V10 _ rumania anromma. —
parties have filed claims for labor, supplies, and materials. The bond-
holders interested in the prior mortgages also tiled, in 187 9, inde-
pendent bills to foreclose them. A receiver was appointed by the
court, who took possession of the property on November 1, 1874, and
since then the property has been in the hands of a receiver. The
trustees of the consolidated mortgage were also trustees of the prior _
‘ mortgages. These intervening petitions were for labor and supplies
furnished during the year 1874. The claims were referred to a mas-
ter, who took proof, and has filed a report allowing a large number
of the claims; and to the confirmation of that report objections have
~ been made by some of the mortgagees. During that year, and before
the receiver took possession of the railway, the company issued cer·
tificates of indebtedness, instead of paying the money, and a large
portion of the claims consist of these certificates given by the com·
pany. There was an order entered by the court, when the bill was
Bled for the foreclosure of the consolidated mortgage, directing the
receiver, out of the net earnings of the road, to pay all certifi-
cates of indebtedness and other balances which might be due to the
employes of the road, and what might be due for supplies and ma-
terials furnished since the first day of January, 1874. It is claimed
that this order was entered by the consent of the parties then ap—
pearing in the case, and that the parties to the prior mortgages are
not bound by this order; but it seems to me that being an order
made at the time the court took jurisdiction of the case, the parties
then in court were clearly bound by it, and that all parties who came
into the litigation afterwards must be considered as coming subject
to the policy which had been prescribed by the court in relation to
the payment of the labor and supply claims, and if that be not so,
then certainly subject to the order as modified by the court at the in-
stance of the first mortgagees. Then it would follow, under the rule of
the supreme courtin the case of Fosdick v. Schell, 99 U. S. 235, the
court having a discretion in relation to the appointment of a receiver,
and the right to prescribe on what terms the appointment should be
made, that the condition then imposed upon the property should ad-
here to it during the progress of the litigation, and therefore all claims
coming within the terms of the order of the court should be paid in the
manner there pointed out. But independent of this, as I understand
the facts of the case, under the rule which the supreme court laid
down in the case already referred to, these claims would be payable
out of the net earnings of the road, in consequence either of those
earnings having been diverted from the payment for labor performed,