not show, and appellant does not assert in his brief, that such an order was made.

It does not appear that the Building and Loan Commissioner of California was a party to the proceedings, and as far as the record shows, he made no claim to any of the assets of the corporation and took no steps to liquidate it or to wind up its business. Consequently, no proceedings having been taken under the Building and Loan Act of the state, and the Building and Loan Commissioner having made no claim to the assets, it was not necessary to obtain authority from the commissioner in order to permit defendant association to resume or to continue its business.

Plaintiff has sued the corporation without joining the receiver as a defendant. The corporation filed its verified answer and the case was tried without reference to the receivership except the allegation of his appointment and his abandonment of the judgments described in the pleadings. Since a corporation for which a receiver has been appointed cannot be sued without the consent of the court which appointed him and no such order is alleged to have been made, and since there is no claim that the receivership is still in force, it is presumed that the receiver has been discharged and that defendant corporation is no longer in the custody of the federal court. By instituting the action in this form plaintiff has admitted the legal capacity of defendant.