Darien Bank v. J.K. Clarke Lumber Co.

• Decision Date: 28 February 1901
• Citation: 38 S.E. 363,112 Ga. 947
• Parties: DARIEN BANK v. J. K. CLARKE LUMBER CO. et al. J. K. CLARKE LUMBER CO. et al. v. DARIEN BANK.
• Court: Georgia Supreme Court

38 S.E. 363

112 Ga. 947

DARIEN BANK v. J. K. CLARKE LUMBER CO. et al.

J. K. CLARKE LUMBER CO. et al. v. DARIEN BANK.

Supreme Court of Georgia

February 28, 1901

Syllabus by the Court.

1. The judgment entered by the trial court in the present case did not follow the special verdict upon which it was based.

2. Where the judgment rendered by the supreme court upon a main bill of exceptions renders it unnecessary to decide the questions presented by a cross bill of exceptions sued out in the same case, the writ of error issued thereon will be dismissed.

Error from superior court, McIntosh county; P. Seabrook, Judge.

Action by the Southern Bank of the State of Georgia against the J K. Clarke Lumber Company, the Darien Bank intervening. From the judgment, both parties bring error. Judgment on main bill of exceptions reversed. Cross bill of exceptions dismissed.

Garrard & Meldrim, for plaintiff in error.

Chisholm & Clay, W. G. Charlton, and W. W. Mackall, for defendants in error.

LUMPKIN P.J.

The Southern Bank of the State of Georgia, a creditor of the J K.

Clarke Lumber Company, filed against it an equitable petition in the nature of a creditors' bill. An order was passed referring the case to an auditor, and it was therein, in substance, declared that any other creditor of the defendant might file an intervention, and that the same should be referred to and passed upon by the auditor. The Darien Bank availed itself of the privilege thus granted. A hearing before the auditor was had, at which the following facts were shown: The lumber company was indebted to the Darien Bank several thousand dollars upon certain instruments in the form of drafts drawn on the company itself by its secretary and treasurer. These instruments, one of which was for $3,000 will be hereinafter designated as "one-name paper." The lumber company was further indebted to the bank upon a promissory note for $2,000 indorsed by Adam Strain. The bank also held an individual promissory note of J. K. Clarke for $10,000. This note did not represent a debt actually due by Clarke to the bank, but was placed with it as collateral security for the payment of certain indebtedness of the lumber company to it. Whether the indebtedness here referred to was that alone which was evidenced by the one-name paper, or included also the indorsed note, was a seriously controverted question. Certain shares of stock owned or controlled by Clarke, and which he had hypothecated with the bank as collateral security for the $10,000 note, had been sold, and the proceeds, amounting to $1,485, paid to the bank. The main matter in controversy before the auditor was whether or not the payment of the $1,485 should be treated as an extinguishment pro tanto of the lumber company's indebtedness upon the one-name paper, or of its indebtedness upon the note indorsed by Strain. The auditor found that this sum should be credited upon that note. The correctness of this conclusion depended upon a proper solution of various disputed issues as to which the evidence was confused and decidedly conflicting, and the nature of which will be gathered from what appears below. To the auditor's report the bank filed eleven exceptions of law, and one of fact. The last exception of law and the single exception of fact alleged error in the finding above mentioned. When the case came on for trial in the superior court, the first and second exceptions of law were overruled, and all of the remaining exceptions of law, except the eleventh, were sustained. The court, reserving its decision as to the approval or disapproval of this exception, submitted to a jury the following questions: "(1) Was the ten thousand ($10,000) dollar note given to the Darien Bank by James K. Clarke given for the purpose of securing one-name paper of the James K. Clarke Company, or was it given to secure the payment of any and all present or future indebtedness due the bank by the James K. Clarke Lumber Company? (2) Were the securities placed with the Bank of Darien by Mr. James K. Clarke placed there as additional security for the payment of the onename paper of the James K. Clarke Lumber Company, or was it placed there for the purpose of securing present or future indebtedness of any kind of the James K. Clarke Lumber Company to the Darien Bank? (3) If you answer the preceding question by saying that the securities were placed with the bank to secure present and future indebtedness, answer whether or not Mr. James K. Clarke directed the bank how or where to apply the money realized from the sale of these securities; and, if he did, to what particular indebtedness of this character did he direct the money to be applied? (4) If Mr....