insolvent company nor by personal affiliation with the individual directors would be embarrassed in the due administration of his office. Fitzgerald v. State Mutual Building & Loan Ass'n, 69 Atl. Rep., 564. See Michigan Law Review, Vol. 7, p. 53.

An officer of a corporation, under whose management it became insolvent, is not a proper person to be appointed receiver. The Court of Chancery may remove a receiver for cause. When an officer of a corporation has been appointed its receiver, and it appears proper that his conduct as such officer should be investigated to ascertain whether he has not obtained an advantage which he ought not to be permitted to retain, sufficient cause for removal exists. McCullough v. Merchants' Loan & Trust Co., 29 N. J. Eq., 217.

All that ought to have been done by the corporation itself, the court can, in the exercise of a sound discretion, require to be done through the instrumentality of its receivers.

The court will not direct a receiver to bring suit to ascertain and enforce the liability of promoters, officers and directors of the corporation for the benefit of creditors until its visible assets have been liquidated and the fact and amount of deficiency has been ascertained. Land Title & Trust Co. v. Asphalt Co. of America, 121 Fed. Rep., 587; Id., 127 Fed. Rep., 1.

Receivers have a discretion in the management of the trust property subject to the control of the court. Knott v. Receivers of Morris Canal, 4 N. J. Eq., 423.

A receiver who transfers the property after the allowance of a claim and before the claim is paid, is liable personally to the creditor. Lockport Felt Co. v. United Box Board & Paper Co., 79 Atl. Rep., 544.

A receiver will not be appointed where it appears that the corporation is being dissolved by the stockholders under Section 31 and in accordance with the provisions thereof, there being no allegations of the insolvency of the corporation or mal-administration on the part of its directors. Hegeman v. Atlantic Rubber Shoe Co., 75 Atl. Rep., 819.

Purchase under a judgment and execution by officers will not prevent equity from examining into the action in behalf of a foreign receiver, where it is evident that the suit and judgment constituted а mere device for protecting the officers in the possession of the property as against the receiver, creditors and stockholders. Bidlock v. Mason, 26 N. J. Eq., 230.

It is not an abuse of the receiver's discretion to refuse to adjourn a sale at the request of counsel representing ninety-seven per cent. of the creditors and all of the stockholders where it appears that a corporation was hopelessly insolvent and had no chance of resuming business. Fleming v. Fleming Hotel Co., 70 N. J. Eq., 509.

See Hayes v. Pierson, 65 N. J. Eq., 353; Honeyman v. Haughey, 66 Atl. Rep., 582; Strauss v. Casey Machine & Supply Co., 66 Atl. Rep., 958.

Appointment by Federal court.

See U. S. Shipbuilding Co. v. Conklin, 126 Fed. Rep., 132 (Circuit Court of Appeals).

Foreign receiver.

This state recognizes the right of a receiver appointed in a foreign jurisdiction to sue to recover property passing under his control. Hurd v. City of Elizabeth, 41 N. J. Law, 1.

A receiver appointed in a foreign jurisdiction may maintain an action in this state, provided it does not infringe the rights of creditors here. Edwards v. National Window Glass Jobbers' Ass'n, 68 Atl. Rep., 800.

In what courts receiver must bring suit.

The receiver acquires no power to sue in equity merely because he is an officer appointed by and amenable to the directions of the Court of Chancery. He must collect legal claims through the legal tribunals and enforce equitable rights of the insolvent company through courts of equity. Riley v. Clarendon Oil & Refining Co., 20 N. J. L. J., 246.

Objections to receivers' report.

See Strauss v. Casey Machine & Supply Co., 69 N. J. Eq., 19; see also Id., 66 Atl. Rep., 958.

Claims against receiver.

As to presentation and adjudication of claims, see Colonial Trust Co. v. Pacific Packing & Nav. Co., 158 Fed. Rep., 277.

67. Receiver to qualify and take oath.

Every receiver shall before acting enter into such bond and comply with such terms as the court may prescribe, and take and subscribe the following oath or affirmation: "I, do swear (or affirm)

that I will faithfully, honestly and impartially execute the powers and trusts reposed in me as receiver, for the creditors and stockholders of the and that without favor or affection," which oath or

affirmation shall be filed in the office of the clerk in chancery within ten days after the taking thereof.

P. L. 1829, p. 61; Act of 1875, §73.

68. Property, franchises, etc., of insolvent corporation vests in receiver upon appointment.

All the real and personal property of an insolvent corporation, wheresoever situated, and all its franchises, rights, privileges and effects shall, upon the appointment of a receiver, forthwith vest in him, and the corporation shall be divested of the title thereto.

P. L. 1828, p. 61.

This section was intended to settle the question as to whether the property of an insolvent company vests in the receiver. Willink v. Morris Canal & Banking Co., 4 N. J. Eq., 377, held that it did not; that the title to the property is not changed by the appointment, and that a power only is delegated to the receivers to take charge of it and sell it. Corrigan v. Trenton Del. Falls Co., 7 N. J. Eq., 489, 496, held that the statute, and the appointment of receivers under it, are a conveyance or transfer of all the property of the insolvent company to the receivers for the benefit, of the creditors of the company, to be distributed in the mode pointed out by the statute. To the same effect, Freeholders of Middlesex v. State Bank, 29 N. J. Eq., 268, 274; aff'd, 30 Id., 311, and Minchin v. Second Nat'l Bank, 36 N. J. Eq., 436, 442. In Receiver v. First Nat'l Bank, 34 N. J. Eq., 450, 456, the contrary view is expressed by Vice Chancellor Van Fleet, who states that the decision of Chancellor Halsted was made in ignorance of the prior decision in Willink v. Morris Canal & Banking Co., supra. And to the same effect is Kirkpatrick v. Corning, 37 N. J. Eq., 54, 59.

The question seems settled by this and the succeeding section. But the title of an insolvent corporation to its property continues until there is either an adjudication of insolvency or the appointment of a receiver or trustee. Squire v. Princeton Lighting Co., 72 N. J. Eq., 883.

Under this section assessment calls may properly be made by the receiver rather than by the court itself. He should give thirty days' notice as required by Section 22. Falk v. Whitman Cigar Co., 55 N. J. Eq., 396; Meley v. Whitaker, 61 N. J. Law, 602; see also Thompson on Corporations, Sections 2003, 2004.

In relation to calls upon stockholders for unpaid subscriptions the receiver succeeds to the rights of the company.

Where the receiver has no assets for the prosecution of a disputed claim and the stockholders have not asserted the validity of the claim and indemnified him against the expense of a suit, he cannot be required to bring suit before making an assessment on the stockholders. The Cumberland Lumber Co. v. Clinton Hill Lumber Co., 64 N. J. Eq., 517.

Buildings of a corporation, mortgaged to trustees for bondholders, were burned while company was in hands of receivers. Trustees received insurance and, under an order of court, transferred the money to receivers. Under sanction of court the receivers transferred the assets of the corporation to a new company and paid over the insurance. Held, the new company was not required to pay over unexpended money to trustees or to apply the money toward rebuilding. Dallett v. Staten Island Clay Co., 61 N. J. Eq., 39.

A receiver of an insolvent corporation may enjoin the prosecution of a pending action commenced against the corporation by a creditor thereof, prior to the commencement of the insolvency proceedings in view of the statute vesting all the corporation's assets in the receiver. Morton v. Stone Harbor Imp. Co., 44 Atl. Rep., 875. A debtor of an insolvent corporation cannot set off notes not yet due against a claim of the corporation, at least in the absence of some equitable ground. McManus-Kelly Co. v. Pope Mfg. Co., 70 Atl. Rep., 297.

The right of a receiver to property which the corporation holds on conditional sale.is discussed in Tilford v. Atlantic Match Co., 134 Fed. Rep., 924.

A petition for an order on receivers to turn over property is merely an application for incidental relief and does not go to the substantial issues. Kirkpatrick v. Eastern Milling and Export Co., 135 Fed. Rep., 146; aff'd 137 Id., 387.

Debts of creditors are fastened upon the property of a corporation when it has been declared insolvent. Graham Button Co. v. Spielman, 50 N. J. Eq., 120; aff'd Id., 796.

Lien of execution.

If the personal property of a corporation has become bound by the delivery of a writ of execution to the sheriff, or if the judgment creditor elects to satisfy his execution out of debts under Section 62 of the Corporation Act, before the commencement of insolvency proceedings, the rights thus created will not be disturbed. Van Steenburg v. Parsell Pearl Button Co., 19 N. J. L. J., 149. See also Van Waggoner v. Moses, 26 N. J. Law, 570; Squire v. Princeton Lighting Co., 72 N. J. Eq., 883.

69. When debts paid or provided for, Court may direct receiver to reconvey property, or may dissolve corporation.

Whenever a receiver shall have been appointed as aforesaid and it shall afterwards appear that the debts of the corporation have been paid or provided for, and that there remains or can be obtained by further contributions sufficient capital to enable it to resume its business, the court of chancery may, in its discretion, a proper case being shown, direct the receiver to reconvey to the corporation all its property, franchises, rights and effects, and thereafter the corporation may resume control of and enjoy the same as fully as if the receiver had never been appointed; and in every case in which the court of chancery shall not direct such reconveyance, said court may, in its discretion, make a decree dissolving the corporation and declaring its charter forfeited and void.

In Conklin v. U. S. Shipbuilding Co., 140 Fed. Rep., 219, Circuit Court, it was held that this section does not create a right enforceable in a Federal court of equity, the dissolution of a corporation created by a state being a matter for determination by the tribunal. to which the state has committed it.

It is doubtful whether the words "provided for," as used in this section, are answered by an extension of time of payment. Fleming v. Fleming Hotel Co., 70 N. J. Eq., 509.

70. Upon reorganization company may issue bonds and stock to creditors.

Whenever a majority in interest of the stockholders of such corporation shall have agreed upon a plan for the reorganization of the corporation and a resumption by it of the management and control of its property and business, such corporation may, with the consent of the court of chancery, upon the reconveyance to it of its property and franchises, mortgage the