U.S. Supreme Court
Penn v. Calhoun, 121 U.S. 251 (1887)
Penn v. Calhoun
Submitted March 30, 1887
Decided April 11, 1887
121 U.S. 251
In a suit for foreclosing a railroad mortgage, the court being satisfied that money loaned the railroad company by a bank, an intervening creditor at a time when the company was much embarrassed, and shortly before the commencement of the suit, went into the general funds of the company, and not especially to the payment of mortgage interest, and that there was no fraud or deception on the part of the trustees and no misuse of current income by the receiver of the road to the injury of the bank, held that the bank had only the rights of a general creditor in the distribution of the proceeds from the sale of the mortgaged property.
This was an appeal from a decree dismissing the petition of an intervening creditor in a foreclosure suit. The case is stated in the opinion of the Court.