Morris v. Hiler

The “ Stilwell act ” proceedings under which Dusenbury was arrested were ostensibly brought by the receiver, but were really instituted in his name by the attorneys for the judgment creditors acting as the receiver’s attorneys and for the benefit of the fund.

Under such circumstances the receiver would not probably be personally liable; but for the acts of his attorney and agents would be liable as receiver, and the fund in court be subject to the claim of the injured party (Camp agt. Barney, 4 Hun, 373: Cardot agt. Barney, 63 N. Y., 281).

*324I think it reasonable that any recovery of damages for false ■imprisonment in such a case should be payable out of the fund. The “ Stilwell proceedings ” were instituted to benefit and increase the fund and to satisfy the judgment creditors’ ■claim. An injury, such as false imprisonment inflicted by proceedings taken in the name of the receiver, may be the ■subject of an action against the attorneys or other persons ■directly responsible for it; but while there is a fund out of which it may be satisfied there is no good reason for turning over ■the injured party to the chances of individual responsibility.

The parties prosecuting proceedings under the Stilwell act are not required to give an undertaking against damages, as in the case of arrests under the Code, and the defendant, if unlawfully imprisoned, must have recourse to an action against ■the persons causing the imprisonment. If a receiver is the ostensible party liable the court should, in ordinary cases, provide for the satisfaction of the injured party out of the fund. Motion for distribution of fund denied.