Rust v. Producers Co-Operative Exchange, Inc.

58 S.E.2d 435, 81 Ga. App. 260, 1950 Ga. App. LEXIS 873

• Court: Court of Appeals of Georgia
• Decided: March 16, 1950
• Docket: 32926, 32927
• Status: Published

Opinions

Townsend, J.

(After stating the foregoing facts.) The affidavit in garnishment is sworn to by R. M. Reed as agent for Producers Co-operative Exchange Incorporated. The bond signature contains the typewritten words, “Producers Co-Operative Exchange, Inc. (Seal), Principal, By____________________________________; Hartford Accident and Indemnity Company (Seal) by R. B. Chambers, Attorney in Fact, Security.” Counsel for the garnishees contend that it is apparent from the record that no one signed as an officer of the plaintiff corporation so as to bind the principal on said bond, as a consequence of which the court had no jurisdiction to issue any summons upon said garnishment. In substance, the garnishees contend that the bond, not having been signed by the principal, is void; that by reason of the bond being void, the garnishment proceedings are void, and that by reason of the garnishment proceedings being void, the judgment against them is void. It follows that if the bond is a valid bond the proceedings based thereon are valid and culminated in a valid judgment against the garnishees. The bond is not. conditioned as required by statute, in that the signature of no agent of the principal appears thereon. However, a statutory bond, not duly executed, may still be sustained as a common-law bond. Stephens v. Crawford, 3 Ga. 499; Crawford v. Howard, 9 Ga. 314; Wall v. Mount, 121 Ga. 831 (49 S. E. 778); Williams v. Mitchem, 151 Ga. 227 (106 S. E. 284); Paxson v. Planters Warehouse & Loan Co., 20 Ga. App. 267 (92 S. E. 1023); McCorkel v. J. J. Whitten & Son, 26 Ga. App. 707 (107 S. E. 97); Graves v. Campbell, 33 Ga. App. 505 (126 S. E. 854); U. S. Fidelity & Guaranty Co. v. McCurdy, 51 Ga. App. 507 (180 S. E. 902). In 11 C. J. S., Bonds, § 16, it is stated: “In the absence of statute, where a bond is sealed and delivered, it is not essential to its validity that it be signed by the obligor. . . Independent of any statutory requirement the manner and form of the signature, when made, is immaterial, provided it is made by the obligor for the purpose and with the intention of binding himself.” In this case, the only signature of the principal was the typewritten name “Producers Co-Operative Exchange, Inc.” But the bond was properly signed by the surety, and the obligation of the surety is not in any way conditioned upon the form of signature of the principal. The bond was made at the instance of the principal with the evident intention of binding itself, and was acted upon by it, and was signed by a surety at its instance. The principal is therefore estopped to deny its validity. The case was tried on the assumption that the bond was sufficient, and no complaint was made concerning it until after judgment. Counsel for the garnishees rely upon Mayo v. Renfroe, 66 Ga. 408 (4), a case dealing with the bond of a public official, in his contention that a bond not signed by a principal is invalid, but in that case the bond was never ac- ' cepted and its inavalidity is based upon another ground. Contrariwise, it was held in U. S. Fidelity & Guaranty Co. v. McCurdy, supra, that the liability of a surety on the joint and several bond of a public officer, where the principal acts and receives public moneys thereunder, is not affected by the failure of the principal to sign the bond, and that the same may be enforced as a valid common-law obligation. Although this court in that case had under consideration the bond of a public official, a careful examination of the opinion, written pursuant to an answer of the Supreme Court to a certified question U. S. Fidelity & Guaranty Co. v. McCurdy, 180 Ga. 683, 180, S. E. 633), leads us to the conclusion that the doctrine of estoppel applies against the principal on private as well as public bonds when such principals have acted .upon and received benefits under such bonds. Foreign persuasive authorities:heréin cited also support this view. In the case at bar, the bond; having been acted upon by the principal whose typewritten' signature appears thereon, must likewise be construed as'a'valid: common-law undertaking. .

The motion for a new trial was on the general groúnds only. It is contended, however, that a new trial should have been granted because the plaintiff in execution, who traversed the answer of the garnishee, failed to comply with the' garnishment statute. The original judgment against the defendant Williams was obtained in Greene County. The plaintiff thereafter went before a justice of the peace of Cobb County, pursuant to the provisions outlined in Code § 46-604, and caused the latter to issue a summons returnable to the Cobb County Superior Court. Code § 46-604 provides in part: “and it shall be the duty of the officer serving such summons to return or transmit the certified affidavit and bond, together, with his actings and doings thereon, to the superior or justice’s court of the county in which such suit shall be pending or judgment shall have been obtained.” There is no evidence in the record that this was done. Counsel for the garnishee rely upon Columbus Iron Works Co. v. Pou, 98 Ga. 516 (25 S. E. 571), in their contention that where this part of the statute has not been complied with there could be no lawful judgment upon the garnishment in favor of the plaintiff, either against a surety or a garnishee. However, in Carr & Co. v. Roney, 118 Ga. 634 (45 S. E. 464) the Supreme Court held this case to be unsound and declined to follow it. The ruling there made was as follows: “Where a garnishment was sued out . . in one county based upon a suit pending in another, it was erroneous to dismiss the garnishment proceeding upon the ground that it did not affirmatively appear from the original affidavit and bond that the officer who took the same had made out a certified copy thereof, and that the officer who served the summons had transmitted such certified copy with his return thereon to the court where the main case was pending.” It follows that, while it is necessary that such return be made, there is no requirement of statute that an entry thereof shall be made on the original. It is therefore no ground for reversal that this entry was not made.

It is further contended that, since the affidavit in the garnishment proceedings shows it is based upon a judgment rendered in 1940, such a judgment, being dormant, could not be the basis of a valid judgment, and also that, since the judgment was not introduced in evidence,. the plaintiff did not carry the burden of proving that he had a valid, unsatisfied judgment. Proof that a judgment is more than seven years old is not conclusive of its dormancy. Code § 110-1001 provides the manner in which judgments may be kept alive. Section 110-1002 et seq. provide the manner of reviving them after they, have become dormant. It is the right and duty of the garnishee, after the rendition of a verdict finding him indebted, to inquire into the validity of the judgment on which, the garnishment is based. Ingram v. Jackson Mercantile Co., 2 Ga. App. 218 (2) (58 S. E. 372); Merchants &c. Bank v. Haiman, 80 Ga. 624 (5 S. E. 795). He may raise the point that the garnishment proceedings are based on a dormant judgment and, upon proof thereof, the plaintiff is not entitled to judgment. The purpose of his so doing is to protect himself from twice paying the debt, should it turn out that the plaintiff was not in fact entitled to recover from the original defendant. But in the present case the defendant admitted the judgment, that it was good and valid, and that he had paid no part of it. Such an admission would be sufficient to protect the garnishee, and to prima facie establish the validity of the judgment sued on. The proof thus meets the requirements of South Georgia Grocery Co. v. Wade-Chambers Grocery Co., 12 Ga. App. 213 (77 S. E. 6), and Fagan v. Jackson, 1 Ga. App. 24 (57 S. E. 1052), that the plaintiff must show that he has obtained a judgment against the defendant. It is true that money cannot be subjected to garnishment based on a void judgment or a dormant judgment. Ingram v. Jackson Mercantile Co., supra. A garnishment proceeding is a distinct suit on a new cause of action. Anderson v. Ledbetter-Johnson Contractors, 62 Ga. App. 732 (2) (9 S. E. 860). It was stated in Milner v. Neel, 114 Ga. 118, 121 (39 S. E. 890): “No court has ever held a judgment void because it was rendered upon a cause of action which had been barred before the commencement of the suit. If a person is sued upon a'cause of action which is barred, he cannot fail or refuse to attend the court and allow a judgment to go against him and afterwards claim that the judgment is void.” See also Burch v. Wofford-Terrell Co., 52 Ga. App. 685 (1) (184 S. E. 419). Similarly, it appearing that the duty is upon the garnishee to inquire into the validity of the original judgment against the defendant, he cannot let the judgment go against him and later claim it was void because the statute had run against the judgment on which the garnishment is brought. Where the judgment is not denied, and there is direct evidence of its validity, the burden shifts to him to make this defense before the judgment against him is entered.

The ultimate question is whether there was evidence to warrant the jury in finding that the transfer of payments by the garnishee from H. E. Williams Sr. to his son, H. E. Williams Jr., beginning as of April 28, 1948, the day the garnishment summons was served, was a cover-up transaction for purposes of evasion. Before the service of the summons, according to the testimony of the bookkeeper for Rust Cheese Company, checks to H. E. Williams Sr. were made out simply, “H. E. Williams.” One of these checks, dated April 22, was in evidence. Notice to produce checks issued subsequently was given, but the checks were not produced. The bookkeeper testified, “I don’t know whether these checks were made out to Mr. H. E. Williams Jr. or Sr. after the time- of the service of the summons of garnishment . . I did not produce the other checks and I don’t know whether the checks after garnishment were any different from the check produced, but I think they were made out to H. E. Williams without stating Jr. or Sr.” The only other evidence is that of the defendant, H. E. Williams Sr., who stated, “I could not continue to operate my milk route after the summons of garnishment was served on Rust Cheese Company. I then began working for my son in driving the same milk route. He was paid the same commissions. The change was that I told Rust Cheese Company to pay my son rather than me, and I told them to change the books to the name of my son, H. E. Williams Jr. and to pay him. I and my son live together. He purchased a new truck with his own money, and he continued to operate on the same route I had formerly operated. Since that time I have worked for my son, and my son has repaid me by doing some work for me and money as I needed it.”

Under this evidence the.jury was authorized to find that H. E. Williams Sr. actually made no change in his employment; that Rust Cheese Company made no change on its books, and that the transaction was a mere cover-up to evade the garnishment proceedings. This case differs from Rainey v. Eatonton Co-Op Creamery, 69 Ga. App. 547 (26 S. E. 2d, 297), cited by counsel for the garnishee, in that there the husband was the defendant in execution, and the evidence showed that over a considerable period of time, both before and after service of the summons of garnishment, checks had been regularly made payable, not to him, but to his wife, the court holding that the jury was authorized to find that the funds so dispersed were a part of her separate estate.

The trial court did not err in overruling the motions in arrest of judgment and for a new trial.

Judgment affirmed.

MacIntyre, P. J., and Gardner, J., concur.