Lou Hill Co. v. Bjoralt

• Decision Date: 25 April 1961
• Docket Number: No. 38774,No. 2,38774,2
• Parties: LOU HILL COMPANY v. L. K. BJORALT et al
• Court: Georgia Court of Appeals

Page 39

120 S.E.2d 39

103 Ga.App. 564

LOU HILL COMPANY v. L. K. BJORALT et al.

No. 38774.

Court of Appeals of Georgia, Division No. 2.

April 25, 1961.

Syllabus by the Court.

A bankrupt debtor in perfecting his exemption of money, set aside to him in a bankruptcy proceeding, in a proceeding before the ordinary of the county of his residence under the provisions of Code § 51-601 must comply with the provisions of Code §§ 51-201, 51-301, 51-302 and 51-303 relating to the schedule to be attached to his application, the notice to be published by the ordinary, the notice to be given creditors by the applicant or his agent, and the time of the hearing. When such application is made, however, and a properly certified copy thereof filed in the court where a garnishment proceeding, involving a fund subject to the exemption as perfected, is pending against the bankrupt, the action in the latter court should be stayed pending the completion of the proceedings before the ordinary in compliance with the Code sections enumerated above.

The plaintiff Lou Hill Co. obtained a judgment against the defendant Lyle K. Bjoralt in February, 1959, in the amount of $458.97 plus $14.50 costs. On April 4 1960 the plaintiff filed a garnishment on said judgment in the Municipal Court of Columbus, the Columbus Bank & Trust Company being named as the garnishee. On April 18, 1960, the defendant filed his bankruptcy petition in the United States District Court and was duly adjudicated a bankrupt by said court on April 29, 1960. On May 3, 1960, the defendant filed a plea for stay in the garnishment proceedings in the municipal court on account of his bankruptcy proceedings. On May 9, 1960 the garnishee filed its answer stating it was indebted to the defendant in the sum of $356.34, and prayed for stay of the garnishment proceedings until final determination of the bankruptcy proceedings.

On October 12, 1960, the defendant filed his petition with the Ordinary of Muscogee County, Georgia, in which he recited that he was claiming, as a homestead in the pending bankruptcy proceedings, the funds held by the garnishee bank, and that after said funds were set aside to him he desired to invest said funds, under the direction of the ordinary, in articles of personal property which are exempt under the laws of the State of Georgia. The ordinary, on the same date the petition was filed, ordered the defendant to invest said funds in personal property and file his schedule of such investment with the court of ordinary.

On October 27, 1960 the defendant was discharged in bankruptcy. The funds in the hands of the garnishee were set aside by the referee to the defendant bankrupt as part of his homestead exemption. On November 10, 1960 the defendant filed a petition in the municipal court setting forth said facts and attached thereto a copy of his discharge in bankruptcy together with a certified copy of his application to convert said funds into personal property and the order of the ordinary, dated October 12, 1960, allowing same. It was also alleged in said petition that the plaintiff's claim was scheduled in the defendant's bankruptcy schedules and that the plaintiff was notified of said bankruptcy proceedings as required by law. A hearing was held in the municipal court on November 21, 1960, at which time the plaintiff made a motion to dismiss the pleadings filed by the defendant in said court on November 10. After hearing argument, the court took the matter under advisement. On December 1, 1960 the Ordinary of Muscogee County filed his petition in the municipal court asking that said funds be turned over to him for the purpose of investment on behalf of the defendant. The plaintiff renewed its motion to dismiss in writing on December 7, 1960. On December 12, 1960, the municipal court entered an order overruling plaintiff's motion to dismiss, and on December 13, 1960 entered an order dismissing the garnishment proceedings. On this action of the municipal court, the plaintiff assigns error and brings the case to this court for review.

Young, Hollis & Moseley, Columbus, for plaintiff in error.

Beverly R. Keil, Ray, Owens, Keil & Thornton, Swift, Pease, Davidson & Chapman, Columbus, for defendants in error.

JORDAN, Judge.

The facts in this case are similar to the factual situation presented in the case of Roquemore v. Goldstein, 100 Ga.App. 591, 112 S.E.2d 24, 27, a case cited and relied upon by both of the parties in this case. In the Roquemore case the plaintiff had obtained a judgment against the defendant Roquemore and subsequently filed a garnishment against his employer on December 5, 1957. The employer (garnishee) made an answer on March 17, 1958, showing an indebtedness to Roquemore in the amount of $200.16, and on the same date Roquemore filed his voluntary petition and was adjudicated a bankrupt in the United States District Court. The bankrupt claimed this amount of money as a homestead and the referee set it aside for him as such. Upon his discharge in bankruptcy on June 30, 1958, Roquemore filed a petition for stay of execution and on the hearing introduced in evidence the discharge in bankruptcy. The court denied his motion to dismiss and entered a judgment in favor of the plaintiffs against Roquemore and his surety on the dissolution bond which he had posted. This judgment of the Civil Court of Fulton County was affirmed by the appellate division of that court and on appeal to this court was affirmed in an opinion written for the court by Judge Townsend. In the Roquemore case the bankrupt defendant relied entirely upon his discharge in bankruptcy...