Booth v. State , 131 Ga. 750 ( 1908 )

Lewis, J.

1. The assignment of error is made that this judgment is void, upon the ground that the court had no authority to render the same. The assignment raises a question of jurisdiction. If the judgment was merely interlocutory in its nature, and not final, or such a judgment that the excepting party can not review by direct bill of exceptions, the court did have jurisdiction, and the case would be prematurely in the Supreme Court. On the other hand, if it is final in its character, and a judgment reviewable by direct bill of exceptions, the court had no jurisdiction to render the same in vacation before the ease was ripe for hearing at some term of the court. It is true for some purposes courts of equity are always open; but we take it as a well-settled rule that neither a court of law nor equity has jurisdiction to pass a judgment final in its nature, adjudicating and settling the substantial rights of the parties litigant, before the case has reached some term of the court when it is triable. In ordinary suits the second term after filing suit is the trial term, unless the parties by consent in equity causes make the appearance term the trial term. Even by consent jurisdiction can not be conferred upon the court to hear .and dispose of, by judgment, a case that has never reached the appearance term. The superior courts can hear and determine in vacation certioraries, motions for new trial, and all such other matters as they can hear and determine in term time, that do not require a jury, upon proper notice and application. Civil Code, §4323-4. There must be, however, some term of the court at which the case is ripe for trial, before any judgment can be made finally disposing of the ease. In equity, as well as law, the court has no jurisdiction in vacation, except what is expressly conferred by law. Civil Code, §4325. We see nothing in the act of 1907 (Acts. 1907, p. 85), upon which the original suit is based, asking for a receiver, that takes this case out of the ordinary rules of procedure in equity causes; certainly no authority is given the court by the act, and no jurisdiction conferred, that courts of equity did not have before the passage of the act.. See, in this connection, Ivey v. City of Rome, 129 Ga. 286 (58 S. E. 852); Lochrane v. Equitable Loan Co., 122 Ga. 433 (50. S. E. 372). In Akerman v. Moon, 81 Ga. 688 (8 S. E. 321), a receiver had been appointed upon an estate, and several creditors had intervened. The matter was referred to a master for a report as to the priority of liens, etc. The petitioner applied to the court for ah order directing the receiver to pay her claim, alleging that it was the highest in rank of all unpaid claims; and this was substantiated by the report of the master. On demurrer by several holders of inferior liens, the petition was dismissed. This judgment was reversed on exceptions taken thereto, the court holding that the receiver should have been directed to pay the amount of the claim. It will be noted in this case there had been a report by a master, confirmed by the'court, as to the priority of the liens; and there was nothing left but to pay off the claims according to the priority of the liens established by a final judgment. In Hawkins v. Dale, 95 Ga. 512 (20 S. E. 304), a receiver was appointed for a sawmill, and later, at chambers, an order was granted allowing Hawkins to intervene, and directing, that, upon his giving bond, all the projDerty described in the original petition be delivered to him. Subsequently Dale, Dixon & Co. presented a petition to the judge in chambers, alleging that part of the property belonged to them and not to the receiver. The receiver only was cited to show cause, and upon his answer an order was passed decreeing that the receiver and Hawkins deliver the specified .property to Dale, Dixon & Co. upon their giving bond. The property not being delivered, Hawkins was cited for contempt, and upon his answer was discharged as to this feature of the case, but the order decreeing that the property be delivered to Dale, Dixon & Co. was allowed to stand. Upon exceptions by Hawkins, it was held that this order was void, in that Hawkins had not been given notice of the proceeding to dispossess him of the property which he held under the first order of the court. The judgment was reversed, and on a second trial a consent order was taken by the parties in term time, that the ease be heard in vacation without a jury, upon ten days notice to each party; and it 'was held on the second writ of error (100 Ga. 6) that the consent order was essential to give the judge jurisdiction to dispose of the matter in vacation. The real question involved is, whether or not this judgment is merely interlocutory in its nature, or final in its nature. Counsel for both parties seemed to treat it as a final judgment that can be reviewed under a direct bill of exceptions, and therefore not interlocutory. We are clearly of the opinion that this view is correct. It is difficult sometimes in actions on the equity side of the court, especially in cases of receivership, to determine whether an order is administrative in its character, resting in the sound discretion of the chancellor, or final in its nature. To be final it does not necessarily mean that the judgment disposes of the entire case. A judgment may be rendered separable from a judgment disposing of the entire case, and yet be a judgment' that is final as to some of the substantial rights of the parties as contended for in their pleadings. It is final when, as to the subject-matter of the judgment, any of the substantial rights of the parties litigant are finally settled by the judgment. It then fails to be merely an administrative order, lying in the discretion of the court, and open for modification at any time. While it is true*a wide discretion is given a court of equity in passing interlocutory decrees and orders, only administrative in their character, looking to the collection of money and the protection and preservation of property, and preparatory to and for. the purpose of expediting and reaching a final judgment disposing of the entire case, yet there is a limit to this discretion, and a point beyond which if the court goes, the judgment loses its interlocutory character, and becomes a final judgment in the sense that the court has no jurisdiction to render the same in vacation. Without discussing the limits of this discretion at length, there is a rule which clearly fixes the nature of this judgment as a final judgment, and therefore void, as the court had no jurisdiction to render the same in vacation before the trial term. If the judgment is a final disposition of the case, or, if the excepting party had been successful in the court below, the judgment would have been a final disposition of the case, it is a final judgment to all intents and purposes. Civil Code, §5526; Mechanics Bank v. Harrison, 68 Ga. 463; Lochrane v. Equitable Loan Co., supra. Applying this test to this judgment, it was in no sense merely interlocutory, but final and conclusive as to the subject-matter of the same. The contention of the State under the pleading was, that the State had a prior lien or preference for the debt due it by the bank, and it asked for a judgment establishing this priority and directing the receiver to pay off the indebtedness. The plaintiffs in error, contesting creditors in the court below, denied this claim of priority, and set. up other facts as matters of defense, and resisted the rendition of a judgment to pay off the State’s claim. The court settled by this judgment these issues raised by the pleadings, under the evidence submitted. The judgment as to the.priority of the State’s claim over other creditors, and as to the disposition of the $192,502.90 ordered to be paid to the State, was a final disposition of the case. Only one other issue was left in the. ease, and that was whether the balance of $11,871.08 claimed by the State was a debt due the State. It was as much a final judgment as it would have been had this issue also been settled by the court; the only difference being, had this issue also been determined, it would have been a final disposition of the case as made by the State’s intervention and the answer thereto. It was a judgment as to the subject-matter of the same, finally adjudicating and settling the rights of the parties litigant under the pleadings; and if the plaintiffs in error had been successful in their contention under the pleadings in the court below, it would have been a final disposition of the entire case made by the intervention and the answer thereto. The judgment, being final in its nature, and not merely interlocutory, was void for want of jurisdiction in the court -to render the same in vacation. However correct we may regard the conclusion of the learned judge in the court below in his construction' of the law, the judgment was rendered at the wrong time, and we are constrained to reverse the same for the reasons above stated. See also, in this connection, Central Trust Co. v. Grant Locomotive Works, 135 U. S. 207 (10 Sup. Ct. 736, 34 L. ed. 97).

2. We are, however, clearly of the opinion that the court was correct in the conclusion reached as to the priority of the State’s claim and as to the failure of the contesting creditors, Booth et al., to set up any valid defense under the facts, contesting the right of the State to have its indebtedness paid off out of funds in the bands of the receiver. Under tbe common law the sovereign right of the State to priority of payment out of the effects of an insolvent existed. Robinson v. Bank of Darien, 18 Ga. 66 (7). It was held in this decision that this priority not only existed, but that it was a wholesome right, and such as should receive the sanction and approbation of the courts. As stated also in this opinion, this principle was adopted by an act of the legislature of 1784. We know of no law that contravenes this general proposition. There is nothing in the original act, or the acts amendatory thereof, establishing State depositories and providing for bonds and rules for regulating such depositories, that abrogates or modifies in any way this sovereign right- of priority on the part of the State. This, however, is not an open question. In the case of Seay v. Bank of Rome, 66 Ga. 609, the original act providing for the appointment of State depositories, and providing for a bond in the sum of $50,000, came under review. Under this act there was no limit as to the .amount of funds the State could deposit. In this case the court held that preference in favor of the State’s claim as against individual creditors extended to all the assets of the bank,, notwithstanding the additional security of a bond given by the bank, and was good for an amount due the State over and above the amount of the bond. This original act was amended (Acts 1903, p. 32), limiting the amount of deposit by the State to tbe amount of tbe bond given by the bank, and providing for a larger bond to cover fully the amount deposited. Evidently the primary object of this amending act, as well as the act of 1907 providing for a State bank examiner, etc., was to require and secure additional protection and security for the State’s money in the various banks established as State depositories; but there is nothing in the various acts referred to that would justify the inference that it was the purpose of the legislature to abrogate or change the law, as it existed prior to the passage of these acts, giving the State a priority as to debts over individual creditors and depositors of an insolvent bank.

It was the contention further of the creditors, Booth et al., in the court below, that the State, having deposited an amount in the bank greater than the amount of the bond given by the bank, should be forced to proceed on the'bond against the bank and its surety -for the excess, and should be held as estopped in this proceeding as to this balance. As stated, this bond was required only as additional security, and in no way changed the priority of the State’s claim on all the assets of the bank. The State had a right to exhaust its remedy against the principal before going on the surety. There was really no breach of the bond if there was money in the hands of the receiver belonging to the principal to pay the State its indebtedness.

3. There is no merit in the defense set up that the State is estopped from asserting its claim by reason of certain alleged acts of negligence or wrong conduct of the bank examiner. Even if the acts alleged constituted negligence or misfeasance, it is a well-settled principle that the State can not be estopped from asserting its right, on account of negligence or illegal conduct of its officers, and can only be estopped by legislative act or resolution. Alexander v. State, 56 Ga. 479 (7), 491.

4. There was no merit in the motion of the plaintiff in error, urged in the court below, to dismiss the original bill and the intervention fded by the State, upon the ground that there was no process attached, and no process prayed for, and because said case was not made returnable to any term of the court, and no judgment of relief was prayed for. Prior to the time the intervention was filed by Booth et al., an answer to the original bill was filed by the Neal Bank, admitting the allegations of the petition by the State, and joining in the prayer for a receiver. This answer was an implied waiver of process and service. Civil Code, §4981, provides that “Appearance and pleading shall be a waiver of all irregularities of the process, or of the absence of process, and the service thereof.” See also Gay v. Cheney, 58 Ga. 304; Saffold v. Foster, 74 Ga. 752; DeLeon v. Heller, 77 Ga. 740. The intervenors who were made parties plaintiff to this original suit were parties to the pleadings as they found them. They found an implied waiver of process, and there was no merit in their objection.

' 5. There was no error upon the part of the court in refusing to dismiss the original suit and the intervention of the State, upon the ground that the same was not made returnable to any term of the court.- The law makes the case returnable to the next term of court after the lapse of a certain time from the date of filing the suit.

6. Nor is there any merit in the contention of the plaintiffs in error that the case ought to have been dismissed for the reason that there was no prayer for any judgment or relief. There was in the original suit against the bank a prayer for a judgment appointing a receiver to wind up the affairs of the bank, and also for a final judgment allowing the State bank examiner as treasurer to retain assets of the bank in his hands sufficient to pay off the indebtedness claimed by the State.

But apart from the merits of these preliminary motions; for reasons already set forth, the court had no jurisdiction in vacation, before the appearance term, to dispose of the case by final judgment. The judge reached the correct result, but at the wrong time." The judgment must be reversed; but as the facts were not disputed and the errors alleged to have been committed were solely errors of law, and as the nature of the ease, large public interests being involved, demands a speedy disposition, direction is given that the premature judgment be entered in term time, if at the time of entering the same the case before the court be not materially changed. Ivey v. City of Rome, supra.

Judgment reversed, with direction.

All the Justices concur, Lewir J., sitting instead of LumpTcin, J., disqualified.