Georgia Ice Company vs. Porter & Meakin

Supreme Court of Georgia1883-02-20

70 Ga. 637

Summary · law.co

Holding. The judgment is affirmed. The court held that the notary public's connection to Porter was insufficient to void the attachment, and that property held equitably by a de facto corporation is subject to attachment for the corporation's obligations even when legal title is in an individual's name and the business later incorporates de jure under a different name.

Georgia Ice Company challenged an attachment issued by a notary public on grounds that the notary had an improper relationship with one of the plaintiffs, Porter, since they were co-employees at a bank where Porter was also a stockholder. The court found this connection insufficient to disqualify the notary or void the attachment writ.

The core dispute involved whether property held in the name of one individual could be subject to an attachment levied against a business entity that operated as a de facto corporation before later obtaining a de jure charter under a different name. The court held that when persons conduct business as a corporation in fact, hold themselves out as such to the public, and obtain credit under that name, the equitable ownership of property remains with that business entity even if legal title is later taken in an individual's name for the group's benefit. The defendants could not escape liability by later incorporating under a different name and taking title in an associate's name.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Whether a notary public's co-employment with a party disqualifies the notary from issuing an attachment
Whether equitable ownership of property in a de facto corporation is subject to attachment
Whether conversion of a de facto corporation into a de jure corporation relieves the property from liability for prior obligations

Procedural posture

The defendants appealed a judgment rendered in a claim case involving an attachment levied on property allegedly belonging to the North American Ice Company.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

majority opinion

Hall, Justice.

The notary public issuing this attachment bore no such relation to either of the plaintiffs as would make it improper for him to act, and as would render the writ void; he was not connected in business with Porter in such manner as to disqualify him from acting as a notary, from taking the affidavit and bond and signing the writ in a case in which Porter and his partners were parties. The most that can be said is that Porter and the notary were co-employ 6s in a bank in which Porter was likewise a stockholder. None of the cases cited for the plaintiff in error have gone this length, though they have gone quite far enough. 50 Ga., 425, 435, is a complete answer to the position here taken.

Nor was there any error in charging the jury that the North American Ice Company was concluded by a judgment regularly rendered upon an attachment sued out against them and levied upon their property.

Where parties commenced and carried on business as a corporation defacto, and held themselves out to the world as such, and in that name and character obtained credit, though the same persons afterwards obtained a charter under another name, and thereby became a corporation de jure, continuing all the time to use in the last named corporation the property on which they carried on business, and obtained credit under their first name, and when they took titles to the property in question in the name of one of their associates in the enterprise, for the use of himself and all the others who paid the purchase money therefor, it was not error to charge the jury in a claim case, “ that if the company had the equitable ownership of the property at the time of the levy of the attachment, it would be subject; that if the deed was taken for the benefit of the persons who were afterwards incorporated for the purpose of carrying but the same objects that these persons were associated together for, the equitable title would be in defendant, even though the charter was not obtained until afterward, it would be their duty to find the property subject, but if he took the deed at the time for other and different parties, it would be otherwise.”

The verdict finding the property subject, under this charge, which fairly submitted the issue, was sustained by the evidence in the case, and being so sustained, was not only authorized but required by well settled principles of law. The defendants were estopped from denying the character and name under which they traded and obtained the credit, especially after judgment had been rendered against them covering the transaction. Code, §§3577, 3826, 3753. That a perfect equity is subject to levy and sale, although the naked legal title may be in a third person, is so clear, that a citation of authorities to sustain it would be needless. The conversion of a trading company acting as a corporation defacto, into one dejurc, will not exempt the property held in the latter character from liability for the obligations of the former. Morawetz on Corp., §143, and cases cited in note there; Ib., 134.

Judgment affirmed.