Manheim v. Clafin

• Decision Date: 11 July 1888
• Citation: 7 S.E. 284,81 Ga. 129
• Parties: MANHEIM et al. v. CLAFIN et al.
• Court: Georgia Supreme Court

7 S.E. 284

81 Ga. 129

MANHEIM et al. v. CLAFIN et al.

Supreme Court of Georgia

July 11, 1888

Syllabus by the Court.

Where a creditor has an honest mortgage on personalty, and has foreclosed the same at law, he has no occasion, either as a substitute for or in aid of his foreclosure proceeding, to file a bill in a court of equity in order to realize the fruits of his foreclosure as against fraudulent mortgages of prior date on the same property, which are also foreclosed and under which the property has been seized and is about to be sold. The remedy of the honest creditor is ample, full and adequate at law; and he may attack by affidavit, under section 3979 of the Code, or, if necessary, may obtain, under the act of October 16, 1885, an injunction, the appointment of a receiver, etc., from a court of law, and especially under the act of October 24, 1887, is he limited in his mode of obtaining equitable relief to a petition addressed to the superior court.

A creditor, whose debt is not in judgment, and who has no lien by contract upon certain goods not fraudulently purchased from himself, or, if so purchased, which he does not seek to reclaim by a rescission of the contract, cannot pursue such goods by bill in equity in the hands of a third person, who in fraud of the creditor, has purchased, or pretended to purchase, them from the debtor. His remedy is by attachment, under section 3297 of the Code; and, even did he need equitable relief, the act of 1887, above cited, would confine him to petition addressed to the superior court as the mode of obtaining it.

Error from superior court, Pulaski county; KIBBEE, Judge.

Martin & Smith and Jordan & Watson, for plaintiffs in error.

A. C. Pate and Weil & Brandt, for defendants in error.

BLECKLEY C.J.

1. No one can doubt that foreclosing a mortgage on personalty under section 3971 of the Code, is a proceeding at law; and section 3979 a gives the mortgagee the option of foreclosing in equity. Here the mortgagees, Clafin & Co., took the legal remedy in preference to the equitable, and then, without the least necessity for it that we can see, invoked the aid of equity to enable them to realize their money out of the goods covered by their mortgage. This they did solely because there were prior fraudulent mortgages in favor of other persons covering the same goods, which mortgages had already been foreclosed, and levies made. But section 3979 of the Code provides that "if any creditor of the mortgagor, whether his debt be in judgment or not, desires to contest the validity or fairness of the mortgage lien or debt, he may make an affidavit of the grounds upon which he relies to defeat such mortgage; and, upon filing the same with the levying officer, together with a bond and good security, payable to the mortgagor, and conditioned to pay all costs and damages incurred by the delay, if the issue be found against the contestant, it shall be the duty of such officer to return the same to the court to which the mortgage, fi. fa. is made returnable, to be tried in the manner prescribed above, for an affidavit of illegality by the mortgagor." Here is a specific legal remedy by which to attack the fraudulent mortgages, and the bill does not explain why it was not used, or why, if used, it would not be efficacious. Again, suppose...