American Exchange National Bank v. Council , 146 Ga. 580 ( 1917 )

Per Curiam.

A bank borrowed money from another bank, and secured the loan by transfer and delivery of its customers’ paper, with its incidental collateral. The borrowing bank failed, and a receiver was appointed in an insolvency proceeding. The receiver filed a petition to the court of his appointment, representing that a warehouseman had in his possession certain bales of cotton for which he had issued a warehouse receipt to the president of the defunct bank in his individual name, which cotton had been delivered by a customer of the bank to be applied on his indebtedness,- which receipt had been mislaid and could not be found; and he prayed to be authorized to execute an indemnity bond to the warehouseman and to receive the cotton, and when so received to sell it and hold the proceeds as assets of the insolvent bank. An order was granted as prayed, and the receiver, upon giving bond to the warehouseman, obtained the cotton and sold it. Subsequently the lending bank intervened and set up the indebtedness it held against the borrowing bank, and disclosed the collaterals by which such indebtedness was secured, among which were two notes given by the customer who had delivered the cotton to the warehouseman. The lending bank also brought, in another court, an action of trover against the warehouseman for the cotton, predicated on being the holder of the warehouse receipt. Thereupon the receiver filed a petition to enjoin the trover suit and to require the lending bank to assert its claim in the equitable proceeding against the insolvent bank. The court granted an interlocutory injunction. Held, that under the undisputed evidence and the pleadings it was error to grant a temporary injunction.

Judgment reversed.

All the Justices concur, except Fish, O. J., absent.