155 Ga. 585 | Ga. | 1923
(After stating the foregoing facts.)
The court below only passed upon the general demurrer, sustaining it and dismissing the petition. In so doing we are of the opinion that the court erred. The petition alleges that the notes deposited with the bank as collateral security without the indorsement of Theodore Titus Sr. were without value, and that Theodore Titus Sr., who indorsed the notes, did so in consideration that the notes signed by the Thomasville Cadillac Co., a firm composed of Theodore Titus Jr. and W. S. Smith, would be extended for ninety days. It was further alleged that the Bank of Thomas-ville released and discharged Theodore Titus Sr. as indorser or surety on the notes, without the consent of plaintiff; and that it did not, after the release, attempt to enforce and collect the notes against Theodore Titus Sr. and as a result of its action in permitting Theodore Titus Sr. to erase his name as indorser on the notes, totally destroyed their value, and that by virtue of the release and discharge by the bank the collateral notes were rendered totally worthless and without value. Taking these allegations to be true, this amounted to a conversion by the bank of the notes, and under the allegations of the petition the plaintiff is entitled to collect an amount which represents the actual damage which the plaintiff has sustained by such conversion. Citizens Bank of Madison v. Shaw, 132 Ga. 771 (65 S. E. 81). In the above-cited case this court held:
“ If a creditor receives promissory notes under an agreement to collect them and apply the proceeds to the payment of the debt, he is bound to use ordinary care and diligence in making such collection; and if any loss should happen to the pledgor by reason of a want of such care and diligence, the law will compel the pledgee'to make good the loss so resulting. . . If promissory notes are deposited with a creditor under an agreement of the character indicated in the preceding headnote, and they are converted by the creditor, this does not conclusively entitle the debtor to a credit of the face value of the collateral, but to an amount which represents the actual damage which he had sus
There is equity in the petition. The plaintiff seeks not only to have the bank required to credit on his indebtedness the value of the property converted, but he offers to pay the bank the difference, if any, between the value of the collateral with interest and his indebtedness to the bank; and he seeks further to have canceled the record of the mortgage given by him to secure the indebtedness to the bank, etc. The plaintiff is not required to wait until the bank brings suit on the indebtedness, which it may delay for years, but he has the right to bring the present action and have his rights determined in a court of equity, as prayed. Whether Theodore Titus Sr. is a necessary party to such a proceeding as the present, is not involved in this case, as the court only passed upon the general demurrer. For the reasons set out above the court erred in dismissing the petition.
Judgment reversed.