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Lawskills.com Georgia Caselaw
CHAS. S. MARTIN DISTRIBUTING CO. et al. v. COOPER et al.
18703.
Receiver, etc. Before Judge Edmondson. Hall Superior Court. June 1, 1954.
CANDLER, Justice.
From receivership assets, the judge, as an item of necessary expense, may award reasonable counsel fees to the attorney whose service brought the fund into court for the benefit of those creditors who share in its distribution; and this applies to counsel for the debtor where his service is beneficial rather than injurious to his client's creditors.
Chas. S. Martin Distributing Company, Inc., sued J. B. Cooper and W. Randolph Allen, doing business as J. B. Cooper Sales Company, in the Superior Court of Hall County for $15,575.06. By their answer, the defendants admitted owing the petitioner $13,500, and further by way of cross-bill alleged that they, both as partners and individually, were due several other creditors stated amounts; that they, as partners and individually, had sufficient assets to pay the claims of their creditors in full if permitted to do so in an orderly and equitable manner; that several other creditors were threatening to file suits against them, and a multiplicity of pending suits would make it impossible for them to operate their business for the best interest of their creditors; and that a receiver should be appointed immediately to take over their assets, operate their business, collect their accounts, sell their merchandise in a business-like way, pay their creditors in an equitable manner, and prevent the accrual of those court costs which would result from a multiplicity of suits. Without objection from any creditor and in compliance with the defendants' prayer therefor, the court appointed James A. Dunlap receiver, and ordered him to give bond in the sum of $10,000, take charge of the defendants' business and take possession of their assets, both as partners and individually. He also ordered him to publish the notice required by Code 37-410 and fixed November 16, 1953, as the ultimate date for creditors to intervene in the cause. On April 30, 1954, William B. Gunter, as attorney for the defendants, asked the court to award him a fee of $1,000 from the receivership assets. His application as amended alleges that he, prior to the appointment of a receiver, assisted the defendants and some of their creditors in an effort to solve their financial problems; that he prepared and filed the defendants' answer and a cross-bill which placed his clients' assets in the court where they could be administered by a receiver for the benefit of their creditors; that he has assisted the receiver in ascertaining facts within the knowledge of his clients; that the receivership has enured to the benefit of all of his clients' creditors, since an orderly and equitable administration of their assets has resulted therefrom; that he could have charged and collected a fee for his services from his clients prior to a surrender of their assets, but to have done so would have resulted in a reduction of their assets and subjected him to criticism; that he has represented the defendants in all matters relating to the receivership; and that he has received no pay for any of his legal services. Three of the seventy-six creditors objected to the allowance of a fee to the applicant on the ground that the receivership assets were not legally chargeable with such an item of expense. Over this objection, the judge ordered the receiver to pay the applicant a fee of $750 out of the receivership assets, and the exception is to that judgment.
There is no contention that Mr. Gunter did not render the legal services mentioned in his application, which resulted in placing all of the assets of the debtors in the hands of the court to be fairly administered for the benefit of all their creditors. In Mohr-Weil Lumber Co. v. Russell, 109 Ga. 579 (34 S. E. 1005), it was held: "The bringing of a fund into court operates for the benefit of those who share in it. Compensation for services rendered in placing a fund where the court can administer it may fairly be regarded as an expense chargeable to those among whom it is distributed. The only just and reasonable basis for paying out of money brought into court the fees of the attorneys by whose services this result was produced is, that by rendering those services they did something of value to the successful claimant or claimants of the money." Also Code 55-315 expressly provides "that in all [receivership] cases the presiding judge, or other competent tribunal, shall allow such compensation to the attorney or attorneys filing the original petition, and the receiver or receivers appointed thereunder, as their services are reasonably worth." And in equity cases, it is the province of the judge to determine upon whom the costs shall fall. Code 37-1105. While Mr. Gunter represented the debtors in the case at bar, he nevertheless rendered their creditors identically the same legal service and secured the same beneficial result for them which would have been produced by an original petition for receivership filed by some other attorney for one or more of his clients' creditors. To his clients' creditors he unquestionably rendered valuable legal services; and a failure to pay him reasonable compensation for those services would be contrary both to morals and the law. Compare Buckwalter v. Whipple, 115 Ga. 484 (41 S. E. 1010). In these circumstances we are not prepared to say that the judge was without legal authority to grant his application, and it is not insisted that the amount allowed for Gunter's fee is excessive. Accordingly, we find no error.
Judgment affirmed. All the Justices concur.
W. B. Gunter, James A. Dunlap, Kenyon, Kenyon & Gunter, contra.
Frank B. Stow, Robert E. Andrews, for plaintiffs in error.
SUBMITTED SEPTEMBER 14, 1954 -- DECIDED OCTOBER 11, 1954.
Saturday May 23 03:28 EDT


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