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In Equity.

Baldwin, Starr & Co. filed their bill in 1868 against McGriff, as trustee of Sarah M. Ryan, to subject her trust estate to a debt in their favor. The pleadings showed that her trust estate was created under a marriage settlement by which Mrs. Sarah M. Ryan was made tenant for life of certain property, with remainder to her children. The property was acquired by Mrs. Sarah M. Ryan (formerly Taylor) under will of her mother, by which, also, the property so acquired was charged with a certain debt in favor of William M. Snell, amounting to $2,800. In 1874 the cause was referred to a master and he was directed to report what portion of the debt sued on was chargeable to, and to be paid out of the rents and income of, said Sarah M. Ryan's trust estate. Afterwards, and before any hearing was had before the master, Sarah M. Ryan, the life tenant, died. McGriff, the trustee, and also the remainder-men and said Snell, who had an interest in said land, regarded said bill as at end by reason of the death of said Sarah M. Ryan. None of them had any notice of the hearing by the master, or of his report, or of the final decree, which was taken against McGriff, as trustee of Sarah M. Ryan, several years after her death, and after the remainder-men and said Snell had effected a partition of said lands in the state court and were in possession of their respective shares. The decree was taken against the entire property, as the property of Sarah M. Ryan, and execution issued on said decree was levied on said land, and the entire fee therein advertised for sale.

The defendant, Thomas J. McGriff, trustee, filed an "affidavit of illegality" in accordance with the state statute, alleging substantially (1) that he and the parties at interest had no notice of the hearing of said case by the master, and was not there represented by counsel, nor did he have notice nor was he represented when said decree was taken; but well knowing that Sarah M. Ryan's death extinguished the trust estate against which the bill was proceeding, and having received no notice as aforesaid of said proceedings, he believed the whole case abandoned, and never heard of the master's report or decree until the execution was levied. He submitted that a decree taken against the trust estate of a deceased life-tenant was wholly void. (2) The affidavit alleged that the execution was proceeding illegally because the advertisement misdescribed the property, failed to follow the decree, no notice of the levy was given as required by law, the sale was advertised to occur at the wrong place, etc.

The case was heard upon a motion to dismiss the affidavit of illegality, the sole ground urged being that this remedy was inappropriate; that defendant had no remedy except a bill of review.

Bacon & Rutherford and E. F. Best, for Baldwin, Starr & Co.
Hill & Harris, for McGriff, trustee.

SETTLE, J., (orally.) I could find support for the conclusion I have reached in this case in the rule adopted by this court in reference to

the remedy known in the state laws as "an affidavit of illegality," this being a mode by which a defendant in an execution may set up grounds showing that an execution has issued or is proceeding illegally. Code, § 3664. The rule referred to is the forty-third rule of this court, and is as follows: "In cases of illegality, the marshal shall observe the rules applicable to sheriffs in like cases." It is conceded that the sheriff in a "like case" would be bound to accept an affidavit of illegality, and arrest the sale under the execution. Code, § 4215. But I do not think it necessary to place the decision upon this ground. The following considerations have most weight with me in leading to the conclusion reached, which is to refuse the motion. to dismiss the paper filed as an affidavit of illegality.

Here is a writing, by whatever name it be called, by which it is shown to the court of equity that its own decree and process, issued upon its decree, are about to be abused, and injustice is about to result. The property of certain remainder-men, whose interest has now vested, and of a third party who claims under a paramount title, is about to be sold, as alleged, under an execution against the estate of a life-tenant in the said property, who was dead when the decree was issued, and whose estate perished with her death. Whether this pleading now before the court be treated as an affidavit of illegality, or as a motion supported by that affidavit, which is my inclination, I am satisfied that the court has such power over its own decree and its own process as to suspend the enforcement thereof until a hearing. can be had on the case made. If the information that its process was about to be abused was brought to the knowledge of the court by its own officer, I am not sure but that it would even then be the right and duty of the court to check that abuse, and prevent injustice, ex

suo mero motu.

It is said that the only remedy in a case like this is the bill of review. I do not think so. The supreme court have virtually held that in matters of this character the form of the proceeding is less important than the substance of the right; and that in some instances mere motions, supported by affidavit, are the most appropriate modes of relief. Krippendorf v. Hyde, 110 U. S. 276; S. C. 4 Sup. Ct. Rep. 27. If there were no remedy in a case of this kind, nor alleged to exist, it would be the right and duty of the court to frame one.

LEHIGH VALLEY COAL Co. v. HAMBLEN and others.

(District Court, N. D. Illinois. March 9, 1885.)

1. TRADE NAME-FOREIGN CORPORATION-CORPORATION ASSUMING SAME NAMEINJUNCTION.

A United States circuit court cannot interfere by injunction, at the instance of a corporation organized under the laws of another state, and prevent any necessary step from being taken, under the statute of the state in which such court is located, in the creation of a corporation bearing the same name as the foreign corporation.

2. SAME-RELIEF, WHEN GRANTED.

Whether relief could be granted after the creation of the corporation, and use of the name of the foreign corporation in fraud of its rights, is not determined.

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GRESHAM, J. The complainant company was organized under the laws of Pennsylvania, in 1875, for the purpose of mining anthracite coal in that state, and selling the same there and elsewhere. It owns valuable coal mines in Pennsylvania, and does a large and lucrative. business. For a number of years it has had an extensive and profitable business in the west and north-west; and for convenience in the management of that business it has maintained an agency at Chicago, where it owns real estate, including a dock worth $200,000, and has on hand coal worth $400,000. The defendants in this suit, wishing to create a corporation in Illinois bearing the same name as the complainant, to carry on the same business, filed their articles of association with the secretary of state on the twenty-sixth of December, 1884, under the general laws of Illinois authorizing the creation of corporations. The secretary of state thereupon issued to the defendants a license as commissioners to open books for subscription to the capital stock of the new corporation, to be known as the Lehigh Valley Coal Company. This suit was brought to prevent the defendants, by injunction, from receiving stock subscriptions, or taking any other steps necessary to be taken under the statute, in the creation of the new corporation.

The object of the defendants in causing an Illinois corporation to be created, bearing the same name as the complainant company, is obvious. They hope, by this means, to secure the benefit of part, at least, of the patronage which the complainant has acquired. Unwilling to engage in open, manly competition with the complainant and others carrying on the same business, the defendants resort to a trick or scheme whereby they hope to deceive the public, and obtain an unfair advantage of the complainant. Such conduct might be fairly characterized more harshly; and it is with extreme reluctance that I deny the complainant the relief prayed for.

The complainant is a foreign corporation, and it is only by comity v.23F,no.5-15

that it is doing business in Illinois at all. The state can say to it any day, "Go!" and it must go. That being so, I do not see that the complainant has a legal right to say a corporation shall not be created in Illinois bearing its (the complainant's) name. If the state of Illinois may create a corporation bearing the same name as the complainant, and it certainly can,-this court has no right by injunction to prevent anything from being done under the state law which is necessary in the creation of such a corporation. The commissioners perform a function under the laws of the state in the formation of the corporation. If they are not officers of the state they are instrumentalities employed by the state. If they can be enjoined from receiv ing stock subscriptions under the license issued to them by the secretary of state, I do not see why the latter might not be enjoined from issuing a license, or doing anything else under the state statute. The general law authorizing the secretary of state to issue a license to commissioners to receive stock subscriptions provides that no license shall be issued to two or more companies having the same name. Before bringing this suit the complainant should have brought to the attention of the secretary of state the matters alleged in the bill. He might, on a proper application, have revoked the license to the defendants, unless they adopted another name for their company. I do not think this court can interfere by injunction, at the instance of a foreign corporation, and prevent any necessary step from being taken under the statute of this state in the creation of a corporation.

I do not say what may be done if the defendants succeed in creating their corporation bearing the complainant's name, and a suit shall be brought by the complainant to prevent individuals claiming to be officers or managers of such corporation from interfering with the complainant's business, as already stated.

The temporary injunction heretofore granted is dissolved, and the bill is dismissed.

PENNSYLVANIA COAL Co. v. DOUGLAS and others.

(District Court, N. D. Illinois. March 9, 1885.)

This case is in all respects similar to Lehigh Valley Coal Co. v. Hamblen, ante, 225, and the bill is dismissed for the reasons already given.

INSOLVENCY

ASIDE.

RICHARDSON and others v. DAY and others.

(Circuit Court, N. D. Illinois. February 16, 1885.)

ILLINOIS STATUTE-FRAUDULENT PREFERENCE ACTION TO SET

No suit can be brought against the assignee of an insolvent, and a creditor to whom he has made a conveyance in fraud of his other creditors, until a demand has been made upon the assignee to sue, and he has refused so to do.

In Equity.

Flower, Remy & Gregory, for complainants.

S. D. Puterbaugh and H. B. Hopkins, for defendants. GRESHAM, J. The demurrer to the bill in this case was argued last Monday. Day Bros. & Co. were wholesale and retail dry-goods merchants at Peoria, Illinois. On the twenty-eighth of September, 1884, this firm was indebted to the defendant Charles B. Day, late a member of the firm, and a brother of one of the partners of the firm, in the sum of $200,000, and he was liable on the firm's paper for $500,000 more. On this date the firm transferred to Charles B. Day its entire stock of goods, worth $300,000, in discharge of the amount due him, and to secure him against loss on account of his liability upon the firm's paper. Charles B. Day at once took possession of the property transferred to him by bill of sale, which was the entire stock of goods, and the firm at once suspended and ceased to do business. On the ninth day of October following, the insolvent firm made an assignment of their remaining property, under the statute of Illinois, to the defendants Jack and Puterbaugh, for the benefit of the rest of their creditors. The transfer to C. B. Day included the entire assets of the firm, except some bills receivable, the face value of which was $40,000, but the actual value of which was less than $20,000. The bill avers that in order to evade the statute of Illinois governing assignments by insolvent debtors, and prohibiting preferences, it was agreed between the firm and Charles B. Day that the former should, by a bill of sale, transfer to the latter their entire stock of goods by way of preference over the other creditors.

The bill also alleges that Jack and Puterbaugh, the assignees, have neglected to take any measures for the recovery of the property transferred to C. B. Day, and that they do not intend to impeach the transaction between him and the assignors. The complainants, who have a claim against the insolvent estate amounting to $7,700, bring the suit to recover the property transferred to C. B. Day, and have the proceeds thereof equally divided among all the creditors.

If it was true that the insolvent firm had determined to make an assignment under the state law, and that C. B. Day knew of the insolvency and of this disposition, and, for the purpose of evading the provisions of the law and preferring C. B. Day, it was agreed that the transfer should be made to him first in pretended payment of his debt,

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