Case Name: Andrews & Co. vs. Kaufmans
Court: Supreme Court of Georgia
Jurisdiction: Georgia
Decision Date: 1878-08
Citations: 60 Ga. 669
Docket Number: 
Parties: Andrews & Co. vs. Kaufmans.
Judges: Blecklet, Judge, concurred, but furnished no written opinion.
Reporter: Georgia Reports
Volume: 60
Pages: 669–677

Head Matter:
Andrews & Co. vs. Kaufmans.
Where between the levying of an attachment by a creditor and the obtaining judgment thereon, the debtor made to another creditor notes of $100.00 each in lieu of a pre-existing debt, and the notes were sued in a justice court and placed in judgment, such judgments were prior in lien to a subsequent judgment on the attachment. The fact that the small notes were made, by agreement, for the purpose of defeating the attaching creditor and preferring the other, does not, without more, make a case of collusion and fraud, and, consequently, does not warrant such a hypothesis in the charge.
Jackson, Judge, dissented.
Attachments. Lien. Judgments. Fraud. Before Judge Crawford. Muscogee Superior Court. November Term, 1877.
To the report contained in the decision, it is only necessary to add, that the court charged, in substance, as follows: The issuing and levying of the attachment created a lien, and when judgment was obtained, the lien was good as against the debtor; the only question is, was it good as against the other creditors who held the small judgments against the debtor ? If nothing else appeared except their existence and priority over the judgment in attachment, they would be entitled to the fund raised by the attachment. But it is claimed by the other side that, after the attachment lien had been created, the debt of Andrews & Co. was divided into small notes, within the jurisdiction of a magistrate’s court, to secure the payment of the Andrews debt and defeat the legal effect of the attachment. The law allows a debtor to prefer one creditor to an other, by payment, transfer or sale; or by mortgaging unincumbered property to secure one creditor to the exclusion of another. But if the Kaufmans bad a lien by attachment on this money, the debtor could not by relinquishment, positive order or mortgage, remove that lien so as to give Andrews the benefit of it. Nor could he accomplish the same resnlt by agreeing to change his liability to a court of less jurisdiction where an earlier- judgment than the attachment judgment could be obtained. If such were the facts, it would amount to collusion (which would be an ingenious legal device under the forms of law to defeat and destroy its own just operation), and a judgment so obtained, though good as between the parties making it, would be fraudulent as to third parties, and must be postponed to the attachment judgment. If, however, the facts were not so, and there was no collusion, then the prior judgments would not be fraudulent, and would take the fund.
Blandford & Garrard; W. A. Little, for plaintiffs in error,
cited Code, §§447, 1953, 3580, 3331, 3329; 1 Kelly, 192; 24 Ga., 353; 18 Ib., 668; 22 Ib., 466; 23 Ib., 616; Bump on Fr. Con., 217.
Thornton & Grimes, for defendants,
cited on division of debt, 22 Ga., 466; 23 Ib., 616. On distinction made by lien of attachment, Code, §§3331, 1945. On fraud, Code, §§1947, 1952, 3596, 3290; 58 Ga., 94.

Opinion:
Warner, Chief Justice.
This case came before the court below on a rule against the sheriff to distribute money in his hands, there being conflicting claims to it, whereupon an issue was made up and tried, when the jury, under the charge of the court, found the issue in favor of J. & J. Kaufman. The case is brought here on a bill of exceptions to the charge of the court and refusal to charge as requested. It appears from the evidence in the record, that J. & J. Kaufman sued out an attachment against Wesley, their non-resident debtor, which was executed by serving a summons of garnishment on Murdock, the agent of the Southern Mutual Insurance Company, on the 6th day of November, 1879, and judgment was obtained thereon on the 8th of March, 1877. It further appeared in evidence, that on the 8th of December, 1876, Wesley, who was indebted to J. C. Andrews & Co. that amount, executed and delivered to them nine promissory notes for $100.00 each, due one day after date, which notes were sued in a justice court and judgments rendered thereon on the 3d day of January, 1877. Executions were issued on the attachment judgment and on the justice court judgments, and placed in the sheriff's hands to claim the money collected from the garnishee by virtue of the attachment process. It also appears from the evidence in the record, that the sheriff collected the money from the garnishee on the Kaufmans' fi. fa. by the instructions of the attorney for Andrews & Co., who notified him to hold it up as he would claim it for them. The sheriff had no instructions from the attorneys of the Kaufmans to have the execution issued, or to collect the money.
The counsel for Andrews & Co., requested the court to charge the jury, that " if they believed from the evidence that J. & J. Kaufman sued out an attachment against Wesley and served the same by garnishment on Murdock, and after this, Wesley being indebted to J. O. Andrews & Co. in the sum of nine hundred dollars, gave his nine notes for $100.00 each, and Andrews & Co. obtained judgments at common law on said notes before the attachment judgment in favor of the Kaufmans, then the judgments in favor of Andrews & Co.constitute a prior lien against the fund in the sheriff's hands, if the transaction between Andrews & Co and Wesley was bona fide and he owed them the money." This request the court gave, with the addition of the following words, " and not made collusively to give Andrews & Co. a preference over the Kaufmans," and refused to give the request in charge without adding the additional words as above stated, and this refusal to charge the request without adding the additional words, is the error complained of.
In this state a debtor may prefer one creditor to another, and to that end he may Iona fide give a lien by mortgage or other legal means. Code, §1943. Debts in the aggregate which amount to more than justice court jurisdiction, may be divided into liquidated demands so as to bring them within such jurisdiction. Code, §447. As between attaching creditors only, does the first attachment levied create a prior lien (Code, §3330), but in a contest between attachments and ordinary judgments on suits, it is the judgment, and not the levy, which fixes the lien. Code, §3331. All monej'raised by process of garnishment shall be paid over to the creditors of the defendant according to the priorities now established by law. Code, §3545.
Should the court have given the charge as requested, without the additional words, " and not made collusively, to give Andrews & Co. a preference over the Kaufmans," in view of the evidence in the record and the law applicable thereto ? The charge of the court assumes that the preferring of Andrews & Co. by Wesley, the debtor, by giving to them the $100.00 notes so as to enable them to obtain judg rnents thereon in due course of law, and thus acquire a prior lien on the money in the garnishee's hands over the Kaufmans' attachment, was in law a collusive fraud, and would defeat the lien of Andrews & Co.'s older judgments upon the money in the hands of the garnishee. This is not an open question in this court. See Lavender vs. Thomas, 18 Ga., 668 ; Bank of Savannah vs. The Planters' Bank et al. 22 Ga., 466 ; Alexander et al. vs. Young, 23 Ga., 616. If the debt due by Wesley to Andrews & Co. had not been a bona fide debt for which the small notes were given, but merely an assumed indebtedness, as was the case in Raefle vs. Moore, 58 Ga., 94, it would have presented an entirely different question, but when a man does nothing more than the law allowTs him to do, it is difficult to perceive how it can be said with legal propriety, that he has been guilty of a collusive fraud.
It was suggested that the Kaufmans had acquired a lien on the money in the garnishee's hands by the levy of their attachment. The reply is that they obtained no lien upon the money as against a common law judgment creditor, whose judgment was of older date than their attachment judgment.
In view of the previous rulings of this court in the cases cited, we think the court erred in adding the words to the request to charge, " and not made collusively to give Andrews & Oo. a preference over the Kaufmans," as set forth in the record.
Let the judgment of the court below be reversed.
Blecklet, Judge, concurred, but furnished no written opinion.