The morning news. [volume] (Savannah, Ga.) 1887-1900, 1900-01-07
OLD LEGAL FIGHT RENEWED.
TRUSTEE WANTS POSSESSION OF
FUND FROM SALE OF BANK
RUPT STOCK.

The NeidIinEer, Rabun 4 Nell Liti-
cation In New Form and Brought
to the Attention of Different Court.
This Time the Superior Court Is
Asked to Protect Interests of I'm
secured Creditors and Direct Sher-
iii Sweeny to Pay over the Money.
Five Thousand Four Hundred and
seventy-fve Dollars in Money and
Several Legal Principles at stake.
Judge speer Refused to Entertain
Jurisdiction.
The struggle for the money arising
from the sale of the stock in trade of Neid-
linger, Rabun G. Nell. under foreclosure
proceedings in the Superior Court, was
renewed yesterday when an injunction
was obtained temporarily restraining
Sheriff Sweeny from turning any of the
fund over to the secured creditors until
the further order of the court.
The application for an injunction and
for other relief was made by Mr.. w. p.
Hardee, trustee of the bankrupt estate,
appointed by the unsecured creditors.
Judge FalIigant granted the petition for
the payment of the money to any one
claiming it, until the entire matter could
be heard and determined.
The defendants in the case are Sheriff
Thomas j. Sweeny, the Southern Bank
Chatham Bank, Germania Bank and Ogle-
thorpe Savings and Trust Company. 1t
is alleged in the petition that the frro Of
Neidinger Rabun & Nell was adjudged
bankrupt on April a. 1899, and that on
May, following, the plaintiff was appoint
ed the trustee of the estate The firm ad-
judged bankrupt consisted of William c.
Neidlinger John W. Rabun and william
b. Nell.
Coming down to the subject matter of
complaint, IL is alleged and charged that
on July IS, 1898, the firm gave mortgages
upon the stock in trade belonging to ID to
the Southern Bank, to secure an indebted
ness of 81, 800. to the Chatham Bank to Sc
cure an Indebtedness of $3.50, to the Ges-
mania Bank to secure an Indebtedness
OF 81 Zoe and to the Oglethorps Savings
and Trust Company to secure an indebt-
edness of $500. Ten days after the mort
cages were given the Southern Bank in
stituted proceedings to foreclose the one
held by it, and, with the consent of the
firm and the approval and concurrence of
the other banks, levied on the property
covered by the mortgage and sold it on
ten days notice to the highest bidder for
cash. The property brought $54i5, not
enough to pay half of the claims held by
the banks but still enough to make it de
sirable For Its possession there has been
a constant legal squabble ever since the
firms adjudication in bankruptcy and the
appointment of the trustee.
1t is charged in the petition of the trus-
tee that at the time the mortgages to the
D. anlrg tod
lessly insolvent and that this condition
of its affairs was known to the mort
gagees. 1t is charged further that the
transfers of the property, by means OF
the mortgages and their foreclosure, with
the consent of the firm, were made with
intent to prefer the banks and to delay,
hinder and defraud the other creditors
not In the same manner favored and Sc
cured. 1t is charged that by permitting
the Southern Bank to foreclose its mort
gage a preference was created. which in
vaidates the mortgage under the bank
ruptcy law.
Under the circumstances it is contended
in the petition, the mortgages given to the
banks were preferences, and as such void
under the law. The alleged acts of bank
ruptcy were all committed within four
months of the filing of the petition, the
result of which was the adjudication of
the firm as bankrupt by the Federal Dis
trict Court.
Trustee Hardee represents to the court
that he is the representative of all the
creditors, under the bankruptcy proceed
ings, and that the fund ought to be turn
ed over to him for distribution. The es-
tate, In his view OF the matter including
the fund now in the hands OF the sheriff
Of the county should be administered m
full by him. under the direction of the
United States District Court, and not by
the Superior Court
For this reason he wants judgments
against Sheriff Sweeny and the four banks
named as defendants. for the principal sum
accruing by the sale of the stock under
the foreclosure Of the alleged invalid mort
cages, AS He asks for an order direct
ing the sheriff 10 pay the money over TO
him. He asks for temporary injunction,
restraining any action in the matter by
| the sheriff until the further order of the
court This last was granted. and Sheriff
| Sweeny directed to show cause before
| Judge Falligant on Jan. 20 why the order
should not be continued in force until the
case can be heard and determined on its
merits
The trustee has made a previous effort
| TO collect this money In the United States
| Court, seeking from Judge Speer an in
| junction requiring Sheriff Sweeny to turn
It over, A temporary injunction, holding
the matter and the money i'm statu quo.
was obtained from the Federal Court, and
the application for a mandatory injunction
was argued when Judge Speer was last
| in Savannah. His decision was against
the trustee. Judge Speer refused to in
| terfere with what he termed the undoubt7