69 F. 679 | U.S. Circuit Court for the Northern District of Georgia | 1895
This case is heard on exceptions to the special master’s report, which states the facts and issues in the ease as follows:
Special Master’s Report.
To the Hon. William T. Newman, Judge of the United States Circuit Court for the Northern District of Georgia:
The subscriber, having been appointed by the honorable court special master to hear the evidence in said case, and to determine the liability-therefrom, having heard and considered the evidence in said case and the arguments of counsel, reports as follows:
It appears from the evidence that a judgment was rendered against one Perino Brown on March 27, 1884, in the superior court of Pulton county, for $1,916.60 principal, $368.94 interest, with interest from the judgment at. 7 per cent, per annum, on which there was a return of nulla bona. Garnishment issued upon the judgment, and was served upon the Western & Atlantic Railroad Company, which answered an indebtedness of $80 to defendant in judgment. This answer was traversed by the plaintiff! in judgment, and, upon the trial of the traverse before a jury, a verdict was rendered against the traverse. A motion for a new trial wan made, and the verdict sot, aside, and a now trial granted; hut before new trial was had the hill in this case was filed. The judgment above referred to was assigned to J. S. McLendon on January 7, 1888, and was alive at the dato oí the proceedings upon the garnishment, and is still alive. There were two garnishments,—the first was sued out January 28, 1888, and served January 31, 1888; the other was sued out on the 8th of November, 1888, and served the same day. The joint answer to the two garnishments was filed April 27, 1889. and was traversed upon the same day by the plaintiffs. The trial above ref erred to was upon the first garnishment sued out.
W. H. Patterson was appointed to a clerical position in the depot of the Western & Atlantic Railroad Company at Chattanooga in the year 1881 or*680 1882, at a salary of $75 or $80 per month. Subsequent to tbe appointment, Mr. Patterson went to Gov. Brown, through whom tlie appointment was made, and endeavored to make an arrangement by which he (Patterson) could resign, and have his father-in-law, Mr. Perino Brown, appointed to the position. Gov. Brown declined to consent to this arrangement, but stated that the company would have no objection to continuing Mr. Patterson’s appointment and allowing Mr. Patterson to fill the duties of the office by a competent and satisfactory deputy. This suggestion was adopted, and Mr. Perino Brown personally performed the duties of the office to which Mr. Patterson had been appointed. It seems clear to me that this arrangement was made in good faith and was not the outcome of fraud or substitute. Some time subsequent to the consummation of this arrangement, Mr. Patterson resigned his situation, and Mr. Perino Brown seems to have assumed the position on his own account. But, after one month Mr. Patterson was reappointed to the same position, and Mr. Brown again assumed the position as deputy of Mr. Patterson. During this one month Mr. Perino Brown’s name appeared on the pay roll of the defendant company, and an indebtedness appeared to him on said pay roll of $80, opposite which amount was marked the word “garnisheed.” During the remainder of the time covered by the controversy, both before and after the month just mentioned, the pay roll showed no indebtedness to Mr. Brown, but a salary appeared each month due W. H. Patterson. This salary was drawn sometimes by Mr. Patterson, and sometimes by Mr. Brown in Mr. Patterson’s name, in accordance with an arrangement agreed upon between them.
After a careful examination of all the evidence in this case, and diligent search of the law controlling it, I am of the opinion that there is no liability on the part of the Western & Atlantic Railroad Company, for two reasons: (1) Upon the expiration of the charter of the Western & Atlantic Railroad Company, the suit pending at the time abated, and no legal judgment could be rendered upon that suit against the funds in the hands of the receiver. The equitable bill on which we are proceeding is for the distribution of the fund which existed upon the expiration of the corporation’s charter. McLendon has no claim against this fund, and cannot participate in its distribution. His cross bill, therefore, under his allegations, cannot be sustained. (2) But, were this not the case, my finding is that the Western & Atlantic Railroad Company would not b,e indebted to the plaintiff upon the traverse to the answer of the garnishment. Mr. Brown, from the evidence, occupies the position of subcontractor, appointed by and deriving all his rights from Mr. Patterson. Mr. Patterson was the only party to the contract with the railroad company. They looked to him alone for a proper discharge of the functions of the office, and hold him alone responsible for the discharge of its duties. I see no reason for differentiating this case from any other case of contractor and subcontractor. If A contracts with B 'to build B’s house, and sublets the work, or part of it, to C, and the payments under the contract with B are made at stated intervals to A, a garnishment served upon B against funds due C would not justify B in witholding the contract payments due to A; and that is precisely the case made by the evidence before us. I therefore find that the defendant, the Western & Atlantic Railroad Company, is not indebted to J. S. McLendon in any sum.
This January 81, 1895. Albert Howell, Jr., Special Master.
Tbe exceptions are to tbe correctness of tbe report on both grounds on wbicb tbe decision is placed by tbe special master.
Tbe first question made by tbe exceptions and tbe argument of tbe case is as to tbe effect of tbe dissolution of tbe corporation on tbe rights of McLendon against it as garnishee. Whatever rights McLendon was to have as against the Western & Atlantic Railroad Company were to be reached by bis succeeding in bis traverse to tbe company’s answer to tbe garnishment. McLendon bad no debt against tbe Western & Atlantic Railroad Company, except such as tbe court in the garnishment proceeding might have ad
But, independently of the foregoing, I think the special master is right in the conclusion which he reached on the merits of this