Hurt Building Inc. v. Atlanta Trust Co.

182 S.E. 187, 181 Ga. 274, 1935 Ga. LEXIS 71
CourtSupreme Court of Georgia
DecidedOctober 16, 1935
DocketNo. 10882
StatusPublished
Cited by38 cases

This text of 182 S.E. 187 (Hurt Building Inc. v. Atlanta Trust Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hurt Building Inc. v. Atlanta Trust Co., 182 S.E. 187, 181 Ga. 274, 1935 Ga. LEXIS 71 (Ga. 1935).

Opinion

Bell, Justice.

The judgment to be reviewed in this case is the refusal of the court to set aside a judgment confirming a receivers’ sale. After careful consideration of the voluminous record and of the several questions discussed in the briefs, we have reached the conclusion that the case is controlled by a very few plain and familiar principles, and that under them the judgment must be affirmed, regardless of any opinion which might be entertained by this court as to other questions argued. In this view, there is much in the record which may be treated as immaterial and omitted from this statement.

The Atlanta Trust Company, as the trustee under a security deed conveying property situated in Atlanta which may be described in brief as the Hurt Building, filed a petition in the superior court of Fulton County to foreclose the deed as an equitable mortgage, the deed having been made to secure an issue of bonds of which there was past due and unpaid an amount in excess of $3,000,000 at the time the suit was filed. To this action certain pleas were filed, and proceedings were also instituted in the Federal Court. Holders of all but a relatively small portion of the bonds confided their respective interests to two committees, called the bondholders’ committees. Pending the suits these committees entered into a contract with D. Frank' Mennis, one purpose of which, among others, was to end all resistance to the foreclosure of the security or trust deed, and to bring about an early sale of the property by receivers theretofore appointed by the superior court. Mennis agreed to procure the dismissal of all adversary proceedings, and to cause to be conveyed to the receivers certain property rights appurtenant to the Hurt Building in order that the same might be sold in connection therewith. The contract anticipated that at the 'instance of Mennis a new corporation would be created, to sxtceeed automatically, upon its organization, to all the rights granted to Mennis under the contract. The proposed corporation was referred to by the parties as “the purchaser corporation,” a designation appropriate to the thought that it might bid and become the purchaser at thé receivers’ sale. The' committees promised that upon the dismissal of the antagonistic proceedings and the execution of the acts to be performed by Mennis, they would in the fol[276]*276lowing manner assist the new corporation in its effort to acquire the property: They would bid for the property as much as $2,100,-000, and if they became the successful bidders they would then resell the property to the “Purchaser Corporation,” such resale to be partly for cash and partly on terms. If the bidding should pass $2,100,000, the Purchaser Corporation would carry on the bidding to whatever price it desired, and in ease it should become the successful bidder, the committees would “cause their nominee to accept the assignment of such successful bid and to acquire title to properties as aforesaid, and thereafter cause title to said properties to be sold to the Purchaser Corporation at and for a purchase-price equal to the amount of the successful bid of the Purchaser Corporation at the foreclosure sale, such price to be payable” $600,000 in bonds and the balance in cash. The $600,000 of bonds would be secured by mortgage on the property involved in the suit and other property specified. The contract between the committees and Mennis as just described was approved by the superior court. Hurt Building Inc., the plaintiff in error, is the “purchaser corporation” contemplated by the contract.

Mennis procured dismissal of all proceedings, wherever filed, in opposition to the foreclosure of the security deed, including dismissal of a writ of error pending in the Supreme Court of Georgia and having as its purpose the reversal of a decree of foreclosure theretofore entered in the superior court of Fulton County, to wit, on March 22, 1934. Mennis also caused to be transferred to the receivers the property rights appurtenant to the Hurt Building and otherwise executed the affirmative covenants undertaken by him in his contract with the two committees. The way being thus apparently clear for such action, the superior court on January 28, 1935, passed an order directing the receivers to sell the property known as the Hurt Building to the highest bidder for cash on March 5, 1935, after prescribed advertisement. The order required a deposit of $25,000 from each person desiring to qualify as a bidder, and contained the following additional provisions: “The court may reject any or all bids. If a purchaser whose bid is confirmed by this court does not complete payment of the purchase-price in 90 days after such confirmation or within such additional time as may be granted by this court, then the deposit made by such bidder shall be forfeited as damages for his failure to complete. Such [277]*277sale shall be subject to confirmation by this court, and the receivers shall report to this court at 10 a. m. on March 6, 1935, the highest and best bid or bids received by them, for confirmation or rejection by this court at that time or at such later time as the court may adjourn the hearing. If the receivers are in doubt as to which bid is the highest and best bid, the receivers .shall report to the court all such bids as they deem advisable to report. At the hearing by the court on the- question of confirmation of the sale the court may receive a further bid or bids from any person who qualified at the sale or then qualifies as a bidder.” The receivers exposed the property for sale on March 5, 1935, as directed. Hurt Building Inc., after duly qualifying, submitted a bid of $2,280,000, which was the largest amount offered, and the receivers declared the property sold to this company, subject to confirmation by the court. On March 6 the court convened for the purpose of considering confirmation. It seems that the receivers had prepared a report showing that the highest bid had been submitted by Hurt Building Inc., but before the presentation of such report an attorney representing holders of second-mortgage bonds stated to the presiding judge that he had on the previous day obtained from the Federal district court an order restraining the further progress of the sale; whereupon the judge of the superior court entered the following order:

“On this the 6th day of March, 1935, there came on before the court the hearing with respect to the report of the receivers as to the sale conducted on the previous day under order of the court, this hearing being provided for by this court in its order of January 28, 1935, and being for the purposes specified in said order. After discussion, all parties at interest, including all qualified bidders under the receivers’ report this day filed, being present before the court and consenting thereto; it is now ordered that the hearing set for this day by the order of January 28, 1935, is hereby set for ten o’clock a. m. Tuesday, March 19, 1935, and that all the terms and provisions of the order of January 28, 1935, relative to the hearing provided therefor as of to-day, shall in every respect apply to the hearing to be held on March 19, 1935, or any adjournment thereof, including the provision that further bids may be made by any person who qualified at the sale, or then qualifies as a bidder. This the 6th day of March, 1935.”

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Bluebook (online)
182 S.E. 187, 181 Ga. 274, 1935 Ga. LEXIS 71, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hurt-building-inc-v-atlanta-trust-co-ga-1935.