were issued and sold-the proceeds being used in construction work. The remainder, $25,000, was deposited as collateral to secure a loan of $13,000 by the bank.

The Railway Company entered into a contract with an electric company to operate its road when completed, but became financially embarrassed before its completion, and defaulted in the payment of interest on its bonds.

On December 3, 1907, appellant, hereinafter called the Telephone Company, recovered a judgment in the circuit court of Tyler county, W. Va., against the Railway Company for $3,004.40 and costs.

At the November rules, 1907, of the circuit court of Tyler county, the Telephone Company, pursuant to the provisions of section 7, c. 139, of the Code of West Virginia (sec. 5099), filed its bill against the Railway Company and one Hamilton, who had filed a mechanic's lien on the property, setting forth the rendition of the judgment and other facts relevant and appropriate to the relief demanded, praying that the lien established by the judgment be enforced-that other parties holding liens be notified, and the property of the Railway Company be sold for the payment of the judgment and such other liens as should

be established.

At the January rules, 1910, the Telephone Company, by leave of the court, amended its bill by making the Trust and Deposit Company mortgagee, and one John Schrader, holder of a portion of the bonds secured by the mortgage, parties. In its amended bill, the Telephone Company averred the execution of the mortgage, filing a copy thereof as an exhibit, to be read as a part of the amended bill. It appears that another mortgage, or deed in trust, was executed by the Railway Company to the Trust and Deposit Company on the same day, to secure a bond issue of $3,000,000, but none of the bonds have been issued or sold. Summons was issued and served upon the Trust Company and Schrader.

At February rules an order was made referring the cause to K. S. Boreman, commissioner in chancery, to ascertain and report the amount of property owned by the Railway Company, the liens existing against the property, and their order of priority. He was directed to give notice, as provided by the statute, to all persons holding liens against the property of the Railway Company. No further action was taken in this cause until June 27, 1913.

On May 8, 1911, appellee, Henry M. Jackson, a citizen of Pennsylvania, filed his bill in the District Court of West Virginia, against the Railway Company and the Union Trust & Deposit Company, mortgagee, in which he alleged that he was the owner of $52,000 of the bonds secured by the mortgage of November 1, 1905, and of coupons for overdue interest thereon, to the amount of $8,580.

He set forth the embarrassed and unfinished condition of the road and the necessity for its completion, and that when completed it could be operated under its contract with the Electric Company. He set out the execution of the mortgages, and alleged that the property of the Railway Company, in its present condition, would not bring its value, and that a sale would result in a great sacrifice. He further alleged:

"That the property can be saved for the company, and all loss prevented, so far as the first preferred mortgaged bondholders are concerned, by the appointment of a receiver, and the issue and sale of receiver's certificates, and with the proceeds of the certificates the railroad can be completed, such coupons as must be retired can be paid, the road put into operation, and in this way the property can be saved from sacrifice and all parties' interests promoted."

It was further alleged that a receiver could sell $30,000 of certificates, which should be declared a first lien on the property of the Railway Company. Complainant prayed the court to appoint a receiver for all of the property of the Railway Company, with direction to take immediate possession and to issue and sell certificates, and from the proceeds pay the overdue interest coupons and to complete the road, and put same into operation by having the cars of the electric company operated thereon, and for such other and further relief as might seem meet in the premises. Process was issued and served on the officers of both defendants. No answers were filed.

On May 11, 1911, a decree was made appointing a receiver for the property of the Railway Company, and directing him to take immediate possession of said property and operate same. He was further directed

"to institute and prosecute all such suits as may be necessary, in his judgment, to the protection of the property and likewise to defend all actions or suits now pending in any court against the said company, the prosecution or defense of which will, in the judgment of said receiver, be necessary and proper for the protection of the property and rights now placed in his charge."

The receiver was further directed to make a full report to the court of the present condition of the property of the Railroad Company, specifying the amount estimated to be necessary to be expended in order to complete said road, etc.

On May 24, 1911, upon the report of the receiver, he was authorized to issue certificates not exceeding $30,000, which he was directed to hypothecate or sell, etc. He was further directed, with the proceeds of the certificates, to complete the construction of the road and cause it to be operated under the provisions of the contract made with the Union Traction Company. The order contained the usual provisions found in such decrees, providing for the discharge of duties by the receiver, filing bond, etc. Thereafter other certificates were authorized and issued, aggregating in all $60,000. Pursuant to the provisions of these orders, the receiver took into his possession all of the property of the Railway Company, issued and disposed of the certificates, and with the proceeds completed the construction of the road and put it into operation, making reports of his proceedings to the court. Other proceedings were had in the cause which are not material or relevant to the question presented upon this appeal.

Recurring to the proceedings in the cause pending the circuit court. of Tyler county, it appears that, on June 27, 1913, an order was made reciting that K. S. Boreman, the commissioner theretofore appointed, had retired from his office without executing said order. O. C. Carter was appointed commissioner, with direction to proceed with the execution of the order. Pursuant to this order, the commissioner, on

July 3, 1913, published in the Tyler County Star a notice to all persons having liens on the property to file them at his office, on a day named in said notice; he also notified the parties to the suit.

On August 16, 1913, the commissioner filed his report, which, after stating that the Railway Company appeared and denied that process was served upon it, reported the execution of the mortgages to the Trust and Deposit Company, but "that none of the defendants to this suit offered to prove the issuing of bonds provided for in said trusts, or offered to show the ownership of such, if any were issued."

He reported that, in addition to the judgment of the Telephone Company, there were several small claims proven. He also reported the character of the property owned by the Railway Company, and that the rents and profits from said property would not, in five years, pay off and discharge the liens thereon. Thereafter, and on the 13th day of September, 1913, the report of O. C. Carter, Esq., commissioner, was confirmed, and a decree rendered directing that the property of the Railway Company be sold by M. H. Willis, Esq., special commissioner, at public auction for the purpose of paying the liens as reported by the commissioner. Thereafter a motion was lodged by the Railway Company to vacate the decree, for that no service of process was made upon it. This motion was refused, and, upon appeal, the Supreme Court affirmed the judgment. 76 W. Va. 120, 85 S. E. 65. This phase of the case has no relevancy to this appeal.

On October 13, 1913, the Farmers' & Producers' National Bank of Sistersville, W. Va., filed its petition in the District Court of the United States, setting forth the facts herein recited, and, further averring that it held, by deposit of John F. Schrader, as collateral security for loans negotiated by him, a portion of the receiver's certificates issued under, and pursuant to the decrees of the court, aggregating $10,000, exclusive of accrued interest; that, relying upon the proceedings had in the District Court, various persons, to petitioners unknown, had purchased practically all of the certificates issued by said receiver; that M. H. Willis, special commissioner, has given notice that he will sell the property of the Railway Company pursuant to the provisions of the decree of the circuit court of Tyler county. Petitioner prayed that the court enjoin the commissioner from selling the property, or otherwise executing the said decree, and that the Telephone Company, by mandatory injunction, be directed to procure the dismissal of its suit in said circuit court, etc.

Upon notice of this motion, the Telephone Company filed its answer to the petition, in which the material allegations of fact were admitted, but denied that petitioner was entitled to the relief demanded. The District Judge, after careful examination of the facts and the authorities, enjoined the receiver of the state court from proceeding with the sale of the property, and the Telephone Company from prosecuting its suit in said court.

From this decree the Telephone Company appealed. This appeal is docketed as No. 1625.

In the case of H. M. Jackson against the Railway Company, the receiver, C. L. Williams, in his report to the court on October 18, 1917,

stated that the income received from the operation of the railroad had ceased to cover the operating expenses and recommended that the property be immediately sold. The court, on January 16, 1918, being the same day upon which the order enjoining the receiver appointed by the state court was made, entered a decree appointing V. B. Archer, Esq., special commissioner to make sale of all the property of the Railway Company and report to the court.

From this decree the Telephone Company appealed. This appeal is docketed No. 1626. The appeals are heard together and will be disposed of accordingly.

[1] Before proceeding to discuss the questions presented by the assignments of error, a motion, lodged by the Farmers' & Producers' National Bank, to dismiss the appeal in No. 1625, should be disposed of. This motion is based upon the ground that the question involved is the jurisdiction of the District Court, and that it should have been certified directly to the Supreme Court of the United States, as prescribed by section 238 of the Judicial Code (Act March 3, 1911, c. 231, 36 Stat. 1157 [Comp. St. § 1215]). Counsel for the movant frankly concedes that the decision of the Supreme Court in Louisville Trust Co. v. Knott, 191 U. S. 225, 24 Sup. Ct. 119, 48 L. Ed. 159, "bears against" his position. He suggests that the more recent case of Merriam v. Saalfield, 241 U. S. 22, 36 Sup. Ct. 477, 60 L. Ed. 868, "modifies and, in effect, supersedes" the former case. We are unable to concur in this suggestion. The instant case comes clearly within the construction of section 238, made in the Knott Case. In this connection, because pertinent at this time, it may be appropriate to note that, while in many cases the conflict is referred to as one of jurisdiction, whereas it comes in respect to the right of possession of, or control over, the property to be appropriated to the satisfaction of the decree, or judgment. This is not very important, but illustrates the distinction between this case and those coming within the provisions of section 238 of the Judicial Code.

[2] For the purpose of clarifying the situation it is proper to note that, under the laws of West Virginia, the Telephone Company was permitted, after the return of the writ of fieri facias, unsatisfied, to file a bill in a court of equity, in which, after appropriate proceedings, the court may order the property of the judgment debtor, or any part thereof, to be sold and the proceeds applied to the discharge of the judgment. The Code provides that

"In every such suit, all persons having liens on the real estate, sought to be subjected by judgment or otherwise, shall be parties plaintiff or defendant.

And whether the suit be so brought or not, every such lien holder, whether he be named as a party to the suit so brought or not, or whether he be served with process therein, or not, may present, prove and have allowed any claim he may have against the judgment debtor, which is a lien on such real estate."

It appears that the Supreme Court of West Virginia has uniformly held that, in suits to enforce judgment liens under this section of the Code, a receiver will not be appointed unless allegations are made showing the necessity therefor, with a specific prayer for such ap

pointment. No such averment is made in the bill filed by the Telephone Company, nor is there any prayer for the appointment of a receiver. While no judgment in personam is sought, the only relief demanded being the sale of the specific property described in the bill, the suit comes within those classed as proceedings quasi in rem or "in the nature of a proceeding in rem." The suit may be likened to a bill to foreclose a mortgage, or a judgment creditor's bill.

A careful examination of the decisions discussed in the opinion of the learned District Judge, and others cited by counsel in their briefs, discloses the difficulty experienced in "running the line" which courts. must observe to avoid conflict in dealing with property which other courts have taken into their possession, or assumed control over, by means of process appropriate for that purpose.

As said by Mr. Justice Matthews in Heidritter v. Elizabeth Oil Cloth Co., 112 U. S. 295, 5 Sup. Ct. 135, 28 L. Ed. 729, the rule by which the courts are guided

"has no reference to the supremacy of one tribunal over the other, nor to the superiority in rank of the respective claims, in behalf of which the conflicting jurisdictions are invoked. It simply requires, as a matter of necessity, and, therefore, of comity, that when the object of the action requires the control and dominion of the property involved in the litigation, that court which first acquires possession, or that dominion which is equivalent, draws to itself the exclusive right to dispose of it, for the purposes of its jurisdiction."

In that case the property was seized by the marshal under a libel, followed by a judgment of condemnation for violation of the internal revenue law a proceeding in rem. Subsequent to the seizure, the sheriff levied upon and sold the property to satisfy a mechanic's lien. The court held that the purchaser, under the marshal's sale, acquired title.

In Hagan v. Lucas, 10 Pet. 400, 9 L. Ed. 470, the property in controversy had been levied upon by the sheriff, a forthcoming bond given by the defendant in the execution, and possession retained by him. A second officer levied another execution. The court held the second levy invalid, saying:

"The first levy, whether it were made under the federal or state authority, withdraws the property from the reach of the process of the other."

In Wabash R. R. Co. v. Adelbert College, 208 U. S. 54, 28 Sup. Ct. 187, 52 L. Ed. 379, Judge Moody says:

"When a court of competent jurisdiction has, by appropriate proceedings, taken property into its possession through its officers, the property is thereby withdrawn from the jurisdiction of all other courts. The latter courts, though of concurrent jurisdiction, are without power to render any judgment which invades or disturbs the possession of the property while it is in the custody of the court which has seized it."

In that case the court had taken possession, by its receiver, and sold the property, but in its decree confirming the sale, had retained control for the purpose of adjudicating claims, etc. The court held that, under the clause retaining the control, the property in the possession of the purchaser could not be seized by a receiver appointed in a subsequent suit.