Case Name: MARTIN v. CITIZENS BANK et al.
Court: Supreme Court of Georgia
Jurisdiction: Georgia
Decision Date: 1930-02-22
Citations: 170 Ga. 180
Docket Number: No. 7063
Parties: MARTIN v. CITIZENS BANK et al.
Judges: All the Justices concur, except Russell, G. J., and Hill, J., who dissent.
Reporter: Georgia Reports
Volume: 170
Pages: 180–184

Head Matter:
MARTIN v. CITIZENS BANK et al.

Opinion:
Per Curiam.
1. A joint promissory note containing a provision that the makers jointly and severally transfer, sell, assign, and convey to the payee of the note a sufficient amount of his or tlioir homestead exemptions to pay the note in full, and that in the event these exemptions are obtained or granted to either of the makers in the bankruptcy court, then they request and direct the trustee to deliver to such payee a sufficient amount of the property or money claimed as exempt to pay off the amount due thereon, conveys the title to the property of the bankrupt afterwards set aside to him as a homestead exemption. Saul v. Bowers, 155 Ga. 450 (117 S. E. 86); Comer Bank v. Meador-Cauthorn Co., 160 Ga. 719 (128 S. E. 785).
No. 7063.
February 22, 1930.
Wheeler & Kenyon, for plaintiff in error.
Jones & Reid and R. W. Smith Jr., contra.
2. Trustees in bankruptcy shall "set apart the bankrupt's exemption and report the items and estimated value thereof to the court as soon as practicable after their appointment." U. S. O. A. title 1.1, § 75. When a trustee has been appointed and qualified, the referee has no authority to set apart the bankrupt's exemption. In re Peabody, Fed. Gas. 10866. It is contemplated by the above section of the bankruptcy act and by general order 17 that the trustee shall set apart the exemption and make the report of his actions; and that thereafter the creditors may file exceptions to such report. Such is undoubtedly the regular and orderly method of setting aside homestead exemptions to bankrupts. In re W. C. Allen & Co., 134 Fed. 620, 622. "But a court of bankruptcy is a court of equity, seeking to administer the law according to its spirit, and not merely by its letter." Cain's Case, 127 Fed. 552, • 553. In setting apart the property claimed by a bankrupt as exempt, after its appraisal, the trustee acts ministerially. In re Campbell, 124 Fed. 417. But where there is no trustee appointed, and the referee passes an order setting aside the exemption claimed by the bankrupt, such order is not void because the exemption was not set aside by the trustee. In favor of the judgment of the referee it will be presumed that that officer had the property set aside duly appraised.
3. The title to the property set aside as an exemption to the bankrupt having passed to the payee of the note by reason of the above provision therein, the wife could not have the property so assigned to her bankrupt husband as an exemption set apart as a year's support. Scruggs v. Morel, 22 Ga. App. 93 (95 S. E. 316).
4. Where a receiver had been appointed to take charge of property in litigation, and the court thereafter directed the party in possession of the property to deliver the same to the receiver, said order of the court was not erroneous for the reasons that it was contrary to law and evidence, and that the court was without authority at an interlocutory hearing to pass an order requiring a party, who was a bona fide claimant in possession of the property in dispute, to deliver the same to the receiver before the question of title to same had been duly determined and adjudicated. Civil Code (1910), § 5475.
5. Applying the above principles, the court did not err in the judgment rendered in this case.
Judgment affirmed.
All the Justices concur, except Russell, G. J., and Hill, J., who dissent.