Jackson v. McIntosh

• Decision Date: 07 April 1926
• Docket Number: No. 4770.,4770.
• Parties: JACKSON et al. v. McINTOSH, Comptroller of the Currency, et al.
• Court: U.S. Court of Appeals — Fifth Circuit

12 F.2d 676 (1926)

JACKSON et al. v. McINTOSH, Comptroller of the Currency, et al.

No. 4770.

Circuit Court of Appeals, Fifth Circuit.

April 7, 1926.

C. N. Davie and Chas. S. Reid, both of Gainesville, Ga., for appellants.

Howell C. Erwin, Thos. F. Green, and Thos. J. Shackelford, all of Athens, Ga., and M. C. Elliott, of Washington, D. C. (Green & Michael, Shackelford & Shackelford, and Erwin, Erwin & Nix, all of Athens, Ga., and W. S. Poage, of Washington, D. C., on the brief), for appellees.

Before WALKER, BRYAN, and FOSTER, Circuit Judges.

WALKER, Circuit Judge.

This is an appeal from a decree denying a temporary injunction, prayed for in a bill filed by the appellants, one of them being a stockholder of the Georgia National Bank, of Athens, Ga., and both of them being creditors of that bank, against the appellees, the Comptroller of the Currency and the receiver of that bank appointed by such Comptroller, who took charge of the assets of said bank for the purpose of liquidation as provided by law. The injunction prayed for was one restraining and enjoining the appellees from consummating or further attempting to consummate an alleged proposed disposition of assets of said bank. The allegations of the bill showed the following:

Prior to the filing of the bill said receiver filed in the court below an application for the approval by that court of a pretended sale to the Georgia Securities Company, a corporation organized under the laws of Georgia, with a capital stock of $10,000 (herein called the corporation), of the assets of said bank, except cash on hand, stockholders' liability, liability of officers and directors for misfeasance or malfeasance in office, and described real estate, and the court made an order that any and all parties in interest show cause, if any there be, at a time and place stated, why said application should not be granted, and that notice of that order be given by publication in a named newspaper. That application showed as follows:

The application has been approved by the Comptroller of the Currency. The corporation will deliver to the receiver, for the bank's creditors, its debentures, dated November 3, 1925, for the amount due each creditor at the date of the bank's suspension, payable on or before five years from date, with interest thereon at the rate of 4 per cent. per annum, interest payable annually. Said debentures to be secured by deed of trust of the transferred assets, made by the receiver to named trustees as security for the payment of said debentures. Any available cash in the hands of the receiver at the time of the proposed sale, after reserving such sums as may be deemed necessary to pay expenses of the receivership, shall be distributed by the receiver to the bank's creditors, the sums so paid to be credited upon the debentures upon presentation for that purpose, "and where debentures are not presented to be so credited, or where any creditor of said bank should fail or refuse to accept said debenture, then the amounts that would be payable to such creditor under said distribution shall be held by said receiver to the credit of such creditors, and paid to them upon application, and the debentures issued to such creditors shall thereupon be credited accordingly."

Said trustees in their discretion may require any action with respect to the property conveyed to them, "including the sale, transfer, assignment, or conveyance of any or all of said property or assets." "If any question should arise with respect to the rights or liabilities of either the debenture holders, or any of them, or the company under this indenture, then the decision made by the trustees, or a majority of them, concurred in by said company, acting through its directors, or a majority of them, shall be final and conclusive. Should any such question arise, and the decision of the trustees, or a majority of them, not be concurred in by said company, then the question shall be referred by them to the judge of the judicial circuit in which is located the city of Athens, Ga., and his decision thereon shall be final and conclusive. * * * The trustees shall be deemed the representatives of all debenture holders in said proceedings, in so far as necessary parties are concerned. * * *"

If "at any time during the administration of the assets of said Georgia Securities Company the trustees, or a majority of them, should be of the opinion that the officials in charge of said company are not pressing with due and proper diligence the collection of any or all of its assets, then said trustees may call upon said officials to proceed with greater dispatch in the collection of the same, and should said officials thereafter omit to press said collections, or convert said assets into cash for the benefit of debenture holders with due and proper diligence, in the judgment of said trustees, or a majority of them, then said trustees may demand and receive of said officials all of the assets of said company, and by themselves, or through such agents as they may employ,...