Dennard v. Farmers' & Merchants' Bank of Coolidge
| Decision Date | 11 December 1919 |
| Docket Number | 1360. |
| Citation | 101 S.E. 672,149 Ga. 590 |
| Parties | DENNARD ET AL. v. FARMERS' & MERCHANTS' BANK OF COOLIDGE. |
| Court | Georgia Supreme Court |
Syllabus by the Court.
Under the pleadings and the evidence, the grant of an interlocutory injunction against all the defendants was unauthorized; an interlocutory injunction against any of the defendants generally was likewise unauthorized. With respect to the specific sum in controversy, or the proceeds into which the same may have been converted, the plaintiff below was not entitled to a receiver and at the same time to the writ of ne exeat. The order appointing the receiver and requiring the principal defendants to turn over to him the specific property was inconsistent with the writ of ne exeat awarded at the same time to prevent the principal defendants from removing any of their property from the state, and with the bond they were required to give thereunder.
Error from Superior Court, Thomas County; W. E. Thomas, Judge.
Suit for injunction and for appointment of a receiver, etc., by the Farmers' & Merchants' Bank of Coolidge against C S. Dennard and others. Receiver appointed and all defendants enjoined from further selling property, and writ of ne exeat ordered to issue to prevent part of defendants from departing from the State and removing any of their property beyond its jurisdictional limits, and requiring them to deliver certain sum of money to receiver on demand, and defendants bring error. Reversed.
Plaintiff held not entitled to both writ of ne exeat issued to prevent defendants from removing their property from state and appointment of receiver to take charge of the specific fund alleged to have been fraudulently obtained from plaintiff bank, the two forms of relief being inconsistent.
The Farmers' & Merchants' Bank of Coolidge filed an equitable petition against Dennard Bros., a firm composed of C. S. Dennard and L. V. Dennard, and against Mrs. Allie Dennard (the wife of C. S. Dennard), Mrs. Rosa Lee Dennard (the wife of L. V. Dennard), E. M. Kennington, and Mrs. Mamie Kennington, the last named being the wife of E. M. Kennington and a sister of C. S. Dennard and L. V. Dennard. In substance, the petition alleged as follows: Dennard Bros were general merchants, and also engaged in the business of buying cotton. They were regular customers of the bank. During the cotton season of 1918, the bank advanced to them a sum of money with which to pay for cotton bought by them taking as security the warehouse receipts to the cotton. The sum advanced was carried as an overdraft and amounted to $17,493.20. Against this advance the bank held warehouse receipts for 114 bales of cotton. When the advances were made by the bank, Dennard Bros. were the owners of real and personal property of the approximate value of $14,000 exclusive of the cotton purchased by them. In the latter part of October, 1918, after these advances had been made, Dennard Bros., with the knowledge of the bank, sold their stock of merchandise for a little more than $7,000, which was deposited to their general account with the bank. The bank then demanded and received from them a deposit of $6,000 to cover any difference that might thereafter arise between the amount of the advances made by the bank and the market value of the cotton, the purpose and object of the deposit being to secure the bank against any possible decline in the market price of cotton pending the sale of the same. After the deposit of $6,000 had been made with the bank, the market price of cotton did decline, and the value of the cotton held by the bank, by reason of the decline, was approximately $6,000 less than the purchase price of the cotton which had been advanced by the bank. In January, 1919, C. S. Dennard, as manager of the business of Dennard Bros., represented to the bank that they desired to invest the $6,000 held by the bank in certain land in Colquitt county, of the value of $10,000, and agreed that if the bank would consent to the use of the $6,000 they would, as soon as the land was purchased, convey it to the bank as security in lieu of the $6,000 then held by the bank. The bank consented and agreed that they might draw a check against the $6,000 deposit, which was expressly made not subject to check, in payment of land, upon condition that the land would be immediately conveyed to the bank.
On January 23, 1919, following the agreement, Dennard Bros. drew a check on the bank in favor of Mrs. Emma Kennington, one of the defendants, for $6,000, the check showing the following entry thereon: "For payment of land." This check was indorsed by Mrs. Kennington, and under the advice of her husband, E. M. Kennington, it was deposited with the Moultrie Banking Company for collection. In due course the check was presented to the plaintiff bank and by it paid in good faith. Promptly after the payment of the check, the plaintiff requested Dennard Bros. to convey the land to it, according to the agreement. They did not refuse to make a conveyance to the bank, but delayed doing so until February 18, 1918, on which date they informed the bank that they were not in position either to return the money or to make the promised conveyance. The bank then discovered that Dennard Bros. had not in fact purchased any land from Mrs. Mamie Kennington and that she did not in fact own any unincumbered land in Colquitt county; that Dennard Bros. had disposed of practically all their property, with the exception of a storehouse and lot of the value of approximately $1,500; that the $6,000 was obtained from the bank as the result of a conspiracy between the several defendants; that, immediately upon the payment of the $6,000 check, Mrs. Kennington directed the Moultrie Banking Company to issue to each of the Dennard Bros. a cashier's check for his pro rata share of the fund, which was done; that each of them...
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