McAnson v. Martin, 82 Ill. App. 432 (1899)

May 22, 1899 · Illinois Appellate Court

82 Ill. App. 432

J. Alexander McAnson v. Nicholas Martin.

1. Receiver—Compensation of, Where Improperly Appointed.— Where a receiver Has been improperly appointed, and the order appointing him is vacated or reversed, he should not be permitted to reduce the assets by withholding any part thereof for his compensation or for the fees of his attorney.

Appeal, by a receiver from an order denying him compensation and attorney fees out of the receivership fund of the Superior Court of Cook County; the Hon. John Barton Payne, Judge, presiding. Heard in tliis court at the October term, 1898.

Affirmed.

Opinion filed May 22, 1899.

Statement of the Case.—This is an appeal by a receiver from an order denying him compensation or attorney’s fees out of the receivership fund.

Upon a bill of complaint filed by one Sexton against Blackall and others, appellant was appointed receiver pendente lite of certain mortgaged chattels.

Appellee appealed from the interlocutory order appointing the receiver, and this court reversed the order, holding that the receiver had been improperly appointed. Martin v. Sexton, 72 Ill. App. 395.

The Superior Court, thereafter, and upon the mandate of this court, vacated the appointment of the receiver and directed that appellant, the receiver, turn over to appellee all the property in his hands as receiver, except cash, and ordered that he file a report. A part of the order is as follows:

“ The court also reserves for future consideration the question of the compensation of the receiver and the disposition of the moneys now on hand or in bank.”

Appellant then made his report as receiver, showing the amount in his hands, and asking to be allowed the sum of $1,000 for his own compensation as a receiver, and $350 for his attorney’s fees. Appellee objected to such allowance, and averred- that the charges were excessive; that the attorney for the receiver was also attorney for one of the litigants, viz., Sexton, and that the receiver was entitled to no compensation out of the funds, but should be paid by the complainant, if by any one, who had wrongfully procured his appointment. The report of the receiver and the objections thereto were referred to a master in chancery to take evidence and report conclusions. After hearing evidence, the master reported that the receiver is not entitled as a matter of law to be compensated from the funds in his hands as receiver, and included in his report the following: “ In the event that the court shall hold that I have erred in finding the law to be .as above stated,” then to avoid a re-reference, finds that $450 would be reasonable compensation for the receiver; that the attorney for the receiver was not attorney for Sexton, party to the suit; and that a reasonable fee for.such attorney would be $2501 The master’s fees for taking testimony and making report are indicated as $200. A stipulation in the proceeding is to the effect that the fees of the shorthand reporter may be included by the master as part of his fees and taxed with the costs.

The court overruled exceptions to the master’s report and entered the final order appealed from. By that order the court adjudges that appellant, having been wrongfully appointed a receiver, at the instance of Sexton, complainant in the bill of complaint, and the order appointing him having been vacated, he is not entitled to retain any of the 'Binds in his hands as receiver for compensation to himself br for fees of his attorney; and he is ordered to refund the sum of ’$150 already paid by him to his attorney out of the receivership funds. Thé court finds that the “ reasonable and just fees and costs of reference ” are $20.0, and decrees that the amount be taxed as costs against appellant.

Marcus Kavanagh and Alexander S. Bradley, attorneys for appellant.

Flowee, Smith & Musgrave, attorneys for appellee.

Me. Justice Seaes

delivered the opinion of the court.

That the receiver was improperly appointed, has been already adjudicated by this court. Martin v. Sexton, 72 Ill. App. 395.

It has been repeatedly held that where a receiver has been improperly appointed and the order appointing is vacated or reversed, the receiver should not be permitted to reduce the assets by withholding any part thereof for compensation to himself or for fees of his attorney. The latest of these decisions is Highley v. Deane, 168 Ill. 266.

But it is contended by counsel for appellant that no such determination of the matter of the receiver’s compensation and his attorney’s fees should be made until a final disposition of the cause and an ascertainment thereby of the merits of the controversy. The decisions in this State do not support this contention. On the contrary it seems to have been the practice to determine at the time of the .vacating of the appointment of the receiver and the return by him of the funds and property in his hands, that he should not retain any of such funds by way of compensation for himself or fees for his lawyer. Einstein v. Lewis, 54 Ill. App. 520; Myres v. Frakenthal, 55 Ill. App. 390; Young v. Ruton, 69 Ill. App. 513.

Objection is made that no reference to a master should have been ordered as to the amount of compensation and attorney’s fees until the court had determined whether any such compensation or fees might be allowed. It might have been a wiser and more economical course to have proceeded as suggested. But appellant appears to have assented to the reference, made no objection in the trial court, and can not be heard now, for the first time, in this behalf. The master’s fees are objected to as costs. It appears that it was stipulated that the stenographic work should be included as costs. JSTo sufficient ground is pointed out for' holding that the costs taxed are improper.

The decree is affirmed.