Court Opinion

ID: 5553165
Source: CourtListenerOpinion
Date Created: 2022-01-11 00:36:03.670305+00
Date Added: 2024-06-11T08:35:13.350990
License: Public Domain

Lumpkin J.,
By the Court. delivering the opinion.
We are quite clear, that whether Semmes can be made liable to creditors of the bank in another proceeding or not, he cannot by process of garnishment. The record shows, that he transferred his stockto Smith — Smith agreeing to pay the amount due thereon to the bank. And- thereupon, the Cashier surrendered up to Setnmeshis note. Noattempt hasever been made by the bank, to charge him as a debtor to the bank, or to hold him responsible in any -way, upon his original subscription for stock,
*546It is conceded, that if this substitution of liability had been-made by the bank, it would have discharged Semmes. It was done by the Cashier; and we are authorized to assume, that the act was ratified by the bank. We infer this, not only from its acquiescence, but from the further fact, that upon the faith of this transaction — constituting Smith a stockholder in the place of Semmes — he was made a director of the bank, which he could not be unless a stockholder, and he was no stockholder, unless this contract or arrangement between the Cashier, Semmes and himself.made him one.
This is not all. This very stock was subsequently transferred by Smith, for no other or further assignment of the stock was ever made by Semmes. So that those who controlled the bank, at the time Mott, the plaintiff, made his deposit — to recover which this suit is brought — must necessarily have derived their right and authority through Smith, and upon the faith of this transfer by Semmes. So that the-proof, as to the ratification of this act, on the part of the bank,, is conclusive.
In Phillips vs. Wesson et al., 16 Ga. Rep. 137, this Court say, “But there is a technical difficulty which cannot be well overcome, as to this remedy by garnishment. Admitting all the facts charged in the bill to be true, Phillips, perhaps, could safely swear, that he owed Stephens nothing, and that he had nothing of his in his hands. For, this being a fraudulent arrangement between them to defeat the creditors, Phillips is not liable to account to Stephens, although he may be-to the creditors. And notwithstanding the transfer by Stephens may be a nullity, as to his creditors, still, it will be perceived, that the process of garnishment does not make and meet the issue fairly. At any rate, this legal remedy is not complete. Phillips may swear, in answer to the garnishment,, that he owed Stephens nothing; yet, if he admitted the facts charged in the bill, he would subject himself, undoubtedly, not to a prosecution for perjury on his former oath, but to a *547decree in favor of the creditors of Stephens, to account for the goods or their value.”
If the Court reasoned rightly, in respect to a case confessedly fraudulent, what ought to be its opinion in the case before us, where not a debt had been contracted by the bank, when Semmes’ note was delivered up to be cancelled. And when Mott’s debt had no existence for years afterwards. And especially when it appears, that Semmes had washed his hands of this charter, long before it went into the possession of its foreign purchasers. Perhaps for the very reason that he would not lend his sanction to such a transfer.
Let the creditors then go into equity, and, if they can, subject Semmes for aiding and abetting in the fraudulent • abstraction of the effects of this bank. But he cannot be reached by process of garnishment, if he has been discharged by the bank. The witness, Kyle, swears positively that the money was paid to the bank upon this transferred stock. I put no stress upon this proof in this opinion.
Judgment affirmed.