Opinion
43910.
SUBMITTED SEPTEMBER 4, 1968.
DECIDED JANUARY 7, 1969. REHEARING DENIED JANUARY 21, 1969.
Claim to fund. Dougherty Superior Court. Before Judge Sabados.
Burt Burt, Donald D. Rentz, H. P. Burt, for appellant.
Farkas, Landau Davis, Lee Hitchcock, Malone, Drake Malone, Thomas Wm. Malone, John L. Tracy, P. Walter Jones, for appellee.
The assignment of his interest in his brother's estate by Ben Adler to another, who transferred it to appellee, was made when Ben Adler was in receivership with the knowledge of his assignee and was made at a time when Ben Adler was restrained by court order from transferring his assets. Thus, the assignment to the first assignee and the further assignment to appellee were void and ineffective. The assignment of such interest to appellant was made after the receivership proceedings had been dismissed as to Ben Adler and at a time when he was freed from court restraint and could make a valid assignment of his interest in his brother's estate to appellant, who is entitled to the proceeds of the brother's estate, in the registry of the court.
SUBMITTED SEPTEMBER 4, 1968 — DECIDED JANUARY 7, 1969 — REHEARING DENIED JANUARY 21, 1969 — CERT. APPLIED FOR.
This case was transferred by this court to the Supreme Court. Adler v. Ormond, 117 Ga. App. 600 ( 161 S.E.2d 435). The Supreme Court thereupon transferred the case to this court. Adler v. Ormond, 224 Ga. 430 ( 162 S.E.2d 353). It is not necessary to repeat all facts stated in our transfer of this case to the Supreme Court. The statement of several facts in addition will suffice as the answer to the questions involved is quite simple and uncomplicated. The appellant and appellee filed their claims in this proceeding, each claiming the funds in the registry of the court, which funds represented the net estate of Morice Adler, brother of Ben Adler. After the administration of the estate of Morice Adler had been completed and its assets reduced to cash, the Savannah Bank Trust Company and the Florida National Bank instituted an action for receivership in the Superior Court of Dougherty County, after which the judge of said superior court issued an ex parte order restraining the defendants therein, including Ben Adler, from disposing of any of their assets. There is no direct attack upon this order. Appellee's claim to the funds is based on an assignment of the fund to her by P. Walter Jones, an attorney at law. Ben Adler made an assignment of the fund to appellee on October 16, 1963, a time when the restraining order against Ben Adler was in effect with full knowledge thereof by Jones. Appellant claims the fund under an assignment from Ben Adler on December 27, 1963, after the case had been settled with the plaintiffs in the receivership proceeding insofar as Ben Adler and his son, Morris, were concerned and an amendment was filed to the proceeding dismissing Morris Adler and Ben Adler from the case. The court allowed the amendment and struck these two defendants from the restraining order on December 30, 1963.
The trial judge awarded the assets of the estate of Morice Adler to the appellee and the appellant appeals from that judgment.
1. The order appointing the receiver is not subject to collateral attack. Murray v. Miller, 157 Ga. 11, 13 ( 121 S.E. 113).
2. The assignment to attorney Jones during the effectiveness of the restraining order against Adler was void, since Jones knew of the restraining order and his assignment to appellee was likewise void. Chestnut v. Weekes, 183 Ga. 367, 371 ( 188 S.E. 714); Compton v. Cassada, 54 Ga. 74. The instruments in issue are not negotiable. "The right of an heir or a legatee to an interest in an estate is a chose in action, and is assignable." Sanders v. Hepp, 190 Ga. 18, 20 ( 8 S.E.2d 87), and cit. It is obvious that a chose in action is an asset of Ben Adler which he was restrained from transferring. If Ben Adler could transfer valuable choses of action which it was a receiver's duty to enforce, no receivership could be effective to collect and preserve assets for the benefit of creditors if the debtor so desired. In the case of receivership, priorities cannot be changed or created by the act of the person in receivership. He is no longer free to dispose of property not in his possession or in his possession and not subject to levy and avoid the lien of a general judgment, as illustrated in Fidelity c. Co. v. Exchange Bank, 100 Ga. 619 ( 28 S.E. 393). Ben Adler was not free to assign his interest in his brother's estate at the time he sought to do so. The appellant's assignment was made after the receivership proceeding by amendment had been dismissed as to Ben Adler. Thereafter there was no prohibition against his assigning his interest in his brother's estate. The fact that the court did not allow the amendment striking Ben Adler and his son from the receivership proceeding until after Ben Adler had assigned his interest in his brother's estate to appellant is immaterial, since the amendment striking the Adlers as defendants was tantamount to a dismissal of the case as to them, which plaintiffs could do without approval by the court in such circumstances as we have in this case. As to the questions raised by the receivership, see Code § 55-301 (Ga. L. 1855-6, p. 219); Code § 55-302; Coker v. Norman, 162 Ga. 238 ( 133 S.E. 243); Erikson v. Hewlett, 212 Ga. 423 ( 93 S.E.2d 563); McKoy v. Bush, 200 Ga. 759, 760 ( 38 S.E.2d 669); Nix v. Ellis, 118 Ga. 345 ( 45 S.E. 404, 98 ASR 111); Jones v. Wilson, 195 Ga. 310 ( 24 S.E.2d 34); 75 CJS 755, Receivers, § 114; 45 AmJur 115, 119, 132, 137, 146, 153, Receivers, §§ 135, 141, 158, 167, 176, 189.
The court erred in awarding the assets in the registry of the court to appellee.
Judgment reversed. Eberhardt and Whitman, JJ., concur.