JUDICIAL DECISIONS

Analysis

• General Consideration
• Bank Deposits
• Alimony

RESEARCH REFERENCES

ALR.

Acceptance of cashier’s check from debtor as absolute or conditional payment, 36 A.L.R. 470 ; 42 A.L.R. 1353 ; 45 A.L.R. 1487 .

Title to commercial paper deposited by customer of bank to his account, 99 A.L.R. 486 .

What is an action for “debt” within attachment or garnishment statute, 12 A.L.R.2d 787.

Rule denying relief to one who conveyed his property to defraud his creditors as applicable where the threatened claim which occasioned the conveyance was paid or was never established, 21 A.L.R.2d 589; 6 A.L.R.4th 862.

Creditor’s acceptance of obligation of third person as constituting novation, 61 A.L.R.2d 755.

Unsolicited mailing, distribution, house call, or telephone call as invasion of privacy, 56 A.L.R.3d 457.

Liability of creditor for excessive attachment or garnishment, 56 A.L.R.3d 493.

Rule denying recovery of property to one who conveyed to defraud creditors as applicable where the claim which motivated the conveyance was never established, 6 A.L.R.4th 862.

Spouse’s liability, after divorce, for community debt contracted by other spouse during marriage, 20 A.L.R.4th 211.

JUDICIAL DECISIONS

Analysis

• General Consideration
• Limitation on Compulsory Election

JUDICIAL DECISIONS

Analysis

• General Consideration
• Interests in Estates

RESEARCH REFERENCES

C.J.S.

37 C.J.S., Fraudulent Conveyances, § 167.

ALR.

Creditor’s knowledge that stock is unpaid as affecting stockholders’ liability, 7 A.L.R. 972 ; 69 A.L.R. 881 .

Valuation of notes and accounts receivable in determining question of insolvency or bankruptcy, 133 A.L.R. 1274 .

Jurisdiction, and propriety of its exercise, to require real property in another state or country to be applied in satisfaction of debt (including the setting aside of a fraudulent conveyance thereof), 144 A.L.R. 646 .

Right of creditors of life insured as to options or other benefits available to him during his lifetime, 37 A.L.R.2d 268.

JUDICIAL DECISIONS

Analysis

• General Consideration
• Actions

RESEARCH REFERENCES

C.J.S.

37 C.J.S., Fraudulent Conveyances, §§ 1, 150 et seq.

ALR.

Larceny or embezzlement as affected by purpose to take or retain property in payment of, or as security for, a claim, 13 A.L.R. 142 ; 116 A.L.R. 997 .

Availability of judgment under which exempt property has been seized as a set-off or counterclaim against claim based on the wrongful seizure, 20 A.L.R. 276 .

Attachment or execution creditor as purchaser within rule that first of two purchasers to obtain possession will prevail, 21 A.L.R. 1031 .

Right of creditor to interest after bankruptcy, declared insolvency, or appointment of receiver, where assets are more than sufficient to pay the principal of all claims, 39 A.L.R. 457 ; 44 A.L.R. 1170 .

Property covered by power of appointment as subject to claims of donee’s creditors, 121 A.L.R. 803 .

Right of creditors in respect of property gratuitously conveyed or transferred to a third person for alleged benefit of debtor, 147 A.L.R. 1160 .

Purchase of annuity by debtor as fraud on creditors, 154 A.L.R. 727 .

Construction and effect of provision in note for “renewal until paid,” and the like, 35 A.L.R.2d 1090.

Conveyance or transfer in consideration of legal services, rendered or to be rendered, as fraudulent as against creditors, 45 A.L.R.2d 500.

Exemption of proceeds of national service life insurance from claims of creditors, 54 A.L.R.2d 1335.

Right of creditor to set up statute of limitations against other creditors of his debtor, 71 A.L.R.2d 1049.

Unsolicited mailing, distribution, house call, or telephone call as invasion of privacy, 56 A.L.R.3d 457.

Purchase of annuity by debtor as fraud on creditors, 74 A.L.R.6th 549.

Creditor’s right to have bankruptcy discharge of individual debtor revoked, vacated, and set aside, 138 A.L.R. Fed 253.

JUDICIAL DECISIONS

Analysis

• General Consideration
• Judgments
• Actions

RESEARCH REFERENCES

Am. Jur. 2d.

21 Am. Jur. 2d, Creditor’s Bills, §§ 3, 4.

37 Am. Jur. 2d, Fraud and Deceit, § 497.

C.J.S.

37 C.J.S., Fraudulent Conveyances, §§ 150 et seq.

ALR.

Creditor’s receipt of proceeds of conveyance or transfer by debtor as estopping him to claim that conveyance or transfer was fraudulent, 9 A.L.R. 358 .

Necessity of exhausting remedies against other judgment debtor before bringing suit to set aside conveyance as fraudulent, 22 A.L.R. 200 .

Right of creditor or one representing him to recover money paid or property transferred by debtor on illegal consideration, 34 A.L.R. 1297 .

Delivery of key as satisfying condition of immediate delivery and actual or continued change of possession to uphold sale of personal property against subsequent purchaser or third persons generally, 56 A.L.R. 518 .

Absolute conveyance or transfer with secret reservation as fraudulent per se as against creditors, 68 A.L.R. 306 .

Joinder of grantees or transferees in different conveyances or transfers in suit to avoid them as in fraud of creditors, 69 A.L.R. 229 .

When statute of limitations or laches commences to run against action to set aside conveyance or transfer in fraud of creditors, 76 A.L.R. 864 ; 100 A.L.R.2d 1094.

Remedies of creditors of insolvent decedent’s estate where other creditors have received excessive payments, 77 A.L.R. 981 .

Validity as against creditors of conveyance in trust for settlor for life with remainder to his appointees, 93 A.L.R. 1211 .

Right of creditor of decedent, before perfecting his claim or after loss of recourse against decedent’s estate, to pursue remedy against property conveyed by the decedent in fraud of his creditors, 103 A.L.R. 555 .

Fraud of judgment debtor in concealing assets or misrepresenting his financial condition as affecting failure to issue execution or revive judgment within the statutory period or as ground of action for fraud and deceit causing loss of legal remedy on the judgment, 104 A.L.R. 214 .

Decree in suit by judgment creditor to set aside conveyance in fraud of creditors as bar to another suit for same purpose in respect of another conveyance, 108 A.L.R. 699 .

Succession, estate, or gift tax in respect of or as affected by conveyance or transfer restoring to original owner property transferred by him to defraud or delay creditors, 108 A.L.R. 1508 .

Criterion of jurisdictional amount in action in form of creditors’ bill or suit to avoid conveyance in fraud of creditors, 109 A.L.R. 1185 .

Conflict of laws as regards validity of fraudulent and preferential transfers and assignments, 111 A.L.R. 787 .

Rights as between creditors of fraudulent grantor, where one or more of them, in payment of or as security for his debt, receives deed or mortgage from fraudulent grantee, 114 A.L.R. 406 .

Right to attack and conditions of attack upon conveyance, mortgage, or transfer as fraudulent as against creditors as affected by mortgage or other security for indebtedness to attacking creditor, 116 A.L.R. 1048 .

Complainant’s purpose to defraud creditors as defense to suit to recover property paid for by him but conveyed to defendant, 117 A.L.R. 1464 .

Right of individual creditor or creditors of debtor in liquidation or receivership to maintain bill to set aside conveyances or transfers in fraud of creditors, 119 A.L.R. 1339 .

Statute of limitation applicable to suit by creditor to set aside transfers of debtor’s property, 128 A.L.R. 1289 .

Right of grantee, or his privies, to maintain suit or proceeding for affirmative relief, where claim is made or anticipated that conveyance was made with intention on part of grantor, but without actual fraud by grantee, to defraud former’s creditors, 128 A.L.R. 1504 .

Conditions of creditor’s bill or suit to avoid conveyance as a fraud on creditors where creditor has recovered foreign judgment, 129 A.L.R. 506 .

Right to set aside, for benefit of heirs and distributees, a conveyance or transfer by decedent in fraud of his creditors, 148 A.L.R. 230 .

Rights as between creditors of grantor or transferrer and those of grantee or transferee in respect of property conveyed or transferred in fraud of creditors, 148 A.L.R. 520 .

Pleading and proof of exempt character of property in suit to set aside its conveyance as in fraud of creditors, 154 A.L.R. 913 .

Right of wife or child by virtue of right to support to maintain action to set aside conveyance by husband or parent as fraudulent, without reducing claim to judgment, 164 A.L.R. 524 .

Right of attachment or judgment creditor, or officer standing in his shoes, to attack older lien or security interest for usury, 70 A.L.R.2d 1409.

Right of tort claimant, prior to judgment, to attack conveyance or transfer as fraudulent, 73 A.L.R.2d 749.

Conveyance as fraudulent where made in contemplation of possible liability for future tort, 38 A.L.R.3d 597.

Right of secured creditor to have set aside fraudulent transfer of other property by his debtor, 8 A.L.R.4th 1123.

Right of creditor to recover damages for conspiracy to defraud him of claim, 11 A.L.R.4th 345.

Purchase of annuity by debtor as fraud on creditors, 74 A.L.R.6th 549.

RESEARCH REFERENCES

ALR.

Conveyance in consideration of future support as fraudulent against creditors, 2 A.L.R. 1438 ; 23 A.L.R. 584 .

Right of secured creditor to have set aside fraudulent transfer of other property by his debtor, 8 A.L.R.4th 1123.

RESEARCH REFERENCES

ALR.

Confirmation of composition in bankruptcy as barring later confirmation of composition or discharge within six years, 80 A.L.R. 406 .

Debtor’s waiver of, or refraining from exercising, right to resort to bankruptcy, or his insolvency, as consideration for release of all or part of liability, 108 A.L.R. 656 .

JUDICIAL DECISIONS

Analysis

• General Consideration
• Conveyances Between Spouses
• Preferences by Corporate Officers
• Assignments
• Actions

RESEARCH REFERENCES

C.J.S.

21C.J.S., Creditor and Debtor, § 3 et seq. 37 C.J.S., Fraudulent Conveyances, §§ 112, 115.

ALR.

Conveyance in consideration of future support as fraudulent against creditors, 2 A.L.R. 1438 ; 23 A.L.R. 584 .

Attachment or execution creditor as purchaser within rule that first of two purchasers to obtain possession will prevail, 21 A.L.R. 1031 .

Right of surety who discharges obligation due to government to be subrogated to priority or preference of latter, 24 A.L.R. 1502 ; 83 A.L.R. 1131 .

Right of surety discharges obligation due to government, to be subrogated to rights of latter against third persons, 24 A.L.R. 1523 .

Priority as between different assignees of same chose in action as affected by notice to debtor, 31 A.L.R. 876 ; 110 A.L.R. 774 .

Preference in event of debtor’s insolvency in respect of funds designated or set apart by him for payment of specified obligations, 32 A.L.R. 950 .

Right of debtor who pays creditor to control application of payments made by latter to his creditor with proceeds of original payment, 41 A.L.R. 1297 ; 130 A.L.R. 198 ; 166 A.L.R. 641 .

Character of service contemplated by statutes giving a lien or preference, in event of insolvency, to servants, employees, laborers, etc, 54 A.L.R. 567 .

Trust or preference in respect of money deposited in bank by court, or pursuant to its order, or by officer of court, 86 A.L.R. 209 .

State’s prerogative right of preference at common law, 90 A.L.R. 184 ; 167 A.L.R. 640 .

Right of creditor who institutes supplementary proceedings to priority over other creditors in respect of property disclosed thereby, 92 A.L.R. 1435 ; 153 A.L.R. 211 .

Conflict of laws as regards validity of fraudulent and preferential transfers and assignments, 111 A.L.R. 787 .

Equality among claimants under indemnity or surety bond which is insufficient to pay all claimants in full, 128 A.L.R. 1096 .

Judgment debtor’s personal injury claims against third person or latter’s liability insurer as subject to creditor’s bill, 51 A.L.R.2d 595.

Debtor’s return of merchandise to selling creditor for credit as preferential transfer voidable in bankruptcy proceedings, 62 A.L.R.2d 774.

Right of creditor to set up statute of limitations against other creditors of his debtor, 71 A.L.R.2d 1049.

Validity of provision in deed or transfer to assignee for benefit of creditors for payment of attorneys’ fees, 79 A.L.R.2d 513.

Creditor’s knowledge of preference, or of debtor’s insolvency, under § 60(b) of Bankruptcy Act, as indicated by receipt of property in payment of debt, 88 A.L.R.2d 1050.

JUDICIAL DECISIONS

Comparison of corporate rights to those of individual. —

Corporation has an equal right with an individual allowing preference, but clearly under the law a corporation “shall not be allowed to prefer any creditor or class of creditors, except such as have debts entitled to priority by the laws of this State.” Milledgeville Banking Co. v. McIntyre Alliance Store, 98 Ga. 503 , 25 S.E. 567 , 1896 Ga. LEXIS 82 (1896).

Assignments with or without preferences. —

Insolvent corporation is capable of making a general assignment for benefit of creditors, either with or without giving preference and priority of payment to certain of the creditors. Albany & Renssellaer Iron & Steel Co. v. Southern Agric. Works, 76 Ga. 135 , 1886 Ga. LEXIS 2 (1886).

Preference of creditor even though incidental benefit accrues to directors. —

Right of debtor corporation to prefer a creditor, and right of creditor to be preferred, cannot be lost simply because, as a mere incident to the transaction by which preference is effected, the directors may themselves gain some benefit. Milledgeville Banking Co. v. McIntyre Alliance Store, 98 Ga. 503 , 25 S.E. 567 , 1896 Ga. LEXIS 82 (1896); Atlas Tack Co. v. Macon Hdwe. Co., 101 Ga. 391 , 29 S.E. 27 , 1897 Ga. LEXIS 240 (1897).

Sole owner of insolvent corporation preferring self as creditor. —

Sole owner and president of defendant corporation may not, after corporation becomes insolvent, seize all the corporation’s remaining assets and apply those assets to the debt owed by the corporation to the owner personally, thereby rendering the corporation incapable of paying its other business debts. Fountain v. Burke, 160 Ga. App. 262 , 287 S.E.2d 39 , 1981 Ga. App. LEXIS 2968 (1981).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Assignments for Benefit of Creditors, § 10.

ALR.

Right of resident creditors of foreign corporation to preference over nonresident creditors, 1 A.L.R. 648 .

Right of creditor of corporation to maintain action or suit for his own benefit against another creditor to whom corporation has given a preference, 12 A.L.R. 246 .

Right of corporation to prefer creditors, 19 A.L.R. 320 ; 38 A.L.R. 90 ; 48 A.L.R. 479 ; 56 A.L.R. 207 ; 62 A.L.R. 738 .

Waiver of right of government to preference in the assets of insolvent debtor by taking security, 24 A.L.R. 1495 ; 83 A.L.R. 1119 .

Priority as between different assignees of same chose in action as affected by notice to debtor, 31 A.L.R. 876 ; 110 A.L.R. 774 .

Power of municipality to transfer or assign its right to enforce assessment or lien for local improvements, 55 A.L.R. 667 .

Payment of depositor’s check after insolvency of bank as an unlawful preference, 74 A.L.R. 937 .

Debtor’s return of merchandise to selling creditor for credit as preferential transfer voidable in bankruptcy proceedings, 62 A.L.R.2d 774.

Validity of provision in deed or transfer to assignee for benefit of creditors for payment of attorneys’ fees, 79 A.L.R.2d 513.

JUDICIAL DECISIONS

Even an insolvent debtor may prefer one creditor to another, and to this end the debtor may transfer choses in action as collateral security for preexisting debt, surplus in such case not being reserved for the debtor’s own benefit. Suttles v. Vickery, 179 Ga. 751 , 177 S.E. 714 , 1934 Ga. LEXIS 395 (1934).

Mere pendency of suit against debtor does not extinguish the debtor’s right to prefer one creditor over another, and in such case, controlling question is “existence or nonexistence of fraud in the transfer.” Suttles v. Vickery, 179 Ga. 751 , 177 S.E. 714 , 1934 Ga. LEXIS 395 (1934).

Assignment to be made in good faith and not benefit debtor. —

Debtor is permitted to prefer one creditor over another and to make assignments to that end, so long as the transfer is made in good faith and does not benefit the debtor. Bank of Cave Spring v. Gold Kist, Inc., 173 Ga. App. 679 , 327 S.E.2d 800 , 1985 Ga. App. LEXIS 2666 (1985).

Effect of assignment prior to service of summons of garnishment. —

If assignment is made before service of summons of garnishment upon drawee, garnishing creditor will be postponed to assignee, and this is so whether or not garnishee was notified of assignment. Suttles v. Vickery, 179 Ga. 751 , 177 S.E. 714 , 1934 Ga. LEXIS 395 (1934).

Sufficient consideration to support equitable and legal assignments to secure preexisting indebtedness. —

Suttles v. Vickery, 179 Ga. 751 , 177 S.E. 714 , 1934 Ga. LEXIS 395 (1934).

RESEARCH REFERENCES

Am. Jur. 2d.

21 Am. Jur. 2d, Creditor’s Bills, §§ 35, 79.

C.J.S.

21 C.J.S., Creditor and Debtor, § 3 et seq.

ALR.

Priority as between different assignees of same chose in action as affected by notice to debtor, 31 A.L.R. 876 ; 110 A.L.R. 774 .

Preference in event of debtor’s insolvency in respect of funds designated or set apart by him for payment of specified obligations, 32 A.L.R. 950 .

Right of debtor who pays creditor to control application of payments made by latter to his creditor with proceeds of original payment, 41 A.L.R. 1297 ; 130 A.L.R. 198 ; 166 A.L.R. 641 .

Debtor’s return of merchandise to selling creditor for credit as preferential transfer voidable in bankruptcy proceedings, 62 A.L.R.2d 774.

Validity of provision in deed or transfer to assignee for benefit of creditors for payment of attorneys’ fees, 79 A.L.R.2d 513.

JUDICIAL DECISIONS

Description of nature of debts in schedule. —

Assignors’ schedule of creditors need not describe nature and character of debts; if the schedule sets forth in detail the name of, amount due to, and residence of each of the creditors of assignors, no further description of the debts is required. Stultz & Blair v. Fleming & Bussey, 83 Ga. 14 , 9 S.E. 1067 , 1889 Ga. LEXIS 2 (1889).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Assignments for Benefit of Creditors, §§ 4, 5, 47.

C.J.S.

21 C.J.S., Creditor and Debtor, § 5 et seq.

ALR.

Conflict of laws as regards validity of fraudulent and preferential transfers and assignments, 111 A.L.R. 787 .

Valuation of notes and accounts receivable in determining question of insolvency or bankruptcy, 133 A.L.R. 1274 .

Creditor’s knowledge of preference, or of debtor’s insolvency, under § 60(b) of Bankruptcy Act, as indicated by receipt of property in payment of debt, 88 A.L.R.2d 1050.

RESEARCH REFERENCES

ALR.

What language in conveyance or contract amounts to assumption of mortgage by grantee, 101 A.L.R. 281 .

Release of vendee (or intermediate assignee of vendee’s interest) by subsequent dealings between assignee and vendor, 125 A.L.R. 979 .

RESEARCH REFERENCES

ALR.

The fact that the parties to a conveyance in fraud of creditors are not in pari delicto as affecting the right of the party guilty of fraud to relief, 7 A.L.R. 150 .

Who may take affidavit as basis for warrant of arrest, 16 A.L.R. 923 .

Conveyance in consideration of future support as fraudulent against creditors, 23 A.L.R. 584 .

Imputation of agent’s knowledge to bankrupt or to creditor as satisfying conditions of provisions of Bankruptcy Act excepting unscheduled debts from discharge, 134 A.L.R. 185 .

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, annotations decided under former Ga. L. 1880-81, p. 174 and Ga. L. 1884-85, p. 100 have been included in the annotations for this Code section.

Construction of Act. —

Former Ga. L. 1880-81, p. 174 was remedial in nature and should be strictly construed against the assignor and assignee, and liberally in favor of the creditors. Turnipseed v. Schaefer, 76 Ga. 109 , 1886 Ga. LEXIS 1 (1886) (decided under former Ga. L. 1880-81, p. 174).

Effect of noncompliance. —

Former Ga. L. 1880-81, p. 174 was mandatory and assignment by an insolvent debtor for the benefit of creditors is void and conveyed no title when no schedule or inventory was attached to the deed of assignment. Crittenden Bros. v. Coleman & Co., 70 Ga. 293 , 1883 Ga. LEXIS 324 (1883); Crittenden Bros. v. Coleman & Co., 74 Ga. 331 , 1884 Ga. LEXIS 378 (1884) (decided under former Ga. L. 1880-81, p. 174).

Annexed schedules are not part of the contract. Birdseye v. Underhill, 82 Ga. 142 , 7 S.E. 863 , 1888 Ga. LEXIS 375 (1888) (decided under former Ga. L. 1880-81, p. 174).

Specificity of schedules. —

It is essential to rights of creditors that schedule of property assigned be made out specifically, so that it may be seen if assignment covers property sold by them, and whether, by reason of fraud in debtor, they can claim title thereto. Crittenden Bros. v. Coleman & Co., 70 Ga. 293 , 1883 Ga. LEXIS 324 (1883) (decided under former Ga. L. 1880-81, p. 174).

Inventory and schedule need not state values of property listed. —

It is not essential to validity of deed of assignment that values should be affixed to items of property included in inventory and schedule thereto attached. Anthony v. Price & Maas, 92 Ga. 170 , 17 S.E. 1024 , 1893 Ga. LEXIS 37 (1893) (decided under former Ga. L. 1880-81, p. 174).

Intention to defraud by material omissions from schedule. —

See Wood & Lovingood v. Haynes, Henson & Co., 92 Ga. 180 , 18 S.E. 47 , 1893 Ga. LEXIS 38 (1893) (decided under former Ga. L. 1880-81, p. 174).

Omission from schedule of property assigned of a right of redemption. —

When one who made a voluntary assignment for the benefit of creditors omitted from schedule attached thereto the right of redemption which that person had in certain premises which the person conveyed for security of a debt, such omission was fatal to the assignment. McMillan v. Knapp, 76 Ga. 171 , 1886 Ga. LEXIS 3 (1886) (decided under former Ga. L. 1880-81, p. 174).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Assignments for Benefit of Creditors, §§ 4, 5.

ALR.

Imputation of agent’s knowledge to bankrupt or to creditor as satisfying conditions of provisions of Bankruptcy Act excepting unscheduled debts from discharge, 134 A.L.R. 185 .

Bankrupt’s right to object to allowance of claims, 64 A.L.R.2d 889.

RESEARCH REFERENCES

C.J.S.

21 C.J.S., Creditor and Debtor, § 5 et seq.

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Assignments for Benefit of Creditors, § 117.

C.J.S.

21 C.J.S., Creditor and Debtor, § 5 et seq.

JUDICIAL DECISIONS

Later change in law. —

Assignment contrary to law at time it was made is void, although law was afterwards altered. Mason & Fant v. S. Stricker & Co., 37 Ga. 262 , 1867 Ga. LEXIS 155 (1867).

Situs of debt follows creditor, and law of creditor’s domicile prevails where creditor and debtor are residents of different states. Birdseye v. Underhill, 82 Ga. 142 , 7 S.E. 863 , 1888 Ga. LEXIS 375 (1888).

RESEARCH REFERENCES

C.J.S.

21 C.J.S., Creditor and Debtor, § 42.

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Assignments for Benefit of Creditors, §§ 4, 5.

C.J.S.

21 C.J.S., Creditor and Debtor, § 45.

ALR.

Power, after institution of bankruptcy proceedings, of court in which receivership or assignment proceedings have previously begun, to allow or pay fees or other compensation or expenses connected therewith, 90 A.L.R. 1217 .

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Assignments for Benefit of Creditors, § 90 et seq.

C.J.S.

21 C.J.S., Creditor and Debtor, §§ 14, 50 et seq.

ALR.

Preference in event of debtor’s insolvency in respect of funds designated or set apart by him for payment of specified obligations, 32 A.L.R. 950 .

JUDICIAL DECISIONS

Assignee for creditors can sue on account included in deed of assignment for use of purchaser. —

Trustee or assignee holding legal title to choses in action under valid deed of assignment for benefit of creditors can sue for amount of an account included in such assignment for use of one who purchased the account at public sale held by that person as such trustee or assignee. May v. McCarty, 11 Ga. App. 454 , 75 S.E. 672 , 1912 Ga. App. LEXIS 50 (1912).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Assignments for Benefit of Creditors, § 90 et seq.

C.J.S.

21 C.J.S., Creditor and Debtor, § 14, 50 et seq.

ALR.

The fact that parties to a conveyance in fraud of creditors are not in pari delicto as affecting the right of the party guilty of fraud to relief, 7 A.L.R. 150 .

Conveyance in consideration of future support as fraudulent against creditors, 23 A.L.R. 584 .

Preference in event of debtor’s insolvency in respect of funds designated or set apart by him for payment of specified obligations, 32 A.L.R. 950 .

Absolute conveyance or transfer with secret reservation as fraudulent per se as against creditors, 68 A.L.R. 306 .

Assignees for creditors as within protection of statute requiring filing or recording of conditional-sale contract or chattel mortgage, 71 A.L.R. 981 .

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, decisions under former Ga. L. 1884-85, p. 100, are included in the annotations for this Code section.

Complainants attacking assignment as fraudulent could proceed without first reducing complainants’ claims to judgment. Burns v. Beck, 83 Ga. 471 , 10 S.E. 121 , 1889 Ga. LEXIS 98 (1889) (decided under former Ga. L. 1884-85, p. 100, No. 429).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Assignments for Benefit of Creditors, § 116.

C.J.S.

21 C.J.S., Creditor and Debtor, § 78 et seq. 37 C.J.S., Fraudulent Conveyances, § 150 et seq.

ALR.

Priority of assignment of chose in action over subsequent garnishment as affected by lack of notice to debtor of assignment, 52 A.L.R. 109 .

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Assignments for Benefit of Creditors, § 117.

C.J.S.

37 C.J.S., Fraudulent Conveyances, § 179 et seq.

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Assignments for Benefit of Creditors, § 116.

C.J.S.

21 C.J.S., Creditor and Debtor, §§ 69, 78 et seq. 37 C.J.S., Fraudulent Conveyances, § 150 et seq.

ALR.

The fact that parties to a conveyance in fraud of creditors are not in pari delicto as affecting the right of the party guilty of fraud to relief, 7 A.L.R. 150 .

Conveyance in consideration of future support as fraudulent against creditors, 23 A.L.R. 584 .

Absolute conveyance or transfer with secret reservation as fraudulent per se as against creditors, 68 A.L.R. 306 .

RESEARCH REFERENCES

C.J.S.

37 C.J.S., Fraudulent Conveyances, § 170 et seq.

ALR.

Death of principal defendant as abating or dissolving garnishment or attachment, 21 A.L.R. 272 ; 131 A.L.R. 1146 .

Right of creditors in respect of property gratuitously conveyed or transferred to a third person for alleged benefit of debtor, 147 A.L.R. 1160 .

JUDICIAL DECISIONS

When trustee failed to appoint successor. —

When property was devised to named trustee with power to appoint trustee’s own successor, but trustee died without exercising this power, judge of superior court was authorized to appoint trustee. White v. McKeon, 92 Ga. 343 , 17 S.E. 283 , 1893 Ga. LEXIS 75 (1893).

When trustee of naked trust died, judge might appoint successor, who could maintain ejectment on title. Logan v. Goodall, 42 Ga. 95 , 1871 Ga. LEXIS 16 (1871).

Power to appoint when trust was executed by children reaching majority. —

When trust was executed by children reaching majority, a judge did not have power, on resignation of trustees after death of grantor, to appoint a successor in trust for the children. Milledge v. Bryan, 49 Ga. 397 , 1873 Ga. LEXIS 386 (1873).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Assignments for Benefit of Creditors, § 86.

C.J.S.

21 C.J.S., Creditor and Debtor, § 43 et seq.

ALR.

Death of principal defendant as abating or dissolving garnishment or attachment, 21 A.L.R. 272 ; 131 A.L.R. 1146 .

Jurisdiction to garnish debt as affected by previous assignment by principal defendant to a nonresident served constructively, 39 A.L.R. 1465 .

JUDICIAL DECISIONS

Claims under former O.C.G.A. § 18-2-22 not extinguished. —

O.C.G.A. § 18-2-22 was repealed on July 1, 2002, when Georgia enacted the Uniform Fraudulent Transfers Act (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., but this repeal does not extinguish causes of action that arose under former O.C.G.A. § 18-2-22 before that date. Gerschick v. Pounds, 281 Ga. App. 531 , 636 S.E.2d 663 , 2006 Ga. App. LEXIS 940 (2006), cert. denied, No. S07C0191, 2007 Ga. LEXIS 95 (Ga. Jan. 8, 2007).

Conveyance at issue took place in September 2001 and needed to be construed under former O.C.G.A. § 18-2-22 (repealed) even though the statute was repealed when the legislature adopted the Uniform Fraudulent Transfer Act (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq. Flatau v. Smith (In re Smith), No. 07-50410-JDW, No. 07-5062, 2007 Bankr. LEXIS 3825 (Bankr. M.D. Ga. Oct. 30, 2007).

Defendant did not have to be indebted to plaintiff. —

Read and considered as a whole, a jury charge was an accurate statement of the law and was authorized by the evidence in an action in which the jury was instructed that it was not necessary for a defendant to be indebted to a plaintiff at the time of a transfer for former O.C.G.A. § 18-2-22 to apply and there was evidence that an attorney made a conveyance with actual intent to defraud a future creditor, a client; moreover, the trial court fully and completely charged the law on fraudulent conveyances, including former O.C.G.A. § 18-2-22 (2). Gerschick v. Pounds, 281 Ga. App. 531 , 636 S.E.2d 663 , 2006 Ga. App. LEXIS 940 (2006), cert. denied, No. S07C0191, 2007 Ga. LEXIS 95 (Ga. Jan. 8, 2007).

Aiding and abetting. —

Although Georgia courts had not yet had an opportunity to address the issue of whether there was a cause of action for aiding and abetting a fraudulent transfer when the alleged aider-abetter was not a debtor or a transferee, the instant court concluded that Georgia courts were not likely to recognize such an action; the Uniform Fraudulent Transfer Act (UFTA) (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., did not refer to parties other than debtors, creditors, and transferees, and further there was no language in UFTA that suggested the creation of a distinct cause of action for aiding and abetting claims against non-transferees. Hays v. Paul, Hastings, Janofsky & Walker LLP, No. 1:06-CV-754-CAP, 2006 U.S. Dist. LEXIS 95849 (N.D. Ga. Sept. 14, 2006).

No-action clause. —

Claims by noteholders under the Uniform Fraudulent Transfers Act (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., against a corporation and the corporate directors and officers should have been dismissed by the district court because a no-action clause in trust indentures that governed the notes barred the noteholders’ claims since the noteholders did not fall within any exception to the rule that no-action clauses barred fraudulent conveyance claims; the appellate court had jurisdiction to grant permission to appeal to all appellants because both prongs of 28 U.S.C. § 1292(b) had been satisfied, which was that the district court had stated the required language in the court’s order and the appellants had then filed an application for interlocutory appeal within ten days of that statement. Akanthos Capital Mgmt., LLC v. CompuCredit Holdings Corp., 677 F.3d 1286, 2012 U.S. App. LEXIS 8359 (11th Cir. 2012).

Motion for summary judgment denied. —

Summary judgment motion filed by an insurer in response to a Chapter 7 trustee’s complaint charging that certain premiums paid to the insurer by a debtor were fraudulent conveyances that were recoverable under 11 U.S.C. § 548 and/or under Georgia’s Uniform Fraudulent Transfers Act (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., was denied because the case presented significant factual issues concerning the legal relationships between the debtor and the entities on behalf of which the debtor had paid the premiums and the presence of such issues foreclosed summary judgment. Coleman v. Zurich Am. Ins. Co. (In re Darrow Auto. Group, Inc.), No. 09-11228, No. 10-01078, 2011 Bankr. LEXIS 5253 (Bankr. S.D. Ga. Mar. 29, 2011).

Trial court erred by denying an insurance company’s motion for summary judgment on a claim that the company engaged in a conspiracy which violated the Uniform Fraudulent Transfers Act (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., by a conspiracy to settle a bad faith/negligence claim possessed by an estate for less than the claim’s true value because the insurer was found not to have engaged in fraudulent conduct. Baker v. Huff, 323 Ga. App. 357 , 747 S.E.2d 1 , 2013 Ga. App. LEXIS 590 (2013), cert. denied, No. S13C1799, 2014 Ga. LEXIS 149 (Ga. Feb. 24, 2014), cert. denied, No. S13C1798, 2014 Ga. LEXIS 155 (Ga. Feb. 24, 2014).

Motion for directed verdict properly denied. —

Attorney and a wife’s motion for a directed verdict was properly denied as a party bringing a fraudulent conveyance action under former O.C.G.A. § 18-2-22 did not have to be a creditor; the circumstances and the timing of the transfer showed the attorney’s intent to defraud as a quitclaim deed from the attorney to the wife was “rush recorded” two days after the attorney received a draft order for the underlying judgment, no valuable consideration was given for the transfer, and the attorney was an expert in estate planning, including the protection of assets from the claims of creditors. Gerschick v. Pounds, 281 Ga. App. 531 , 636 S.E.2d 663 , 2006 Ga. App. LEXIS 940 (2006), cert. denied, No. S07C0191, 2007 Ga. LEXIS 95 (Ga. Jan. 8, 2007).

Case improperly dismissed for failure to state a claim. —

Trial court erred in granting the defendants’ motion to dismiss for failure to state a claim because it was too soon in the case to conclude, as a matter of law, that the plaintiffs could not present evidence satisfying the statutory elements of O.C.G.A. § 18-2-70 et. seq., seeking to void the transfer of assets. Lyle v. Fulcrum Loan Holdings, 354 Ga. App. 742 , 841 S.E.2d 182 , 2020 Ga. App. LEXIS 190 (2020), cert. denied, No. S20C1327, 2020 Ga. LEXIS 789 (Ga. Oct. 19, 2020), cert. denied, No. S20C1103, 2020 Ga. LEXIS 787 (Ga. Oct. 19, 2020).

Transfer to avoid bankruptcy ramifications. —

Under former O.C.G.A. § 18-2-22 (repealed), a wife’s motion to dismiss a claim brought by a Chapter 7 trustee to avoid a transfer made to her by a debtor husband was denied because the trustee, through the complaint and use of a quitclaim deed, provided a factual basis sufficient to state a claim including some evidence that the transfer was made for no consideration, that the transfer was voluntary, and that the wife knew of the debtor’s insolvency at the time the transfer was made. Flatau v. Smith (In re Smith), No. 07-50410-JDW, No. 07-5062, 2007 Bankr. LEXIS 3825 (Bankr. M.D. Ga. Oct. 30, 2007).

Fraudulent transfer not predicate act under RICO. —

Trial court erred by failing to dismiss the plaintiff’s claim for theft as a predicate offense under the Georgia RICO statute, O.C.G.A. § 16-14-1 et seq., because a fraudulent transfer was not an enumerated predicate offense under the Georgia RICO statute, but instead, a civil tort governed by the Uniform Voidable Transactions Act, O.C.G.A. § 18-2-70 . Z-Space, Inc. v. Dantanna's CNN Center, LLC, 349 Ga. App. 248 , 825 S.E.2d 628 , 2019 Ga. App. LEXIS 142 (2019).

Transfer was not fraudulent. —

When a corporation paid a dividend to a shareholder pursuant to a shareholders agreement after designating itself an S corporation, it was not a fraudulent transfer because it was not error to find that the transfer was made in exchange for reasonably equivalent value since the shareholders agreement provided the corporation with valuable benefits by virtue of its S-corporation election. Crumpton v. McGarrity (In re Northlake Foods, Inc.), 518 Fed. Appx. 604, 2013 U.S. App. LEXIS 7578 (11th Cir. 2013).

No fraud shown by developer. —

In an action brought by the purchasers of a lot seeking to cancel the developer’s security deed based upon alleged fraud, the trial court properly granted summary judgment to the developer as, even if the developer knew of the sale of the lot to the purchasers, such sale did not estop the developer from the developer’s claim against the lot pursuant to the developer’s security deed; however, the trial court did err by denying the equitable subrogation claim asserted by the purchasers’ lender since exercising subrogation did not prejudice the developer in any manner. Byers v. McGuire Props., 285 Ga. 530 , 679 S.E.2d 1 , 2009 Ga. LEXIS 243 (2009), overruled, SRM Group, Inc. v. Travelers Prop. Cas. Co. of Am., 308 Ga. 404 , 841 S.E.2d 729 , 2020 Ga. LEXIS 235 (2020).

Judgment creditor could not set aside fraudulent transfer that occurred prior to assignment of loan. —

Because of the anti-assignment statute, O.C.G.A. § 44-12-24 , a judgment creditor did not have standing under the Uniform Fraudulent Transfers Act (UFTA), O.C.G.A. § 18-2-70 et seq., to contest transfers by the debtor that occurred prior to assignment of the debtor’s loan to the creditor. Merrill Ranch Props., LLC v. Austell, 336 Ga. App. 722 , 784 S.E.2d 125 , 2016 Ga. App. LEXIS 197 (2016), cert. denied, No. S16C1438, 2016 Ga. LEXIS 721 (Ga. Oct. 31, 2016).

No asset of debtor involved. —

Judgment voiding a transfer of property as fraudulent under the Uniform Fraudulent Transfers Act (UFTA) (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., was reversed because, despite not being recorded, the 2002 security deed executed in favor of a former sister-in-law, pledging the property as collateral for a promissory note, gave the former sister-in-law, as one of the defendant’s creditors, priority over the plaintiff’s judgment, such that the property could not be characterized as the defendant’s asset under the UFTA. Wallin v. Wallin, 341 Ga. App. 440 , 800 S.E.2d 617 , 2017 Ga. App. LEXIS 218 (2017).

No property transfer involved. —

Trial court correctly granted summary judgment in favor of the defendants as to the plaintiff’s fraud counts pursuant to the Uniform Fraudulent Transfers Act (UFTA), O.C.G.A. § 18-2-70 et seq., because the UFTA explicitly requires a transfer of an asset, which is defined as certain forms of property and neither defending entity owned property in that classic sense, thus, the UFTA was not the appropriate vehicle for the plaintiff’s recovery. Dan J. Sheehan Co. v. Fairlawn on Jones Condo. Ass'n, Inc., 334 Ga. App. 595 , 780 S.E.2d 35 , 2015 Ga. App. LEXIS 685 (2015), cert. denied, No. S16C0473, 2016 Ga. LEXIS 217 (Ga. Mar. 7, 2016).

Broker-dealer was entitled to summary judgment on customers’ claims because another broker-dealer did not fraudulently transfer assets to the broker-dealer before going out of business as the customer accounts of registered representatives were not assets of the other broker-dealer in that the registered representatives were independent contractors who used the other broker-dealer’s platform. The other broker-dealer merely facilitated the transfer of the registered representatives and customer accounts to the broker-dealer. King v. Kovack Secs., No. 1:18-CV-04079-SCJ, 2021 U.S. Dist. LEXIS 212142 (N.D. Ga. Sept. 28, 2021).

Fraudulent conveyance claim not stated. —

Administrator failed to state a claim under the Georgia Uniform Fraudulent Transfer Act, now Uniform Voidable Transactions Act, O.C.G.A. § 18-2-70 et seq., against group three when the administrator alleged that defendant one held title to the property when the suit was filed, and claimed that the administrator was entitled to recover the property from defendant one and to set aside the lien to defendant two; the administrator acknowledged that defendants three, four, and five denied any knowledge of the administrator’s lien on the property when they purchased the property, and that therefore no one disclosed the lien to the closing attorney or defendants three, four, and five, despite certain parties’ knowledge and affirmative duty to disclose the existence of the writ as constituting a lien on the property. Huggins v. Powell, 315 Ga. App. 599 , 726 S.E.2d 730 , 2012 Ga. App. LEXIS 348 (2012).

Choice of law. —

In a fraudulent conveyance action transferred from the Northern District of Texas, Georgia’s former fraudulent conveyance law, former O.C.G.A. § 18-2-22 , which was in force at the time the actions in question occurred, was the applicable state law under Texas choice of law principles because Georgia had the most significant relationship to the issues raised in the lawsuit. MC Asset Recovery v. Southern Co., No. 1:06-CV-0417-BBM, 2008 U.S. Dist. LEXIS 123609 (N.D. Ga. Apr. 1, 2008).

Damages. —

Georgia law allowing the recovery of general and punitive damages for fraudulent conveyances survived the enactment of Georgia’s Uniform Fraudulent Transfers Act, O.C.G.A. § 18-2-70 et seq. Interfinancial Midtown, Inc. v. Choate Constr. Co., 343 Ga. App. 793 , 806 S.E.2d 255 , 2017 Ga. App. LEXIS 479 (2017).

RESEARCH REFERENCES

Am. Jur. 2d.

37A Am. Jur. 2d, Fraudulent Conveyances and Transfers, § 2.

ALR.

Uniform Voidable Transactions Act, 50 A.L.R.7th Art. 5.

JUDICIAL DECISIONS

Transfer. —

Definition of a “transfer” is broad enough to encompass a co-owner’s withdrawal of funds from a joint bank account. Bishop v. Patton, 288 Ga. 600 , 706 S.E.2d 634 , 2011 Ga. LEXIS 151, overruled in part, SRB Inv. Servs., LLLP v. Branch Banking & Trust Co., 289 Ga. 1 , 709 S.E.2d 267 , 2011 Ga. LEXIS 270 (2011).

Debtor was entitled to summary judgment with respect to an adversary complaint count alleging fraudulent transfer of property under the Georgia Uniform Fraudulent Transfer Act (UFTA) (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., because the transfer of property fully protected the plaintiffs’ liens and, therefore, there was no “asset” and no claim for fraudulent conveyance existed. SEG Gateway, LLC v. Bay Circle Props., LLC (In re Bay Circle Props., LLC), No. 15-58440-WLH, No. 16-05334-WLH, 2017 Bankr. LEXIS 2159 (Bankr. N.D. Ga. Aug. 1, 2017).

When a minor, by and through the minor’s parent and guardian, appealed the trial court’s denial of the minor’s motion for summary judgment on the minor’s claim for fraudulent transfer under the Uniform Voidable Transactions Act (UVTA), O.C.G.A. § 18-2-70 et seq., against the minor’s grandfather, the trial court erred in finding that the UVTA could never be used to set aside the terms of a previously entered divorce decree because the plain language of the UVTA supported the conclusion that the equitable division of assets within a divorce decree was a transfer within the UVTA. Enlow v. Enlow, 352 Ga. App. 865 , 836 S.E.2d 128 , 2019 Ga. App. LEXIS 653 (2019).

Defendants’ claim that there was no antecedent debt at the time of the November 2014 transfers was unsupported by the record as the bank and/or its predecessors-in-interest held a right to payments under the terms of the February 2012 promissory note and the obligation to make such payments extended to the debtor no later than April 2014. Tuggle v. Ameris Bank, 363 Ga. App. 600 , 872 S.E.2d 1 , 2022 Ga. App. LEXIS 183 (2022).

Property. —

Defendants’ transferring of corporate goodwill, or “book of business,” to another entity was a transfer of property under the broad definition of property in Georgia’s fraudulent transfer law. Jones v. Tauber & Balser, P.C., 503 Bankr. 162, 2013 U.S. Dist. LEXIS 173255 (N.D. Ga.), modified, 503 Bankr. 510, 2013 U.S. Dist. LEXIS 173214 (N.D. Ga. 2013).

Broker-dealer was entitled to summary judgment on customers’ claims because another broker-dealer did not fraudulently transfer assets to the broker-dealer before going out of business as the customer accounts of registered representatives were not assets of the other broker-dealer in that the registered representatives were independent contractors who used the other broker-dealer’s platform. The other broker-dealer merely facilitated the transfer of the registered representatives and customer accounts to the broker-dealer. King v. Kovack Secs., No. 1:18-CV-04079-SCJ, 2021 U.S. Dist. LEXIS 212142 (N.D. Ga. Sept. 28, 2021).

Summary judgment improper. —

Trial court erred by granting summary judgment to a creditor because under O.C.G.A. § 18-2-75(b) , the questioned real estate transfer involved the debtor purchasing the property for the debtor’s mother because the debtor had the right to purchase the property and it was only deeded to the debtor briefly the same day, which transfer was not to satisfy an antecedent debt, thus, no fraudulent transfer occurred. Truelove v. Buckley, 318 Ga. App. 207 , 733 S.E.2d 499 , 2012 Ga. App. LEXIS 879 (2012), cert. denied, No. S13C0374, 2013 Ga. LEXIS 345 (Ga. Apr. 15, 2013).

Transferees were not entitled to summary judgment on a Chapter 7 trustee’s claim to avoid transfers as actually fraudulent under the Bankruptcy Code and Georgia law as the transferees failed to demonstrate by either affirmative evidence or by pointing to lack of evidence that the trustee could not carry the trustee’s burden at trial regarding the debtor’s intent to transfer the debtor’s assets. Rather, several badges of fraud existed, including that the debtor made the transfer to an insider (a company wholly owned by a director of the debtor who owned more than 20 percent of the stock of the debtor) and that the transfer was made for the purpose of satisfying an antecedent debt owed to an insider. Howell v. Fulford (In re Southern Home & Ranch Supply, Inc.), 515 Bankr. 699, 2014 Bankr. LEXIS 3493 (Bankr. N.D. Ga. 2014).

RESEARCH REFERENCES

C.J.S.

37 C.J.S., Fraudulent Conveyances, § 5.

JUDICIAL DECISIONS

Determining the date of insolvency for purposes of a breach of trust claim under Georgia’s common law did not require the application of an insolvency standard differing significantly from the fair valuation standard under O.C.G.A. § 18-2-72 . Post-Confirmation Comm. for Small Loans, Inc. v. Martin, No. 1:13-CV-195, 2016 U.S. Dist. LEXIS 76294 (M.D. Ga. June 13, 2016).

Insolvency resulting in constructive fraud pled. —

Actual fraud was adequately pled by alleging badges of fraud sufficient to infer the fraudulent nature of transfers to insiders; moreover, insolvency resulting in constructive fraud also was adequately pled. Ralls Corp. v. Huerfano River Wind, LLC, 27 F. Supp. 3d 1303, 2014 U.S. Dist. LEXIS 87414 (N.D. Ga. 2014).

Judgment against debtor. —

Debtor’s transfer of real property to the debtor’s spouse, a default judgment in a lawsuit, which the trustee claimed rendered the debtor insolvent, in which the spouse did not participate and which was filed after the transfer did not prove the debtor’s insolvency at the time of the transfer for purposes of former O.C.G.A. § 18-2-22(3); the spouse’s status as the debtor’s spouse, standing alone, did not establish privity with the debtor, and the judgment against the debtor did not bind the spouse. Thurmond v. Turner (In re Turner), No. 00-72597-PWB, No. 02-6433, 2006 Bankr. LEXIS 2745 (Bankr. N.D. Ga. Sept. 19, 2006).

Insolvency determination. —

Trial court did not err in ruling that the debtor was insolvent following the transfers of properties as the debtor acknowledged a past-due debt and lack of liquid assets as of the date of the property transfers. Tuggle v. Ameris Bank, 363 Ga. App. 600 , 872 S.E.2d 1 , 2022 Ga. App. LEXIS 183 (2022).

RESEARCH REFERENCES

Am. Jur. 2d.

37 Am. Jur. 2d, Fraudulent Conveyances and Transfers, § 18 et seq.

C.J.S.

37 C.J.S., Fraudulent Conveyances, § 63 et seq.

JUDICIAL DECISIONS

Antecedent debt. —

Fraudulent transfer claims involving evidence of several badges of fraud survived summary judgment; the equitable doctrine of earmarking was inapplicable because apportionment of the debtor’s estate was not at issue, the in pari delicto defense was inapplicable because liquidators were pursuing the fraudulent transfer claims for the benefit of innocent creditors, and factual issues existed as to whether payment on an antecedent debt was actual value. Am. Pegasus SPC v. Clear Skies Holding Co., LLC, No. 1:13-CV-03035-ELR, 2015 U.S. Dist. LEXIS 189547 (N.D. Ga. Sept. 22, 2015).

RESEARCH REFERENCES

Am. Jur. 2d.

37 Am. Jur. 2d, Fraudulent Conveyances and Transfers, § 25 et seq.

C.J.S.

37 C.J.S., Fraudulent Conveyances, § 78 et seq.

JUDICIAL DECISIONS

Analysis

• General Considerations
• Procedures
• Bankruptcy
• Application

RESEARCH REFERENCES

C.J.S.

37 C.J.S., Fraudulent Conveyances, § 74 et seq.

JUDICIAL DECISIONS

Transfer of property set aside. —

Debtor’s transfer of property to the debtor’s daughter, without consideration, was properly set aside since the deed was recorded nearly 18 months after the deed was signed, recorded the day after the appellate court entered judgment on the case, the debtor continued to occupy the property without paying rent, and the debtor disposed of assets worth at least $500,000 in the seven months after the deed was recorded, leading to the debtor’s insolvency. Kent v. A.O. White, Jr., Consulting Eng'r, Inc., 279 Ga. App. 563 , 631 S.E.2d 782 , 2006 Ga. App. LEXIS 639 (2006), cert. denied, No. S06C1710, 2006 Ga. LEXIS 790 (Ga. Oct. 2, 2006).

After the debtor transferred funds to the debtor’s sister, who had ownership, dominion and control over the funds, the sister was a transferee under 11 U.S.C. § 550 , and the funds were recoverable as a fraudulent conveyance under 11 U.S.C. § 544 and O.C.G.A. § 18-2-75 . Ogier v. Braswell (In re Clark), 435 Bankr. 753, 2009 Bankr. LEXIS 3294 (Bankr. N.D. Ga. 2009).

When an investor asserted fraudulent transfer and related claims against accounts in the names of the former wife and widow of a consultant who allegedly defrauded the investor, the claims survived a motion to dismiss because the investor: (1) stated viable claims; (2) did not have to anticipate affirmative defenses; and (3) did not admit such defenses. Speedway Motorsports, Inc. v. Pinnacle Bank, 315 Ga. App. 320 , 727 S.E.2d 151 , 2012 Ga. App. LEXIS 366 (2012), cert. denied, No. S12C1329, 2013 Ga. LEXIS 50 (Ga. Jan. 7, 2013).

Evidence that a corporation was insolvent at the time the corporation made payments in the amount of $248,367 to each of two principals, and that the corporation did not receive reasonably equivalent value for the payments, was sufficient to show that the payments were constructively fraudulent and could be recovered for the corporation’s bankruptcy estate under 11 U.S.C. § 544 and O.C.G.A. § 18-2-75 ; although the principals claimed that the payments were due on a loan the principals made to the corporation and that the principals returned some payments to the corporation’s accounts, there was no evidence supporting the principal’s claims. Anderson v. Patel (In re Diplomat Constr., Inc.), No. 09-68613-MGD, No. 11-5609, 2013 Bankr. LEXIS 4303 (Bankr. N.D. Ga. Aug. 26, 2013).

No property transfer involved. —

Trial court correctly granted summary judgment in favor of the defendants as to the plaintiff’s fraud counts pursuant to the Uniform Fraudulent Transfers Act (UFTA) (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., because the UFTA explicitly requires a transfer of an asset, which is defined as certain forms of property and neither defending entity owned property in that classic sense; thus, the UFTA was not the appropriate vehicle for the plaintiff’s recovery. Dan J. Sheehan Co. v. Fairlawn on Jones Condo. Ass'n, Inc., 334 Ga. App. 595 , 780 S.E.2d 35 , 2015 Ga. App. LEXIS 685 (2015), cert. denied, No. S16C0473, 2016 Ga. LEXIS 217 (Ga. Mar. 7, 2016).

Reasonably equivalent value. —

Debtor’s twice monthly $1833 payments to the defendant in exchange for regular, hotel managerial services did not constitute avoidable fraudulent transfers under O.C.G.A. §§ 18-2-74(a)(2)(B) and 18-2-75 because the defendant’s work for the debtor constituted reasonably equivalent value in exchange for the payments. Anderson v. Patel (In re Diplomat Constr., Inc.), No. 09-68613-MGD, No. 11-5611, 2013 Bankr. LEXIS 4297 (Bankr. N.D. Ga. Aug. 6, 2013).

Trial court did not err in ruling that the transfers of the properties for one dollar and love and affection were not for reasonably equivalent value under the Georgia Uniform Fraudulent Transfers Act, O.C.G.A. § 18-2-7 et seq., as the UFTA’s purpose was to protect creditors from the depletion of the debtor’s estate to the prejudice of unsecured creditors. Tuggle v. Ameris Bank, 363 Ga. App. 600 , 872 S.E.2d 1 , 2022 Ga. App. LEXIS 183 (2022).

In a voidable-transaction action, the CEO attested that company defendants lost money on the transaction, and the landlord did not set forth facts rebutting those assertions, or facts showing that transaction of paying all for utilizing the debtor’s numbers in exchange for 98 percent of revenue, was not for reasonably equivalent value. Windward Campus Owner, LLC v. Good Night Med. of Ohio, LLC, 363 Ga. App. 177 , 871 S.E.2d 36 , 2022 Ga. App. LEXIS 135 (2022).

Failure to offer evidence of value. —

Transferees were not entitled to summary judgment on a Chapter 7 trustee’s constructive fraud claims under the Bankruptcy Code and Georgia law as the transferees failed to offer any evidence of the value of the collateral at issue and, thus, the trustee’s evidence created a question of fact. Howell v. Fulford (In re Southern Home & Ranch Supply, Inc.), 515 Bankr. 699, 2014 Bankr. LEXIS 3493 (Bankr. N.D. Ga. 2014).

Transfers not made by debtor not subject to attack. —

Judgment creditor could seek relief under the Uniform Fraudulent Transfers Act (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., against the judgment debtor and transferees, but it could not pursue the judgment debtor’s mother and sister or their corporation because they did not receive any interest from the judgment debtor and were not themselves debtors of the judgment creditor whose transfers were subject to attack. RES-GA YPL, LLC v. Rowland, 340 Ga. App. 713 , 798 S.E.2d 315 , 2017 Ga. App. LEXIS 130 (2017).

Accrual of action for fraudulent conveyance. —

In determining when a cause of action accrued for purposes of O.C.G.A. § 9-3-32 , it was necessary to ascertain the time when the plaintiff could first have maintained the plaintiff’s action to a successful result. The relevant date for determining the statute of limitations on a fraudulent conveyance claim, pursuant to O.C.G.A. §§ 18-2-74 , 18-2-75 , and 18-2-76 , was the date that the debtor incurred the obligation to make the transfer. Kipperman v. Onex Corp., 411 Bankr. 805, 2009 U.S. Dist. LEXIS 71666 (N.D. Ga. 2009).

Claims not subject to arbitration. —

When a trustee of a creditor trust under bankruptcy debtors’ confirmed plan alleged that providers of financial services to the debtors were the transferees of fraudulent transfers from the debtors under O.C.G.A. § 18-2-75(a) , the claims were not subject to arbitration under arbitration clauses in contracts between the providers and the debtors; the claims were not derived from the rights of the debtors under the contracts since the debtors were the transferors, and the trustee asserted the claims on behalf of the creditors. Cohen v. Ernst & Young, LLP, 372 Bankr. 530, 2007 Bankr. LEXIS 2810 (Bankr. S.D. Ga. 2007).

Summary judgment improper. —

Trial court erred by granting summary judgment to a creditor because under O.C.G.A. § 18-2-75(b) , the questioned real estate transfer involved the debtor purchasing the property for the debtor’s mother because the debtor had the right to purchase the property and the property was only deeded to the debtor briefly the same day, which transfer was not to satisfy an antecedent debt, thus, no fraudulent transfer occurred. Truelove v. Buckley, 318 Ga. App. 207 , 733 S.E.2d 499 , 2012 Ga. App. LEXIS 879 (2012), cert. denied, No. S13C0374, 2013 Ga. LEXIS 345 (Ga. Apr. 15, 2013).

Summary judgment was inappropriate as to a lender’s claims under Georgia’s Uniform Fraudulent Transfers Act (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., because the evidence was not undisputed, particularly given the evidence of the guarantor’s optimistic efforts to secure additional investors and shore up the financials of the guarantor’s businesses during the same approximate time frame. Nissan Motor Acceptance Corp. v. Sowega Motors, Inc., No. 4:10-CV-111, 2012 U.S. Dist. LEXIS 128854 (M.D. Ga. Sept. 11, 2012).

Trustee’s avoidance action alleging fraudulent conveyance could not be resolved on summary judgment because genuine issue of material fact existed with respect to the debtor’s insolvency. Kelley v. Speciale (In re Gregg), No. 11-40125- JTL, No. 11-4047, 2013 Bankr. LEXIS 3285 (Bankr. M.D. Ga. July 2, 2013).

Dispute over law firm’s fees payable by debtor. —

In a complaint seeking to recover pre-petition transfers made by a Chapter 11 debtor to a law firm, the law firm’s motion for summary judgment was denied as there was a genuine dispute of material fact regarding whether the debtor failed to receive reasonably equivalent value for the transfers as required by either 11 U.S.C. § 548(a) (1)(B)(I) or O.C.G.A. § 18-2-75(a) . The law firm contended that the firm’s invoices demonstrated that the firm provided substantial legal services to the debtor in exchange for the payments the firm received, while the debtor’s responsible officer contended that the descriptions of work in the invoices were too vague and cursory to evaluate whether the services constituted reasonably equivalent value. Davis v. McDermott Will & Emery LLP (In re Tom's Foods, Inc.), No. 05-40683-JDW, No. 07-4012, 2010 Bankr. LEXIS 3720 (Bankr. M.D. Ga. Oct. 20, 2010).

Obligation and payments thereon evaluated separately. —

In a fraudulent conveyance action, the need to evaluate a debt separately from the payments thereon was evidenced by 11 U.S.C. § 548 and O.C.G.A. § 18-2-75(a) , which permitted the obligation and the payments to be avoided separately or together. Watts v. Peachtree Tech. Partners, LLC (In re Palisades at West Paces Imaging Ctr., LLC), No. 09-87600-WLH, No. 11-5183, 2011 Bankr. LEXIS 3576 (Bankr. N.D. Ga. Sept. 13, 2011).

Bankruptcy trustee failed to allege that payments to a creditor were avoidable as fraudulent since the bankruptcy debtor incurred the obligation upon execution of an agreement which occurred outside the look-back period for avoiding fraudulent transfers. Gordon v. Harrison (In re Alpha Protective Servs.), 531 Bankr. 889, 2015 Bankr. LEXIS 1741 (Bankr. M.D. Ga. 2015).

Fraudulent transfer shown. —

One million three hundred forty thousand dollars ($1,340,000) in payments made by the debtor to an insider, allegedly for a construction management fee, were avoidable because there was no evidence to support any reasonably equivalent value in excess of the $175,000 contract price since there was no evidence as to what the “extras” were, the cost of the “extras”, or even a contractual basis for the extra charges. Watts v. MTC Dev., LLC (In re Palisades at W. Paces Imaging Ctr., LLC), 501 Bankr. 896, 2013 Bankr. LEXIS 4870 (Bankr. N.D. Ga. 2013).

Payments made by Chapter 7 debtor to an insider, allegedly for a construction management fee, were avoidable as a transfer made to an insider for an antecedent debt because the insider had reasonable cause to believe the debtor was insolvent at the time the payments were made, and, even under the insider’s version of the facts, the payments were for antecedent debt. Watts v. MTC Dev., LLC (In re Palisades at W. Paces Imaging Ctr., LLC), 501 Bankr. 896, 2013 Bankr. LEXIS 4870 (Bankr. N.D. Ga. 2013).

Checks payable from a Chapter 7 debtor that were deposited in an insider’s account were avoidable because there was no evidence that the debtor, which was insolvent at the time of the transfers, received any value as a result of the checks, nor any evidence that the insider used the funds to pay any valid expenses of the debtor. Watts v. MTC Dev., LLC (In re Palisades at W. Paces Imaging Ctr., LLC), 501 Bankr. 896, 2013 Bankr. LEXIS 4870 (Bankr. N.D. Ga. 2013).

Checks payable from a Chapter 7 debtor that were deposited in an insider’s account were avoidable because the checks were on account of antecedent debt. Watts v. MTC Dev., LLC (In re Palisades at W. Paces Imaging Ctr., LLC), 501 Bankr. 896, 2013 Bankr. LEXIS 4870 (Bankr. N.D. Ga. 2013).

Although transfers by a Chapter 7 debtor to insiders could not be avoided because the debtor received reasonably equivalent value, the transfers were nonetheless avoidable because they were made on account of antecedent debt at a time when the debtor was insolvent. Watts v. MTC Dev., LLC (In re Palisades at W. Paces Imaging Ctr., LLC), 501 Bankr. 896, 2013 Bankr. LEXIS 4870 (Bankr. N.D. Ga. 2013).

Actual fraud was adequately pled by alleging badges of fraud sufficient to infer the fraudulent nature of transfers to insiders; moreover, insolvency resulting in constructive fraud also was adequately pled. Ralls Corp. v. Huerfano River Wind, LLC, 27 F. Supp. 3d 1303, 2014 U.S. Dist. LEXIS 87414 (N.D. Ga. 2014).

Fraudulent transfer not shown. —

Trial court did not err in failing to find that the transfer of the home at issue from the debtor to a family member was a fraudulent conveyance and ordering a money judgment against the family member because the family member complied with the divorce court’s order to sell the marital home and to give the bulk of the proceeds to the debtor and the debtor’s wife, supporting a finding that the debtor received reasonably equivalent value for the debtor’s interest in the marital home, which would defeat a claim for a constructive fraudulent conveyance. Agricommodities, Inc. v. Moore, 359 Ga. App. 1 , 854 S.E.2d 781 , 2021 Ga. App. LEXIS 105 (2021).

JUDICIAL DECISIONS

Accrual of action for fraudulent conveyance. —

In determining when a cause of action accrued for purposes of O.C.G.A. § 9-3-32 , it was necessary to ascertain the time when the plaintiff could first have maintained the plaintiff’s action to a successful result. The relevant date for determining the statute of limitations on a fraudulent conveyance claim, pursuant to O.C.G.A. §§ 18-2-74 , 18-2-75 , and 18-2-76 , was the date that the debtor incurred the obligation to make the transfer. Kipperman v. Onex Corp., 411 Bankr. 805, 2009 U.S. Dist. LEXIS 71666 (N.D. Ga. 2009).

JUDICIAL DECISIONS

Pleadings adequate for fraud. —

Actual fraud was adequately pled by alleging badges of fraud sufficient to infer the fraudulent nature of transfers to insiders; moreover, insolvency resulting in constructive fraud also was adequately pled. Ralls Corp. v. Huerfano River Wind, LLC, 27 F. Supp. 3d 1303, 2014 U.S. Dist. LEXIS 87414 (N.D. Ga. 2014).

Claims survived motion to dismiss. —

When an investor asserted fraudulent transfer and related claims against accounts in the names of the former wife and widow of a consultant who allegedly defrauded the investor, the claims survived a motion to dismiss because the investor: (1) stated viable claims; (2) did not have to anticipate affirmative defenses; and (3) did not admit such defenses. Speedway Motorsports, Inc. v. Pinnacle Bank, 315 Ga. App. 320 , 727 S.E.2d 151 , 2012 Ga. App. LEXIS 366 (2012), cert. denied, No. S12C1329, 2013 Ga. LEXIS 50 (Ga. Jan. 7, 2013).

Improper dismissal for failure to state a claim. —

Trial court erred in granting the defendants’ motion to dismiss for failure to state a claim because it was too soon in the case to conclude, as a matter of law, that the plaintiffs could not present evidence satisfying the statutory elements of O.C.G.A. § 18-2-70 et. seq., seeking to void the transfer of assets. Lyle v. Fulcrum Loan Holdings, 354 Ga. App. 742 , 841 S.E.2d 182 , 2020 Ga. App. LEXIS 190 (2020), cert. denied, No. S20C1327, 2020 Ga. LEXIS 789 (Ga. Oct. 19, 2020), cert. denied, No. S20C1103, 2020 Ga. LEXIS 787 (Ga. Oct. 19, 2020).

Transfer prior to death. —

Although the transfer of a house was accompanied by some badges of fraud, the trial court abused the court’s discretion in enjoining further disposition of the house, pending adjudication of the merits of wrongful death and fraudulent transfer claims since the transferor gave the house to the transferor’s three minor grandchildren in Florida three months before the transferor murdered the decedent. Bishop v. Patton, 288 Ga. 600 , 706 S.E.2d 634 , 2011 Ga. LEXIS 151, overruled in part, SRB Inv. Servs., LLLP v. Branch Banking & Trust Co., 289 Ga. 1 , 709 S.E.2d 267 , 2011 Ga. LEXIS 270 (2011).

Evidence was sufficient to sustain the jury’s verdict under the plaintiff’s theory of fraudulent transfer and civil conspiracy as some evidence authorized the jury to find that a deed conveying the property owner’s sole interest to the real property to the owner and one defendant as joint tenants with right of survivorship without any money exchanged prior to death was to evade the plaintiff before a promissory note was paid. Bloom v. Camp, 336 Ga. App. 891 , 785 S.E.2d 573 , 2016 Ga. App. LEXIS 238 (2016).

Suit against non-transferees of property barred. —

Judgment creditor could seek relief under the Uniform Fraudulent Transfers Act (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., against the judgment debtor, as well as any recipient of the transfers the debtor made, O.C.G.A. §§ 18-2-77 and 18-2-78 , but the creditor could not pursue the judgment debtor’s mother and sister or their corporation because they did not receive any interest in the properties from the judgment debtor. RES-GA YPL, LLC v. Rowland, 340 Ga. App. 713 , 798 S.E.2d 315 , 2017 Ga. App. LEXIS 130 (2017).

Interlocutory injunction proper. —

Trial court did not abuse the court’s discretion in entering an interlocutory injunction to preserve the status quo pending adjudication of the merits of the creditor’s action against the debtors alleging breach of contract and fraudulent transfers in violation of the Georgia Uniform Fraudulent Transfers Act (UFTA), O.C.G.A. § 18-2-70 et seq., because at least seven statutory badges of fraud listed in the UFTA (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-74(b) , were implicated, and the creditor also presented evidence as a non-statutory badge of fraud of the debtors’ pattern of maintaining just enough funds in certain accounts to satisfy the debtors’ financial covenants at the end of each quarter and then transferring the funds away shortly thereafter; under the UFTA, O.C.G.A. § 18-22-77(a)(3)(A), the trial court was authorized to enter an interlocutory injunction against further disposition by the debtor or a transferee, or both, of the asset transferred or of other property. SRB Inv. Servs., LLLP v. Branch Banking & Trust Co., 289 Ga. 1 , 709 S.E.2d 267 , 2011 Ga. LEXIS 270 (2011).

Concrete injury. —

District court correctly held that the relators lacked Article III standing to pursue a state law fraudulent transfer claim against the company owner; the False Claims Act (FCA), O.C.G.A. § 23-3-120 et seq., itself did not confer standing on relators, as the FCA did not assign relators the right to pursue additional claims that arose from or were related to the qui tam action. Relators also could not establish standing under Georgia’s Uniform Voidable Transfers Act (UVTA), O.C.G.A. § 18-2-70 et seq., as it would be inconsistent with case law to hold that the UVTA could create a concrete injury where none existed. United States v. Mortg. Inv'rs Corp., 987 F.3d 1340, 2021 U.S. App. LEXIS 4499 (11th Cir.), cert. denied, 141 S. Ct. 2632 , 209 L. Ed. 2 d 757, 2021 U.S. LEXIS 2458 (2021).

RESEARCH REFERENCES

Am. Jur. 2d.

37 Am. Jur. 2d, Fraudulent Conveyances and Transfers, § 90 et seq.

C.J.S.

37 C.J.S., Fraudulent Conveyances, § 150 et seq.

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, decisions under former Code 1933, § 28-202 and former § 18-2-23 are included in the annotations for this Code section.

Basis of right to set aside fraudulent transfers. —

Former Code 1933, §§ 28-101, 28-102, 28-201 and 28-202 provided creditors with a right to set aside fraudulent transfers, and this remedy was available to any creditor at time of transfer who thereafter reduced their claim to a judgment lien. United States v. Hickox, 356 F.2d 969, 1966 U.S. App. LEXIS 7056 (5th Cir. 1966) (decided under former Code 1933, § 28-202).

Construction in pari materia with other statutes. —

Former Civil Code 1910, §§ 3224 and 3225, being in pari materia, were to be construed together. Warren v. Citizens Nat'l Bank, 145 Ga. 503 , 89 S.E. 520 , 1916 Ga. LEXIS 376 (1916) (decided under former Civil Code 1910, § 3225).

Fraudulent conveyance statute, former §§ 18-2-22 and 18-2-23 should be considered in pari materia. FDIC v. United States, 654 F. Supp. 794, 1986 U.S. Dist. LEXIS 18548 (N.D. Ga. 1986) (decided under former § 18-2-23 ).

“Good faith for value” defense applies differently to 11 U.S.C. § 548 and state law claims. In particular: (i) under § 548(c), regardless of the type of fraud, the transfer is not avoidable if the transferee took for value and in good faith to the extent of the value given; (ii) with respect to actual fraud under state law, the transfer is not avoidable if the transferee took for reasonably equivalent value and in good faith under O.C.G.A. § 18-2-78(a) ; and (iii) in contrast, with respect to constructive fraud under state law, there is no defense to avoidability, but the transferee’s liability is reduced to the extent it gave value to the debtor in good faith under § 18-2-78(d)(3). Trauner v. Delta Air Lines, Inc. (In re Think Retail Sols., LLC), No. 15-56153-BEM, No. 17-5078-BEM, 2019 Bankr. LEXIS 2031 (Bankr. N.D. Ga. July 5, 2019).

One induced to sell goods to a bankrupt by fraud cannot reclaim from trustee. In re Whatley Bros., 199 F. 326, 1912 U.S. Dist. LEXIS 1185 (D. Ga. 1912) (decided under former Civil Code 1910, § 3225).

Impoundment of unpaid purchase money from sale. —

If the fraudulent grantee sells to an innocent purchaser, any unpaid purchase money due on such sale will be impounded as an equitable asset of the debtor for the distribution to the debtor’s creditors. Beasley v. Smith, 144 Ga. 377 , 87 S.E. 293 , 1915 Ga. LEXIS 208 (1915) (decided under former Civil Code 1910, § 3225).

Suspicion alone insufficient. —

Contrary to the trial court’s conclusion, reasonable grounds for suspicion alone do not suffice to render a subsequent purchaser’s title void, and when the buyer acquired the automobile for value, and had no notice that the seller’s title was obtained through fraud, the buyer received good title. Hall v. Hidy, 263 Ga. 422 , 435 S.E.2d 215 , 1993 Ga. LEXIS 699 (1993) (decided under former § 18-2-23 ).

Charge that grounds to suspect fraud in grantor’s acquisition vitiates conveyance. —

It was error to charge that purchaser from one who is fraudulent grantee takes no title as against creditors if the individual has grounds to reasonably suspect fraud in conveyance to the grantor. Hinkle v. James Smith & Son, 133 Ga. 255 , 65 S.E. 427 , 1909 Ga. LEXIS 203 (1909) (decided under former Civil Code 1895, § 2695).

Protection of trustee and contingent beneficiary. —

When it was clearly evident that both the trustee and the contingent beneficiary of a trust had reasonable grounds to suspect that the purpose of the second security deed against certain property and the assignment thereof to the trust, at least in part, was done with the intent of the assignor to delay or defraud creditors in violation of former § 18-2-22(2), neither the trustee nor the beneficiary was a subsequent purchaser entitled to the protections of former § 18-2-23 . FDIC v. United States, 654 F. Supp. 794, 1986 U.S. Dist. LEXIS 18548 (N.D. Ga. 1986) (decided under former § 18-2-23 ).

Reasonably equivalent value. —

Unpublished decision: Bankruptcy court rejected a Chapter 11 trustee’s argument that investors who received payments from affiliated businesses that were accused of operating a Ponzi scheme did not give value for the payments and could not assert a defense under 11 U.S.C. § 548(c) or Georgia law against the trustee’s action seeking recovery of those payments under 11 U.S.C. §§ 544(b) and 548(a)(1)(A) and (a)(1)(B), and Georgia law, as fraudulent transfers. The investors had a claim for the return of principal the investors invested, based on fraud, the investors gave value for payments the investors received up to the amount of the principal the investors invested because the payments satisfied their claim, and their right to keep the payments did not depend on whether the investments the investors made were characterized as debt or equity. In re Int'l Mgmt. Assocs., LLC, No. A06-62966-PWB, No. A06-62966-PWB, No. 09-MP-601, 2009 Bankr. LEXIS 4240 (Bankr. N.D. Ga. Dec. 1, 2009), aff'd, 661 F.3d 623, 2011 U.S. App. LEXIS 22659 (11th Cir. 2011).

When an investor asserted a fraudulent transfer claim against a bank to which a consultant who allegedly defrauded the investor made a down payment on a house, it was error to dismiss the claim based on the bank’s assertion that the bank, under O.C.G.A. § 18-2-74(a)(1), took the consultant’s funds in good faith and for a reasonably equivalent value because: (1) the investor’s complaint did not admit or otherwise demonstrate such an affirmative defense; and (2) the investor had no obligation to anticipate the affirmative defense. Speedway Motorsports, Inc. v. Pinnacle Bank, 315 Ga. App. 320 , 727 S.E.2d 151 , 2012 Ga. App. LEXIS 366 (2012), cert. denied, No. S12C1329, 2013 Ga. LEXIS 50 (Ga. Jan. 7, 2013).

Transfers were avoidable. —

There was no showing of transferees’ good faith in fraudulent transfers from bankruptcy debtors since the lack of information from the debtors, the refusal of the debtors to allow transferees to conduct due diligence, and the usurious interest paid by the debtors clearly indicated that the transactions were fraudulent; thus, the transfers from bankruptcy debtors were avoidable. Kerr v. Audio Answers, Inc. (In re Christou), No. 06-68251-MHM, No. 06-68376-MHM), 2009 Bankr. LEXIS 3291 (Bankr. N.D. Ga. Sept. 28, 2009).

Damages available. —

Georgia law allowing the recovery of general and punitive damages for fraudulent conveyances survived the enactment of Georgia’s Uniform Fraudulent Transfers Act, O.C.G.A. § 18-2-70 et seq. Interfinancial Midtown, Inc. v. Choate Constr. Co., 343 Ga. App. 793 , 806 S.E.2d 255 , 2017 Ga. App. LEXIS 479 (2017).

Suit against non-transferees of property barred. —

Judgment creditor could seek relief under the Uniform Fraudulent Transfers Act (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., against the judgment debtor, as well as any recipient of the transfers the debtor made, O.C.G.A. §§ 18-2-77 and 18-2-78 , but the creditor could not pursue the judgment debtor’s mother and sister or their corporation because they did not receive any interest in the properties from the judgment debtor. RES-GA YPL, LLC v. Rowland, 340 Ga. App. 713 , 798 S.E.2d 315 , 2017 Ga. App. LEXIS 130 (2017).

Summary judgment improper. —

Based on evidence of the sale of judgment debtors’ business to their long-time close friends and evidence that the friends were aware that the business owed money, a genuine issue of material fact remained as to whether the debtors transferred their assets with actual intent to hinder, delay, or defraud their creditor under O.C.G.A. § 18-2-74(a)(1). Therefore, the trial court’s grant of summary judgment was reversed. Abbott Oil Co. v. Rogers, 302 Ga. App. 439 , 691 S.E.2d 561 , 2010 Ga. App. LEXIS 150 (2010), cert. denied, No. S10C1026, 2010 Ga. LEXIS 583 (Ga. July 12, 2010).

Creditor failed to show good faith under O.C.G.A. § 18-2-78 in receiving fraudulent transfers from a bankruptcy debtor as returns on the creditor’s investments in the debtor’s Ponzi scheme, and thus the creditor was not entitled to summary judgment; the creditor was an educated and sophisticated businessman and, despite the creditor’s assertion that the creditor had no reason to doubt the debtor who previously brokered mortgages for the creditor, the facts that the creditor invested substantial funds, received no promissory notes, and was paid no interest were sufficient to indicate that the creditor should have been suspicious of the nature of the transactions. In re Christou v. Cressaty Metals, Inc., No. 06-68251 - MHM, No. 06-68376 - MHM), 2010 Bankr. LEXIS 3430 (Bankr. N.D. Ga. Sept. 23, 2010).

Subsection (e) was inapplicable to transfer.—

Unpublished decision: Subsection (e) of O.C.G.A. § 18-2-78 was inapplicable to the transfer. The transfer occurred as part of the Settlement Agreement after the transferee sued the debtor and, as such, the transferee did not enforce a security interest in compliance with Article 9 of the Uniform Commercial Code; moreover, there was not a segregated, discrete fund in which the transferee could have exercised the transferee’s security interest. Perkins v. Crown Fin., LLC (In re Int'l Mgmt. Assocs., LLC), No. 06-62966-PWB, No. 06-6421-PWB, 2016 Bankr. LEXIS 443 (Bankr. N.D. Ga. Feb. 10, 2016).

RESEARCH REFERENCES

Am. Jur. 2d.

37 Am. Jur. 2d, Fraudulent Conveyances and Transfers, § 92.

C.J.S.

37 C.J.S., Fraudulent Conveyances, § 144.

ALR.

Right of grantee or transferee to be reimbursed for expenditures in payment of taxes or encumbrances on property where conveyance or transfer is in fraud of creditors, 8 A.L.R. 527 .

Delivery of key as satisfying condition of immediate delivery and actual or continued change of possession to uphold sale of personal property against subsequent purchaser or third persons generally, 56 A.L.R. 518 .

Persons asserting claim on theory of agency or trust as within term “creditors” in statutes relating to proof of claims against insolvent bank, 89 A.L.R. 383 .

Right to set aside, for benefit of heirs and distributees, a conveyance or transfer by decedent in fraud of his creditors, 148 A.L.R. 230 .

Rule denying relief to one who conveyed his property to defraud his creditors as applicable where the threatened claim which occasioned the conveyance was never established, 21 A.L.R.2d 589; 6 A.L.R.4th 862.

Right of creditors to attack as fraudulent a conveyance by third person to debtor’s spouse, 35 A.L.R.2d 8.

Right of secured creditor to have set aside fraudulent transfer of other property by his debtor, 8 A.L.R.4th 1123.

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, decisions under former § 18-2-22 are included in the annotations for this Code section.

Limitations on actions. —

U.S. Bankruptcy Court determined appropriate limitations periods for claims for alleged fraudulent conveyances of real property (seven years) and personal property (four years) by analogy to adverse possession and conversion, respectively, in the absence of an express limitations period in former O.C.G.A. § 18-2-22 . Broadfoot v. Hunerwadel, 282 Bankr. 54, 2002 Bankr. LEXIS 299 (Bankr. N.D. Ga. 2002) (decided under former O.C.G.A. § 18-2-22 ).

Trial court improperly granted summary judgment to judgment debtors on a judgment creditor’s claim under O.C.G.A. § 14-8-28 upon finding that the limitations period under O.C.G.A. § 18-2-79 barred the claim as there was no legal basis to conclude that the limitation period in § 18-2-79 was applicable to the creditor’s claim. Morris v. Nexus Real Estate Mortg. & Inv. Co., 296 Ga. App. 477 , 675 S.E.2d 511 , 2009 Ga. App. LEXIS 234 (2009).

Chapter 7 trustee was not barred by the statute of limitations under O.C.G.A. § 18-2-79 or under 11 U.S.C. § 546 from pursuing a cause of action under 11 U.S.C. § 544 because the debtor filed the debtor’s petition before the state statute of limitations expired, but was barred from pursuing avoidance under 11 U.S.C. § 548 of any transfer occurring prior to two years before the petition was filed. Watts v. Peachtree Tech. Partners, LLC (In re Palisades at West Paces Imaging Ctr., LLC), No. 09-87600-WLH, No. 11-5183, 2011 Bankr. LEXIS 3576 (Bankr. N.D. Ga. Sept. 13, 2011).

As an administrator’s fraudulent conveyance claims were time barred under O.C.G.A. §§ 18-2-74(a)(1) and 18-2-79(1) , a limited liability company’s (LLC) failure to respond to the administrator’s requests for admissions was of no consequence and the trial court’s denial of summary judgment to the LLC was improper. Huggins v. Powell, 315 Ga. App. 599 , 726 S.E.2d 730 , 2012 Ga. App. LEXIS 348 (2012).

Administrator’s fraudulent conveyance claims against group one were time barred under O.C.G.A. §§ 18-2-74(a)(1) and 18-2-79(1) , even though the claim was not time barred under the limitations period in effect when the claim accrued, as application of § 18-2-79 , a procedural law in effect at the time the suit was filed, did not violate the constitutional prohibition against retroactive laws under Ga. Const. 1983, Art. I, Sec. I, Para. X; the administrator also failed to avail the administrator of the one-year statute of limitation effective upon discovery of the alleged fraud. Huggins v. Powell, 315 Ga. App. 599 , 726 S.E.2d 730 , 2012 Ga. App. LEXIS 348 (2012).

Even though the four-year statute of limitations under the Georgia Uniform Fraudulent Transfer Act (now Uniform Voidable Transactions Act), O.C.G.A. § 18-2-70 et seq., had not expired, a Chapter 7 trustee’s avoidance action, which was brought pursuant to a Bankruptcy Code provision allowing the trustee to step into the shoes of an unsecured creditor, was barred by the two-year limitations period in the Bankruptcy Code. Nor was the statute tolled by a Bankruptcy Code provision dealing with extensions of time as the trustee’s fraudulent transfer action was brought standing in the shoes of a creditor, not the debtor. Boudreaux v. Hall Oil Co. (In re Pope Logging, Inc.), No. 11-30153, No. 15-03004, 2015 Bankr. LEXIS 3136 (Bankr. S.D. Ga. Sept. 17, 2015).

In a transfer avoidance action under 11 U.S.C. § 544(b) (1), the complaint alleged sufficient facts to raise questions of fact regarding whether the statute of limitations barred the trustee’s claim as it was plausible that the debtors concealed the transfers and the creditor did not learn of the transfers until years later. Lubin v. Markowitz (In re Markowitz), No. 14-68061-BEM, No. 16-5221-BEM, 2017 Bankr. LEXIS 767 (Bankr. N.D. Ga. Mar. 22, 2017).

Trustee’s avoidance claim for transfer of certain real property pursuant to O.C.G.A. § 18-2-74(a)(1) was time barred because from the day the deed was recorded, any subsequent purchaser or judgment creditor was on notice of the transfer and any applicable statute of limitations under O.C.G.A. § 18-2-79 started running as of that date. Gordon v. Webster (In re Webster), 629 Bankr. 654, 2021 Bankr. LEXIS 838 (Bankr. N.D. Ga. 2021).

Action to set aside fraudulent transfer timely filed. —

Fraudulent transfer occurred on the date the deed was recorded, even though the deed was signed nearly 18 months earlier, and the creditor timely filed the creditor’s complaint and action to set aside the fraudulent transfer approximately six months before the four-year statute of limitation would have run. Kent v. A.O. White, Jr., Consulting Eng'r, Inc., 279 Ga. App. 563 , 631 S.E.2d 782 , 2006 Ga. App. LEXIS 639 (2006), cert. denied, No. S06C1710, 2006 Ga. LEXIS 790 (Ga. Oct. 2, 2006).

Fraudulent transfer claim was time-barred. —

Former director’s putative transferee met the transferee’s burden for summary judgment purposes of asserting that a fraudulent transfer claim was time-barred, but the creditor failed to point to specific evidence that gave rise to a triable issue with respect to whether the limitation period did not bar the claim. Am. Nat'l Holding Corp. v. EMM Credit, LLC, 323 Ga. App. 655 , 748 S.E.2d 683 (2013).

Fraudulent transfer claims alleging actual fraud survived summary judgment because fact issues existed as to when the fraudulent nature of the transfers was discovered, but some constructive fraud claims were untimely because no discovery rule applied. Am. Pegasus SPC v. Clear Skies Holding Co., LLC, No. 1:13-CV-03035-ELR, 2015 U.S. Dist. LEXIS 189547 (N.D. Ga. Sept. 22, 2015).

Claim not subject to dismissal based on unrecorded deeds. —

Judgment creditor’s fraudulent transfer action was not shown to be barred by limitations because, even assuming that the reference to the year 2003 in unwitnessed and unrecorded deeds from the judgment debtor proved that the deeds were executed in 2003, those deeds could not prove the passing of title, and questions concerning the judgment creditor’s diligence in discovering the alleged fraud were generally questions for a trier of fact. RES-GA YPL, LLC v. Rowland, 340 Ga. App. 713 , 798 S.E.2d 315 , 2017 Ga. App. LEXIS 130 (2017).

Improper dismissal for failure to state a claim. —

Trial court erred in granting the defendants’ motion to dismiss for failure to state a claim because it was too soon in the case to conclude, as a matter of law, that the plaintiffs could not present evidence satisfying the statutory elements of O.C.G.A. § 18-2-70 et. seq., seeking to void the transfer of assets. Lyle v. Fulcrum Loan Holdings, 354 Ga. App. 742 , 841 S.E.2d 182 , 2020 Ga. App. LEXIS 190 (2020), cert. denied, No. S20C1327, 2020 Ga. LEXIS 789 (Ga. Oct. 19, 2020), cert. denied, No. S20C1103, 2020 Ga. LEXIS 787 (Ga. Oct. 19, 2020).

RESEARCH REFERENCES

Am. Jur. 2d.

37 Am. Jur. 2d, Fraudulent Conveyances and Transfers, § 152 et seq.

C.J.S.

37 C.J.S., Fraudulent Conveyances, § 123 et seq.

RESEARCH REFERENCES

Am. Jur. 2d.

37 Am. Jur. 2d, Fraudulent Conveyances and Transfers, § 126 et seq.

JUDICIAL DECISIONS

Damages available. —

Georgia law allowing the recovery of general and punitive damages for fraudulent conveyances survived the enactment of Georgia’s Uniform Fraudulent Transfers Act, O.C.G.A. § 18-2-70 et seq. Interfinancial Midtown, Inc. v. Choate Constr. Co., 343 Ga. App. 793 , 806 S.E.2d 255 , 2017 Ga. App. LEXIS 479 (2017).

RESEARCH REFERENCES

Am. Jur. 2d.

37 Am. Jur. 2d, Fraudulent Conveyances and Transfers, § 152 et seq.

C.J.S.

37 C.J.S., Fraudulent Conveyances, § 170 et seq.

JUDICIAL DECISIONS

Analysis

• General Consideration
• Nonresident Debtors
• Removal of Domicile
• Debtor’s Concealment
• Removal of Property

RESEARCH REFERENCES

Am. Jur. Pleading and Practice Forms.

2B Am. Jur. Pleading and Practice Forms, Attachment and Garnishment, § 91. 2C Am. Jur. Pleading and Practice Forms, Attachment and Garnishment, §§ 340, 494.

ALR.

What constitutes nonresidence for purpose of attachment, 26 A.L.R. 180 .

Action based on statute as one in which attachment will lie, 26 A.L.R. 563 ; 51 A.L.R. 1386 .

Right of creditor to attach bankrupt’s exempt property after discharge in bankruptcy, 55 A.L.R. 303 .

Nature and extent of relief of successful intervenor or interpleader in attachment, 66 A.L.R. 908 .

Property of incompetent or infant under guardianship as subject of execution, attachment, or garnishment, 92 A.L.R. 919 .

Debtor’s intent to defraud or delay creditors within contemplation of attachment statute as inferable as matter of law from fact that he has removed or is about to remove property from the state without making adequate provision for his creditors, 92 A.L.R. 966 .

Foreign corporation as a nonresident for purposes of attachment law of the state in which it is doing business or is domesticated, 114 A.L.R. 1378 .

Attachment as affected by release or modification of lien to which property was subject when attachment was levied, 128 A.L.R. 1392 .

Right of creditors to reach, by garnishment or other process, commissions of debtor, as executor, administrator, or trustee, 143 A.L.R. 190 .

Money or other property taken from prisoner as subject of attachment, garnishment, or seizure under execution, 154 A.L.R. 758 .

Foreign attachment or garnishment as available in action by nonresident against nonresident or foreign corporation upon a foreign cause of action, 14 A.L.R.2d 420.

Joint bank account as subject to attachment, garnishment, or execution by creditor of one joint depositor, 86 A.L.R.5th 527.

JUDICIAL DECISIONS

Statute embraced all money demands, whether resting in tort or contract. Walker v. Zorn, 56 Ga. 35 , 1876 Ga. LEXIS 197 (1876).

Attachment may issue when debtor resides out of state in all cases of money demands, whether arising ex contractu or ex delicto. Benefield v. Radiator Specialty Co., 116 Ga. App. 588 , 158 S.E.2d 423 , 1967 Ga. App. LEXIS 899 (1967).

Extent of judgment creditor’s lien. —

Lien of judgment creditor is not a lien acquired by contract, but is given by law; consequently, a lienor is not in the position of a bona fide purchaser, and a lien extends only to property levied upon which actually belongs to the defendant in attachment. Parker v. Boyd, 208 Ga. 829 , 69 S.E.2d 760 , 1952 Ga. LEXIS 363 (1952).

Attachment proper as to action for specific damages arising in tort. Graves v. Strozier, 37 Ga. 32 , 1867 Ga. LEXIS 126 (1867).

Attachment proper regarding promise to pay debt with solvent notes. Monroe v. Bishop, 29 Ga. 159 , 1859 Ga. LEXIS 302 (1859).

Attachment proper as to breach of promise of marriage. Morton v. Pearman, 28 Ga. 323 , 1859 Ga. LEXIS 206 (1859).

RESEARCH REFERENCES

ALR.

Replevin for bank account, 44 A.L.R. 1522 .

Attachment in libel and slander cases, 61 A.L.R. 1347 .

Action based on rescission of contract as one arising on contract express or implied within the meaning of attachment statute, 77 A.L.R. 748 ; 95 A.L.R. 1028 .

Judgment in tort action as subject of assignment, attachment, or garnishment pending appeal, 121 A.L.R. 420 .

Attachment statute as applicable to equity suits, 154 A.L.R. 95 .

JUDICIAL DECISIONS

Attachment under Laws 1816, Cobb’s 1851 Digest, p. 75 (see now O.C.G.A. § 18-3-3 ) must be by affidavit in the form required by Ga. L. 1855-56, p. 25, § 42 (see now O.C.G.A. § 18-3-19 ). Harrill v. Humphries, 26 Ga. 514 , 1858 Ga. LEXIS 352 (1858).

RESEARCH REFERENCES

ALR.

What amounts to a “debt” within statute providing for attachment before debt is due, 65 A.L.R. 1439 ; 58 A.L.R.2d 1451.

What sort of claim, obligation, or liability is within contemplation of statute providing for attachment, or giving right of action for indemnity, before a debt or liability is due, 58 A.L.R.2d 1451.

JUDICIAL DECISIONS

Suit in attachment is separate and distinct from a common law action; and failure to number and document them separately is error on part of clerk. Dollar v. Fred W. Amend Co., 184 Ga. 432 , 191 S.E. 696 , 1937 Ga. LEXIS 552 (1937).

Former Code 1933, § 8-104 (see now O.C.G.A. § 18-3-4 ) was applicable to attachments under former Code 1933, § 8-101 (see now O.C.G.A. § 18-3-1 ). Threlkeld v. Whitehead, 95 Ga. App. 378 , 98 S.E.2d 76 , 1957 Ga. App. LEXIS 810, 1957 Ga. App. LEXIS 967 (1957).

Pending action with bail in superior court, plaintiff may take out attachment on same demand returnable to inferior court. Wood v. Carter, 29 Ga. 580 , 1859 Ga. LEXIS 387 (1859).

Filing of declaration claiming damages was commencement of action for purposes of former Code 1863, § 3201 (see now O.C.G.A. § 18-3-4 ), though the defendant was not yet served. Graves v. Strozier, 37 Ga. 32 , 1867 Ga. LEXIS 126 (1867).

Effect upon pending action of payment of costs of attachment. —

When attachment is sued out against the defendant in a pending common-law action, payment by the defendant to the sheriff of the principal, interest, and costs upon the attachment in order to relieve the defendant’s property from seizure does not discharge the defendant from any additional liability to which the defendant might have been subject in the original action. Johnson & Son v. Friedman-Shelby Shoe Co., 15 Ga. App. 561 , 83 S.E. 969 , 1914 Ga. App. LEXIS 329 (1914).

JUDICIAL DECISIONS

Nature of removal for which attachment authorized. —

Former Code 1868, § 3210 did not authorize attachment on ground that the executor or administrator was personally removing, but rather on ground that the executor or administrator is actually removing or about to remove property of the estate. Holloway v. Chiles, 40 Ga. 346 , 1869 Ga. LEXIS 99 (1869).

Twelve-month exemption from suit allowed executors and administrators does not prevent levy of attachment against property of estate in hands of administrator or executor. Hartley v. Hartley, 173 Ga. 710 , 161 S.E. 358 , 1931 Ga. LEXIS 387 (1931).

Proviso that final judgment not be entered for two years from commencement of administration. —

Proviso in former Civil Code 1910, § 5068 that final judgment shall not be entered until expiration of two years from granting of letters of administration serves as a quasi-injunction to restrain administration of property upon which attachment has been levied until determination of issues which may be raised in attachment case. Hartley v. Hartley, 173 Ga. 710 , 161 S.E. 358 , 1931 Ga. LEXIS 387 (1931).

Judgment in attachment will not raise priority of debt owed creditor of intestate in proceeding to marshal assets. Wooten v. Hartley, 186 Ga. 639 , 198 S.E. 750 , 1938 Ga. LEXIS 673 (1938).

RESEARCH REFERENCES

ALR.

Garnishment against executor or administrator by creditor of estate, 60 A.L.R.3d 1301.

JUDICIAL DECISIONS

Exception to rule that joint obligors are necessary parties. —

Former Civil Code 1910, § 5067 provided an exception to rule that joint obligors are all necessary parties to suit on the obligation if within the jurisdiction of the court. Clark v. Maddox, 41 Ga. App. 807 , 154 S.E. 728 , 1930 Ga. App. LEXIS 1102 (1930).

In attachment against one member of partnership, the declaration need not be against all partners. Connon v. Dunlap, 64 Ga. 680 , 1880 Ga. LEXIS 390 (1880).

Interest of one partner in partnership property was not subject to levy and sale under attachment; it could only be reached at law by process of garnishment. J.A. Holifield & Co. v. White, 52 Ga. 567 , 1874 Ga. LEXIS 350 (1874) (decided prior to repeal of § 14-8-74 by Ga. L. 1984, p. 1439).

Partner as sole survivor and nonresident. —

Attachment available against partner’s interest in partnership when the partner is the only survivor and nonresident. Leroy M. Wiley & Co. v. Sledge, 8 Ga. 532 , 1850 Ga. LEXIS 89 (1850).

Interest of tenants in common of a ship can be attached. Walter v. Kierstead, 74 Ga. 18 , 1885 Ga. LEXIS 283 (1885).

RESEARCH REFERENCES

ALR.

Joint bank account as subject to attachment, garnishment, or execution by creditor of one of the joint depositors, 11 A.L.R.3d 1465.

JUDICIAL DECISIONS

This statute was cumulative and not restrictive of other attachment statutes; and nonresident corporation having property in this state is subject to attachment whether or not the corporation transacts business here. Pacific Selling Co. v. Albright-Prior Co., 3 Ga. App. 143 , 59 S.E. 468 , 1907 Ga. App. LEXIS 579 (1907).

Construction of attachment law. —

Attachment was unknown at common law, and should be strictly construed, especially as to nonresident debtors. Mitchell v. Union Bag & Paper Corp., 75 Ga. App. 15 , 42 S.E.2d 137 , 1947 Ga. App. LEXIS 463 (1947).

Attachment against foreign corporation, also being sued in this state. —

Fact that Georgia court may have personal jurisdiction over a corporation does not mean it is not subject also to attachment, for this statute was intended to authorize attachment against a foreign corporation, even though the corporation might be sued in Georgia. Image Mills, Inc. v. Vora, 146 Ga. App. 196 , 245 S.E.2d 882 , 1978 Ga. App. LEXIS 2209 (1978).

Whether doing business in this state or not, nonresident corporation is subject to attachment. Parramore v. Alexander, 132 Ga. 642 , 64 S.E. 660 , 1909 Ga. LEXIS 378 (1909).

Affidavit alleging transaction of business in state. —

Affidavit is sufficient which alleges the defendant, though not incorporated in this state, transacts business here. Parramore v. Alexander, 132 Ga. 642 , 64 S.E. 660 , 1909 Ga. LEXIS 378 (1909).

RESEARCH REFERENCES

ALR.

Constitutionality of statute prescribing conditions of right of defendant in foreign attachment to appear and defend, 17 A.L.R. 884 .

Foreign corporation as a nonresident for purposes of attachment law of the state in which it is doing business or is domesticated, 114 A.L.R. 1378 .

Sufficiency of affidavit for attachment, respecting fraud or intent to defraud, as against objection that it is a mere legal conclusion, 8 A.L.R.2d 578.

Foreign attachment or garnishment as available in action by nonresident against nonresident or foreign corporation upon a foreign cause of action, 14 A.L.R.2d 420.

RESEARCH REFERENCES

Am. Jur. Pleading and Practice Forms.

2C Am. Jur. Pleading and Practice Forms, Attachment and Garnishment, § 452.

ALR.

What sort of claim, obligation, or liability is within contemplation of statute providing for attachment, or giving right of action for indemnity, before a debt or liability is due, 58 A.L.R.2d 1451.

Funds in hands of his attorney as subject of attachment or garnishment by client’s creditor, 35 A.L.R.3d 1094.

JUDICIAL DECISIONS

No basis for writ of attachment. —

Absent allegations of property in Georgia, there was no basis for the issuance of a writ of attachment since the defendants resided outside of Georgia. Ralls Corp. v. Huerfano River Wind, LLC, 27 F. Supp. 3d 1303, 2014 U.S. Dist. LEXIS 87414 (N.D. Ga. 2014).

OPINIONS OF THE ATTORNEY GENERAL

Magistrate courts’ power to order prejudgment attachment. — Because magistrate courts are not “courts of record” those courts may not order prejudgment attachment or garnishment. 1984 Op. Atty Gen. No. U84-28.

RESEARCH REFERENCES

ALR.

Affidavits stating grounds of attachment on information and belief, 86 A.L.R. 588 .

JUDICIAL DECISIONS

Analysis

• General Consideration
• Failure to Give Attachment Bond
• Liability on Attachment Bond
• Recovery on Attachment Bond

RESEARCH REFERENCES

Am. Jur. Pleading and Practice Forms.

2C Am. Jur. Pleading and Practice Forms, Attachment and Garnishment, §§ 385, 452.

ALR.

Liability on attachment bond as affected by lack of levy or by invalid levy, 108 A.L.R. 917 .

Recovery of value of use of property wrongfully attached, 45 A.L.R.2d 1221.

Right to recover attorney’s fees for wrongful attachment, 65 A.L.R.2d 1426.

What constitutes malice sufficient to justify an award of punitive damages in action for wrongful attachment or garnishment, 61 A.L.R.3d 984.

JUDICIAL DECISIONS

Constitutionality. —

Proceeding under this statute afforded due process of law and did not violate U.S. Const., amend. 14. Continental Nat'l Bank v. Folsom, 78 Ga. 449 , 3 S.E. 269 , 1887 Ga. LEXIS 4 (1887).

Service on security of nonresident national bank which gave bond under statute was sufficient. Continental Nat'l Bank v. Folsom, 78 Ga. 449 , 3 S.E. 269 , 1887 Ga. LEXIS 4 (1887).

RESEARCH REFERENCES

C.J.S.

72 C.J.S., Process, §§ 31, 32, 84.

JUDICIAL DECISIONS

Partner cannot be surety on partnership bond. Copeland & Co. v. Monroe, 16 Ga. App. 586 , 85 S.E. 789 , 1915 Ga. App. LEXIS 137 (1915).

RESEARCH REFERENCES

ALR.

Affidavits stating grounds of attachment on information and belief, 86 A.L.R. 588 .

JUDICIAL DECISIONS

Plaintiff’s attorney as surety. —

Former Civil Code 1895, § 4514 was directory; consequently, a proceeding was not void when plaintiff’s attorney signs bond as surety. Husband Bros. v. Georgia S. & Florida Ry. Co., 3 Ga. App. 157 , 59 S.E. 326 , 1907 Ga. App. LEXIS 583 (1907).

JUDICIAL DECISIONS

No question of amendment can be entertained, except amendment of bond, and of that only insofar as may be necessary to make the bond conform to law as a bond in support of attachment as originally issued and levied. Lockett v. DeNeufville, 55 Ga. 454 , 1875 Ga. LEXIS 449 (1875).

Amendment of bond. —

Plaintiff in attachment may amend the plaintiff’s bond, “as in other cases at common law.” Collins v. Southern Fin. Corp., 51 Ga. App. 400 , 180 S.E. 744 , 1935 Ga. App. LEXIS 711 (1935).

Amendment of bond which was absolutely void was not authorized by this statute. Copeland & Co. v. Monroe, 16 Ga. App. 586 , 85 S.E. 789 , 1915 Ga. App. LEXIS 137 (1915).

Filing of attachment bond for first time at trial term was not authorized by statute. Copeland & Co. v. Monroe, 16 Ga. App. 586 , 85 S.E. 789 , 1915 Ga. App. LEXIS 137 (1915).

Burden of proof is on defendant to show insufficiency of bond. Reid v. Armour Packing Co., 93 Ga. 696 , 21 S.E. 131 , 1894 Ga. LEXIS 388 (1894); Stephens v. Woodson, 8 Ga. App. 639 , 70 S.E. 55 , 1911 Ga. App. LEXIS 82 (1911).

Time for raising objection. —

Judgment on attachment not void for insufficiency of bond when question not raised in proceeding. Collins v. Southern Fin. Corp., 51 Ga. App. 400 , 180 S.E. 744 , 1935 Ga. App. LEXIS 711 (1935).

Surety on bond as a minor whose contracts are voidable. —

Contract made by minor not void, but is voidable only; it is therefore no ground for dismissal of attachment that surety upon attachment bond executed by plaintiff in attachment was a minor. Benjamin v. Pardue, 44 Ga. App. 587 , 162 S.E. 291 , 1932 Ga. App. LEXIS 403 (1932).

RESEARCH REFERENCES

ALR.

Constitutionality of statute prescribing conditions of right of defendant in foreign attachment to appear and defend, 17 A.L.R. 884 .

Duty to give bond and procure return of property in order to mitigate damages from its wrongful seizure under legal process, 33 A.L.R. 1479 .

Value of attached property as limit of liability on bond to release attachment, 80 A.L.R. 595 .

Liability on attachment bond as affected by lack of levy or by invalid levy, 108 A.L.R. 917 .

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, decisions under former Code 1868, § 3233, former Code 1873, § 3309, former Code 1882, § 3309, and former Code 1933, § 8-602, dealing with notice to the defendant, have been included in the annotations for this Code section.

Absent personal service, appearance, or replevy, in personam judgment is void. —

When the defendants were not personally served with notice of pendency of attachment, did not appear and defend, and did not give bond and security to replevy property attached, an in personam judgment against the defendants was accordingly erroneous. Broome v. Graham, 99 Ga. App. 682 , 109 S.E.2d 824 , 1959 Ga. App. LEXIS 932 (1959) (decided under former Code 1933, § 8-602).

Contents of notice. —

Written notice to the defendant that attachment was pending against the defendant stating the court to which attachment was returnable, and the time, and stating on what property attachment had been levied, was sufficient compliance with former Code 1868, § 3233 to authorize proceedings as in ordinary suit, especially if the defendant appeared and pleaded to the merits. Pool v. Perdue, 44 Ga. 454 , 1871 Ga. LEXIS 401 (1871) (decided under former Code 1868, § 3233).

Administrator of defendant who dies pending attachment. —

If, pending attachment, the defendant dies, and the defendant’s administrator was made party to the proceeding, and no notice was given, as provided by former Code 1873, § 3309, the administrator stood precisely as did the deceased defendant. The administrator may attack the validity of the attachment, and if the administrator’s objection was good the whole proceeding fell. Ross v. Edwards, 52 Ga. 24 , 1874 Ga. LEXIS 230 (1874) (decided under former Code 1873, § 3309).

When defendant receives sufficient notice and fails to defend. —

When nonresident defendants in attachment were given sufficient notice to put the defendants upon inquiry in time to have defended, but failed to do so, the supreme court will not control decision of presiding judge in refusing to allow the defendants to open judgment rendered in an attachment case for purpose of pleading to merits. Steers & Co. v. Morgan & Armstrong, 66 Ga. 552 , 1881 Ga. LEXIS 58 (1881) (decided under former Code 1873, § 3309).

Plaintiff may entitle self to general judgment against defendant by giving prescribed notice. Sutton v. Gunn, 86 Ga. 652 , 12 S.E. 979 , 1891 Ga. LEXIS 38 (1891) (decided under former Code 1882, § 3309).

Effect on third persons of judgment by court without jurisdiction. —

General judgment of court without jurisdiction of particular class of attachments will not be valid against third persons although the judgment might be good against a defendant. First Nat'l Bank v. Ragan, 92 Ga. 333 , 18 S.E. 295 , 1893 Ga. LEXIS 70 (1893) (decided under former Code 1882, § 3309).

Absence of signature on notice of attachment. —

Although notices of attachment were not signed by the plaintiff, plaintiff’s attorney, or anyone as agent for the plaintiff, when the notices conveyed information required by statute and defendants were in no manner prejudiced by absence of a signature, the notice was sufficient to entitle the plaintiff to judgment on the declaration filed as at common law. Stalvey v. Varn Motors & Fin. Co., 56 Ga. App. 696 , 193 S.E. 627 , 1937 Ga. App. LEXIS 207 (1937).

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, decisions under former Code 1868, § 3236, former Code 1873, § 3312, former Code 1882, § 3312, former Civil Code 1895, § 4560, and former Civil Code 1910, § 5107 are included in the annotations for this Code section.

Traverse need not be sworn to. Ouzts v. Seabrook, 47 Ga. 359 , 1872 Ga. LEXIS 342 (1872) (decided under former Code 1868, § 3236).

Demurrer (now motion to dismiss) may be filed for lack of affidavit and attachment dismissed. DeLeon v. Heller, Hirsch & Co., 77 Ga. 740 , 1886 Ga. LEXIS 395 (1886) (decided under former provisions).

Denial of truth of ground for attachment may be treated as traverse. Cooley v. Abbey, 111 Ga. 439 , 36 S.E. 786 , 1900 Ga. LEXIS 557 (1900) (decided under former Code 1893, § 4560).

Third-party claimant to property levied upon. —

Claimant of property levied on by execution issued on judgment founded on attachment cannot, on trial of claim, traverse grounds on which attachment issued. Foster v. Higginbotham, 49 Ga. 263 , 1873 Ga. LEXIS 347 (1873) (decided under former Code 1882, § 3312).

Burden of proof. —

On trial of traverse, burden of proof is on plaintiff in attachment. Oliver v. Wilson, 29 Ga. 642 , 1860 Ga. LEXIS 269 (1860) (decided prior to codification of this principle).

Admissibility of evidence to sustain traverse after replevy of attached property. —

When ground of attachment is duly traversed, defendant is entitled to introduce evidence to sustain the defendant’s traverse, and presiding justice errs in holding that it is too late to do this after the defendant has replevied property attached. Brumby v. Rickoff, 94 Ga. 429 , 21 S.E. 232 , 1894 Ga. LEXIS 106 (1894) (decided under former Code 1873, § 3312).

Plaintiff is competent witness as to traverse by administrator regarding contract entered with intestate. —

When the plaintiff makes an affidavit for purpose of obtaining attachment against an administrator, and the administrator files traverse to affidavit, the plaintiff is a competent witness upon trial of issue formed, even though the contract, which is the foundation of the plaintiff’s claim, was made with intestate. Effect of verdict for the defendant, upon such issue, is a dismissal of attachment. Ouzts v. Seabrook, 47 Ga. 359 , 1872 Ga. LEXIS 342 (1872) (decided under former Code 1868, § 3236).

Waiver. —

Objections to form of affidavit are waived by appearance of the defendant, and pleading to the merits. Pool v. Perdue, 44 Ga. 454 , 1871 Ga. LEXIS 401 (1871) (decided under former Code 1868, § 3236).

Defendant in attachment does not waive traverse to the plaintiff’s affidavit by afterwards pleading to the merits of the action. The two defenses are perfectly consistent, the former going to the writ and the latter to the declaration. Parker v. Brady, 56 Ga. 372 , 1876 Ga. LEXIS 293 (1876) (decided under former Code 1868, § 3236).

Effect of finding issue in defendant’s favor. —

When issue on traverse is found in favor of the defendant, all defendant gains is that levy falls, and if judgment is obtained on merits the judgment does not date from time of levy, but the judgment would take lien on property attached as well as on other property from date of judgment only. Blakely Milling & Trading Co. v. Thompson, 34 Ga. App. 129 , 128 S.E. 688 , 1925 Ga. App. LEXIS 66 (1925) (decided under former Civil Code 1910, § 5107).

Intervenor’s right to traverse affidavit of attachment. —

Construing O.C.G.A. §§ 18-3-15 and 18-3-50 in pari materia, in light of the due process requirements, the intervenor has the same right to traverse the plaintiff’s affidavit of attachment as the defendant, and once the affidavit of attachment is traversed, the procedure to follow is the same as that accorded the defendant. Trax, Inc. v. Pentagon Aero-Marine Corp., 162 Ga. App. 276 , 290 S.E.2d 196 , 1982 Ga. App. LEXIS 3120 (1982).

RESEARCH REFERENCES

ALR.

Filing bond to secure release or return of seized property as appearance, 57 A.L.R.2d 1109.

JUDICIAL DECISIONS

Omission in pleadings of oath required is amendable when necessary facts existed at time of attachment under this statute was issued. Sloan v. Smith, 29 Ga. App. 591 , 116 S.E. 200 , 1923 Ga. App. LEXIS 134 (1923).

RESEARCH REFERENCES

ALR.

Power of municipal corporation to legislate as to Sunday observance, 37 A.L.R. 575 .

RESEARCH REFERENCES

ALR.

Attachment or garnishment as affected by trick or device by which the property of or indebtedness to nonresident was subjected to the jurisdiction, 37 A.L.R. 1255 .

RESEARCH REFERENCES

ALR.

Attack by defendant upon attachment or garnishment as an appearance subjecting him personally to jurisdiction, 129 A.L.R. 1240 .

JUDICIAL DECISIONS

Affidavit may be sufficient in form though it does not show that debt is due. Askew v. Melvin, 144 Ga. 348 , 87 S.E. 278 , 1915 Ga. LEXIS 199 (1915).

Variance in defendant’s name in required documents. —

Variance between affidavit and bond on one hand and attachment on the other, in the name of party against whom proceedings are brought is fatal to the attachment. Leffler & Son v. Union Compress Co., 126 Ga. 662 , 55 S.E. 927 , 1906 Ga. LEXIS 507 (1906).

Bill of particulars not annexed to papers. —

Attachment not necessarily void because no bill of particulars is annexed to original attachment papers. Pharr v. Estey Piano & Organ Co., 7 Ga. App. 262 , 66 S.E. 618 , 1909 Ga. App. LEXIS 624 (1909).

Absent levy or seizure of property under attachment there can be no recovery on bond. Hinton-Bellah, Inc. v. Thebit, 62 Ga. App. 672 , 9 S.E.2d 779 , 1940 Ga. App. LEXIS 400 (1940).

Effect of release on recovery of attachment expenses. —

Fact that plaintiff’s property had been released did not preclude the plaintiff from recovering expense sustained in consequence of the attachment. Hinton-Bellah, Inc. v. Thebit, 62 Ga. App. 672 , 9 S.E.2d 779 , 1940 Ga. App. LEXIS 400 (1940).

Damages recoverable on attachment expenses. —

Hinton-Bellah, Inc. v. Thebit, 62 Ga. App. 672 , 9 S.E.2d 779 , 1940 Ga. App. LEXIS 400 (1940).

RESEARCH REFERENCES

Am. Jur. Pleading and Practice Forms.

2B Am. Jur. Pleading and Practice Forms, Attachment and Garnishment, § 91. 2C Am. Jur. Pleading and Practice Forms, Attachment and Garnishment, § 340.

JUDICIAL DECISIONS

Levy failing to state that property was levied on as property of the defendant was amendable and such defect was not ground for arresting judgment. Flegal v. Loveless, 93 Ga. App. 41 , 90 S.E.2d 606 , 1955 Ga. App. LEXIS 466 (1955).

Absence of signature on notice of attachment. —

Although notices of attachment were not signed by the plaintiff, the plaintiff’s attorney, or anyone as agent for the plaintiff, where the notices conveyed information required by statute and defendants were in no manner prejudiced by absence of a signature, the notice was sufficient to entitle the plaintiff to judgment on the declaration filed as at common law. Stalvey v. Varn Motors & Fin. Co., 56 Ga. App. 696 , 193 S.E. 627 , 1937 Ga. App. LEXIS 207 (1937).

JUDICIAL DECISIONS

Presumption in favor of officer. —

Absent evidence to the contrary, it is presumed that an officer did the officer’s duty and did not exceed the officer’s authority under this statute. Connolly v. Atlantic Contracting Co., 120 Ga. 213 , 47 S.E. 575 , 1904 Ga. LEXIS 511 (1904).

Failure to state where levy was made. —

When return of an officer on levy of attachment fails to show in what county the levy was made, but the levy is in other respects legal and regular, failure to set out where levy was made is not ground for dismissal. Connolly v. Atlantic Contracting Co., 120 Ga. 213 , 47 S.E. 575 , 1904 Ga. LEXIS 511 (1904).

Levy by sheriff of attachment which should properly be levied by a constable is invalid. Pearce & Renfroe v. Renfroe Bros., 68 Ga. 194 , 1881 Ga. LEXIS 350 (1881).

OPINIONS OF THE ATTORNEY GENERAL

Escrow accounts of real estate brokers are not subject to attachment when broker is defendant inasmuch as money in such accounts is not property of the broker nor does it constitute a debt free from contingencies. 1972 Op. Att'y Gen. No. 72-1.

RESEARCH REFERENCES

ALR.

Levy upon or garnishment of contents of safety deposit box, 39 A.L.R. 1215 .

Replevin for bank account, 44 A.L.R. 1522 .

Contingent remainder as subject to levy and sale by creditor, 60 A.L.R. 803 .

Interest of vendee under conditional sales contract as subject to attachment, garnishment, or execution, 61 A.L.R. 781 .

Liability of sheriff or other officer executing process of execution or attachment for failure to seize sufficient property, 93 A.L.R. 316 .

Maintainability of replevin or similar possessory action where defendant, at time action is brought, is no longer in possession of property, 97 A.L.R. 896 .

Bank deposit as subject of garnishment for debt of depositor as affected by previous acts by bank in relation to deposit, 107 A.L.R. 697 .

Joint bank account as subject to attachment, garnishment, or execution by creditor of one of the joint depositors, 11 A.L.R.3d 1465.

Potential liability of insurer under liability policy as subject of attachment, 33 A.L.R.3d 992.

Liquor license as subject to execution or attachment, 40 A.L.R.4th 927.

JUDICIAL DECISIONS

Omission of description of property on attachment docket. —

Though entry on attachment docket respecting attachment upon land does not contain description of the property, it may not be taken advantage of by a claimant to the property who acquired the property under fraudulent circumstances. Deveney, Hood & Co. v. Burton, 110 Ga. 56 , 35 S.E. 268 , 1900 Ga. LEXIS 324 (1900).

Nature of lien of judgment creditor; limitation of judgment’s scope. —

Lien of a judgment creditor is not a lien acquired by contract; but is given by law. The judgment creditor is not, therefore, in the position of a bona fide purchaser, and the judgment creditor’s lien extends only to property levied upon which actually belongs to the defendant in attachment. Parker v. Boyd, 208 Ga. 829 , 69 S.E.2d 760 , 1952 Ga. LEXIS 363 (1952).

RESEARCH REFERENCES

ALR.

Attachment proceedings as affected by officer’s failure to comply with statutory requirements as to return or inventory, 93 A.L.R. 748 .

Maintainability of replevin or similar possessory action where defendant, at time action is brought, is no longer in possession of property, 97 A.L.R.2d 896.

JUDICIAL DECISIONS

Analysis

• General Consideration
• Effect of Replevy Bond
• Liability of Surety

RESEARCH REFERENCES

ALR.

Voluntary dismissal of repleving action by plaintiff as affecting defendant’s right to judgment for the return or value of the property, 2 A.L.R. 200 .

Recovery for depreciation of property between the date it was replevied and final judgment, 24 A.L.R. 1189 .

Replevin for an undivided share in or undivided quantity of a larger mass, 26 A.L.R. 1015 .

Duty to give bond and procure return of property in order to mitigate damages from its wrongful seizure under legal process, 33 A.L.R. 1479 .

Liability on bond in replevin as affected by superior title or lien of third person, or seizure thereunder, 36 A.L.R. 1102 .

Premium for redelivery bond as item of damages for wrongful attachment, 42 A.L.R. 1057 .

Sufficiency of offer or tender to satisfy requirement of judgment or condition of bond in replevin for delivery or redelivery of chattels, 57 A.L.R. 806 .

Answering to merits or giving bond for release of attachment as waiver of objections to attachment, 72 A.L.R. 120 .

Liability of surety on replevin bond as affected by amendment of pleadings in replevin, 90 A.L.R. 541 .

Right of one joint owner of personal property to maintain against third person replevin, detinue, trover, or other action to recover possession or damages, 110 A.L.R. 353 .

Recovery of damages in replevin for usable value of property detained, by successful party having only security interest as conditional vendor, chattel mortgagee, or the like, 33 A.L.R.2d 774.

Filing bond to secure release or return of seized property as appearance, 57 A.L.R.2d 1109.

Posting of redelivery bond by defendant in attachment as waiver of damages for wrongful attachment, 57 A.L.R.2d 1376.

Replevin or claim-and-delivery: Modern view as to validity of statute or contractual provision authorizing summary repossession of consumer goods sold under retail installment sales contract, 45 A.L.R.3d 1233.

RESEARCH REFERENCES

ALR.

Recovery for depreciation of property between the date it was replevied and final judgment, 24 A.L.R. 1189 .

Duty to give bond and procure return of property in order to mitigate damages from its wrongful seizure under legal process, 33 A.L.R. 1479 .

Premium for redelivery bond as item of damages for wrongful attachment, 42 A.L.R. 1057 .

Sufficiency of offer or tender to satisfy requirement of judgment or condition of bond in repleving for delivery or redelivery of chattels, 57 A.L.R. 806 .

JUDICIAL DECISIONS

Intervention in action. —

Claimant who alleges being the true owner is permitted to intervene in an attachment action. Trax, Inc. v. Pentagon Aero-Marine Corp., 162 Ga. App. 276 , 290 S.E.2d 196 , 1982 Ga. App. LEXIS 3120 (1982).

Construing O.C.G.A. §§ 18-3-15 and 18-3-31 in pari materia, in light of the due process requirements, the intervenor has the same right to traverse the plaintiff’s affidavit of attachment as the defendant, and once the affidavit of attachment is traversed, the procedure to follow is the same as that accorded the defendant. Trax, Inc. v. Pentagon Aero-Marine Corp., 162 Ga. App. 276 , 290 S.E.2d 196 , 1982 Ga. App. LEXIS 3120 (1982).

Only issue in third-party claim requires determination of who has title. —

When property is levied on by virtue of attachment and is claimed by one not party to the attachment, the only issue on trial requires determination of who has title to the property. Bank of Manchester v. Universal Credit Co., 45 Ga. App. 223 , 45 Ga. App. 233 , 164 S.E. 95 , 1932 Ga. App. LEXIS 253 (1932).

Prevailing party refusing to take property back and seeking value instead. —

When tortious levy is made upon property of one not party to the process, and one files statutory claim to the property one cannot, upon recovering judgment finding the property not subject, refuse to take the property back from the officer, and instead seek to hold person causing the levy liable for the property’s full market value. Maxwell v. Speth, 9 Ga. App. 745 , 72 S.E. 292 , 1911 Ga. App. LEXIS 316 (1911).

To whom bond payable. —

When a claim for property attached is not interposed until after judgment on attachment, claim bond should be made payable to the sheriff as in other claim cases. Benton v. Benson, 32 Ga. 354 , 1861 Ga. LEXIS 187 (1861).

JUDICIAL DECISIONS

Refusal to deliver property was a forfeiture of the bond. Stinson v. Hall, 54 Ga. 676 , 1875 Ga. LEXIS 296 (1875).

Breach of bond. —

There is a breach of bond when the property has been consumed or otherwise disposed of so as to render it impossible for obligors in bond to deliver the property to levying officer on demand. Manufacturers' Fin. Acceptance Corp. v. Bradley, 50 Ga. App. 138 , 177 S.E. 272 , 1934 Ga. App. LEXIS 660 (1934).

Claimant’s inability to deliver property, resulting from claimant’s sale of the property, dispenses with advertisement and is a breach of claimant’s bond. Lassiter v. Byrd & Coker, 55 Ga. 606 , 1876 Ga. LEXIS 430 (1876).

When claimant breached claimant’s bond by converting property and dismissing claimant’s claim, claimant thereby waives the right, on trial of suit for breach of bond, to assert that property was not subject to attachment. Earnest v. Barrett, 55 Ga. App. 482 , 190 S.E. 635 , 1937 Ga. App. LEXIS 405 (1937).

RESEARCH REFERENCES

ALR.

Recovery for depreciation of property between the date it was replevied and final judgment, 24 A.L.R. 1189 .

Sufficiency of offer or tender to satisfy requirement of judgment or condition of bond in replevin for delivery or redelivery of chattels, 57 A.L.R. 806 .

Right of one joint owner of personal property to maintain against third person replevin, detinue, trover, or other action to recover possession or damages, 110 A.L.R. 353 .

Replevin or claim-and-delivery: Modern view as to validity of statute or contractual provision authorizing summary repossession of consumer goods sold under retail installment sales contract, 45 A.L.R.3d 1233.

JUDICIAL DECISIONS

Issue in third-party claim. —

When levy was made under attachment before judgment, and a claim interposed thereto, the issue was whether property levied on was that of the defendant in attachment or that of the claimant. Cecil & Thrasher v. Gazan, 71 Ga. 631 , 1883 Ga. LEXIS 236 (1883).

Admissibility of attachment proceedings. —

Attachment proceedings are admissible in a claim proceeding, though judgment therein is defective. Cecil & Thrasher v. Gazan, 71 Ga. 631 , 1883 Ga. LEXIS 236 (1883).

Trial of intervenor’s traverse claim in the same manner as defendant’s traverse. —

See Trax, Inc. v. Pentagon Aero-Marine Corp., 162 Ga. App. 276 , 290 S.E.2d 196 , 1982 Ga. App. LEXIS 3120 (1982).

JUDICIAL DECISIONS

Inability to produce property is equivalent to failure to produce property. Manufacturers' Fin. Acceptance Corp. v. Bradley, 50 Ga. App. 138 , 177 S.E. 272 , 1934 Ga. App. LEXIS 660 (1934).

Occurrence of breach. —

There is a breach of bond when property has been consumed or otherwise disposed of so as to render it impossible for obligors in bond to deliver the property to levying officer on demand. Manufacturers' Fin. Acceptance Corp. v. Bradley, 50 Ga. App. 138 , 177 S.E. 272 , 1934 Ga. App. LEXIS 660 (1934).

Defendant raising defenses decided against defendant in prior claim case. —

One who files claim to levy of attachment and replevies property by giving a forthcoming bond cannot, after judgment has been rendered in the claim case finding the property subject, set up, in defense to an action upon the forthcoming bond, any contention decided against that person by the judgment in the claim case. Thompson v. O'Connor, 115 Ga. 120 , 41 S.E. 242 , 1902 Ga. LEXIS 323 (1902).

RESEARCH REFERENCES

ALR.

Recovery for depreciation of property between the date it was replevied and final judgment, 24 A.L.R. 1189 .

Right of one joint owner of personal property to maintain against third person replevin, detinue, trover, or other action to recover possession or damages, 110 A.L.R. 353 .

Recovery of attorney’s fees as damages by successful litigant in replevin or detinue action, 60 A.L.R.2d 945.

RESEARCH REFERENCES

ALR.

Recovery for depreciation of property between the date it was replevied and final judgment, 24 A.L.R. 1189 .

Liability of garnishee to garnishing creditor for depreciation in value of property pending contest, 32 A.L.R. 572 .

Sufficiency of offer or tender to satisfy requirement of judgment or condition of bond in replevin for delivery or redelivery of chattels, 57 A.L.R. 806 .

Liability of surety on replevin bond as affected by amendment of pleadings in replevin, 90 A.L.R. 541 .

Replevin bond or redelivery bond in replevin as covering damages for detention between judgment against principal and delivery or redelivery of property, 90 A.L.R. 972 .

Right of one joint owner of personal property to maintain against third person replevin, detinue, trover, or other action to recover possession or damages, 110 A.L.R. 353 .

JUDICIAL DECISIONS

Issue in claim interposed before judgment is whether property levied on is claimant’s or defendant’s. W.B. Parham & Co. v. Potts-Thompson Liquor Co., 127 Ga. 303 , 56 S.E. 460 , 1907 Ga. LEXIS 242 (1907).

Claim interposed pending attachment dismissed for irregularity. —

If a claim, interposed pending attachment, be dismissed for irregularity, such dismissal is no bar to another claim, after judgment on the attachment. Benton v. Benson, 32 Ga. 354 , 1861 Ga. LEXIS 187 (1861).

Third person, not party to attachment, may claim property at any time before the property’s sale. Simmons v. Bennett, 20 Ga. 48 , 1856 Ga. LEXIS 9 (1856).

JUDICIAL DECISIONS

Financial institution did not include insurance company garnished as employer. —

Insurance company was not a “financial institution” under the financial institution garnishment scheme, O.C.G.A. §§ 18-4-1(4) and 18-4-4(c)(2), when the insurance company was garnished based on earnings that the company owed the debtor as the debtor’s former employer; rather, the statutes envisioned places of deposit for a debtor’s funds or investments. Blach v. Diaz-Verson, 303 Ga. 63 , 810 S.E.2d 129 , 2018 Ga. LEXIS 72 (2018).

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, decisions under former Ga. L. 1884-55, p. 54, former Civil Code 1895, § 4708, former Civil Code 1910, §§ 5265 and 5268, former Ga. L. 1976, p. 1608, § 1, former O.C.G.A. § 18-4-3 , and former O.C.G.A. T. 18, Ch. 4, Art. 4 are included in the annotations for this Code section.

Constitutionality. —

Postjudgment garnishment procedure meets requirements of judicial supervision and notice, and is not unconstitutional for those reasons. Easterwood v. LeBlanc, 240 Ga. 61 , 239 S.E.2d 383 , 1977 Ga. LEXIS 1395 (1977) (decided under former Ga. L. 1976, p. 1608, § 1); Farmer v. Farmer, 147 Ga. App. 387 , 249 S.E.2d 106 , 1978 Ga. App. LEXIS 2697 (1978) (decided under former Ga. L. 1976, p. 1608, § 1).

Post-judgment garnishment proceedings are not unconstitutional for lack of due process. Morgan v. Morgan, 156 Ga. App. 726 , 275 S.E.2d 673 , 1980 Ga. App. LEXIS 3182 (1980) (decided under former Ga. L. 1976, p. 1608, § 1).

Amendment after evidence but prior to judgment. —

It was not error to allow a party to amend the party’s garnishment affidavit only a few days before judgment, and after all the evidence had been presented. Coleman v. Burnett, 169 Ga. App. 297 , 312 S.E.2d 627 , 1983 Ga. App. LEXIS 3053 (1983) (decided under former O.C.G.A. § 18-4-3 ).

Absence of a judge’s or clerk’s signature on an affidavit for garnishment did not constitute a nonamendable defect justifying the grant of a motion to set aside a judgment. Horizon Credit Corp. v. Lanier Bank & Trust Co., 220 Ga. App. 362 , 469 S.E.2d 452 , 1996 Ga. App. LEXIS 194 (1996) (decided under former O.C.G.A. § 18-4-3 ).

Parties to proceedings. —

Post-judgment garnishments primarily involve a plaintiff (bank) and garnishee (employer) with a very limited right of participation by the defendant (debtor). Flournoy v. Pate (In re Antley), 18 Bankr. 207, 1982 Bankr. LEXIS 4650 (Bankr. M.D. Ga. 1982) (decided under former O.C.G.A. T. 18, Ch. 4, Art. 4).

Defendant debtor was not a “party” to a garnishment proceeding, although provision was made in former O.C.G.A. § 18-4-64 for defendant debtor to receive notice. The defendant debtor at the defendant debtor’s option may become a party by compliance with former O.C.G.A. § 18-4-93 for the limited purposes set out in former O.C.G.A. § 18-4-65. Flournoy v. Pate (In re Antley), 18 Bankr. 207, 1982 Bankr. LEXIS 4650 (Bankr. M.D. Ga. 1982) (decided under former O.C.G.A. T. 18, Ch. 4, Art. 4).

Dismissal of proceeding upon notification of bankruptcy. —

Judgment creditor’s attorney had an affirmative duty to dismiss the garnishment proceeding upon notification of bankruptcy. Dennis v. Pentagon Fed. Credit Union, 17 Bankr. 558, 1982 Bankr. LEXIS 4968 (Bankr. M.D. Ga. 1982) (decided under former O.C.G.A. T. 18, Ch. 4, Art. 4).

Proceedings must be based on a domestic, not a foreign judgment. Union Inv. Co. v. Southern Ry., 32 Ga. App. 478 , 124 S.E. 77 , 1924 Ga. App. LEXIS 478 (1924) (decided under former Civil Code 1910, § 5265).

Separate affidavit and bond is required for each judgment as to which garnishment is sought. Rich & Co. v. Kiser & Co., 61 Ga. 370 , 1878 Ga. LEXIS 127 (1878) (decided under former Ga. L. 1884-55, p. 54).

Impact of consolidation. —

Consolidation by assignee of two executions issued on judgments obtained in separate suits in affidavit and bond renders proceedings illegal and void. Morgan v. Latham, 111 Ga. 835 , 36 S.E. 99 , 1900 Ga. LEXIS 788 (1900) (decided under former Civil Code 1895, § 4708); Wright v. Stewart, 22 Ga. App. 655 , 97 S.E. 193 , 1918 Ga. App. LEXIS 663 (1918) (decided under former Civil Code 1910, § 5268).

RESEARCH REFERENCES

C.J.S.

38 C.J.S., Garnishment, § 140 et seq.

ALR.

Discharge of attachment or garnishment, or bond for its dissolution, by subsequent amendment of pleadings or writ, 74 A.L.R. 912 .

JUDICIAL DECISIONS

Analysis

• General Consideration
• Constitutionality

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Attachment and Garnishment, § 330 et seq.

C.J.S.

38 C.J.S., Garnishment, § 158 et seq.

ALR.

Waiver or admission by garnishee as affecting principal defendant, 64 A.L.R. 430 .

Liability of garnishee to garnisher where former pays debt or releases property pending defective garnishment proceedings, 89 A.L.R. 975 .

Resident or foreign corporation doing business within state as subject to garnishment because of indebtedness to nonresident who in turn is indebted to nonresident principal defendant, 116 A.L.R. 387 .

JUDICIAL DECISIONS

Analysis

• General Consideration
• Constitutionality
• What Is Subject to Garnishment
• Setoff by Garnishee

OPINIONS OF THE ATTORNEY GENERAL

Editor’s notes. In light of the similarity of the statutory provisions, opinions decided under former Code 1933, § 46-301 as it read after passage of Ga. L. 1976, p. 1608, § 1 are included in the opinions for this Code section.

Right of setoff exists in garnishee-employer respecting indebtedness of defendant-employee to garnishee employer as against claim of plaintiff in garnishment; thus, the garnishee is entitled to pay oneself from earnings accruing to the employee before paying the plaintiff in garnishment. 1976 Op. Atty Gen. No. U76-26 (decided under former Code 1933, § 46-301).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Attachment and Garnishment, §§ 69 et seq., 107.

C.J.S.

38 C.J.S., Garnishment, § 173.

ALR.

Money due only on further performance of contract by debtor as subject to garnishment, 2 A.L.R. 506 .

Rights of holder of check as affected by garnishment of drawer’s bank account, 5 A.L.R. 587 .

Garnishment of bank in suit against the payee or other holder of a check upon the bank, 5 A.L.R. 589 .

Levy upon or garnishment of contents of safety deposit box, 19 A.L.R. 863 ; 39 A.L.R. 1215 .

Judgment as subject to garnishment in another court of the state in which it was rendered, 43 A.L.R. 190 .

Money or other property taken from prisoner as subject of attachment, garnishment, or seizure under execution, 48 A.L.R. 583 .

Priority of assignment of chose in action over subsequent garnishment as affected by lack of notice to debtor of assignment, 52 A.L.R. 109 .

Foreign attachment or garnishment upon which jurisdiction is dependent resting upon property coming into hands of garnishee, or obligations having their inception, after service of the writ, 53 A.L.R. 1022 .

Garnishment of salaries, wages, or commissions not expressly exempted by statute, 56 A.L.R. 601 .

Debt owing to two or more as subject of garnishment in action against less than all, 57 A.L.R. 844 .

Who is “employee” within debt exemption statute, 58 A.L.R. 777 .

Right of creditor upon dissolution of his own attachment to garnish custodian of attached property, 59 A.L.R. 526 .

Garnishment against executor or administrator by creditor of heir, legatee, distributee, or creditor of estate, 59 A.L.R. 768 .

County as subject to garnishment process, 60 A.L.R. 823 .

Interest of vendee under conditional sales contract as subject to attachment, garnishment, or execution, 61 A.L.R. 781 .

Issuance of successive writs of garnishment or other process to reach property or earnings exempt in whole or in part, 65 A.L.R. 1283 .

Refusal to render judgment or garnishment in proceedings in rem, because of danger to garnishee of double liability in event of refusal of court of another jurisdiction to recognize or give effect to judgment, if rendered, 69 A.L.R. 609 .

Indebtedness to partnership as subject of attachment or garnishment by creditor of individual partner, 71 A.L.R. 77 .

Construction, application, and effect of statute exempting from garnishment debt evidenced by negotiable instrument, 71 A.L.R. 581 .

Interest of mortgagor or pledgor in property in possession of mortgagee or pledgee as subject of garnishment, 83 A.L.R. 1383 .

Liability for conversion of property as the subject of garnishment by creditor of the owner, 91 A.L.R. 1337 .

Property of incompetent or infant under guardianship as subject of execution, attachment, or garnishment, 92 A.L.R. 919 .

Unliquidated claims of damage in tort as subject of garnishment, 93 A.L.R. 1088 .

Withdrawal value of stock in building and loan association as basis of attachment or execution by member or as subject of garnishment by member’s creditor, 94 A.L.R. 1017 .

Redemption money in hands of officer as subject to attachment, garnishment, or execution, 94 A.L.R. 1049 .

Indebtedness as subject to garnishment or trustee process after debtor has given his check therefor, 94 A.L.R. 1391 .

Right to garnish amount payable under a contract contemplating a cash transaction, 95 A.L.R. 1497 .

Garnishment by landlord’s creditor of tenant’s obligation in respect of rent, 100 A.L.R. 307 .

Garnishment of bank deposit as affected by bank’s right, or waiver of right, to set off depositor’s indebtedness to it against deposit or apply deposit to such indebtedness, 106 A.L.R. 62 ; 110 A.L.R. 1268 .

Garnishment as suit within rule that state may not be sued without its consent, 114 A.L.R. 261 .

Resident or foreign corporation doing business within state as subject to garnishment because of indebtedness to nonresident who in turn is indebted to nonresident principal defendant, 116 A.L.R. 387 .

Debtor’s exemption (other than homestead) as applicable in favor of nonresidents or of residents absent or about to remove from the state, 119 A.L.R. 554 .

Judgment in tort action as subject of assignment, attachment, or garnishment pending appeal, 121 A.L.R. 420 .

Issuance and return of execution as necessary condition of garnishment after judgment, 128 A.L.R. 1153 .

What amounts to a contingency within statute or rule permitting garnishment or similar process before an obligation is due or payable, if payment or delivery is not dependent upon a contingency, 134 A.L.R. 853 .

Right of creditors to reach by garnishment or other process, commissions of debtor, as executor, administrator, or trustee, 143 A.L.R. 190 .

Form of judgment against garnishee respecting obligation payable in installments, 7 A.L.R.2d 680.

Judgment debtor’s personal injury claims against third person or latter’s liability insurer as subject to creditor’s bill, 51 A.L.R.2d 595.

Value of room and board furnished to servant as included in total salary or earnings for purpose of statute exempting wages, 51 A.L.R.2d 947.

Sharecropper’s share in crop wholly or partly unharvested as subject to garnishment, 82 A.L.R.2d 858.

Garnishment of salary, wages, or commissions where defendant debtor is indebted to garnishee-employer, 93 A.L.R.2d 995.

Funds deposited in court as subject of garnishment, 1 A.L.R.3d 936.

Attachment and garnishment of funds in branch bank or main office of bank having branches, 12 A.L.R.3d 1088.

Funds in hands of his attorney as subject of attachment or garnishment by client’s creditor, 35 A.L.R.3d 1094.

Liability of creditor for excessive attachment or garnishment, 56 A.L.R.3d 493.

Garnishment against executor or administrator by creditor of estate, 60 A.L.R.3d 1301.

Special bank deposits as subject of attachment or garnishment to satisfy depositor’s general obligations, 8 A.L.R.4th 998.

Garnishment of funds payable under building and construction contract, 16 A.L.R.5th 548.

Joint bank account as subject to attachment, garnishment, or execution by creditor of one joint depositor, 86 A.L.R.5th 527.

RESEARCH REFERENCES

C.J.S.

38 C.J.S., Garnishment, § 209 et seq.

ALR.

Who is “employee” within debt exemption statute, 58 A.L.R. 777 .

Wrongful discharge: employer’s liability under state law for discharge of employee based on garnishment order against wages, 41 A.L.R.5th 31.

Protection of debtor from acts of discrimination by private entity under § 525(b) of Bankruptcy Code of 1978 (11 USCS § 525(b)), 105 A.L.R. Fed. 555.

Preemption of state-law wrongful discharge claim, not arising from whistleblowing, by § 301(a) of Labor-Management Act of 1947 (29 U.S.C.A. § 185(a)), 184 A.L.R. Fed. 241.

JUDICIAL DECISIONS

Pension funds exempt, not individual pension payments. —

Law exempted from garnishment all pension funds for policemen and municipal employees, irrespective of their source or intended beneficiaries, but it is the funds, rather than the individual pension payments, that are exempt from garnishment. Cooper v. City of Atlanta Policemen's Pension Fund, 147 Ga. App. 633 , 249 S.E.2d 684 , 1978 Ga. App. LEXIS 2875 (1978).

When funds or benefits exempt. —

O.C.G.A. § 18-4-22 means that funds or benefits from a pension or retirement program are exempt from the process of garnishment until such funds or benefits are in the hands of the member or beneficiary of the program. Davis v. Davis, 161 Ga. App. 722 , 288 S.E.2d 748 , 1982 Ga. App. LEXIS 2016 (1982).

Chapter 7 bankruptcy. —

Debtor’s Individual Retirement Account (IRA) would be excluded from the bankruptcy estate under 11 U.S.C. § 541(c) (2) on the basis of the restriction on transfer by garnishment contained in subsection (a) of O.C.G.A. § 18-4-22 , notwithstanding that the transfer restriction was contained only in the Georgia statute and was not contained within the IRA document itself and notwithstanding that the debtor had access to the IRA funds for personal use upon payment of a 10% penalty tax. Meehan v. Wallace, 102 F.3d 1209, 1997 U.S. App. LEXIS 217 (11th Cir. 1997).

Federal preemption. —

Twenty-five percent of the defendant ERISA beneficiary’s benefit payment was subject to garnishment by the defendant judgment creditor under a continuing garnishment pursuant to O.C.G.A. § 18-4-22(a) because the ERISA Plan was a Top Hat Plan, which was not subject to the ERISA anti-alienation provision, 29 U.S.C. § 1056 . AFLAC Inc. v. Diaz-Verson, No., No. 4-11-CV-81, 2012 U.S. Dist. LEXIS 73140 (M.D. Ga. May 25, 2012).

Benefits not actually received not subject to garnishment. —

Retirement benefits paid into registry of trial court by garnishee were not subject to garnishment because the defendant had never received actual possession of the benefits. Birchfield v. Birchfield, 165 Ga. App. 101 , 299 S.E.2d 409 , 1983 Ga. App. LEXIS 1778 (1983).

Individual retirement accounts. —

Federal law preempts O.C.G.A. § 18-4-22 and mandates a finding that individual retirement accounts possessed by the garnishees are exempt from garnishment by commercial creditors in a nonbankruptcy situation. Citizens Bank v. Shingler, 173 Ga. App. 511 , 326 S.E.2d 861 , 1985 Ga. App. LEXIS 1600 (1985) (decided prior to 1990 amendment specifically exempting individual retirement account funds or benefits).

Chapter 7 debtor’s Roth individual retirement account (IRA) was not excluded from the property of the estate because O.C.G.A. § 18-4-22(a) applied only to an IRA within the meaning of 26 U.S.C. § 408 and Georgia law provided no similar protection for a Roth IRA established under 26 U.S.C. § 408 A. Goodman v. Bramlette (In re Bramlette), 333 Bankr. 911, 2005 Bankr. LEXIS 2364 (Bankr. N.D. Ga. 2005).

Annuity. —

O.C.G.A. § 44-13-100 specifically addresses what types of annuities and similar contracts are exempt in bankruptcy cases. Therefore, the debtor’s attempt to exempt the annuity under O.C.G.A. §§ 18-4-22 and 47-2-332 would have failed even if the annuity met the requirements of those statutes (which appeared not to be the case in any event). In re Sheffield, 507 Bankr. 400, 2014 Bankr. LEXIS 900 (Bankr. S.D. Ga. 2014).

Wages for child support not exempt. —

In a garnishment action, the defendant was not entitled to exempt from garnishment the amount of wages the defendant was supposed to pay for child support because O.C.G.A. § 18-4-6 does not specifically exempt child support obligations from garnishment and the court rejected the defendant’s argument that a judgment against the defendant for unpaid child support took priority over the plaintiff’s judgment. Smith v. Robinson, 355 Ga. App. 159 , 842 S.E.2d 917 , 2020 Ga. App. LEXIS 277 (2020), cert. denied, No. S20C1576, 2021 Ga. LEXIS 221 (Ga. Apr. 5, 2021).

Disposable earnings limitation. —

Trial court erred in ruling that the disposable earnings limitation applied to funds from an unfunded plan because doing so would render the disposable earnings limitation expressly mentioned mere surplusage. Truist Bank v. Stark, 359 Ga. App. 116 , 854 S.E.2d 784 , 2021 Ga. App. LEXIS 160 (2021).

RESEARCH REFERENCES

ALR.

Who is “employee” within debt exemption statute, 58 A.L.R. 777 .

Debtor’s exemption (other than homestead) as applicable in favor of nonresidents or of residents absent or about to remove from the state, 119 A.L.R. 554 .

Employee retirement pension benefits as exempt from garnishment, attachment, levy, execution, or similar proceedings, 93 A.L.R.3d 711.

Enforcement of claim for alimony or support, or for attorneys’ fees and costs incurred in connection therewith, against exemptions, 52 A.L.R. 5 th 221.

Individual retirement accounts as exempt property in bankruptcy, 133 A.L.R. Fed. 1.

RESEARCH REFERENCES

C.J.S.

38 C.J.S., Garnishment, §§ 173 et seq., 185 et seq.

ALR.

Who may serve writ, summons, or notice of garnishment, 75 A.L.R.2d 1433.

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, decisions under former Ga. L. 1884-85, p. 95; former Civil Code 1895, § 4710; former Civil Code 1910, § 5270; former Code 1933, § 46-105; former Code 1933, § 46-106, as it read prior to revision by Ga. L. 1976, p. 1608, § 1; former Code 1933, § 46-304 as it read after passage of Ga. L. 1976, p. 1608, § 1; and former O.C.G.A. §§ 18-4-23 and 18-4-64 are included in the annotations for this Code section.

Construction. —

Because garnishment was a special statutory proceeding in derogation of common law, former O.C.G.A. § 18-4-23 had to be strictly construed. ARC Sec., Inc. v. Massey Bus. College, 221 Ga. App. 489 , 471 S.E.2d 569 , 1996 Ga. App. LEXIS 553 (1996) (decided under former O.C.G.A. § 18-4-23 ).

Relationship with other laws. —

After a consumer appealed a district court’s dismissal of the consumer’s improper venue Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692 et seq., complaint, the FDCPA venue provision applied only to legal actions against any consumer, and Georgia garnishment proceedings were not legal actions against any consumer. Ray v. McCullough Payne & Haan, LLC, 838 F.3d 1107, 2016 U.S. App. LEXIS 17633 (11th Cir. 2016).

Former Civil Code 1895, § 4710 was not restricted to service on domestic corporations. Cathcart v. Cincinnati, Hamilton & Dayton Ry. Co., 108 Ga. 253 , 33 S.E. 875 , 1899 Ga. LEXIS 230 (1899) (decided under former Civil Code 1895, § 4710).

Corporation not transacting business in this state is not subject to garnishment, though the corporation’s agent resides herein. Schmidlapp & Co. v. La Confiance Ins. Co., 71 Ga. 246 , 1883 Ga. LEXIS 170 (1883) (decided under former Civil Code 1895, § 4710).

Service upon agent in cases of foreign debt or garnishee. —

Garnishment can lawfully be served upon a foreign corporation by making personal service upon an authorized agent of the company in this state even though the principal debtor and the garnishee may both be nonresidents, or that the debt garnished was contracted and is payable elsewhere (i.e., in another state). United Merchants & Mfrs., Inc. v. Citizens & S. Nat'l Bank, 166 Ga. App. 468 , 304 S.E.2d 552 , 1983 Ga. App. LEXIS 3243 (1983) (decided under former O.C.G.A. § 18-4-23 ).

Process served on corporation pending its application for charter will not confer jurisdiction. Bartram, Hendrix & Co. v. Collins Mfg. Co., 69 Ga. 751 , 1882 Ga. LEXIS 338 (1882) (decided under former law).

Construction of “agent.” —

Word “agent” in former Civil Code 1910, § 5270 should not be construed in a narrow, technical sense, but should be given a broad, common-sense construction. Central of Ga. Ry. v. Ellis, 17 Ga. App. 536 , 87 S.E. 815 , 1916 Ga. App. LEXIS 761 (1916) (decided under former Civil Code 1910, § 5270).

Service on agent in charge. —

When agent was served, return is amendable to show that agent was in charge. Southern Express Co. v. National Bank, 4 Ga. App. 399 , 61 S.E. 857 , 1908 Ga. App. LEXIS 313 (1908) (decided under former Civil Code 1895, § 4710).

Service upon agent who is defendant in main suit. —

Service of garnishment upon corporation doing business in this state may be perfected by service upon its agent in charge of its business in this state, even though agent is defendant in main suit. Jewel Tea Co. v. Patillo, 50 Ga. App. 620 , 178 S.E. 925 , 1935 Ga. App. LEXIS 246 (1935) (decided under former Code 1933, § 46-106).

Delegation of employee as agent. —

If principal officer in charge of business of corporation is authorized to designate another employee because the corporation prefers that the corporation’s principal officer not receive service, then that employee can be designated as agent in charge of office of corporation for purpose of receiving such service. Cleveland Lumber Co. v. Delta Equities, Inc., 232 Ga. 883 , 209 S.E.2d 212 , 1974 Ga. LEXIS 1124 (1974) (decided under former Code 1933, § 46-106).

Entry of service must show service on corporation or the corporation’s alter ego. North Ga. Banking Co. v. Fancher, 23 Ga. App. 683 , 99 S.E. 229 , 1919 Ga. App. LEXIS 288 (1919) (decided under former Civil Code 1910, § 5270).

President of chartered bank is the bank’s alter ego. Third Nat'l Bank v. McCullough Bros., 108 Ga. 249 , 33 S.E. 848 , 1899 Ga. LEXIS 228 (1899) (decided under former Civil Code 1895, § 4710); Twilley & Hodges v. Middle Ga. Bank, 28 Ga. App. 416 , 111 S.E. 694 , 1922 Ga. App. LEXIS 560 (1922) (decided under former Civil Code 1910, § 5270).

When person other than president is served, return must show it was agent in charge. Twilley & Hodges v. Middle Ga. Bank, 28 Ga. App. 416 , 111 S.E. 694 , 1922 Ga. App. LEXIS 560 (1922) (decided under former Civil Code 1910, § 5270).

Service on others. —

Entry showing service on cashier must show that cashier was in charge. North Ga. Banking Co. v. Fancher, 23 Ga. App. 683 , 99 S.E. 229 , 1919 Ga. App. LEXIS 288 (1919) (decided under former Civil Code 1910, § 5270).

Return merely designating person served as “supt.” is insufficient. Hargis v. East Tenn., V. & Ga. Ry., 90 Ga. 42 , 15 S.E. 631 , 1892 Ga. LEXIS 118 (1892) (decided under former law); Southern Ry. v. Hagan, 103 Ga. 564 , 29 S.E. 760 , 1897 Ga. LEXIS 433 (1897) (decided under former Civil Code 1895, § 4710).

Service on chief clerk when agent is absent, and that clerk is in charge suffices. Central of Ga. Ry. v. Ellis, 17 Ga. App. 536 , 87 S.E. 815 , 1916 Ga. App. LEXIS 761 (1916) (decided under former Civil Code 1910, § 5270).

Personal service upon ticket agent in charge of ticket office of railroad company, and selling tickets and handling passenger business for the railroad and other like companies is sufficient. Seaboard Air-Line Ry. v. Browder, 144 Ga. 322 , 87 S.E. 6 , 1915 Ga. LEXIS 185 (1915) (decided under former Civil Code 1910, § 5270).

Burden of proof. —

When corporation denies that agent served was in charge of office, prima facie presumption in favor of return arises, and burden of proof is on company. Twilley & Hodges v. Middle Ga. Bank, 28 Ga. App. 416 , 111 S.E. 694 , 1922 Ga. App. LEXIS 560 (1922) (decided under former Civil Code 1910, § 5270).

Evidence sufficient to challenge service. —

Testimony from the president and controller of a corporation that they were the only persons authorized to receive service and that the person served was not a corporate officer, performed only clerical functions, and was paid on an hourly basis, along with similar testimony from the receptionist who was served, was sufficient evidence that service was improper. ARC Sec., Inc. v. Massey Bus. College, 221 Ga. App. 489 , 471 S.E.2d 569 , 1996 Ga. App. LEXIS 553 (1996) (decided under former O.C.G.A. § 18-4-23 ).

Garnishment procedure meets constitutional due process requirements. —

Constitutional due process requirements are adequately met by judicial supervision and notice to the defendant mandated by the statutory procedure for garnishments. Black v. Black, 245 Ga. 281 , 264 S.E.2d 216 , 1980 Ga. LEXIS 765 (1980) (decided under former Code 1933, § 46-105).

Garnishment proceeding as complying with procedural due process requirements. —

See Antico v. Antico, 241 Ga. 294 , 244 S.E.2d 820 , 1978 Ga. LEXIS 973 (1978) (decided under former Code 1933, § 46-105).

Written notice containing specified information was sufficient, although unsigned. Mahan v. Ford Motor Co., 146 Ga. App. 291 , 246 S.E.2d 374 , 1978 Ga. App. LEXIS 2324 (1978) (decided under former Code 1933, § 46-105).

No garnishment allowed upon out-of-state wages of nonresident. —

Georgia state court was without power to enforce a Georgia child support judgment through the garnishment of the defendant’s wages in another state when defendant was not within Georgia. Nelson v. Nelson, 173 Ga. App. 546 , 327 S.E.2d 529 , 1985 Ga. App. LEXIS 2653 (1985) (decided under former O.C.G.A. § 18-4-64).

Court refused to dismiss consumer’s claim that a debt collection agency’s letter to the consumer did not comply with the requirement of former O.C.G.A. § 18-4-64(c) that written notice include a statement that a garnishment against the property and credits had been or would be served on the garnishee; the collection agency, an agency employee, and a law firm failed to address that claim in their Fed. R. Civ. P. 12(b)(6) motion to dismiss. Taylor v. Heath W. Williams, L.L.C., 510 F. Supp. 2d 1206, 2007 U.S. Dist. LEXIS 14405 (N.D. Ga. 2007) (decided under former O.C.G.A. § 18-4-64).

Dismissal of a garnishment action was proper because the judgment creditor failed to comply with the notice requirement of former O.C.G.A. § 18-4-64(a)(2); the judgment debtor was not served with notice until more than six months after the bank was served. Because there was no compliance with the notice requirements, the burden did not shift to the judgment debtor to raise improper service/notice as a defense. TBF Fin., LLC v. Houston, 298 Ga. App. 657 , 680 S.E.2d 662 , 2009 Ga. App. LEXIS 757 (2009) (decided under former O.C.G.A. § 18-4-64).

Substantial compliance with three- day notice period was insufficient. —

Court of Appeals erred when the court held that a judgment creditor’s notification of a judgment debtor of a garnishment eight business days after service of the garnishee substantially complied with former O.C.G.A. § 18-4-64(a)(7)’s requirement that notice be given within three business days. O.C.G.A. § 1-3-1 did not apply because the statute was unambiguous. Cook v. NC Two, L.P., 289 Ga. 462 , 712 S.E.2d 831 , 2011 Ga. LEXIS 542 (2011) (decided under former O.C.G.A. § 18-4-64).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Attachment and Garnishment, §§ 344, 353.

C.J.S.

38 C.J.S., Garnishment, § 201 et seq.

ALR.

Content of notice to nonresident principal essential to garnishment or attachment, 92 A.L.R. 570 .

Effect of judgment in garnishment proceedings as between garnishee and principal defendant, 166 A.L.R. 272 .

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, certain decisions under former Civil Code 1910, § 5269 are included in the annotations for this Code section.

Additional affidavit to obtain another summons in appropriate cases. —

While summons of garnishment may issue from time to time before trial, without giving an additional affidavit, the plaintiff in a garnishment proceeding is not precluded from making, if the plaintiff so desires, an additional affidavit to obtain another summons of garnishment, when the answer of the garnishee to the first summons shows that the garnishee was indebted to the defendant in an amount less that of the plaintiff’s claim. Johnson v. Atlanta Furn. Co., 47 Ga. App. 124 , 169 S.E. 767 , 1933 Ga. App. LEXIS 313 (1933) (decided under former Civil Code 1910, § 5269).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Attachment and Garnishment, § 342.

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, certain decisions under former Civil Code 1910, § 5269, former Code 1933, §§ 46-105 and 46-301, as they read prior to revision of Title 46 by Ga. L. 1976, p. 1608, § 1, and former O.C.G.A. § 18-4-62 are included in the annotations for this Code section.

Relationship with federal law. —

After a consumer appealed a district court’s dismissal of the consumer’s improper venue Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692 et seq., complaint, the FDCPA venue provision applied only to legal actions against any consumer, and Georgia garnishment proceedings were not legal actions against any consumer. Ray v. McCullough Payne & Haan, LLC, 838 F.3d 1107, 2016 U.S. App. LEXIS 17633 (11th Cir. 2016).

Purpose of summons of garnishment. —

Summons of garnishment is the process that brings the garnishee into court, and in this respect is like process in an ordinary suit, its purpose being to give notice to the garnishee of the plaintiff’s claim upon the defendant’s property in the garnishee’s possession or upon the garnishee’s indebtedness to the defendant. Gowen v. Bell, 113 Ga. App. 324 , 148 S.E.2d 52 , 1966 Ga. App. LEXIS 1055 (1966) (decided under former Code 1933, § 46-105, as it read prior to revision by Ga. L. 1976, p. 1608, § 1).

Substantial compliance with requirements. —

Substantial compliance with the requisites of the Code, with respect to issuing and serving of process, will be sufficient, and, when notice is given, no technical or formal objection shall invalidate any process. Gainesville Feed & Poultry Co. v. Waters, 87 Ga. App. 354 , 73 S.E.2d 771 , 1952 Ga. App. LEXIS 686 (1952) (decided under former Code 1933, § 46-105, as it read prior to revision by Ga. L. 1976, p. 1608, § 1).

Premature answer in garnishment is amendable. —

Answer in garnishment prematurely filed exists, after time for proper filing arrives, in an imperfect form, and is therefore amendable as are pleadings generally. Mark Ten Homes Corp. v. First Nat'l Bank, 115 Ga. App. 597 , 155 S.E.2d 455 , 1967 Ga. App. LEXIS 1180 (1967) (decided under former Code 1933, § 46-301, as it read prior to revision by Ga. L. 1976, p. 1608, § 1).

Personal service necessary. —

Former Civil Code 1910, § 5269 required that when summons of garnishment is issued, officer shall serve the summons upon person of garnishee, which means that the summons shall be served upon the garnishee personally. Robinson v. T.A. Bryson & Sons, 45 Ga. App. 440 , 165 S.E. 158 , 1932 Ga. App. LEXIS 353 (1932) (decided under former Civil Code 1910, § 5269).

Personal service defined. —

Personal service means actual delivery of process to the defendant in person, and does not include leaving a copy at the defendant’s usual place of abode, or the defendant’s home, or at the defendant’s office, or by delivery to someone else. Robinson v. T.A. Bryson & Sons, 45 Ga. App. 440 , 165 S.E. 158 , 1932 Ga. App. LEXIS 353 (1932) (decided under former Civil Code 1910, § 5269).

Availability of personal service provisions of § 9-11-4(d) . —

Provisions of O.C.G.A. § 9-11-4(d) concerning personal service of process are available in a garnishment case. Alpha Transp. Serv., Inc. v. Cartwright, 248 Ga. 701 , 285 S.E.2d 713 , 1982 Ga. LEXIS 668 (1982) (decided under former O.C.G.A. § 18-4-62).

Former O.C.G.A. § 18-4-62 did not expressly state that personal service provisions of O.C.G.A. § 9-11-4(d) are unavailable, and further, § 9-11-4(j) provides that “service shall be sufficient when made in accordance with the statutes relating particularly to the proceeding or in accordance with this Code section.” Alpha Transp. Serv., Inc. v. Cartwright, 248 Ga. 701 , 285 S.E.2d 713 , 1982 Ga. LEXIS 668 (1982) (decided under former O.C.G.A. § 18-4-62).

Service on nonresident garnishee’s agent and answer by garnishee. —

When attachment process is sued out against nonresident and summons of garnishment was served on agent of garnishee, and when garnishee filed answer admitting funds, garnishee cannot legally defend against subsequent action on attachment bond on ground that the garnishee was not personally served as required. Carrington v. Wilharbla Realty Co., 67 Ga. App. 898 , 20 S.E.2d 860 , 1942 Ga. App. LEXIS 533 (1942) (decided under former Code 1933, § 46-105, as it read prior to revision by Ga. L. 1976, p. 1608, § 1).

Return of service conclusive as to identity of person to whom summons was directed. —

When it is not contended that it was irregular or incomplete in any way, return of service is conclusive as to identity of person to whom summons of garnishment was directed. Gainesville Feed & Poultry Co. v. Waters, 87 Ga. App. 354 , 73 S.E.2d 771 , 1952 Ga. App. LEXIS 686 (1952) (decided under former Code 1933, § 46-105, as it read prior to revision by Ga. L. 1976, p. 1608, § 1).

Amendability of return of service. —

Return of service not amendable to show that person named in it was garnishee served. Gibbs v. Rhodes Furn. Co., 58 Ga. App. 352 , 198 S.E. 315 , 1938 Ga. App. LEXIS 251 (1938) (decided under former Code 1933, § 46-105, as it read prior to revision by Ga. L. 1976, p. 1608, § 1).

Motion to quash filed after time for answering has expired. —

When time provided by law for answering summons of garnishment has expired when garnishee files the garnishee’s motion to quash, the trial court errs if the court grants the motion. Gowen v. Bell, 113 Ga. App. 324 , 148 S.E.2d 52 , 1966 Ga. App. LEXIS 1055 (1966) (decided under former Code 1933, § 46-105, as it read prior to revision by Ga. L. 1976, p. 1608, § 1).

Garnishment by judgment creditor against defendant’s insurer. —

After the parents of a shooting victim obtained judgment against the owner of the property on which their son was shot, and the owner filed bankruptcy, the Court of Appeals erred in reversing the trial court and holding that the judgment debtor had no garnishment action against the owner’s insurer; the insurer could contest, under former O.C.G.A. § 18-4-62, the assertion that it held property belonging to the owner, namely the benefits to be paid on the owner’s behalf under an insurance contract. Ross v. St. Paul Reinsurance Co., Ltd., 279 Ga. 92 , 610 S.E.2d 57 , 2005 Ga. LEXIS 151 (2005) (decided under former O.C.G.A. § 18-4-62).

When claim for default arises. —

Claim arises against the garnishee at the time the garnishee falls into default by failing to file answers in a continuing garnishment proceeding, and is separate and distinct from any claim which may have existed prior to that time. Fazio v. Growth Dev. Corp. (In re Growth Dev. Corp.), 168 Bankr. 1009, 1994 Bankr. LEXIS 1890 (Bankr. N.D. Ga. 1994) (decided under former O.C.G.A. § 18-4-90 ).

Garnishee failed to amend the defective answer as permitted by law and, pursuant to former O.C.G.A. § 18-4-90 , the garnishee was automatically in default. Because the garnishee failed to establish the presence of a nonamendable defect on the face of the record or pleadings, the court abused the court’s discretion by granting the motion to set aside the default judgment. Oxmoor Portfolio, LLC v. Flooring & Tile Superstore of Conyers, Inc., 320 Ga. App. 640 , 740 S.E.2d 363 , 2013 Ga. App. LEXIS 250 (2013) (decided under former O.C.G.A. § 18-4-90 ).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Attachment and Garnishment, § 339 et seq.

C.J.S.

38 C.J.S., Garnishment, §§ 174, 185, 186, 188 et seq., 262 et seq.

ALR.

Money due only on further performance of contract by debtor as subject to garnishment, 2 A.L.R. 506 .

Waiver or admission by garnishee as affecting principal defendant, 64 A.L.R. 430 .

Who may serve writ, summons, or notice of garnishment, 75 A.L.R.2d 1433.

Sufficiency, as to content, of notice of garnishment required to be served upon garnishee, 20 A.L.R.5th 229.

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, decisions under former Ga. L. 1884-5, p. 96; former Civil Code 1895, § 4727; former Civil Code 1910, § 5293; former Code 1933, § 46-301, as it read prior to revision by Ga. L. 1976, p. 1608, § 1; former Code 1933, § 46-501 as it read after passage of Ga. L. 1976, p. 1608, § 1; and former O.C.G.A. §§ 18-4-82 and 18-4-84 are included in the annotations for this Code section.

Garnishee may admit indebtedness but claim exemption. —

Garnishee can admit an indebtedness but contend and show by denial that the indebtedness admitted is exempt from the process of garnishment, and because of its denial, the garnishee can fail to pay the amount into court without subjecting itself to the penalty of being subject to judgment for the entire indebtedness. United Merchants & Mfrs., Inc. v. Citizens & S. Nat'l Bank, 166 Ga. App. 468 , 304 S.E.2d 552 , 1983 Ga. App. LEXIS 3243 (1983) (decided under former O.C.G.A. § 18-4-84 ).

Garnishment action against judgment debtor’s insurer was proper. —

After the parents of a shooting victim obtained judgment against the owner of the property on which their son was shot, and the owner filed bankruptcy, the Court of Appeals erred in reversing the trial court and holding that the judgment debtor had no garnishment action against the owner’s insurer; the insurer could contest, under former O.C.G.A. § 18-4-62, the assertion that it held property belonging to the owner, namely the benefits to be paid on the owner’s behalf under an insurance contract. Ross v. St. Paul Reinsurance Co., Ltd., 279 Ga. 92 , 610 S.E.2d 57 , 2005 Ga. LEXIS 151 (2005) (decided under former O.C.G.A. § 18-4-82 ).

Statement in answer that garnishee is not indebted is not a conclusion, but a factual averment. Ole Campbellton Constr. Co. v. Desert Inn & Country Club, 154 Ga. App. 107 , 267 S.E.2d 646 , 1980 Ga. App. LEXIS 2059 (1980) (decided under former Code 1933, § 46-501).

Verification of answer in behalf of corporation. —

Answer in behalf of corporation to summons of garnishment may be verified by any agent who can and will depose positively to facts stated therein. Ole Campbellton Constr. Co. v. Desert Inn & Country Club, 154 Ga. App. 107 , 267 S.E.2d 646 , 1980 Ga. App. LEXIS 2059 (1980) (decided under former Code 1933, § 46-501).

Answer in garnishment is designed to show indebtedness of garnishee for two periods of time prior to the date of service of the summons, and also the period between service and answer. Mark Ten Homes Corp. v. First Nat'l Bank, 115 Ga. App. 597 , 155 S.E.2d 455 , 1967 Ga. App. LEXIS 1180 (1967) (decided under former Code 1933, § 46-301).

Garnishee must answer concerning indebtedness and effects belonging to defendant. Citizens Nat'l Bank v. Dasher, 16 Ga. App. 33 , 84 S.E. 482 , 1915 Ga. App. LEXIS 490 (1915) (decided under former Civil Code 1910, § 5293).

Liability for improper answer on garnishment. —

Garnishee’s reliance on signature cards and the debtor’s assurances that the bank accounts were trust accounts was insufficient to relieve the garnishee of liability for failing to list these accounts on the garnishment answer. Wachovia Bank v. Unisys Fin. Corp., 221 Ga. App. 471 , 471 S.E.2d 554 , 1996 Ga. App. LEXIS 534 (1996) (decided under former O.C.G.A. § 18-4-82 ).

Garnishee cannot refuse to answer and garnishee’s answer must be directed to matter contained in summons. Citizens & S. Nat'l Bank v. AVCO Fin. Servs., Inc., 129 Ga. App. 605 , 200 S.E.2d 309 , 1973 Ga. App. LEXIS 1076 (1973) (decided under former Code 1933, § 46-301).

Bank’s duty to comply with garnishment laws. —

Bank was not entitled to assume that an account was a legitimate corporate account when the bank did not follow the bank’s own internal procedure with respect to opening the account and, thus, the bank was not excused from complying with a summons of garnishment naming a signatory on the account, nor did the fact that the bank was unable to locate the account relieve the bank from the bank’s responsibilities under the garnishment statutes. Mobile Paint Mfg. Co. v. Johnston, 219 Ga. App. 299 , 464 S.E.2d 903 , 1995 Ga. App. LEXIS 1023 (1995) (decided under former O.C.G.A. § 18-4-82 ).

Garnishee’s determination as to status of assets is subject to contrary determination by court. Citizens & S. Nat'l Bank v. AVCO Fin. Servs., Inc., 129 Ga. App. 605 , 200 S.E.2d 309 , 1973 Ga. App. LEXIS 1076 (1973) (decided under former Code 1933, § 46-301).

Answer in nature of an interpleader was permitted. Small v. Mendel, Gosling & Co., 96 Ga. 532 , 23 S.E. 834 , 1895 Ga. LEXIS 128 (1895) (decided under former Civil Code 1895, § 4727); Booth v. Brooke & Co., 6 Ga. App. 299 , 64 S.E. 1103 , 1909 Ga. App. LEXIS 268 (1909) (decided under former Civil Code 1895, § 4727).

Garnishee who is in doubt as to liability may have court resolve such doubt by presenting every element involved in the matter so that the court can make the determination and the garnishee avoid liability. Citizens & S. Nat'l Bank v. AVCO Fin. Servs., Inc., 129 Ga. App. 605 , 200 S.E.2d 309 , 1973 Ga. App. LEXIS 1076 (1973) (decided under former Code 1933, § 46-301).

Inability of garnishee to answer as required. —

See Estridge v. Janko, 96 Ga. App. 246 , 99 S.E.2d 682 , 1957 Ga. App. LEXIS 551 (1957) (decided under former Code 1933, § 46-301).

Portion of section concerning garnishee’s inability to answer as required, inapplicable when garnishee not indebted. —

Statutory provision that when garnishee is unable to answer in what sum garnishee is indebted to defendant or what property garnishee has belonging to the defendant as required by the summon’s garnishee shall so allege in the garnishee’s answer setting forth all facts does not apply when the garnishee has not become indebted to the defendant. Hardware Mut. Cas. Co. v. Scott, 116 Ga. App. 637 , 158 S.E.2d 275 , 1967 Ga. App. LEXIS 913 (1967) (decided under former Code 1933, § 46-301).

Status of indebtedness between defendant and garnishee becomes fixed when latter files answer. —

When answer of garnishee is filed, status of indebtedness between the defendant and the garnishee upon which right and quantum of plaintiff’s recovery depends, becomes fixed, and the plaintiff’s right of recovery is not thereafter affected, increased nor diminished by debts or demands accruing to the credit of the defendant or the garnishee against the other. Estridge v. Janko, 96 Ga. App. 246 , 99 S.E.2d 682 , 1957 Ga. App. LEXIS 551 (1957) (decided under former Code 1933, § 46-301).

Unless garnishee alleges inability to answer, status of indebtedness is fixed when answer is filed. —

When a garnishee fails to allege, as required by former Code 1933, § 46-301, the garnishee’s inability to answer whether or in what manner the garnishee is indebted to the defendant or that a nonresident debtor owes a debt not yet due, the status of indebtedness between the nonresident and the defendant is fixed as of the time when the garnishee files an answer to the summons of garnishment. Estridge v. Janko, 96 Ga. App. 246 , 99 S.E.2d 682 , 1957 Ga. App. LEXIS 551 (1957) (decided under former Code 1933, § 46-301).

Garnishee’s answer to summons, stating there is nothing in garnishee’s possession subject thereto, is sufficient. Citizens & S. Nat'l Bank v. AVCO Fin. Servs., Inc., 129 Ga. App. 605 , 200 S.E.2d 309 , 1973 Ga. App. LEXIS 1076 (1973) (decided under former Code 1933, § 46-301).

Garnishee is entitled to set-off any indebtedness owed by the defendant in garnishment. Mutual Reserve Life Ins. Co. v. Fowler, 2 Ga. App. 537 , 59 S.E. 469 , 1907 Ga. App. LEXIS 448 (1907) (decided under former Civil Code 1895, § 4727).

One owing wages exempt from garnishment, need not pay money into court upon being garnished, but may resist by one’s answer. Emmons, McKee & Co. v. Southern Bell Tel. & Tel. Co., 80 Ga. 760 , 7 S.E. 232 , 1888 Ga. LEXIS 421 (1888) (decided under former Ga. L. 1884-85, p. 96).

Effect of bankruptcy of defendant. —

See Armour Packing Co. v. Wynn, 119 Ga. 683 , 46 S.E. 865 , 1904 Ga. LEXIS 331 (1904) (decided under former Civil Code 1895, § 4727).

OPINIONS OF THE ATTORNEY GENERAL

Editor’s notes. In light of the similarity of the statutory provisions, opinions decided under former O.C.G.A. § 18-4-84 are included in the annotations for this Code section.

Summons of garnishment establishes lien which attaches from date of service. — Summons of garnishment directing the garnishee to deliver any property into court that is subject to garnishment establishes a lien on the subject property that attaches from the date of service of the summons of garnishment. 1981 Op. Atty Gen. No. U81-25 (decided under former O.C.G.A. § 18-4-84 ).

Garnishment action remains ancillary to or dependent upon principal action between creditor and debtor, even though it establishes lien on subject property. 1981 Op. Atty Gen. No. U81-25 (decided under former O.C.G.A. § 18-4-84 ).

Rank of judgment on which garnishment depends determines priority. — Because of ancillary nature of garnishment, the relevant factor in determining priorities of several garnishments is rank of judgment on which garnishment is dependent and not rank of garnishment lien. 1981 Op. Atty Gen. No. U81-25 (decided under former O.C.G.A. § 18-4-84 ).

Priority lien that initial garnishing creditor obtains by virtue of initial creditor having first served garnishee does not defeat priority of subsequent garnishing creditor with senior judgment. 1981 Op. Atty Gen. No. U81-25 (decided under former O.C.G.A. § 18-4-84 ).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Attachment and Garnishment, § 354 et seq.

C.J.S.

38 C.J.S., Garnishment, § 262 et seq.

ALR.

Waiver or admission by garnishee as affecting principal defendant, 64 A.L.R. 430 .

Answer on information and belief by trustee or garnishee in garnishment or trustee process, 125 A.L.R. 253 .

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Attachment and Garnishment, § 1 et seq.

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, decisions decided under former O.C.G.A. § 18-4-83 are included in the annotations for this Code section.

Discharge of garnishee upon plaintiff’s failure to traverse answer. —

By enacting a specific time limitation within which the plaintiff must traverse the garnishee’s answer, the legislature expressed a clear intent to provide for automatic discharge of the garnishee from all obligations under the summons if the plaintiff did not notify the court and garnishee otherwise within the brief prescribed time period. Nockonwood Indus., Inc. v. Tuloka Affiliates, Inc., 164 Ga. App. 424 , 296 S.E.2d 405 , 1982 Ga. App. LEXIS 2821 (1982) (decided under former O.C.G.A. § 18-4-83 ).

Answer need not be served on defendant. —

Garnishee’s answer must be served upon the plaintiff, but there is no requirement that the answer be served upon the defendant, since the plaintiff and the garnishee are the only parties to the garnishment action. Flournoy v. Pate (In re Antley), 18 Bankr. 207, 1982 Bankr. LEXIS 4650 (Bankr. M.D. Ga. 1982) (decided under former O.C.G.A. § 18-4-83 ).

Failure of plaintiff to include sufficient addresses on summons of garnishment. —

In garnishment proceeding, the plaintiff was required to traverse garnishee’s answer within 15 days after filing of answer even though it had not been served with a copy of the answer where it had failed to include its or its attorney’s address on the summons of garnishment. Nockonwood Indus., Inc. v. Tuloka Affiliates, Inc., 164 Ga. App. 424 , 296 S.E.2d 405 , 1982 Ga. App. LEXIS 2821 (1982) (decided under former O.C.G.A. § 18-4-83 ).

Effect of no service of answers. —

When the name and address of the plaintiff’s attorney appeared on the summons of garnishment, but no certificates of service were attached to the answers, and neither the plaintiff nor the plaintiff’s attorney acknowledged receipt, the requirement that the plaintiff traverse the answers within 15 days of service was never triggered. Lowery v. Dallis, 237 Ga. App. 309 , 513 S.E.2d 740 , 1999 Ga. App. LEXIS 84 (1999) (decided under former O.C.G.A. § 18-4-83 ).

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, decisions decided under former O.C.G.A. § 18-4-97 are included in the annotations for this Code section.

Garnishee’s recovery limited where garnishee fails to employ statutory procedure. —

Garnishee’s recovery of attorney’s fees or expenses was limited to $50 after the garnishee failed to employ procedure specified in O.C.G.A. § 18-4-97; garnishee’s award in excess of $50 was, therefore, erroneous. Travelers Ins. Co. v. Trans State, Inc., 172 Ga. App. 763 , 324 S.E.2d 585 , 1984 Ga. App. LEXIS 2658 (1984) (decided under former O.C.G.A. § 18-4-97).

RESEARCH REFERENCES

C.J.S.

38 C.J.S., Garnishment, § 344 et seq.

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, certain decisions under former Code 1933, § 46-401, as it read prior to revision by Ga. L. 1976, p. 1608, § 1; former Code 1933, § 46-401 as it read after passage of Ga. L. 1976, p. 1608, § 1; and former O.C.G.A. §§ 18-4-65 and 18-4-83 are included in the annotations for this Code section.

Relationship with federal law. —

After a consumer appealed a district court’s dismissal of the consumer’s improper venue Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692 et seq., complaint, the FDCPA venue provision applied only to legal actions against any consumer, and Georgia garnishment proceedings were not legal actions against any consumer. Ray v. McCullough Payne & Haan, LLC, 838 F.3d 1107, 2016 U.S. App. LEXIS 17633 (11th Cir. 2016).

Procedure for debtor asserting interest in garnishment funds. —

Only former O.C.G.A. §§ 18-4-65 and 18-4-93 provide how debtor may assert any “interest” the debtor may have in garnishment funds. Flournoy v. Pate (In re Antley), 18 Bankr. 207, 1982 Bankr. LEXIS 4650 (Bankr. M.D. Ga. 1982) (decided under former O.C.G.A. § 18-4-65).

Defendant is not a “party” to the garnishment proceeding, although provision is made for the defendant to receive notice. Flournoy v. Pate (In re Antley), 18 Bankr. 207, 1982 Bankr. LEXIS 4650 (Bankr. M.D. Ga. 1982) (decided under former O.C.G.A. § 18-4-65).

Challenge to validity of judgment not permitted. —

In a postjudgment garnishment proceeding, the judgment debtor’s traverse asserting the judgment was void or voidable was clearly an impermissible challenge to the validity of the judgment. The trial court was not authorized to consider the debtor’s verified complaint for damages which addressed issues in bar of judgment in support of the debtor’s traverse, and the trial court improperly dismissed the proceeding by granting summary judgment on the debtor’s verified complaint without holding an evidentiary hearing on the debtor’s traverse. Southern Land & Cattle Co. v. Brock, 213 Ga. App. 3 , 443 S.E.2d 647 , 1994 Ga. App. LEXIS 448 (1994) (decided under former O.C.G.A. § 18-4-65).

Res judicata. —

Trial court properly granted a bank summary judgment in a suit for conversion against the bank brought by a debtor because the debtor’s claim was barred by res judicata since the debtor failed to raise any challenge in the garnishment proceeding wherein the bank was a garnishee. Copeland v. Wells Fargo Bank, N.A., 317 Ga. App. 669 , 732 S.E.2d 536 , 2012 Ga. App. LEXIS 789 (2012), cert. denied, No. S13C0189, 2013 Ga. LEXIS 124 (Ga. Feb. 4, 2013) (decided under former O.C.G.A. § 18-4-65).

Plaintiff may not challenge judgment establishing debt. —

Plaintiff in garnishment action is precluded from challenging the validity of the judgment upon which the garnishment was based. Loftin v. Loftin, 166 Ga. App. 778 , 305 S.E.2d 641 , 1983 Ga. App. LEXIS 2327 (1983) (decided under former O.C.G.A. § 18-4-65).

Deletion of the conjunction “and” between the partnership’s name and the partner’s name as they appear in the complaint and judgment does not mean that a judgment against the partner does not exist. Newton, Inc. v. Alex, 162 Ga. App. 664 , 292 S.E.2d 121 , 1982 Ga. App. LEXIS 2282 (1982) (decided under former O.C.G.A. § 18-4-65).

Dormancy of judgment. —

In garnishment proceeding to collect arrears on child support judgment, issue of dormancy of judgment was not present when payments made by the appellant during the ten years following the divorce were more than adequate to cover the amount of any arrearages dating from over seven years in the past and the appellee had the right to consider those payments as having been applied to the oldest amounts due. Turner v. Wood, 162 Ga. App. 674 , 292 S.E.2d 558 , 1982 Ga. App. LEXIS 2289 (1982) (decided under former O.C.G.A. § 18-4-65).

Stay of garnishment pending attack on judgment. —

So long as an attack on the underlying judgment is pending in a trial court or in an appellate court, the court in which the garnishment is pending has within the court’s discretion the power to order the garnishment released and stayed until the validity of such judgment has been determined. Smith v. Smith, 161 Ga. App. 20 , 289 S.E.2d 5 , 1982 Ga. App. LEXIS 1744 (1982) (decided under former O.C.G.A. § 18-4-65).

Issuance of stay, without release, relieved garnishee from filing answer. —

Although a court had the authority both to release and stay a garnishment pursuant to former O.C.G.A. § 18-4-65, there was nothing to prevent a court from only issuing a stay without a release, and such a stay relieved the garnishee from answering even without issuance of a release; thus, the trial court erred in entering a default judgment against a bank as the garnishee in a garnishment proceeding while a stay was in effect based on the bank’s failure to file an answer to the garnishment complaint. Chase Manhattan Bank v. LaFray, 258 Ga. App. 183 , 573 S.E.2d 435 , 2002 Ga. App. LEXIS 1382 (2002), cert. denied, No. S03C0371, 2003 Ga. LEXIS 151 (Ga. Feb. 10, 2003) (decided under former O.C.G.A. § 18-4-65).

Failure to determine validity of underlying judgment not error. —

When the trial court’s written order denying the defendant’s traverse is not premised upon findings as to the validity of the underlying judgment, this error presents no ground for reversal. Loftin v. Loftin, 166 Ga. App. 778 , 305 S.E.2d 641 , 1983 Ga. App. LEXIS 2327 (1983) (decided under former O.C.G.A. § 18-4-65).

Former O.C.G.A. § 18-4-93 was inapplicable to different garnishment proceedings based on same debt, but prohibits only further issuance of any summons of garnishment in same proceeding in which traverse was filed, pending hearing on traverse. Cale v. Cale, 160 Ga. App. 434 , 287 S.E.2d 362 , 1981 Ga. App. LEXIS 3145 (1981) (decided under former O.C.G.A. § 18-4-83 ).

Defendant was not a “party” to the garnishment proceeding, although provision is made at former O.C.G.A. § 18-4-64 for the defendant to receive notice. Flournoy v. Pate (In re Antley), 18 Bankr. 207, 1982 Bankr. LEXIS 4650 (Bankr. M.D. Ga. 1982) (decided under former O.C.G.A. § 18-4-83 ).

Defendant may become party to garnishment. —

Present garnishment statutes do not contain a specific provision whereby a defendant may traverse the answer of the garnishee. However, while there is no express provision authorizing a defendant to traverse the garnishee’s answer, it is provided that a defendant may become a party to the garnishment. Terrell v. Fuller, 160 Ga. App. 56 , 286 S.E.2d 50 , 1981 Ga. App. LEXIS 2875 (1981) (decided under former O.C.G.A. § 18-4-83 ).

Defendant is not party to garnishment. —

When garnishment action is filed, the plaintiff and garnishee are the only parties. Defendant is not a party to garnishment. Stone v. Peoples Bank, 127 Ga. App. 588 , 194 S.E.2d 276 , 1972 Ga. App. LEXIS 964 (1972) (decided under former Code 1933, § 46-401, as it read prior to revision by Ga. L. 1976, p. 1608, § 1).

For defendant to become a party it is a condition precedent that garnishment be dissolved. Stone v. Peoples Bank, 127 Ga. App. 588 , 194 S.E.2d 276 , 1972 Ga. App. LEXIS 964 (1972) (decided under former Code 1933, § 46-401, as it read prior to revision by Ga. L. 1976, p. 1608, § 1).

Interest of a defendant or a third party in garnished funds. —

As former O.C.G.A. § 18-4-93 and a court of appeals holding make clear, the interest of a defendant or that of a third party in garnished funds cannot be extinguished prior to a distribution or a judgment directing a distribution of garnished funds. Bowen v. Thompson (In re Thompson), No. 13-52212, 2013 Bankr. LEXIS 5610 (Bankr. N.D. Ga. Apr. 29, 2013) (decided under former O.C.G.A. § 18-4-83 ).

Defendant wishing to contest garnishment should follow procedure outlined in statute. Powell v. Powell, 95 Ga. App. 122 , 97 S.E.2d 193 , 1957 Ga. App. LEXIS 732 (1957) (decided under former Code 1933, § 46-401, as it read prior to revision by Ga. L. 1976, p. 1608, § 1).

Res judicata. —

Trial court properly granted a bank summary judgment in a suit for conversion against the bank brought by a debtor because the debtor’s claim was barred by res judicata since the debtor failed to raise any challenge in the garnishment proceeding wherein the bank was a garnishee. Copeland v. Wells Fargo Bank, N.A., 317 Ga. App. 669 , 732 S.E.2d 536 , 2012 Ga. App. LEXIS 789 (2012), cert. denied, No. S13C0189, 2013 Ga. LEXIS 124 (Ga. Feb. 4, 2013) (decided under former O.C.G.A. § 18-4-83 ).

Challenge to validity of judgment not permitted. —

In a postjudgment garnishment proceeding, the judgment debtor’s traverse asserting that the judgment was void or voidable was clearly an impermissible challenge to the validity of the judgment. The trial court was not authorized to consider the debtor’s verified complaint for damages which addressed issues in bar of judgment in support of the debtor’s traverse, and the trial court improperly dismissed the proceeding by granting summary judgment on the debtor’s verified complaint without holding an evidentiary hearing on the debtor’s traverse. Southern Land & Cattle Co. v. Brock, 213 Ga. App. 3 , 443 S.E.2d 647 , 1994 Ga. App. LEXIS 448 (1994) (decided under former O.C.G.A. § 18-4-83 ).

Brokerage service account owner’s assignee’s claims against the service that it had unlawfully allowed disbursement of the funds in the account, pursuant to a garnishment judgment, after the owner had sought to close the account, were barred by res judicata under O.C.G.A. § 9-12-40 after it was noted that the owner had filed a traverse in the garnishment proceeding and, accordingly, the owner could have raised the same issues at that time, pursuant to former O.C.G.A. § 18-4-93. The owner, as the debtor in the garnishment proceeding, was required to assert any claim that the owner’s right to the funds was superior to that of the judgment creditor, pursuant to former O.C.G.A. § 18-4-95. Lamb v. First Union Brokerage Servs., 263 Ga. App. 733 , 589 S.E.2d 300 , 2003 Ga. App. LEXIS 1311 (2003), cert. denied, No. S04C0416, 2004 Ga. LEXIS 157 (Ga. Feb. 16, 2004) (decided under former O.C.G.A. § 18-4-83 ).

Judgment debtor not party to proceedings unless debtor files a traverse to plaintiff’s affidavit. —

When president of judgment debtor did not file a traverse to the plaintiff’s affidavit to become a party to garnishment proceeding pursuant to former O.C.G.A. § 18-4-93, the president failed to satisfy the statutory mandate and did not become a party to the garnishment proceeding. Travelers Ins. Co. v. Trans State, Inc., 172 Ga. App. 763 , 324 S.E.2d 585 , 1984 Ga. App. LEXIS 2658 (1984) (decided under former O.C.G.A. § 18-4-83 ).

Individual’s wages wrongfully garnished. —

Claim by an individual whose wages are wrongfully garnished, but who is not the defendant in a garnishment proceeding, can not be asserted in the garnishment proceeding. Baptist Convention v. Henry, 187 Ga. App. 551 , 370 S.E.2d 813 , 1988 Ga. App. LEXIS 763 (1988) (decided under former O.C.G.A. § 18-4-83 ).

Traverse properly granted. —

Trial court did not err in granting a sole proprietorship’s traverse, in which it sought to become a party in a golf supplier’s garnishment action and asserted a verified claim to the funds at issue, because there was some evidence to support the findings that the sole proprietorship was a separate and distinct entity from the corporation and that the garnishee assented to the modification of a contract to replace the corporation with the sole proprietorship as contractor; the sole proprietorship had its own tax identification number and liability insurance, and a representative of the garnishee testified that the garnishee was aware that someone had changed the contractor’s name and that the garnishee had no business dealings with the corporation. A. M. Buckler & Assocs. v. Sanders, 305 Ga. App. 704 , 700 S.E.2d 701 , 2010 Ga. App. LEXIS 805 (2010) (decided under former O.C.G.A. § 18-4-83 ).

Relationship to bankruptcy law. —

Chapter 7 debtor was entitled to claim that funds the debtor’s employer withheld from the debtor’s wages and remitted to a Georgia court were exempt from creditors’ claims under O.C.G.A. § 44-13-100(a)(6) because the debtor still had the right at the time the debtor declared bankruptcy to file a traverse under former O.C.G.A. § 18-4-93 to an affidavit a creditor filed when the creditor garnished the debtor’s wages. Because the debtor retained an interest in the funds, the funds became property of the debtor’s bankruptcy estate under 11 U.S.C. § 541(a) (1) and could be exempted from the creditors’ claims, and a lien the creditor held on the funds could be avoided under 11 U.S.C. § 522(f) . In re Williams, 460 Bankr. 915, 2011 Bankr. LEXIS 5193 (Bankr. N.D. Ga. 2011) (decided under former O.C.G.A. § 18-4-83 ).

RESEARCH REFERENCES

Am. Jur. 2d.

6 Am. Jur. 2d, Attachment and Garnishment, §§ 362, 363.

ALR.

Payment under void order in garnishment proceedings as protection to garnishee, 49 A.L.R. 1411 .

Proceedings in one state upon a debt or other claim as affected by pendency in another state of proceedings to garnish or attach such debt or claim, 91 A.L.R 959.

Issues in garnishment as triable to court or to jury, 19 A.L.R.3d 1393.

JUDICIAL DECISIONS

Editor’s notes.

In light of the similarity of the statutory provisions, decisions under former Civil Code 1910, § 5287; former Code 1933, § 46-303, as it read prior to revision by Ga. L. 1976, p. 1608, § 1; former Code 1933, § 46-505 as it read after passage of Ga. L. 1976, p. 1608, § 1; and former O.C.G.A. §§ 18-4-83 , 18-4-85 , 18-4-86 , 18-4-95, and 18-4-114 are included in the annotations for this Code section.

Traverse is not proper vehicle for challenging the validity of a default judgment. Ray v. Standard Fire Ins. Co., 168 Ga. App. 116 , 308 S.E.2d 221 , 1983 Ga. App. LEXIS 2699 (1983) (decided under former O.C.G.A. § 18-4-66).

Motion to vacate garnishment analogous to traverse. —

Motion to vacate a garnishment is analogous to a traverse of the garnishment, and, in turn, the same legal principle regarding the finality of judgment may be applied in both situations. Georgia Farm Bldgs., Inc. v. Willard, 169 Ga. App. 394 , 313 S.E.2d 112 , 1984 Ga. App. LEXIS 1563 (1984) (decided under former law).

Discharge of garnishee upon plaintiff’s failure to traverse answer. —

By enacting a specific time limitation within which the plaintiff must traverse the garnishee’s answer, the legislature expressed a clear intent to provide for automatic discharge of the garnishee from all obligations under the summons if the plaintiff did not notify the court and garnishee otherwise within the brief prescribed time period. Nockonwood Indus., Inc. v. Tuloka Affiliates, Inc., 164 Ga. App. 424 , 296 S.E.2d 405 , 1982 Ga. App. LEXIS 2821 (1982) (decided under former O.C.G.A. § 18-4-83 ).

Answer need not be served on defendant. —

Garnishee’s answer must be served upon the plaintiff, but there is no requirement that the answer be served upon the defendant, since the plaintiff and the garnishee are the only parties to the garnishment action. Flournoy v. Pate (In re Antley), 18 Bankr. 207, 1982 Bankr. LEXIS 4650 (Bankr. M.D. Ga. 1982) (decided under former O.C.G.A. § 18-4-83 ).

Failure of plaintiff to include sufficient addresses on summons of garnishment. —

In garnishment proceeding, the plaintiff was required to traverse garnishee’s answer within 15 days after filing of answer even though it had not been served with a copy of the answer where it had failed to include its or its attorney’s address on the summons of garnishment. Nockonwood Indus., Inc. v. Tuloka Affiliates, Inc., 164 Ga. App. 424 , 296 S.E.2d 405 , 1982 Ga. App. LEXIS 2821 (1982) (decided under former O.C.G.A. § 18-4-83 ).

Effect of no service of answers. —

When the name and address of the plaintiff’s attorney appeared on the summons of garnishment, but no certificates of service were attached to the answers, and neither the plaintiff nor the plaintiff’s attorney acknowledged receipt, the requirement that the plaintiff traverse the answers within 15 days of service was never triggered. Lowery v. Dallis, 237 Ga. App. 309 , 513 S.E.2d 740 , 1999 Ga. App. LEXIS 84 (1999) (decided under former O.C.G.A. § 18-4-83 ).

Purpose of traverse to garnishee’s answer is to give the garnishee right to be heard and for protection of the garnishee’s rights and interests in the premises. Ole Campbellton Constr. Co. v. Desert Inn & Country Club, 154 Ga. App. 107 , 267 S.E.2d 646 , 1980 Ga. App. LEXIS 2059 (1980) (decided under former Code 1933, § 46-504).

Discharge of garnishee upon plaintiff’s failure to traverse answer. —

By enacting a specific time limitation within which the plaintiff must traverse the garnishee’s answer, the legislature expressed a clear intent to provide for automatic discharge of the garnishee from all obligations under the summons if the plaintiff did not notify the court and the garnishee otherwise within the brief prescribed time period. Nockonwood Indus., Inc. v. Tuloka Affiliates, Inc., 164 Ga. App. 424 , 296 S.E.2d 405 , 1982 Ga. App. LEXIS 2821 (1982) (decided under former O.C.G.A. § 18-4-85 ).

Party asserting superior claim must traverse garnishee’s answer. —

Defendant who has elected to become a party to the garnishment proceedings and who has a claim superior to that of the plaintiff to money or property in the hands of the garnishee is authorized to, and indeed must, assert such a claim and then traverse the answer of the garnishee. Terrell v. Fuller, 160 Ga. App. 56 , 286 S.E.2d 50 , 1981 Ga. App. LEXIS 2875 (1981) (decided under former O.C.G.A. § 18-4-85 ).

Failure of plaintiff to include sufficient addresses on summons of garnishment. —