Kubler v. Goerg, s. A90A0897

• Court: United States Court of Appeals (Georgia)
• Citation: 197 Ga.App. 667,399 S.E.2d 229
• Docket Number: Nos. A90A0897,A90A0898 and A90A0899,s. A90A0897
• Parties: KUBLER v. GOERG.
• Decision Date: 05 November 1990

Page 229

399 S.E.2d 229 197 Ga.App. 667 KUBLER
v.
GOERG. Nos. A90A0897, A90A0898 and A90A0899. Court of Appeals of Georgia. Nov. 5, 1990.
Rehearing Denied Nov. 21, 1990.

[197 Ga.App. 672] Macey, Wilensky, Cohen, Wittner & Kessler, Morris W. Macey, James R. Sacca, Atlanta, for appellant.

Richard B. Herzog, Jr., Doffermyre, Shields & Canfield, Robert E. Shields, Powell, Goldstein, Frazer & Murphy, Eric W. Anderson, Kilpatrick & Cody, Thomas C. Shelton, Laurel J. Lucey, Atlanta, for appellee.

[197 Ga.App. 667] CARLEY, Chief Judge.

A simplified statement of the facts relevant to these appeals is as follows: Dr. Bruno Kubler is the trustee in bankruptcy for a German corporation that had secured a personal judgment in Germany against Ms. Ingeborg Skowronek. Since Ms. Skowronek had accounts at C & S National Bank (Bank), Dr. Kubler domesticated the German judgment in Georgia and then initiated garnishment proceedings against the Bank in the State Court of Fulton County. Thereafter, Dr. Klaus Goerg, in his capacity as the German-appointed trustee in bankruptcy of the estate of Heinz Kaussen, filed a claim in Dr. Kubler's garnishment proceeding, and he also filed a complaint against Ms. Skowronek and the Bank in the Superior Court of Fulton County. In both his garnishment claim and his superior court complaint, Dr. Goerg alleged that Ms. Skowronek's accounts at the Bank consisted of the proceeds of a fraudulent transfer to her from Kaussen and that, as to the creditors of the estate, those proceeds remained the property of Kaussen. The Bank was subsequently dismissed from Dr. Goerg's fraudulent conveyances action and Ms. Skowronek failed to file a timely answer to his complaint. However, before a default judgment was entered against Ms. Skowronek, Dr. Kubler moved to intervene in Dr. Goerg's fraudulent conveyances action but, because of a stay mandated by the pendency of a related bankruptcy proceeding,

Page 230

no ruling was made in either the garnishment proceeding or the fraudulent conveyances action for a ten-month period. At the end of that period, Dr. Kubler's motion to intervene was denied and Dr. Goerg was granted a default judgment against Ms. Skowronek. In Case No. A90A0897, Dr. Kubler appeals from the denial of his motion to intervene and, in Case No. A90A0898, he appeals from the grant of default judgment in favor of Dr. Goerg. In Case No. A90A0899, Dr. Goerg cross-appeals from the grant of the default judgment, contending that the same did not provide the full relief to which he was entitled.

[197 Ga.App. 668] CASE NO. A90A0897

1. OCGA § 9-11-24(a)(2) provides, in relevant part, that "[u]pon timely application anyone shall be permitted to intervene in an action ... [w]hen [he] claims an interest relating to the property or transaction which is the subject matter of the action and he is so situated that the disposition of the action may as a practical matter impair or impede his ability to protect that interest, unless [his] interest is adequately represented by existing parties." Thus, "the requirements for intervention under the rule are three-fold: interest, impairment resulting from an unfavorable disposition, and inadequate representation. [Cit.]" Lynn v. Wagstaff Motor Co., 126 Ga.App. 516, 517, 191 S.E.2d 324 (1972).

With regard to the first requirement of OCGA § 9-11-24(a)(2), Dr. Kubler, as Ms. Skowronek's judgment creditor, clearly had an interest in the outcome of Dr. Goerg's fraudulent conveyances action. However, merely having an interest in the outcome of that litigation would not be sufficient to authorize Dr. Kubler to intervene therein. OCGA § 9-11-24(a)(2) requires that an applicant for intervention claim "an interest relating to the property or transaction which is the subject matter of the action...." (Emphasis supplied.) The "property" which is the subject matter of Dr. Goerg's action is Ms. Skowronek's accounts at the Bank and the "transaction" which is the subject matter of that action is the alleged fraudulent conveyance of that property to Ms. Skowronek. Accordingly, in the absence of Dr. Kubler's claim of an interest relating to that specific property or to that specific transaction, he had no right to intervene pursuant to OCGA § 9-11-24(a)(2).

The record shows, however, that Dr. Kubler was not only Ms. Skowronek's judgment creditor, but that he had also secured the domestication of the German judgment in Georgia and had filed a garnishment proceeding against the Bank. "Courts and text-writers have in different ways undertaken to describe the effect created by serving a process of garnishment. It is at least an inchoate or an incomplete lien." Anderson v. Ashford & Co., 174 Ga. 660, 662(1), 163 S.E. 741 (1932). Thus, by the time Dr. Goerg filed his fraudulent conveyances action, Dr. Kubler already had "at least an inchoate or an incomplete lien" on Ms. Skowronek's accounts at the Bank and he had, therefore, an "interest" relating to the specific property which was the subject matter of Dr. Goerg's action. See First Nat. Bank in Newnan v. Blackburn, 254 Ga. 379(1), 329 S.E.2d 897 (1985); Moore v. Moore, 247 Ga. 243, 244(1), 275 S.E.2d 334 (1981). Compare Brown v. Truluck, 239 Ga. 105, 236 S.E.2d 60 (1977); Braddy v. Dessau Realty & Ins. Co., 148 Ga.App. 589, 252 S.E.2d 10 (1978). Dr. Goerg had an interest in the accounts sufficient to authorize him to file a claim in [197 Ga.App. 669] Dr. Kubler's pending garnishment proceeding (see Perry v. Freeman, 163...