Atlantic Trust Co. v. Chapman

In Atlantic Trust Co. v. Chapman (1908) 208 U.S. 360, a trust company brought an action for foreclosure of a mortgage pursuant to which it sought, among other things, the appointment of a receiver to take charge of the mortgaged property pending the sale under a judgment of foreclosure. When the sale occurred three years later, there was insufficient funds to pay all of the receiver fees and the court ordered the trust company to pay the deficiency. (Id. at pp. 367-368.) The Atlantic Trust court reversed, holding that "no such liability could arise from the simple fact that it was on plaintiff's motion that a receiver was appointed to take charge of the property pending the litigation." (Id. at p. 369.) The court noted, among other things, that the trial court could have but had not conditioned the appointment of a receiver on the requirement that the trust company be liable for any deficiency in the funds required to pay the receiver fees. (Id. at p. 372.)