171 Ga. 81 | Ga. | 1930
Lead Opinion
Davidson owned 20 shares of the capital stock of the Citizens Bank of Fort Valley at the date of its failure oh November 27, 1928. At that time he had on deposit in said bank the sum of $2,267.47. The superintendent of banks made an assessment of 100 per cent, against the stockholders to pay depositors of this bank, and, to enforce the assessment against Davidson, issued an execution-against him for $2,000. Davidson had all his money, except that deposited in the above bank, on deposit in the Fourth National Bank'of Macon. The latter bank closed the day before the former bank closed. The superintendent of banks threatened to have the execution recorded on the general execution docket unless payment was-made by a named day. Davidson owned considerable farming properties all free from liens, and considerable properties of other kind's, and conducted large farming operations. He had no other banking connections except with
Prior to 1893 there was no general statutory liability of stockholders for deposits made in banks over and above any amount which might be due upon their subscriptions to the capital stock
Was this situation changed by the banking act of 1919, or any
But it is insisted that this has been changed by section 19 of the act of August 25, 1927. Acts 1927, pp. 195, 199. The purpose of this section of this act was simply to fix the priority of payment of the claims of depositors. Under the banking act of 1919, six classes of debts came ahead of depositors. Under the act of 1927, depositors are to be paid first. It gives additional protection to depositors, and was not intended to take away from them any protection which they enjoyed under previous laws. It is urged by counsel for the plaintiff, that, as the act of 1927 provides for the payment of depositors first out of the assets of the bank, there is no necessity for them to have the exclusive benefit of this statutory liability of stockholders. To this contention we can not agree. The act of 1927 merely fixes the priority of payment of depositors;, and in no way changes the liability of stockholders in this respect from one to the depositors to one to the bank. In the motion for a rehearing counsel for the plaintiff concedes that the assets of insolvent banks are, as a general rule, largely insufficient to pay depositors. From this fact the necessity arises for applying these funds to the payment of deposits. If stockholders are permitted to set off against this statutory liability to depositors deposits due to them by the bank, the assets arising from this source and properly applicable to the payment of depositors would be diverted; and the right of depositors to be paid therefrom would be partially .or wholly destroyed.
In the motion for a rehearing it is conceded that the act of 1927 “ added to the rights of depositors, and did not take away any rights” previously given them. The banking act. of .1919, and the amendment thereto of 1925, makes a bank “ responsible to its creditors to the extent of its capital and its assets,” and makes
So we are of the opinion that the statutory liabilities of stockholders to depositors in a bank are not assets of the bank, save in the sense that they may be enforced by the superintendent of banks for the benefit of depositors. This stockholders’ liability is one due to the depositors, and not to the bank. There is therefore no mutuality between this liability of stockholders to depositors, and a debt due by the bank for deposits to stockholders. The latter can not be set off against the former. So we adhere to the decision in Swicord v. Crawford, supra, and decline to overrule it. In Bennett v. Wilkes County, 164 Ga. 790 (139 S. E. 566), we
Davidson attacks as unconstitutional the law providing for the assessments of stockholders, upon the ground that it denies due process of law to the stockholders, in violation of the 14th amendment to the constitution of the United States, and the due-process clause of the State constitution. He makes the point that the law permits the superintendent of banks to make the assessment, to issue an execution therefor, and place the same on the general execution docket, thus creating an apparent lien on his property, without giving him the right to be heard before this is done. This contention has been decided against the plaintiff by both this court and the Supreme Court of the United States. In Coffin v. Bennett, 164 Ga. 350 (138 S. E. 670), this court held that section 20 of article 7 of the banking act of 1919 (Acts 1919, p. 135), as amended by the act of August 25, 1925 (Ga. Laws 1925, p. 119), provided only for a summary issuance of executions against stockholders of banks, as a mode of commencing suits against them to enforce their statutory liability to depositors, and that the act of 1919, as amended by the act of 1925, accorded to stockholders the right to contest by affidavit of illegality their liability for the assessments levied by the superintendent of banks, and the amount and necessity thereof, and was not unconstitutional as denying to such stockholders due process of law. The case was taken to the Supreme Court of the United States. That court held that “The objection urged by the plaintiff in error seems to be that this section purports to authorize an execution and the creation of a lien at the beginning, before and without any judicial proceeding. But the stockholders are allowed to raise and try every possible defense by an affidavit of illegality, which, as said by the Supreme Court of' Georgia, makes the so-called execution ‘a mode only of commencing against them suits to enforce their statutory liability to depositors.’ ” Coffin v. Bennett, 277 U. S. 29 (48 Sup. Ct. 422, 72 L. ed. 768). So the contention which plaintiff makes was dealt with both by this court and by the Supreme Court of the United States, and it was decided against him.
Plaintiff further contends that he paid the execution under duress. The facts on which he bases this contention are fully set
Judgment affirmed.
Rehearing
ON MOTION FOR REHEARING.
1. Counsel for the plaintiff takes offense at some of the language used by the writer in his opinion in this case. The language to which he excepts does not bear the construction which
2. In the second ground of the motion for rehearing it is insisted that we erred in holding that the execution which issued against the stockholder in this case was under the act of 1925, and that this act was constitutional as it gave to the stockholder a right to defend against an execution issued thereunder. It is insisted that we overlooked the fact that, the execution in this case recites that it was “ issued by and under the authority of the said act of the legislature of the State of Georgia, approved 'August 16, 1919,-amendment August 14, 1920,” and that it was not issued under the act of 1925. It is urged that this court is powerless to change the language of the writ as issued by the banking department, as this court is powerless to change the language of an act of the legislature. We did not undertake to change the recital of this execution. We simply construed the meaning of this recital. We hold that the meaning of the recital that the execution was issued under the act of August 16, 1919, is not to be determined from that act as it was originally passed, but from that act as it was amended at-the date of the issuance of the execution. After the passage of the act of 1919 it was amended by the act of 1925, so as to provide for defenses to executions issued under the act of 1919 as- so amended. The language in this recital, “amendment approved August 14, 1920,” should be disregarded, as the act of August 14, 1920, does not in any way refer to the issuance of executions to enforce’ stockholders’ liability to depositors in insolvent banks. Property construed, this execution was issued under the act of 1919 as amended by the act of 1925.
3. In the third ground of the motion for rehearing it is urged that we overlooked, in passing upon the question of duress, the decision in Logan v. Sumter, 28 Ga. 242 (73 Am. D. 755), in which it was held that “A defendant who has paid an execution on which he is not liable may recover back the money — he having paid it under the belief that he was liable.” In that case the defendant paid when he was not liable. In the instant case the defendant admitted liability, but was attempting to set off a counter-demand against the same.
After due consideration, we do not think that the provisions of the statutes referred to require a different conclusion from that reached and expressed in the opinion rendered in this case. By these statutory provisions funds collected from the liability of stockholders to depositors are assets of the bank only in the sense that they are to be collected and applied to the payment of depositors, and not for the payment of debts which the bank may be due to depositors.
Concurrence Opinion
concurring specially. It is my opinion that the request to review the case of Swicord v. Crawford, 148 Ga. 719, should be granted and the decision overruled; but since it is not possible to obtain that unanimous consent required by law in order to overrule that case, I concur in the opinion delivered by Mr. Justice Hines in this case in behalf of the court, in which the law is so clearly and aptly set forth, as well as in the judgment of affirmance.