Court Opinion

ID: 6639285
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:44:05.938774+00
Date Added: 2024-06-11T15:59:10.960962
License: Public Domain

On Petition for Rehearing.
PER CURIAM.
The question for decision in this case was as to the legal effect of a decree in equity of the United States District Court. It was not upon the effect under the Georgia statutes of a statutory judgment for the foreclosure of a mortgage. The state Legislatures certainly have no authority to prescribe the modes of procedure in the courts of the United States or the effect of their decrees. Clark v. Smith, 13 Pet. 195, 10 L. Ed. 123; Scott v. Neely, 140 U. S. 106, 11 S. Ct. 712, 35 L. Ed. 358; Whitehead v. Shattuck, 138 U. S. 146, 11 S. Ct. 276, 34 L. Ed. 873; Cates v. Allen, 149 U. S. 451, 13 S. Ct. 883, 977, 37 L. Ed. 804.
It is therefore a question of equity practice, governed by the rules of procedure of the United States District Court, is governed by decisions affecting the general equity practice, and is binding and conclusive upon the parties and privies to the same extent and in respect to the same points and questions as the judgment in any other form of action. 27 Cyc. 1669, 1792.
But we agree with the court below that the mortgage was properly attested for record. The court found as a fact that it had been re-executed before record; Magid, Watson, Turnipseed, and Attride being all present at the same time and place, and there either signed or admitted the signatures made by them. That Attride, the notary who acted as official witness, was a stockholder of the mortgagor corporation, was ruled to bo insufficient to exclude him from acting as such. We agree with such ruling. Such official act is, in Georgia, nonjudicial. Wardlaw v. Mayer, 77 Ga. 620, 624. As to the general law on this subject, see 1 Cyc. 557.
The stockholder is disqualified from acting as an attesting witness, notarial or otherwise, who is a stockholder of the corporation receiving the mortgage, for the reason that he increases his own estate by taking such mortgage, and it is considered contrary to public policy for him to act in bis own interest. Southern Iron & Equipment Co. v. Voyles, 138 Ga. 258, 75 S. E. 248, 41 L. R. A. (N. S.) 375, Ann. Cas. 1913D, 369.
At common law, an interested witness was not excluded from testifying against his interest. Brown v. Burke, 22 Ga. 574, 578 ; 40 Cyc. 2253. The rule seems to be well settled that an officer who is a stockholder is not disqualified in acting as an official witness to a deed given by Ms corporation. It is an action against Ms interest. Greve v. Echo Oil Co., 8 Cal. App. 275, 96 P. 904, 907-908.
In this case the property, since August, 1922, had been in gremio legis. It was in possession of the court when the bankruptcy proceeding was filed. The decree of foreclosure bad been entered for more than a year. At the time of such filing of the bankruptcy proceeding there was no judgment lien against the property. All of the other creditors were unsecured, junior, and represented by the mortgagor. It is not thought that in such a case it was ever the purpose of the Bankruptcy Act to recognize the trustee as having a superior lien to the mortgage.
The petition for rehearing is denied.