Summit Ins. Co. of New York v. Mulherin, 29375

• Decision Date: 04 February 1975
• Docket Number: No. 29375,29375
• Parties: SUMMIT INSURANCE COMPANY OF NEW YORK et al. v. Suzanne L. MULHERIN et al.
• Court: Georgia Supreme Court

Page 788

212 S.E.2d 788

233 Ga. 606

SUMMIT INSURANCE COMPANY OF NEW YORK et al. v. Suzanne L. MULHERIN et al.

No. 29375.

Supreme Court of Georgia.

Feb. 4, 1975.

Swift, Currie, McGhee & Hiers, J. Alexander Porter, Atlanta, Hull, Towill, Norman, Barrett & Johnson, Patrick J. Rice, Augusta, for appellants.

Jay M. Sawilowsky, Henry J. Heffernan, Augusta, for appellees.

Syllabus Opinion by the Court

HAll, Justice.

This case involves the question of venue as to nonresident co-defendants.

Appellee Suzanne L. Mulherin brought this action in the Superior Court of Richmond County against six defendants, only two of whom are residents of Richmond County. The resident defendants are appellee's husband A. T. Mulherin and his trustee in bankruptcy James E. Slaton. The remaining defendants are Summit Insurance Company of New York ('Summit,' a New York corporation with its registered agent in Fulton County); M. A. Studstill (resident of Berrien County); the accounting firm of Meeks, Roberts and Spicer (resident of Irwin County); and the architectural firm of B. G. Sanders and Associates (resident of Fulton County). Summit, Studstill and Meeks, Roberts and Spicer are the appellants herein.

M. A. Studstill and A. T. Mulherin ('builders') entered into contracts as joint adventurers to build three public housing projects in Blackshear, Moultrie and Soperton, Georgia. Summit issued surety bonds on the contracts, and builders agreed to indemnify Summit for any losses it may sustain on the bonds. The indemnification agreement contained an assignment of builders' rights in the construction contracts effective upon, among other things, appointment of a trustee for builders. Summit was also given the right to assume performance of the construction contracts upon builders' delay in performance or upon their insolvency, incompetency or bankruptcy.

Appellee took an assignment of A. T. Mulherin's rights in the joint venture agreement, including his right to 25% of the profits on the construction contracts. Subsequently, A. T. Mulherin filed a petition in bankruptcy. Summit then notified the owners of the various construction projects that it was assuming performance of all contracts and exercising its assignment under the indemnification agreement. Summit hired the accounting firm of Meeks, Roberts and Spicer to supervise disbursements under all the contracts. Summit also advised B. G. Sanders and Associates, the architect and developer of the projects, of its actions.

Appellee then filed a 'complaint in equity' against the above-named defendants. The complaint alleged that upon completion of the three construction projects appellee would be entitled to 25% of the profits but that Summit intended to seize her share and apply it to losses sustained as a result of a performance bond it issued on a South Carolina construction contract undertaken by A. T. Mulherin. In its amended answer Summit denied that it had any present intention to seize any monies allegedly belonging to appellee but that it would 'avail itself of all legal rights and remedies at law or in equity, if any, to protect itself from any losses or potential losses in connection with the issuance of any surety bonds.' A. T. Mulherin's trustee in bankruptcy admitted that he claimed 25% of the profits on A. T. Mulherin's behalf.

Appellee asked for the following relief: (1) that Studstill, B. G. Sanders and Associates, and Meeks, Roberts and Spicer be enjoined from paying to Summit and the trustee any money arising from the three construction projects; (2) that the defendants pay into the registry of the court a fund representing 25% of the profits on the three projects; (3) that Summit and the trustee be required to set forth in the present action any claims they may have to the fund; (4) that the court decree that the fund is the property of appellee; (5) that Studstill, B. G. Sanders and Associates, and Meeks, Roberts and Spicer make account to the court of the manner of determining the amount of the fund; (6) that Summit, the trustee and A. T. Mulherin be enjoined from receiving any of the fund; (7) that all defendants be permanently enjoined from bringing any actions, legal or equitable, against appellee based upon the subject matter of the complaint; and (8) that all defendants make an accounting as to the fund.

The trial court denied the motions of Summit, Studstill and Meeks, Roberts and Spicer to dismiss for improper venue and for lack of jurisdiction over the person. Based on the verified pleadings, affidavits, and arguments of counsel at the interlocutory hearing, the trial court granted appellee temporary relief essentially in the form prayed for. The defendants Summit, Studstill and Meeks, Roberts and Spicer appeal from the order denying their motions and granting relief to appellee.

1. Appellee has filed a motion to dismiss the appeal for failure to transmit the record in time and asserts that delay was due solely to appellants' failure to pay costs in the trial court. In response, appellants have submitted several affidavits to this court urging justification for the delay.

Code Ann. § 6-808(a) provides that where no transcript of the evidence and proceedings is to be sent to the appellate court, the clerk of the lower court shall prepare and transmit the record within 20 days after the date of filing of the notice of appeal. In the present case appellants' notice of appeal was filed in the trial court August 23, 1974. No transcript of the evidence and proceedings is involved. The record was not filed in this court until September 23, 1974, ten days late according to the above statute.

Appellee made no objection in the trial court prior to transmittal of the record. According to Rule 11(c) of this court, promulgated March 2, 1972, appellee has therefore waived any objection to delay in transmittal. Rule 11(c) provides: 'Appellee shall be deemed to have waived any failure of the appellant to comply with the provisions of the appellate practice act relating to the filing of the transcript of the evidence and proceedings or transmission of the record to this court unless objection thereto was made and ruled upon in the trial court prior to transmittal.' Accordingly, appellee's motion to dismiss is denied. See Southeastern Plumbing Supply Co. v. Lee, 232 Ga. 626, 208 S.E.2d 449.

2. Only two of the defendants are residents of Richmond County where the action was brought. They are A. T. Mulherin and his trustee in bankruptcy. In order for venue to lie in Richmond County as to appellants (nonresident defendants) substantial equitable relief must be sought against at least one of the two resident defendants. Code Ann. § 2-4903, art. VI, § XIV, par. 3; Ammons v. Bolick, 233 Ga. 324, 210 S.E.2d 796; Empire Land Co. v. Stokes, 212 Ga. 707(1), 95 S.E.2d 263; Screven County v. Reddy, 208 Ga. 730(2), 69 S.E.2d 186; Ellis v. Farmer,119 Ga. 238, 46 S.E. 105.

There are no allegations in appellee's verified complaint of any past, present or future threatened wrongdoing on the part of either resident defendant. Nor do the affidavits submitted by appellee at the interlocutory hearing show any such wrongdoing. Nothing in the complaint nor affidavits lays any claim to substantial relief, legal or equitable, that a...