1. A claim for reimbursement from funds held by the receiver
appointed by this Court, not based on legal right but allowable
under an order of this Court, in the discretion of the receiver,
cannot be enforced against him by an action in a state court, and
such action may be enjoined by this Court consistently with
Jud.Code, § 265. P.
265 U. S.
491.
2. Section 66 of the Judicial Code, providing that every
receiver of property appointed by a federal court may be sued,
without leave of the court, "in respect of any act or transaction
of his in carrying on the business connected with such property,"
does not apply to a suit based on acts occurring before the
receivership for the cost of which he has been given discretionary
authority by the court to make reimbursement. P.
265 U. S.
492.
Injunction granted.
Page 265 U. S. 491
Upon return of an order heretofore issued to the respondents
Duhon and Kebideaux (
ante, p.
265 U. S. 76) to
show cause why they should not be enjoined from maintaining an
action in a state court against the receiver in this cause.
MR. JUSTICE VAN DEVANTER delivered the opinion of the Court.
In a recent report of the receiver in this case, he called
attention to an action brought against him in the District Court of
Wichita County, Texas, by J. H. Duhon and H. J. Kebideaux, the
object of which is to enforce payment by him of the claim
hereinafter described. On examining the report, this Court ordered
the plaintiffs in that action to show cause why they should not be
enjoined from maintaining it. In due time, they submitted a
response.
The claim sought to be enforced is one for reimbursement for the
cost of drilling an oil well in the river bed, and, if paid, must
be paid out of an impounded fund in the receiver's custody. The
well was drilled prior to the receivership, and without right. In
no possible view did the drilling give rise to an enforceable claim
against the receiver or against any property in the
receivership.
The right asserted against the receiver is based on a subsequent
order of this Court.
256 U. S. 607.
That order is not imperative or mandatory, nor does it purport to
give any operator or driller a right to be reimbursed. On the
contrary, it commits the question of reimbursement to the
receiver's discretion. Its words are, "is hereby authorized, in his
discretion," etc. Obviously the receiver's action in a matter
committed to his discretion by this Court cannot be controlled by
any other court. The plaintiffs say that the receiver recognized
their claim. Even so, they assert and reassert that there has been
no
Page 265 U. S. 492
reimbursement. If this be true, the matter still rests in the
receiver's discretion. A mere recognition of the claim would not
terminate his discretion. He would be free to reconsider until
there was an actual reimbursement.
If the plaintiffs desired to enforce reimbursement regardless of
the receiver's discretion, they should have applied to this Court
for a mandatory order. No other court could change the existing
order, or require the receiver to surrender his discretion under
it, and yet that is what the plaintiffs seek to accomplish by their
action against the receiver. They rely on § 66 of the Judicial
Code, which reads as follows:
"Every receiver or manager of any property appointed by any
court of the United States may be sued in respect of any act or
transaction of his in carrying on the business connected with such
property, without the previous leave of the court in which such
receiver or manager was appointed, but such suit shall be subject
to the general equity jurisdiction of the court in which such
manager or receiver was appointed so far as the same may be
necessary to the ends of justice."
Whether the section, rightly understood, applies to a receiver
appointed by this Court in a suit within its original jurisdiction
we need not consider. In terms, it is confined to suits against a
receiver in respect of his acts or transactions while carrying on
the business of the receivership. Here, the receiver is not sued in
respect of any act or transaction of his in the course of the
business, but in respect of acts occurring prior to the
receivership, for the cost of which this Court by a subsequent
order authorized him, in his discretion, to make reimbursement.
Under the plaintiffs' showing, the receiver's only connection with
the matter has been a refusal to exercise his discretion favorably
to them. That, in our opinion is not such an act or transaction as
the section intends.
Buckhannon & Northern R. Co. v.
Davis, 135 F. 707, 711.
Page 265 U. S. 493
Our conclusion is that an injunction should issue restraining
the plaintiffs from maintaining their action. Such an injunction,
in the circumstances disclosed, may issue consistently with § 265
of the Judicial Code.
Wells Fargo & Co. v. Taylor,
254 U. S. 175.
Injunction granted.