tract existing at the time of his appointment where the corporation could not have been compelled to perform it.' The mere fact that a leased line, forming part of a unit system covered by a mortgage, does not pay expenses, is not sufficient justification for the receiver to disaffirm the lease as to such branch line." $286. Effect of discharge as to liability. The liability of the receiver being official in its nature, and not personal, it follows that no action can be maintained against him after he has been discharged growing out of personal injuries occasioned by the negligence of his agents and employees, nor will a suit pending against him at the time of his discharge be continued against him.' And where injuries have been sustained 'A receiver appointed to conduct the business of a corporation pending an action may refuse to perform a contract which was still executory at the time of his appointment, and the specific performance of which could not have been enforced against the corporation; and such refusal does not give liability under the contract a preference over executed contracts. Scott v. Rainier Power & R. Co. 13 Wash. 108. Refusal of the receivers of a railroad company to carry out a contract by the company for the purchase of steel rails to be delivered at a specified time will not authorize the seller to maintain an action for breach of the contract, where the latter, before such refusal, has so delayed its preparations for performance that it could not have the rails ready for delivery at the time specified. Diamond State Iron Co. v. San Antonio & A. P. R. Co. (Tex. Civ. App.) 33 S. W. 987. * Receivers of a branch railroad will not be permitted to disaffirm leases of feeding roads where a mortgage upon all the property, including the leased lines, contemplates that it shall be operated as a unit, although such lines do not pay expenses. Mercantile Trust Co. v. St. Louis & S. F. R. Co. 71 Receivers of a railroad company will be directed to carry out a contract with a coal and iron company under which the latter conveyed to the railroad company a branch road in consideration of a stipulation on the part of the latter to pay the earnings of such branch to the former until the cost should be reimbursed in full. Fidelity Ins. T. & S. D. Co. v. Norfolk & W. R. Co. 72 Fed. Rep. 704. 3 In Ryan v. Hays, 62 Tex. 42, a receiver was appointed by a court of competent jurisdiction on the application of bond-holding creditors, and invested with exclusive authority to manage and carry on the business of the road as a common carrier, subject to the supervision of the court, and with all the rights and franchises of the corporation. A sale was made of the mortgaged property and a deed executed to the purchasers. Subsequently the purchasers of the railroad property conveyed the same back to the original company, and its board of directors passed a resolution accepting from the receiver the property and all money in his hands and assumed all debts and liabilities against him as receiver. The receiver was finally discharged, but before such discharge suit was brought against the receiver and railroad company to recover damages for injuries inflicted on the plaintiff through the negligence of the receiver and his agents while in his exclusive charge. Held (1) that the receiver was not liable after all the property once in his control as reIceiver had been turned over to the purchasers and after he had received his discharge. (2) That his liability, being an official one, ceased at his discharge, except where he was personally at fault. (3) That the relation of master and servant does not technically exist between a railroad company and a receiver when the company's property is placed in his possession by the proper court. (4) While this is true, the profits or income of the property while in the hands of the receiver are responsible for the satisfaction of claims for injuries resulting from the negligence of the receiver or his employees. (5) The railroad company was not responsible for damages sustained by plaintiff through the negligence of the servants of the receiver further than its current receipts while in his hands, and the company, on the discharge of the receiver, would not be responsible merely by reason of their purchase from those who bought at the receiver's sale. See also Hicks v. International & G. N. R. Co. 62 Tex. 38; International & G. N. R. Co. v. Ormond, 62 Tex. 274. In Brown v. Gay, 76 Tex. 444, it is held that the sole liability of a receiver, except in cases where he is personally at fault, is official, and a discharge of the receiver and return of the property to the owner would render a judgment against him for injuries fruitless. See also Texas P. R. Co. v. Johnson, 76 Tex. 421; Bogga v. Brown, 82 Tex. 41; Texas P. R. Co. v. Overheiser, 76 Tex. 437; Texas P. R. Co. v. Griffin, 76 Tex. 441; Texas & P. R. Co. v. Geiger, 79 Tex. 13; Texas & P. R. Co. v. Miller, 79 Tex. 81, 11 L. R. A. 395; Texas & P. R. Co. v. Comstock, 83 Tex. 537; Texas & P. R. Co. v. Adams, 78 Tex. 372. In Farmers' Loan & T. Co. v. Central R. Co. 7 Fed. Rep. 537, it is held that no action can be sustained against the receiver of a railroad company after his discharge and the transfer of the property to a purchaser under an order of court in a foreclosure proceeding. In Farmers' Loan & T. Co. v. Central R. Co. 17 Fed. Rep. 758, it is held that where a receiver is discharged and the sale of the property confirmed with a provision in the order of confirmation that the purchaser shall pay all debts of the receiver and all claims and liabilities pending in the foreclosure case, the purchaser at such sale cannot be permitted, after accepting the property, to question the validity of the order, and it is the proper exercise of the chancery power of the court on surrendering the trust property to the purchaser to retain jurisdiction of the original case and enforce the payment of the debts and liabilities incurred by the receiver while operating the railway. In Davis v. Duncan, 19 Fed. Rep. 477, it is held that a receiver is not personally liable for the torts of his employees, and only when he commits the wrong himself is he personally liable; that proceedings against a receiver for the torts of his employees is in the nature of a proceeding in rem and renders the property held by the receiver liable in compensation for such injuries; that the railroad company is not liable for injuries inflicted by a receiver or his servants by a person through the negligence of the receiver's agents or employees, and the receiver has been discharged and the property restored to the company, the company in such case becomes liable for the damage resulting from such injury if during the receivership the current receipts have been applied towards betterments or permanent improvement of the road, at least to the extent of such diversion.' And in case the property of the company has while its property was in the hands of a receiver and when it was out of possession, having no control over it. In Brown v. Wabash R. Co. 96 Ill. 297, it was provided in the deed of sale "that said estate and interest are hereby charged with and shall pass by virtue of these presents subject to the payment of all liabilities incurred in respect to the said railroad or its business by said receiver." Held that the purchase under the deed was subject for the payment of such liabilities as the receiver had incurred while he had possession of the road. And it seems, in such a case, if a receiver is liable for the personal injuries arising from the negligent management of a road the party injured or his repre sentative must first sue at law and settle the question of the receiver's liability and the amount of damages, and then file his bill against the grantee company; that a bill in equity will not be maintained in the first instance. In Sloan v. Central Iowa R. Co. 62 Iowa, 728, it is held under §§ 1278 and 1307 of the Code that the property in the hands of a receiver is liable for the claim of an employee for injuries received through the negli gence of coemployees. In Schmid v. New York, L. E. & W. R. Co. 32 Hun, 335, the railroad property was sold under an order of foreclosure to certain parties, as trustees, subject to all lawful indebtedness of the receiver, made or incurred by him during his receivership, which indebt edness was made a lien upon the premises prior to the lien of the mortgages. Subsequently the purchasers conveyed the property to the defendant company, also making the conveyance subject to the debts and liabilities, after which the receiver was discharged. It was held that the plaintiff could maintain an action against the grantee of the purchaser to recover the amount of her judgment, or to have the same declared a lien upon the property so sold and satisfied by the sale thereof. See also Pennsylvania Finance Co. v. Charleston, C. & C. R. Co. 46 Fed. Rep. 508. 1 Texas & P. R. Co. v. Huffman, 83 Tex. 286. In this case it is held that a railroad company is not liable for the negligence of its receivers, ipso facto, but where it is alleged and proved on trial that the earnings of the road while in the hands of a receiver had been invested in betterments of the property and then turned over to the company, the company is responsible, on the ground that it has received the benefit of the fund which was primarily liable for the damages occasioned by the act of the receiver. Texas P. R. Co. v. Johnson, 76 Tex. 421; Texas P. R. Co. v. Griffin, 76 Tex. 441; Mobile & O. R. Co. v. Davis, 62 Miss. 271. A railroad company cannot be held iable for breach of a receiver's contracts or his torts, by mere proof that upon his discharge it received the property from him, in the absence of been sold under a foreclosure proceeding and the purchaser at such sale has assumed all the receiver's liabilities, or the purchaseis made subject to the liabilities against the property, the purchaser becomes liable therefor, and the person entitled to damages may recover the same in an action at law against the purchaser,' or the court making the foreclosure, if it retains jurisdiction for that purpose, may enforce the payment against the purchaser.' As we have elsewhere seen, the court will not permit the receiver evidence of betterments to the road from the net earnings realized by the receiver. Missouri, K. & T. R. Co. v. McFadden (Tex.) 33 S. W. 853. Failure to assert a claim against a railroad company while the property is in the hands of a receiver, and the presentation of another claim by the same claimant, which is paid, do not estop him to assert such claim after the property is turned over to the corporation by the receiver without a sale. Diamond State Iron Co. v. San Antonio & A. P. R. Co. (Tex. Civ. App.) 33 S. W. 987. 1 In Farmers' Loan & T. Co. v. Central R. Co. 17 Fed. Rep. 758, the claims for damages were filed in the foreclosure proceeding, pursuant to the terms of the order of court, and under the statute of Iowa the claims were entitled to a lien upon the railroad for the amount of damages from the time of recovering judgment. The receiver was not personally liable, but the property in his hands was liable and could be reached by suit in form against the receiver. In Schmid v. New York, L. E. & W. R. Co. 32 Hun,335, the action was brought by the plaintiff against the receiver and a judgment recovered against him. Subsequently, plaintiff's judgment not being paid, an action was brought for the amount of the claim, claiming a lien on the property sold by the receiver. See also Ryan v. Hays, 62 Tex. 42; Hicks v. International & G. N. R. Co. 62 Tex. 38; International & G. N. R. Co. v. Ormond, 62 Tex. 275. But see Ohio & M. R. Co. v. Nickless, 73 Ind. 383. In Brown v. Wabash R. Co. 96 Ill. 297, a bill in equity was brought by Brown as administrator against the railway company on account of an accident occurring while the railway was in the hands of the receiver. The basis of the action was to recover in an action of equity unliquidated damages for personal injury, and it was held that there being a remedy at law the court would not take jurisdiction. The court say: "A court of chancery is not a forum in which the question of damages should be settled; if it was, the sacred right of trial by jury could easily be abrogated and set aside by merely resorting tosuch a tribunal." A purchaser of a railroad is liable for damages caused by negligence of a receiver if the betterments upon the road by the receiver subsequent to the sale, and the earnings turned over to the purchaser, exceeded in value the liabilities imposed upon the purchaser by the decree of the court and the operating expenses of the receiver and claims for damages against him. Houston & T. C. R. Co. v. Kelly (Tex. Civ. App.) 35 S. W. 878. Farmers' Loan & T. Co. v. Central R. Co. 17 Fed. Rep. 758. to be sued without its permission first obtained,' except in actions in the Federal court, where by act of Congress the rule has been changed.' 1 Palys v. Jewett, 32 N. J. Eq. 302; Melendy v. Barbour, 78 Va. 544. In Kinney v. Crocker, 18 Wis. 74, it is held that the courts of Wisconsin have jurisdiction in actions for injuries against a receiver appointed by the United States court without leave to bring such action. Barton v. Barbour, 104 U. S. 126, 26 L. ed. 672; Blumenthal v. Brainard, 38 Vt. 402; Lyman v. Central Vermont R. Co. 59 Vt. 167; Pacific R. Co. v. Wade, 91 Cal. 449, 13 L. R. A. 754. In Eddy v. Lafayette, 49 Fed. Rep. 807, it is held that the act of March 3, 1887, was intended to place receivers of railroad companies upon the same plane with the railroad companies, both as respects their liability to be sued for acts done while operating the road, and as respects the mode of service of process. In Central Trust Co. v. East Tennessee, V. & G. R. Co. 59 Fed. Rep. 523, it is held that the Judiciary Act of 1887 and 1888 is not restricted to the courts having jurisdiction of the receiver and the property or to the Federal courts generally, but extends to any court of competent jurisdiction, and the appointing court has no power to enjoin the bringing of such suits in any other than the Federal courts. See Texas & P. R. Co. v. Johnson, 151 U. S. 81, 38 L. ed. 81. See also Dillingham v. Russell, 73 Tex. 47, 3 L. R. A. 634; Southern P. R. Co. v. Maddox, 75 Tex. 300; Barton v. Barbour, 104 U. S. 126, 26 L. ed. 672; Kinney v. Crocker, 18 Wis. 75; Melendy v. Barbour, 78 Va. 544. In Central Trust Co. v. St. Louis, A. & T. R. Co. 40 Fed. Rep. 426, it is held that where receivers of a railroad running through Arkansas, and who were appointed in that case, had removed into another state, the court would authorize them to be sued in the state of Arkansas by service on their station agents or clerks therein. Prior to the Act of Congress it had been the rule in the state courts of Arkansas to permit a receiver of a railroad to be sued without special leave of court. In Missouri P. R. Co. v. Texas P. R. Co. 41 Fed. Rep. 311, it is held that a judgment rendered in an action in a state court against a receiver appointed in an action in the circuit court instituted prior to the passage of the judiciary act of March 3, 1887, and which had been brought without the consent of the court appointing such receiver was not conclusive as to him but was subject to the equity juris. diction of the court appointing him. In Central Trust Co. v. St. Louis, A. & T. R. Co. 41 Fed. Rep. 551, it is held that when a state court has ju risdiction of the parties and the subject matter their judgment against the receiver of a Federal court is as final and conclusive as it is against any other suitor; that it is not within the jurisdiction of the United States circuit court to annul, vacate, or modify the judgment of state courts, and this rule is not affected by the last clause of the 3rd section of the Act of Congress of August 13, 1888 (25 Stat. at L. 436). A receiver of a railroad appointed by a Federal court is not entitled under the Act of March 3, 1887, chap. 373, § 3 (24 Stat. at L. 552-554), to immunity from suit for acts done by his predecessor without previous permis |