Sanders v. Culpepper

Mobley, Presiding Justice.

Walter Sanders, as trustee in bankruptcy of the Atlanta Times, Inc., brought a complaint in Fulton Superior Court against numerous defendants, alleging that: The corporation was chartered by Fulton Superior Court in June, 1961, failed in August, 1965, and was adjudicated a bankrupt in the United States District Court for the Northern District of Georgia, Atlanta Division, in January, 1966. The plaintiff duly qualified as trustee in bankruptcy and brings this action under written order of the referee in bankruptcy. The defendants are stockholders in the corporation, holding unpaid shares of stock, and subscribers of unpaid shares of stock, as shown by an attached exhibit. The scheduled claims of creditors of the corporation are in the amount of $2,218,994.45, and all assets will not exceed $1,294,846.07. The action is brought in equity. The amounts due by the defendants constitute a trust fund for the payment of the debts of the corporation and the action is brought to marshal the assets to pay the indebtedness of the bankrupt corporation.

Demand was made for a decree in equity, that the action be maintained against all the defendants to avoid a multiplicity of suits and establish the plaintiff’s equitable rights, and that the plaintiff have judgment against the defendants in the respective amounts shown by the attached exhibit.

The defendants Brooks and Marion Culpepper filed motions to dismiss the complaint for lack of jurisdiction, alleging that they are residents of Talbot County, Georgia. The trial judge entered an order on January 12, 1970, sustaining these motions. On February 5, 1970, the judge entered another order, reciting the former order, in which he held that “there is no just reason for delay in entering final judgment” in favor of these defendants, pursuant to § 54 of the Civil Practice Act (Ga. L. 1966, pp. 609, 658; Code Ann. § 81A-154 (b)), and entered final judgment in favor of them, sustaining their motions to dismiss the complaint against them for lack of jurisdiction.

The trustee in bankruptcy appeals from these two orders.

We consider first the question of whether the appeal is premature. The instances in which judgments and rulings may be appealed are provided by Ga. L. 1965, p. 18, as amended by Ga. L. 1968, pp. 1072, 1073 (Code Ann. § 6-701). The only division of this statute applicable in the present case is Division 1, as follows: “Where the judgment is final — that is to say —where the cause is no longer pending in the court below.”

This language has the same meaning as that portion of the former appellate statute providing that, “No cause shall be carried to the Supreme Court or Court of Appeals . . . while the same is pending in the court below. . .” Code of 1933, § 6-701. Under the language of the former statute, this court has held that where several defendants are sued jointly on a joint cause of action, and there is a final dismissal as to some of the defendants, the judgment of dismissal cannot be reviewed until the final termination of the action; but where several defendants are sued jointly, but not on a joint cause of action, the judgment of dismissal is such a final judgment as can be reviewed immediately. Johnson v. Motor Contract Co., 186 Ga. 466 (1) (198 SE 59); Veal v. Beall, 189 Ga. 31, 33 (5 SE2d 5); Beavers v. LeSueur, 191 Ga. 361, 362 (12 SE2d 581); Millers Nat. Ins. Co. v. Hatcher, 194 Ga. 449 (1) (22 SE2d 99); Moore v. Harrison, 202 Ga. 814, 817 (44 SE2d 551); Stanley v. Greenfield, 205 Ga. 99 (52 SE2d 467).

The defendants in the present case were sued jointly, for the purpose of avoiding a multiplicity of actions, but not on a joint cause of action. A separate judgment is sought against each defendant on the separate contract of such defendant with the bankrupt corporation. Therefore the cause is no longer pending as to the two appellees, and the judgment is a final judgment subject to review.

“Equity cases shall be tried in the county where a defendant resides against whom substantial relief is prayed.” Constitution, Art. YI, Sec. XIY, Par. Ill (Code Ann. § 2-4903).

There is a long line of eases decided by this court holding that a trustee in bankruptcy of an insolvent corporation may recover unpaid stock subscriptions from any number of persons in one equitable action, and may bring the action in the county of the residence of any of the defendants. See Allen v. Grant, 122 Ga. 552 (50 SE 494); Spratling v. Westbrook, 140 Ga. 625 (79 SE 536); Carlisle v. Ottley, 143 Ga. 797 (85 SE 1010, LRA 1917C 393, AC 1917A 573); Chappell v. Lowe, 145 Ga. 717 (89 SE 777); McKey v. Wright, 147 Ga. 662 (95 SE 217); Story v. Belfor, 155 Ga. 192 (116 SE 539).

The trustee in bankruptcy was authorized to join the defendants Brooks and Marion Culpepper in this equitable action, although the complaint was not filed in the county of their residence, and the trial judge erred in dismissing the complaint as to these parties.

Judgment reversed.

All the Justices concur, except Felton and Hawes, JJ., who dissent.