Baker v. Mills & Gibb

81 Ga. 342 | Ga. | 1888

Simmons, J. — The court below did not abuse its discretion in g-anting this injunction.

Judgment affirmed. (Head*note by the court.)

May 2, 1888.

Injunction. Before Judge Marshall J. Clarke. Eulton superior court. September term, 1887.

About November 28, 1887, an attorney for Mills & Gibb called on Baker & Woolman and demanded payment of their account. They acknowledged its correctness and gave him a check for $250, which was paid. On December 21 thereafter, he again called on them and urged payment of the amount still due. They gave him another check for $300 in part payment, Baker informing him that they had money in the bank but not enough to cash the check, but if it were sent to New York, they would, by the time it was returned to Atlanta, have enough in bank to meet it. On this rep-reservation it was forwarded to New York, but when it was returned to Atlanta it was found that there was no money in bank to pay it, and if there had been any at all when it was given, it had, in the meantime, been drawn out. At the time each of these checks was given, Mills & Gibb would have proceeded to take legal steps to place the business of the firm (who were traders doing business) in the hands of a receiver, had they not been deceived by the representations and assurances of Baker. When the first check was given, Baker stated to the attorney that his firm had a capital of $3,500 and a stock of the value of $7,500, and their whole liabilities were not above $5,200, leaving a net surplus of $5,800 ; and complainants were thereby misled and took no legal steps to enforce their claims, as they would otherwise have done. Immediately after the giving of the second check, and for the purpose of avoiding the filing of a bill against them as insolvent traders, it was announced that the firm had dissolved, and that Baker had bought out Woolman and’had assumed all indebtedness; although he knew of the giving of the second check and the delay in its presentation. Baker paid Woolman $100 cash and gave him certain notes and obligations, and then took charge of the stock and property of the firm, and is proceeding to sell and control the same as a trader. The goods of complainants which remained on hand at the time of the dissolution were taken possession of by Baker, and most of them still so remain. They have been mingled with other goods in the store, making their identification difficult; and Baker is proceeding to sell at greatly reduced prices, part of the stock at less than cost, and to appropriate the proceeds. Baker & Woolman are insolvent. The true facts as to the misrepresentation made by Baker were not discovered until after the dissolution of the firm and the failure to pay the check. There are numerous past due and unpaid debts outstanding against Baker and Woolman, and unless a receiver is appointed, attachments, etc. will be taken out, and a multiplicity of suits will result. Complainants pray for a receiver, for injunction, for a decree setting aside the sales made by them, and that they recover the goods sold by them which remain on hand, and for payment for those disposed of, or, if this cannot be done, that the entire stock be sold by the receiver and they be paid in full; also for subpoena and general relief.

A rule nisi was issued and a temporary receiver appointed. Other creditors were subsequently made parties to the bill.

On the hearing, Baker moved to dismiss the bill on the grounds:

(1) Because there was no cause of action set forth.

(2) Because complainants had no lien and showed no special reason taking them out of the general rule and entitling them to an extraordinary remedy.

On the hearing, this answer was read by complainants and its reading objected to by counsel for Baker, but the objection was overruled. On the material facts of the case the evidence was conflicting.

(1) The court erred in granting the temporary order upon an ex parte showing, there being no charges in the bill to require or justify such an order.

(2) The court erred in not dismissing the bill on motion of defendant at the hearing', for the reasons given in the motion.

■ (5), (8) The court erred in appointing a receiver and granting an injunction.

(6) , (9) The court erred in requiring the bond above referred to, and in placing all of the stock in the hands of the receiver.

(7) The court erred in not requiring bond of the complainants, as requested by defendant’s counsel.

No further opinion than the head-notes was filed in this and the remaining cases of this term.