Southern Cotton Mills v. Ragan

Supreme Court of Georgia

Southern Cotton Mills v. Ragan

72 S.E. 158, 136 Ga. 789, 1911 Ga. LEXIS 226

CourtSupreme Court of Georgia

DecidedAugust 22, 1911

StatusPublished

Cited by1 cases

This text of 72 S.E. 158 (Southern Cotton Mills v. Ragan) 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

Southern Cotton Mills v. Ragan, 72 S.E. 158, 136 Ga. 789, 1911 Ga. LEXIS 226 (Ga. 1911).

Pincite

Opinion

Lumpkin, J.

1. Whether or not a bank was authorized by its charter to act as a trustee for bondholders secured by a mortgage, this did not authorize decrees, rendered in an equitable proceeding to foreclose the mortgage, to be 'treated as nullities, at the instance of a person who took a conveyance under a sale by receivers appointed in such case.

2. Under the pleadings and evidence, there was no error in refusing to appoint a receiver under the petition filed by the grantee from the receivers, which sought to have the conveyance cancelled, and to have an accounting.

3. A corporation issued bonds and executed a mortgage to secure them. Under an equitable petition filed by the trustee named in the mortgage, the property of the mortgagor was placed in the hands of receivers, and a decree of foreclosure was entered. The receivers sold at private sale the property covered by the mortgage, and, upon confirmation by the court, made a deed and delivered the property, the grantee paying an amount in cash, giving a certain note to the receivers for another amount, and assuming the payment of the bonds and buying subject to the mortgage. Held, that the directors of the mortgagor had no such title or interest as authorized them to file, in their own names, as directors, a petition to enforce the contract of purchase from the original receivers or to seek to foreclose the mortgage, and to have new reeeiyers appointed to take charge of the property sold.

4. It was accordingly erroneous to appoint receivers under an equitable petition so filed, over objection of the purchasers.

5. Under the facts of this case, such appointment, upon a petition filed solely by the directors of the mortgagor in their individual names', as directors, was erroneous, altliough the bondholders and the trustees were named as defendants along with the purchasers at the receivers’ sale, and some of the defendant bondholders, under the name of intervenors, and the trustee joined in the prayer for a receiver.

Judgment affirmed in the first entitled ease, and reversed in the second.

All the Justices concur, except Beck, J., absent.

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Lumpkin, J.

1. Whether or not a bank was authorized by its charter to act as a trustee for bondholders secured by a mortgage, this did not authorize decrees, rendered in an equitable proceeding to foreclose the mortgage, to be 'treated as nullities, at the instance of a person who took a conveyance under a sale by receivers appointed in such case.

2. Under the pleadings and evidence, there was no error in refusing to appoint a receiver under the petition filed by the grantee from the receivers, which sought to have the conveyance cancelled, and to have an accounting.

3. A corporation issued bonds and executed a mortgage to secure them. Under an equitable petition filed by the trustee named in the mortgage, the property of the mortgagor was placed in the hands of receivers, and a decree of foreclosure was entered. The receivers sold at private sale the property covered by the mortgage, and, upon confirmation by the court, made a deed and delivered the property, the grantee paying an amount in cash, giving a certain note to the receivers for another amount, and assuming the payment of the bonds and buying subject to the mortgage. Held, that the directors of the mortgagor had no such title or interest as authorized them to file, in their own names, as directors, a petition to enforce the contract of purchase from the original receivers or to seek to foreclose the mortgage, and to have new reeeiyers appointed to take charge of the property sold.

4. It was accordingly erroneous to appoint receivers under an equitable petition so filed, over objection of the purchasers.

5. Under the facts of this case, such appointment, upon a petition filed solely by the directors of the mortgagor in their individual names', as directors, was erroneous, altliough the bondholders and the trustees were named as defendants along with the purchasers at the receivers’ sale, and some of the defendant bondholders, under the name of intervenors, and the trustee joined in the prayer for a receiver.

Judgment affirmed in the first entitled ease, and reversed in the second.

All the Justices concur, except Beck, J., absent.

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Bluebook (online)

72 S.E. 158, 136 Ga. 789, 1911 Ga. LEXIS 226, Counsel Stack Legal Research, https://law.counselstack.com/opinion/southern-cotton-mills-v-ragan-ga-1911.

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