1. Where a judgment reverses the cause and remands it for
further proceedings in accordance with the court's opinion, the
opinion is incorporated in the judgment, and may be considered in
determining whether the judgment is final. P. 292 U. S.
2. A judgment of a state supreme court in a liquidation
proceeding which sustains the validity and priority of an execution
levied by an intervening creditor on property of the insolvent,
leaving no discretion to the trial court with respect to the matter
and fully disposing of the intervention, is a final judgment for
the purposes of appeal to this Court. P. 292 U. S.
3. Under the laws of Iowa, the official liquidator appointed by
statute upon the dissolution of an insolvent Iowa insurance company
in a suit by the State, is the statutory successor of the
corporation. P. 292 U. S.
4. In holding that such a liquidator was not the successor to
the corporate personality with title derived from the statutes of
the domicile, but a chancery receiver with title (if any) created
by the Iowa decree in the dissolution proceeding, the Supreme Court
of Montana denied full faith and credit to the statutes and
judicial proceedings of Iowa. P. 292 U.S. 121
5. Whether there is any law or policy prevailing in Montana
whereby the local creditors of an insolvent foreign insurance
company are entitled to enforce their full claims, by executions
upon its property in Montana, not merely as against a chancery
receiver, but as against the domiciliary successor of the
corporation seeking to
Page 292 U. S. 113
devote all of it assets to pro rata
all of its creditor, is a question for determination by the Supreme
Court of that State. P. 292 U.S.
6. When the decision of a state supreme court, due to an error
in applying the Federal Constitution, leaves unanswered a question
of state law that may be determinative of the case, this Court will
vacate the judgment and remand for further proceedings. P.
292 U. S.
94 Mont. 508; 23 P.2d 959, reversed.
The District Court of Montana entered a final decree adjudging
that Clark, the Iowa liquidator of a dissolved Iowa insurance
company, was the successor to the personality and title of the
corporation, that the assets should be liquidated and ratably
distributed subject only to liens existing at the date of
dissolution, that a local ancillary receiver should be retained to
assist the foreign liquidator, that assets in Montana should be
retained in that State until local creditors had received their
ratable proportion of the assets there and elsewhere, and that an
execution upon a judgment which had been recovered against the
corporation by the present respondents should be set aside and
cancelled. Upon appeal by the judgment creditors to the Supreme
Court of Montana, the decree was reversed and their execution
MR. JUSTICE CARDOZO delivered the opinion of the Court.
The question is whether full faith and credit has been given by
the courts of Montana to the statutes and judicial
Page 292 U. S. 114
proceedings of the State of Iowa. United States Constitution,
Art. IV, § 1.
The petitioner, the official liquidator of an Iowa insurance
company, declares himself the universal successor of the
corporation (Keatley v. Furey, 226 U.
, 226 U. S.
-404), the representative of its personality and
powers after its life has been extinguished. (Relfe v.
Rundle, 103 U. S. 222
Martyne v. American Union Fire Ins. Co.,
216 N.Y. 183, 110
N.E. 502; Deschenes v. Tallman,
248 N.Y. 33, 37, 161 N.E.
321.) The Supreme Court of Montana has held that his title to the
assets, if he has any, is derived not from any statute, but from an
involuntary assignment under a judgment of a foreign court. A title
traced to such a source is subject in Montana to attachment and
execution at the suit of local creditors. The question has been
left unanswered whether attachments and executions are enforceable
to the same extent in derogation of the title of a statutory
Federal Surety Company was organized as an insurance corporation
under the laws of Iowa, and thereafter received authority to do
business in Montana. In September, 1931, the state of Iowa sued it,
alleging its insolvency and praying for a decree of dissolution and
the distribution of the assets. A statute of Iowa provides that
"the commissioner of insurance henceforth shall be the receiver
and/or liquidating officer for any insurance company, association
or insurance carrier, and shall serve without compensation other
than his stated compensation as commissioner of insurance, but he
shall be allowed clerical and other expenses necessary for the
conduct of such receivership."
Code of Iowa 1931, § 8613-c 1. See also
Code of Iowa,
1931, §§ 8402, 8964. On September 25, 1931, a decree in favor of
the state was entered by default, and an amended decree on December
22 of the same year. By these decrees, the corporation was adjudged
to have been dissolved on September 25, 1931;
Page 292 U. S. 115
the Commissioner of Insurance, E. W. Clark, was adjudged to be
"the successor to said corporation," and as such to hold "title to
all property owned by Federal Surety Company at the time it so
ceased to exist;" and liquidation was decreed in accordance with
We have said that the corporation had authority to do business
in Montana. The grant was subject to conditions. A statute of
Montana provides that the dissolution of a corporation does not
"take away or impair any remedy given against any such
corporation, its stockholders or officers, for any liability which
has been previously incurred."
§ 6013, Montana Revised Codes of 1921. The preservation of
existing remedies is not confined to domestic corporations. It
applies to foreign corporations also. This results, in the view of
the Montana court, from a provision of the state Constitution as
well as from a supplementary statute. By Article XV, § 11, of the
"no company or corporation formed under the laws of any other
country, state or territory, shall have, or be allowed to exercise,
or enjoy within this state any greater rights or privileges than
those possessed or enjoyed by corporations of the same or similar
character created under the laws of the state."
And by a supplementary statute (§ 6659, Revised Codes,
"All foreign corporations licensed to do business in the State
of Montana shall be subject to all the liabilities, restrictions,
and duties which are or may be imposed upon corporations of like
character organized under the laws of this state, and shall have no
other or greater powers."
Construing that statute, the Supreme Court of Montana has
written in the case now under review:
"Suits against domestic corporations do not abate upon the entry
of a decree of dissolution, and the same rule, by virtue of this
statutory provision, must apply to a foreign corporation."
Mieyr v. Federal Surety Co.,
94 Mont. 508, 23 P.2d 959,
Long before the dissolution of the Federal Surety Company, the
respondents Williard and Wheaton, as trustees
Page 292 U. S. 116
of a syndicate, brought suit in a Montana court to recover from
the surety company the damages due upon a bond. The first trial
resulted in a nonsuit, which was reversed upon appeal. Williard
v. Federal Surety Co.,
91 Mont. 465, 8 P.2d 633. After the
decree of dissolution, the case came on for a second trial, and, on
May 10, 1932, judgment in favor of the plaintiffs was entered by
default. The Supreme Court of Montana has held that the dissolution
of the surety company did not abate the suit. There was thus a
final judgment, valid under the Montana practice and effective
according to that practice, to liquidate the claim.
To say that there was such a judgment is not to dispose of the
whole case. A judgment existing, the remedies available to enforce
it are still to be determined. Before the respondents were in a
position to issue execution, the situation had been complicated by
a suit for the appointment of a receiver begun in a Montana
District Court. On March 25, 1932, Mieyr, a simple contract
creditor, brought suit against the surety company and Clark, the
foreign liquidator, praying an ancillary receivership to preserve
the local assets. A temporary receiver (Crichton) was appointed the
same day. While that suit was pending, the respondents filed a
petition on May 24, 1932, for leave to issue an execution against
securities and moneys which had been discovered in Montana, the
levy to have the same effect as if no receiver had been appointed.
An order to that effect was granted, subject, however, to a later
motion to vacate it. Within due time thereafter, Clark filed a
cross-petition and an answer, asserting his title as successor to
the dissolved corporation, opposing the demands of the judgment
creditors and setting up his rights and privileges under article
IV, § 1, of the Federal Constitution. On August 25, 1932, the
District Court of Montana entered a final decree adjudging that
Clark was the successor to the personality and title of the Iowa
corporation; that the assets should be liquidated
Page 292 U. S. 117
and ratably distributed, subject only to the liens existing at
the date of dissolution; that Crichton should be continued as an
ancillary receiver to assist the foreign liquidator; that the
assets in Montana should be retained in that state until local
creditors had received their ratable proportion of assets there and
elsewhere, and that the execution upon the respondents' judgment
and any preference thereby created, as well as the earlier order
sanctioning the levy, should be set aside and cancelled.
From that decree, and from an order denying a motion to vacate
or modify it, the judgment creditors, who are the respondents in
this Court, appealed to the Supreme Court of Montana. After
argument and reargument, the decree and order were there reversed,
two members of the court dissenting. Mieyr v. Federal Surety
94 Mont. 508, 23 P.2d 959. The court held that the
respondents' judgment had been lawfully recovered, though the
defendant was dissolved; that the ancillary receivership was void
for the reason that a simple contract creditor (Mieyr) was without
standing to maintain the suit; that Clark, the foreign liquidator,
was not the successor to the corporate personality with a title
derived from the statutes of the domicile, but was a chancery
receiver with a title (if any) created by the Iowa decree; that, as
against such a receiver, creditors in Montana were at liberty to
levy attachments and executions, irrespective of their right to
enforce such a levy against a statutory successor, and hence that
the respondents' execution should be reinstated, and the cause
remanded for further proceedings in accord with the opinion. A writ
of certiorari brings the case here.
Our jurisdiction to issue the writ is challenged on the ground
that the decree to be reviewed is without the requisite finality.
Judicial Code § 237, 28 U.S.C. § 344. The challenge should not
prevail. The decree of the Montana court is final to the extent
that it confirms the respondents'
Page 292 U. S. 118
execution and permits a levy that will override the liquidator's
title. A final order results where a court denies a petition by an
intervening creditor to establish a prior lien (Gumbel v.
Pitkin, 113 U. S. 545
113 U. S.
), or a petition by a municipal corporation
intervening in a foreclosure suit to enforce a lien for taxes
superior to the mortgage (Savannah v. Jesup, 106 U.
, 106 U. S.
-565), or one by a chancery receiver appointed by a
state court for the delivery of property in the possession of
another court (Ex parte Tiffany, 252 U. S.
, 252 U. S. 36
Cf. Hovey v. McDonald, 109 U. S. 150
109 U. S. 155
Williams v. Morgan, 111 U. S. 684
111 U. S. 689
United States v. River Rouge Co., 269 U.
, 269 U. S. 41
Dexter Horton National Bank v. Hawkins,
190 F. 924, 927).
The doctrine of those cases is applicable here. Further judicial
proceedings may be necessary between the liquidator and others not
before us. As between the liquidator and the respondents claiming
as judgment creditors, the suit is at an end. They came into court
pro interesse suo
with a petition to establish the
priority of their judgment. The petition has been granted and
priority decreed. Not only that, but an order vacating the
execution has been reversed, and the levy reinstated. So far as
these respondents are concerned, there is nothing more to be
"The property of the Federal Surety Company within the State of
Montana at the time of the levy of the execution by Williard et
not being in possession of the Iowa receiver, was subject
to levy, and the levy made under the execution in May, 1932, is
good and valid."
By that opinion, which by reference was incorporated in the
judgment (Metropolitan Water Co. v. Kaw Valley District,
223 U. S. 519
223 U. S. 523
Gulf Refining Co. v. United States, 269 U.
, 269 U. S.
), nothing was left to the discretion of the trial
court in respect of the priority of the execution or of the
respondents' rights thereunder. The intervening petition has been
finally disposed of, and no longer is a pending proceeding,
whatever may be said
Page 292 U. S. 119
of the suit in which the claimants intervened. Cf.
47 U. S.
6 How. 201, 47 U. S.
-203; United States v. River Rouge Co.,
Jurisdiction being here, the case will be considered on the
We assume in accordance with the decision of the Montana court
that the respondents' action against the surety company did not
abate on dissolution, but was lawfully pursued to judgment.
9 Wall. 23; cf. Sinnott v. Hanan,
214 N.Y. 454, 458-459, 108 N.E. 858; Marstaller v. Mills,
143 N.Y. 398, 400, 38 N.E. 370. Cases such as Remington &
Sons v. Samana Bay Co.,
140 Mass. 494, 5 N.E. 292, and others
cited in the margin [Footnote
] are not at war with this conclusion. They express the rule
to be applied when there is no statute or public policy to the
contrary in the state where the foreign corporation has been
licensed to do business. They do not delimit the capacity of a
state, when granting such a license, to subject it to conditions.
Complications might exist if there had been no one within the state
upon whom process could be served. Here, the action was begun, and
the company had appeared and answered, before the date of
dissolution. Moreover, a power of attorney was on file, pursuant to
the Montana law (Revised Codes, 1921, § 6212) whereby process might
be served on the insurance commissioner of the state, the power to
remain in force so long as any policy or liability of the company
was outstanding in Montana. Cf. American Railway Express Co. v.
Kentucky, 273 U. S. 269
273 U. S. 274
Washington v. Superior Court, 289 U.
, 289 U. S.
-365. Complications also might exist if there were no
Page 292 U. S. 120
in being with authority to continue the defense. Here, there had
been the designation of a liquidator who was competent to represent
the corporation if he had chosen to intervene. Cf. Oklahoma
Natural Gas Co. v. Oklahoma, 273 U. S. 257
are not to be understood as intimating that such complications
would be fatal if they existed, but merely to exclude them. In such
circumstances, the judgment is at least effectual to liquidate the
claim as a charge upon the local assets. But this, as we have seen,
is only a partial statement of the problem. To ascertain the
procedure by which the charge is to be enforced, whether by the
levy of execution or by a ratable division, other considerations
must be weighed. In particular, it must be known whether superior
interests or titles have developed between the summons and the
judgment, and whether the quality or operation of those interests
affects the method of distribution. Something did intervene here,
the appointment of a liquidator under the statutes of the domicile.
That much is undisputed. Did the Supreme Court of Montana misjudge
the quality and operation of this intervening interest, and, in so
doing, did it deny to the statutes and decrees of Iowa the faith
and credit owing to them under the Constitution of the United
In our judgment, the statutes of Iowa have made the official
liquidator the successor to the corporation, and not a mere
receiver. State ex rel. Attorney General v. Fidelity Loan &
113 Iowa, 439, 85 N.W. 638. His title is not the
consequence of a decree of a court whereby a corporation still in
being has made a compulsory assignment of its assets with a view to
liquidation. Sterrett v. Second National Bank,
248 U. S. 73
Bonding Co. v.
Page 292 U. S. 121
Karatz, 262 U. S. 77
262 U. S. 88
Great Western Mining Co. v. Harris, 198 U.
, 198 U. S. 575
17 How. 322. His title is the consequence of
a succession established for the corporation by the law of its
creation. Relfe v. Rundle, supra; Keatley v. Furey, supra;
Sterrett v. Second National Bank, supra,
page 248 U. S. 77
cf. Bockover v. Life Assn. of America,
77 Va. 85;
Converse v. Hamilton, 224 U. S. 243
224 U. S. 257
Bernheimer v. Converse, 206 U. S. 516
206 U. S. 534
So the lawmakers have plainly said. So the Iowa court adjudged in
We think the Supreme Court of Montana denied full faith and
credit to the statutes and judicial proceedings of Iowa in holding,
as it did, that the petitioner was a receiver deriving title
through a judicial proceeding, and not through the charter of its
being and the succession there prescribed. "When the transfer of a
debtor's property," said the court,
"is the result of a judicial proceeding, there is no provision
of the Constitution which requires the courts of another state to
carry it into effect, and as a general rule no state court will do
this to the prejudice of the citizens of its own state,"
citing Reynolds v. Adden, 136 U.
, a case of insolvency proceedings in
against a natural person, and Zacher v. Fidelity
106 F. 593, an enforced assignment to the receiver
of a corporation which retained its corporate life. Bankruptcy or
insolvency proceedings, whether the debtor is a natural or a
juristic person, confer upon the receiver or assignee a title
which, generally speaking, is without recognition outside of the
state of his appointment except in subordination to the claims of
local creditors. Security Trust Co. v. Dodd, Mead &
Co., 173 U. S. 624
Cole v. Cunningham, 133 U. S. 107
11 How. 33, 52 U. S. 44
Barth v. Backus,
140 N.Y. 230, 35 N.E. 425; Ward v.
Connecticut Pipe Mfg. Co.,
71 Conn. 345, 41 A. 1057;
Gilbert v. Hewetson,
79 Minn. 326, 82 N.W.
Page 292 U. S. 122
655. Upon the strength of these and like decisions, the Montana
court has refused recognition to a receiver or liquidator who in
truth is a statutory successor. Whether it would have favored that
conclusion of it had correctly interpreted his standing its opinion
does not tell us. The case should go back to the end that the
priority of the execution may be determined with understanding of
the title displaced and overridden.
In thus holding, we do not say that there is an invariable rule
by which the title of a statutory liquidator must prevail over
executions and attachments outside of the state of his appointment.
The subject is involved in confusion, with decisions pro and con.
There are cases which lay down the rule that the title of such a
liquidator will have recognition and enforcement everywhere without
affirming or denying the possibility of exceptions. Kinsler v.
103 Neb. 382, 172 N.W. 33; U.S. Truck Co. v.
Pennsylvania Surety Corp.,
259 Mich. 422, 243 N.W. 311;
Bockover v. Life Assn., supra; Parsons v. Charter Oak Life Ins.
31 F. 305; Fry v. Charter Oak Life Ins. Co.,
F. 197; cf. Taylor v. Life Association of America,
493; Smith v. Taggart,
87 F. 94; Southern Building
& Loan Assn. v. Miller,
118 F. 369. Other cases add a
dictum (Martyne v. American Union Fire Ins. Co., supra
that the state in which the title is assailed may declare a
contrary policy by statute or decision. Cf. Disconto
Gesellschaft v. Umbreit, 208 U. S. 570
208 U. S.
-580. Still others take the view that the claims of
local creditors are entitled to precedence. Schloss v. Surety
149 Iowa, 382, 128 N.W. 384; Lackmann v. Supreme
142 Cal. 22, 75 P. 583. The position of a claimant
who has the standing of a statutory successor is more closely
analogous to that of a trustee under a voluntary general assignment
for the benefit of creditors (Ockerman v. Cross,
29; Warner v. Jaffray,
96 N.Y. 248, 255; Hervey Co.
v. R.I. Locomotive Works,
Page 292 U. S. 123
664) than to one deriving title under a decree in insolvency
proceedings (Security Trust Co. v. Dodd, Mead & Co.,
p. 173 U. S.
), yet it is stronger than either in that, for many
purposes, the corporation under which he claims has passed out of
Whether there is in Montana a local policy, expressed in statute
or decision, whereby judgments and attachments have a preference
over the title of a charter liquidator is a question as to which
the Supreme Court of that state will speak with ultimate authority.
It has not spoken yet. The tendency in most of the states is to
give priority to the title unless a contrary policy is expressed
with reasonable clarity. Martyne v. American Union Fire Ins.
Co., supra; Kinsler v. Casualty Co., supra; Bockover v. Life Assn.
of America, supra. Cf. Cogliano v. Ferguson,
Mass. 364, 139 N.E. 527. No statute or decision brought to our
notice from Montana removes the question from the field of doubt.
True, there are the statutes heretofore referred to whereby suit
may be maintained against foreign corporations after dissolution on
the same basis as against domestic ones. Nothing in those
provisions declares the existence of a policy to allow the assets
of an insolvent corporation to be torn to pieces at the suit of
rival creditors when they could be distributed equally and without
sacrifice at the hands of a receiver. At all events, the policy, if
it exists, is indicated too obscuredy to permit us to accept it
until so instructed by the Montana court. The drastic consequences
of acceptance attest the need of caution. Partnerships and
individuals, if hard pressed, may resort to a court of bankruptcy,
and thus conserve their assets. Business corporations may have
their assets equally distributed through involuntary proceedings.
But insurance corporations, like banks, are excluded from
bankruptcy altogether (11 U.S.C. § 22 b), and must submit to
dismemberment, however great the waste or inequality, unless
Page 292 U. S. 124
appointed. The respondents would have us say that submission to
such consequences is exacted by an unbending rule of law.
We have no thought to impose our reading of the local statutes
and decisions upon the courts of the locality. What we are about to
say as to their meaning does no more than explain the grounds for
our understanding that the courts of Montana have left the question
open. If the law were clear beyond debate, as counsel for the
respondents has contended that it is, our duty might be to dispose
of the entire controversy now, instead of remanding it to the state
court for further action there. We are mindful of the practice
whereby domestic corporations dissolved by the Montana law may be
wound up by the directors as trustees in dissolution. Revised
Codes, § 6011, formerly Civil Code 1895, § 561. We understand also
that, while the assets are so held, claims may be reduced to
judgment, and attachments and executions levied. This is doubtless
the prevailing practice when the corporation is solvent, or when
insolvency is not so gross as to lead to sacrifice or hardship.
Inability to discharge liabilities as they mature, or even
impairment of the capital prescribed by the articles of
association, may not mean that the assets will be insufficient when
put up at public sale. But administration by the directors, subject
to attachment and execution, is not the only form of distribution
that is known to the local law. In appropriate cases, a dissolved
corporation may be wound up by a receiver as an officer of the
court. By § 9303 of the Revised Codes of 1921, a creditor of a
dissolved corporation (presumably a judgment creditor) may apply
for a receiver to liquidate the assets, [Footnote 3
] and, after
Page 292 U. S. 125
such appointment, executions are forbidden. Gardner v.
16 Mont. 221, 40 P. 590; cf. Barker v.
259 F. 484, 488; Rohr v. Stanton Trust &
76 Mont. 248, 251, 253, 245 P. 947; Berryman
v. Billings Mutual Heating Co.,
44 Mont. 517, 521, 121 P. 280.
The decisions are obscure as to the circumstances in which that
statute will be applied. The vast majority of the Montana cases on
the subject of receivers are grounded on another section (9301),
under which the tests are very different. There is hardly a word in
any of them as to the meaning of § 9303 and the remedy
Page 292 U. S. 126
Thus, in Forsell v. Pittsburg & Montana Copper Co.,
42 Mont. 412, 113 P. 479, a creditor obtained a judgment against a
foreign corporation, not dissolved, and execution was issued and
returned unsatisfied. The creditor then applied for a receiver, but
without alleging that there was any property within the state. The
court held that no case was made out by the allegations of the
bill. In Berryman v. Billings Heating Co.,
44 Mont. 517,
525, 121 P. 280, a temporary receiver was appointed in an action
against a domestic corporation not dissolved. In aid of this
appointment, the plaintiff, a simple contract creditor, alleged
that the defendant was insolvent. On appeal, the court held that
this, without more, did not make the appointment necessary, and
vacated the receivership. In Prudential Securities Co. v. Three
Forks, H. & M.V. Ry. Co.,
49 Mont. 567, 572, 144 P. 158,
and again in Scholefield v. Merrill Mortuaries, Inc.,
Mont.192, 17 P.2d 1081, the situation was the same as in the suit
by Berryman, supra,
the applicants for the receiver being
simple contract creditors suing to collect a debt. What was said as
to the trust fund doctrine when invoked by a creditor so situated
(49 Mont. at p. 572) is in full accord with the doctrine prevailing
in this Court. Hollins v. Brierfield Coal & Iron Co.,
150 U. S. 371
case at hand is barely grazed by Ferrell v. Evans,
Mont. 444, 454, 65 P. 714, 718. There, the suit was for the
appointment of a receiver to wind up a building and loan company
whose charter had expired. The court held that there was no need of
superseding the directors who were statutory trustees under § 6011
of the Revised Codes. The opinion states: "No exception is made is
case of insolvency," but this is supplemented by the statement
that, in fact, "the association was not insolvent." The dictum
quoted does not amount to a decision that a receiver will never be
appointed under § 9303 in a case where a corporation has been
dissolved and multiplying executions threaten a dispersion of the
assets. No such question was involved.
Page 292 U. S. 127
The situation was much the same in Merges v.
45 Mont. 355, 123 P. 21. The charter of a solvent
corporation had expired, and there was no sufficient ground for
superseding the directors through the appointment of receivers.
We do not read these decisions as holding in any clear or final
way that the directors of a dissolved corporation will never be
required to give place to a receiver, no matter how great the
danger of inequality or waste. Indeed, it is uncertain whether such
a holding would be possible without denying any function to § 9303
of the Montana Code. Inequality and waste are to be avoided in
special measure when banks or insurance companies, unable, as we
have seen, to have the protection of courts of bankruptcy, are in
course of liquidation. The Supreme Court of Montana has been
mindful of this need at all events in respect of banks, and has
stated it with force and clarity. Thus, in Rohr v. Stanton
Trust & Savings Bank, supra,
a creditor brought suit in
the hope of gaining a preference for his deposit out of the assets
of a bank in the hands of a receiver. The court said (p. 251),
"the general principle of equity that the assets of an insolvent
are to be distributed ratably among general creditors applies with
full force to the distribution of the assets of a bank,"
and again (p. 253), "The available assets" are to be
Page 292 U. S. 128
conserved that each depositor or other creditor shall receive
payment or dividend according to the amount of his debt, and that
none of equal class shall receive any advantage or preference over
Cf. Aetna Accident & Liability Co. v. Miller,
Mont. 377, 389, 170 P. 760. It would seem that conservation of
assets and equality of distribution are goods no less important in
the winding up of insurance companies and of other moneyed
corporations than in the winding up to banks.
From this survey of the decisions in Montana there results this
truth, if nothing more -- that there has been no definitive
pronouncement as to the circumstances justifying a receivership for
an insolvent corporation, and that the question is left open
whether receivers of such a corporation will be appointed after
dissolution to prevent waste or inequality. If that is so, it
results also that the question is still open whether executions may
be subordinated to the title of a foreign liquidator without a
forbidden discrimination between corporations organized in Montana
and those from other states. A statute preserving remedies after a
decree of dissolution does not mean that for every purpose a
corporation, though dissolved, is still a juristic person, or that
equity is indifferent as to the mode of marshaling the assets. All
that it means is that suits shall not abate, but may be prosecuted
to judgment as if the corporation were in being. What will be done
afterwards in the enforcement of a judgment will vary with the
circumstances. When a charter liquidator whose standing is
recognized in Montana is decreed to have an interest superior to
the lien of later executions, as if his position were that of a
receiver appointed by the local courts, there is no resulting
inequality between foreign and domestic corporations, no favoring
of the one class in hostility to the other. So, at least, the
Montana court may not unreasonably decide. By hypothesis, the
domestic corporation, after dissolution, may be placed,
Page 292 U. S. 129
upon a proper showing, in the hands of a receiver, and its
assets ratably distributed. The foreign corporation, represented by
a foreign liquidator, may be subjected to the same restraints. If
supplementary directions are thought to be appropriate to the end
that local assets may be kept within in Montana till local
creditors are paid their share of all the assets everywhere, there
is power in a court of equity to assure the requisite equality.
Sands v. E. S. Greeley & Co.,
88 F. 130; Receivers
Middlesex Banking Co. v. Realty Investment Co.,
104 Conn. 206,
132 A. 390; Buswell v. Supreme Sitting of Order of Iron
161 Mass. 224, 36 N.E. 1065; Fawcett v. Supreme
Sitting of Order of Iron Hall,
64 Conn. 170, 29 A. 614;
People v. Granite State Provident Assn.,
161 N.Y. 492, 55
To resume: the Supreme Court of Montana will determine whether
there is any local policy whereby an insolvent foreign corporation
in the hands of a liquidator with title must submit to the
sacrifice of its assets or to their unequal distribution by writs
If such a policy exists and the foreign liquidator is thus
displaced, other questions may remain as to the power of the state
which there is no occasion to consider in advance of the event.
The decree should be vacated insofar as it adjudges the validity
and priority of the respondents' execution (cf. Dorchy v.
Kansas, 264 U. S. 286
264 U. S. 291
Missouri v. Public Service Comm'n, 273 U.
, 273 U. S.
), and the cause remanded to the Supreme Court of
Montana for further proceedings not inconsistent with this
It is so ordered.
National Surety Co. v. Cobb,
66 F.2d 323; Marion
Phosphate Co. v. Perry,
74 F. 425; Fitts v. National Life
130 Ala. 413, 30 So. 374; Riddell v. Rochester
German Ins. Co.,
35 R.I. 45, 85 A. 273; Morgan v. New York
National Building & Loan Ass.,
73 Conn. 151, 46 A.
The insolvent corporation in Sterrett v. Second National
was not to be dissolved until there had been a
final settlement of the business. Pp. 248 U. S.
"Upon the dissolution of any corporation, the district court of
the county in which the corporation carries on its business, or has
its principal place of business, on application of any creditor of
the corporation, or of any stockholder or member thereof, may
appoint one or more persons to be receivers or trustees of the
corporation, to take charge of the estate and effects thereof, and
to collect the debts and property due and belonging to the
corporation, and to pay the outstanding debts thereof, and to
divide the moneys and other property that shall remain over among
the stockholders or members."
Another section dealing with the appointment of receivers is
9301, subd. 5.
"A receiver may be appointed by the court in which an action is
pending, or by the judge thereof: . . ."
"In cases when a corporation has been dissolved, or is
insolvent, or in imminent danger of insolvency, or has forfeited
its corporate rights."
By construction, that section has been limited to receivers
appointed pendente lite.
"It is a well settled rule of law that there cannot be such a
thing as an action brought distinctively and solely for the
appointment of a receiver."
State v. District Court,
50 Mont. 259, 263, 146 P. 539,
540. A receivership is a provisional remedy. "An action must be
pending before a receiver can be appointed." State v. District
All this, according to our understanding, has no relation to an
application under § 9303, where the appointment of a receiver is
the end and aim of the proceeding.
Compare the decisions in California under statutes identical in
form: Henderson v. Palmer Union Oil Co.,
29 Cal. App. 451,
156 P. 65; French Bank Case,
53 Cal. 495, 553;
Havemeyer v. Superior Court,
84 Cal. 327, 365, 24 P. 121;
State I. & I. Co. v. San Francisco,
101 Cal. 135,
147-148, 35 P. 549; Elliott v. Superior Court,
727, 145 P. 101.
Gilna v. Barker,
78 Mont. 357, 254 P. 174, it would
seem, is even farther from the case at hand. A creditor brought
suit against a domestic corporation for the liquidation of a debt.
The trial court dismissed the complaint on the ground that suit was
unnecessary after the corporation had been dissolved. That judgment
was reversed. The court did not hold that there would be no
occasion for a receivership thereafter. It left that question
"Counsel for defendants argue that plaintiff should have
intervened in the case in which the court decreed a sale of the
property of the defunct corporation, and should have asked for a
receiver. He may have been entitled to that privilege, but, if so,
it did not deprive him of the right to institute the instant case,
reduce his claim to judgment, and take the chance of realizing on
Separate opinion by MR. JUSTICE McREYNOLDS.
This cause has been much obscured by verbiage. The practical
problems incident to administering the affairs of insolvent
insurance companies are often complex; but
Page 292 U. S. 130
the issues presently presented for determination are narrow, and
ought to cabin our discussion.
In 1931, an Iowa court, proceeding under local statutes,
adjudged that the corporate existence of the Federal Surety
Company, organized in that state, had terminated, that E. W. Clark,
receiver and liquidating officer, is its successor and holds title
to all corporate property for the purposes of liquidation, etc.
January 31, 1928, the surety company being then authorized to
transact business in Montana, respondents here -- Williard,
Wheaton, and Hay -- duly asked for judgment against it in the
district court of Fergus county. May 20, 1932, judgment went in
their favor. Clark, the Iowa receiver, did not enter his appearance
in the cause, made no effort to prevent the judgment. Execution
issued and was levied, May ___, 1932, upon property of the company
found in Montana.
In March, 1932, one John Mieyr brought suit against the Federal
Surety Company in the district court, Cascade county, Mont. He
alleged indebtedness to himself upon an unliquidated claim, also
indebtedness to other citizens of Montana for considerable sums,
and that the company had much property within the state. He
described the Iowa court proceedings wherein the corporation was
declared dissolved and Clark designated as receiver, and averred
that Clark was then attempting to obtain possession of the
company's property within Montana with intent to remove it. He
asked for judgment for the amount of his claim, and that a local
receiver be appointed to take possession of the company's assets in
Montana and hold them subject to further order, etc. Thereupon, the
court appointed D. A. Crichton receiver of the Montana assets, with
powers as prayed. He duly qualified. Clark appeared specially and
asked that Crichton's appointment be annulled because the court
lacked jurisdiction. This motion was denied May 24th.
Page 292 U. S. 131
On the same day, Williard, Wheaton, and Hay, appearing by
petition, asked and received approval of their action in procuring
levy of the Fergus county execution upon the corporation's
July 25, 1932, Receiver Crichton moved to annul the order of May
24, 1932, which approved the levy of the Fergus county
August 3, 1932, Clark appeared and answered Mieyr's complaint.
He set out proceedings in the Iowa court and his designation as
receiver; he asked an order confirming his title to the company's
assets, also for confirmation of Crichton's appointment as
August 25th, the court authorized an order reciting that the
corporate existence of the surety company was terminated by the
Iowa proceedings and that title to all of its property passed to
Clark as receiver. This order also confirmed the appointment of
Crichton as receiver of Montana assets, directed all creditors in
that state to file their claims, and that corporate assets should
be delivered to him. And further that the order of May 24th
permitting the Fergus county execution be set aside.
August 31, 1932, Williard, Wheaton, and Hay asked the Cascade
county district court to vacate the order of August 25th upon the
ground that the facts disclosed were not sufficient to justify
appointment of the receiver; also because the court acted without
jurisdiction. In the alternative, they asked that the order be so
modified as to release all property seized under any Montana
execution or attachment. This motion was denied the same day.
On September 18, 1932, Williard, Wheaton, and Hay appealed from
the judgment and order of August 25th confirming Crichton's
appointment as receiver, etc. and revoking the May 24th order which
granted permission for levy of the Fergus county execution. Also
from the order of August 31st which denied their motion to vacate
the one entered August 25th. The issues were thus limited.
Page 292 U. S. 132
The opinion of the Supreme Court came down April 1, 1933. It
"The appeal presents the question whether appellants have the
right to be paid the amount of their claim from the Montana
property before any part of such property is transmitted to the
Iowa receiver for administration through the Iowa receivership,
when, as shown, their claim has been reduced to judgment and
execution levied after the proceedings in the Iowa court designed
to accomplish the dissolution of the corporation. Solution of the
problem presented makes it necessary to determine the effect of the
proceedings in the Iowa court upon the corporate life of the surety
Upon review of the Montana statutes, the court declared that the
suit against the surety company in Fergus County did not abate upon
entry of the Iowa decree, and that the judgment of May 20th therein
was valid. It then came to consider whether levy under the Fergus
County execution was good, and said this "depends upon the effect
of the order appointing Crichton receiver." It ultimately and
"The petition of Mieyr for the appointment of a receiver was
insufficient in that he, being a general creditor, had no right to
the appointment of a receiver, and had an adequate remedy by which
he could be fully protected -- namely, the issuance and levy of a
writ of attachment. The property of the Federal Surety Company
within the state of Montana at the time of the levy of the
execution by Williard et al.,
not being in possession of
the Iowa receiver, was subject to levy, and the levy made under the
execution in May, 1932, is good and valid. The judgment and orders
appealed from are reversed, and the cause remanded for further
proceedings in the district court in accordance with the views
herein expressed. "
Page 292 U. S. 133
The opinion definitely approved the claim of the appellants that
the district court of Cascade County was acting without authority
and beyond its jurisdiction.
Upon the sole petition of Clark, receiver, a writ of certiorari
issued from this Court. We have no jurisdiction unless the judgment
of the state court was final, and only federal questions are open
for our consideration.
The formal judgment of the Supreme Court directed:
"For reasons stated in the opinion, the judgment and orders
appealed from are reversed, and the cause remanded for further
proceedings in accordance with the views expressed in the
Upon its face, this is not final within the meaning of the
statute governing our jurisdiction. And,
"in matters of this kind we may not disregard the face of the
record and treat the judgment as something other than it appears to
be. So to do probably would lead to much confusion and
Hartford Accident & Ind. Co. v. Bunn, 285 U.
, 285 U. S. 178
McComb v. Commissioners, 91 U. S. 1
Bostwick v. Brinkerhoff, 106 U. S. 3
106 U. S. 4
Haseltine v. Central Bank, 183 U.
; Schlosser v. Hemphill, 198 U.
, 198 U. S. 175
Norfolk & S. Turnpike Co. v. Virginia, 225 U.
, 225 U. S. 268
Louisiana Navigation Co. v. Oyster Comm'n, 226 U. S.
, 226 U. S. 101
Georgia Ry. Co. v. Town of Decatur, 262 U.
, 262 U. S. 437
Gulf Refining Co. v. United States, 269 U.
, 269 U. S.
Bostwick v. Brinkerhoff.
"The rule is well settled and of longstanding that a judgment or
decree to be final, within the meaning of that term as used in the
acts of Congress giving this Court jurisdiction on appeals and
writs of error, must terminate the litigation between the parties
on the merits of the case, so that, if there should be an
affirmance here, the court below would have nothing to do but to
execute the judgment or decree it had already rendered. . . . If
the judgment is not one which disposes of the whole case on its
merits, it is not final. Consequently
Page 292 U. S. 134
it has been uniformly held that a judgment of reversal with
leave for further proceedings in the court below cannot be brought
here on writ of error."
Haseltine v. Central Bank of Springfield.
"We have frequently held that a judgment reversing that of the
court below, and remanding the case for further proceedings, is not
one to which a writ of error will lie. . . . While the judgment may
dispose of the case as presented, it is impossible to anticipate
its ultimate disposition. It may be voluntarily discontinued, or it
may happen that the defeated party may amend his pleading by
supplying some discovered defect, and go to trial upon new
evidence. To determine whether, in a particular case, this may or
may not be done might involve an examination not only of the
record, but even of the evidence in the court of original
jurisdiction, and lead to inquiries with regard to the actual final
disposition of the case by the supreme court which it might be
difficult to answer. We have therefore always made the face of the
judgment the test of its finality, and refused to inquire whether,
in case of a new trial, the defeated party would stand in a
position to make a better case. The plaintiffs in the case under
consideration could have secured an immediate review by this Court,
if the court, as a part of its judgment of reversal, had ordered
the Circuit Court to dismiss their petition when, under
], they might have sued out a writ of error at once."
Schlosser v. Hemphill
-- an action in equity to quiet
"By its judgment, the Supreme Court of Iowa reversed the decree
of the trial court, and remanded the cause 'for further proceedings
in harmony with the opinion of this Court.' We have heretofore held
that a judgment couched in such terms is not final in such a sense
as to sustain a writ of error from this Court. . . . Doubtless the
conclusions arrived at by the state supreme court,
Page 292 U. S. 135
and expressed in its opinion, furnish the grounds on which the
court below must proceed when the case goes to a decree there, if
no change in pleadings or proof takes place, but we cannot say what
action might nevertheless be taken, and, as no decree was entered
in the supreme court, and no specific instruction was given to the
court below, we think the writ of error cannot be maintained.
Assuming, without deciding, that a Federal question was so raised
as otherwise to have justified the exercise of our jurisdiction, we
can but repeat what we said in Haseltine's
"The plaintiffs in the case under consideration could have
secured an immediate review by this Court if the court, as a part
of its judgment of reversal, had ordered the circuit court to
dismiss their petition; when, under Mower v. Fletcher,
114 U. S.
, they might have sued out a writ of error at
Louisiana Navigation Co. v. Oyster Comm'n.
error to Louisiana Supreme Court dismissed, judgment not final.
"The contention, however, is that the judgment below is final
for the purpose of review by this Court because, when the opinion
of the Supreme Court of Louisiana is carefully weighed, it will be
found that that court practically finally disposed adversely to the
title of the plaintiff of the substantial part of the lands
involved in the suit, and hence that the court, in remanding the
cause for further proceedings, did so only as to other lands. But,
conceding this to be true, it does not justify the claim based on
it. In the first place, it is settled that this Court may not be
called upon to review by piecemeal the action of a state court
which otherwise would be within its jurisdiction, and, in the
second place, the rule established by the authorities to which we
have referred is that, on the question of finality, the form of the
judgment is controlling, and hence that this Court cannot, for the
purpose of determining whether its reviewing
Page 292 U. S. 136
power exists, be called upon to disregard the form of the
judgment in order to ascertain whether a judgment which is in form
not final might, by applying the state law, be treated as final in
character. Indeed, it has been pointed out that the confusion and
contradiction which inevitably arose from resorting to the state
law for the purpose of converting a judgment not on its fact final
into one final in character was the dominating reason leading to
the establishment of the principle that the form of the judgment
was controlling for the purpose of ascertaining its finality."
Georgia Ry. Co. v. Decatur
-- error to Georgia Supreme
Court in proceeding for injunction.
"The rule is established that, in order to give this Court
appellate jurisdiction, the judgment or decree 'must terminate the
litigation between the parties on the merits of the case, so that,
if there should be an affirmance here, the court below would have
nothing to do but to execute the judgment or decree it had . . .
Gulf Refining Co. v. United States
-- appeal from
Circuit Court of Appeals. The challenged judgment was held
"The general rule established by many decisions, of which
Haseltine v. Central Bank of Springfield (No. 1),
183 U. S.
, is an example, is that the face of the judgment is
the test of its finality, and that, by this test a judgment of
reversal, remanding the cause for further proceedings in conformity
with the opinion of the court ordinarily is not final. But the
direction to proceed consistently with the opinion of the court has
the effect of making the opinion a part of the mandate, as though
it had been therein set out at length. Metropolitan Co. v. Kaw
Valley District, 223 U. S. 519
, 223 U. S.
. Under the stipulations above recited, the trial
court was bound to enter decrees for the government for the stated
sums of money if that court found that the government was entitled
Page 292 U. S. 137
recover the net value of the oil produced. The trial court found
that the government was not so entitled, and the decrees went
accordingly. Turning to the opinion, it will be seen that the
Circuit Court of Appeals decided that the trial court erred 'in
entering the decrees denying the complainant the right to recover
the net value of the oil,' etc. The instruction for further
proceedings not inconsistent with the opinion therefore was
equivalent to a direction to render judgment for the net value --
that is, for the exact sums set forth in the stipulations. See
Moody v. Century Bank, 239 U. S. 374
, 239 U. S.
; Chesapeake & Potomac Tel. Co. v.
Manning, 186 U. S. 238
, 186 U. S.
. There was no evidence to be taken or considered,
and no change in the issue was possible; nothing remained but the
ministerial duty of entering a decree for the precise sums which
had been fixed beyond the power of alteration. It follows that the
jurisdictional objection is without merit."
The judgment of the Supreme Court now before us is not final in
form, and I think inspection of the opinion does not definitely
indicate the action which the District Court of Cascade County
would have been bound to take. In his original petition against the
surety company as sole defendant, Mieyr prayed for judgment upon
his claim, for appointment of a local receiver to take charge of
company assets, etc. And, during the progress of the cause, sundry
questions were interposed by interveners. Others may appear and
amendments may be offered. We have no jurisdiction.
If, however, the judgment below be treated as final, then we
must ascertain, if possible, what was actually determined. Our
function is to review adjudications, not mere expressions of
opinion or unnecessary statements.
Apparently, the Supreme Court definitely adjudged that the trial
court lacked power to appoint a receiver for the corporate assets
within the state at the instance
Page 292 U. S. 138
of Mieyr, a mere general creditor. Consequently the particular
orders complained of by Williard and others were invalid, as they
had claimed. Determination of that question of state law gave
adequate basis for disposition of the cause. It is enough to
support the judgment, and is not reviewable here. Discussion of
federal questions was unnecessary, and views of the court in
respect of them are not presently important.
In any event, it seems reasonably clear that the only federal
question before the Supreme Court of Montana which may be open for
our consideration concerns the effect of the Iowa statutes and
court decree under which Clark became receiver. It accepted the
view that his appointment or designation did not operate to vest
him with adequate title to the property of the defunct company
wherever situated, that
"such [an] involuntary assignment in aid of a statutory judicial
proceeding will not be recognized outside of the jurisdiction of
the appointment, where the rights of domestic creditors are
involved, if the receiver has not obtained possession of the
property and where the creditors have obtained rights or liens upon
the property even after the appointment in the foreign
Probably this conclusion was erroneous. It involved a federal
question. At the most, we should announce the correct rule with the
reasons therefor, and send the cause back to the Supreme Court of
Montana for further proceedings not in conflict with our
determination. But this Court is neither called upon nor can it,
without impropriety, discuss mere questions of state law which may
hereafter be presented for decision by the courts of Montana. It is
not our function to suggest to state courts how they should
interpret their own laws. Theirs is the duty of deciding such
matters, ours requires forbearance from tendering advice in that
The writ of certiorari should be dismissed.