Cortland Wagon Co. v. Gordy

Lumpkin, Justice. ' It appears that Gordy, an insolvent trader, had executed mortgages to the Fourth National Bank of Columbus, to-Peabody, Brannon, Hatcher & Martin, to O. O. Bullock, and to L. A. Scarborough. The Cortland Wagon Company and others, creditors of Gordy,- filed an equitable petition against him and all of the above mentioned mortgagees except Scarborough, for the purpose of having the assets-of Gordy administered under the insolvent trader’s act. The petition also contained certain allegations and prayers-for discovery, the apparent purpose of which was to- attack the validity of the mortgages held by the three mortgagees-who were parties to the proceeding. The attack upon the mortgage given to Peabody, Brannon, Hatcher & Martin, who were a firm of practicing-attorneys, really amounted to- nothing, the only charge against their mortgage being, in effect, that it was given to secure them a fee for their services to be rendered in the-litigation which Gordy anticipated would arise over the winding up of his affairs — the debtor’s anticipation of which appears to have been realized. It was certainly his right to employ attorneys, and we can conceive of no- reason why it was not perfectly legitimate and proper for him to secure to them adequate compensation for their services in this manner. See Drucker & Bro. v. Wellhouse & Sons, 82 Ga. 129. The attacks upon the mortgages given to the bank and to-Bullock were not direct and unequivocal. The petition nowhere distinctly averred that these mortgages were without adequate consideration. It merely charged in general terms, and upon information and belief, certain things which, if true, would show that Gordy was not really ever originally indebted to these parties the full amounts set531 forth in their respective mortgagés, or if so, that the same had been discharged. The special interrogatories by which the discovery above mentioned was sought were of a “fishing” nature; and on the whole, it seems clear that the petitioners really knew nothing against the validity of these mortgages, and were merely casting about in a vague and uncertain way to ascertain something which would discredit them. We do not mean to be understood as holding that the complaining creditors would have no right to' attack mortgages which they believed were not just liens upon, their debtor’s property without having positive knowledge of their invalidity, or that they could not resort alone to the consciences of the mortgagees for the purpose of showing that their alleged liens were invalid. We merely hold that in order to entitle unsecured creditors to avail themselves of this remedy, it is incumbent upon them to make it appear to the court that they have a substantial interest in the subject-matter, and that the relief sought will have the effect of protecting that interest. In other words, a court of equity will not compel discovery unless the party seeking it alleges at least enough to- show that he may derive some benefit from forcing his adversary to disclose the truth. We have not referred to the looseness of the plaintiff’s allegations and prayers for discovery for the purpose of showing that their imperfections would alone be sufficient to authorize a dismissal of their petition, but simply as illustrative of its incompleteness as a whole. Its radical defect lies in the fact that, taking it altogether, it does not show affirmatively that even if the mortgages to the bank and to Bullock should be set aside, the plaintiffs would realize anything from the insolvent debtor’s property. It utterly fails to disclose the amount and value of Gordy’s estate; and, as will have been seen, no attack whatever is made upon the mortgage held by Scarborough, while, as to the attack made upon the mortgage given to the attorneys, it has been shown that the grounds upon 532 which this mortgage is alleged to be invalid axe not well founded. For aught that the petition discloses, these two mortgages would exhaust the debtor’s entire assets. It therefore is not made to appear that any benefit whatever would result to the plaintiffs, either from obtaining the discovery sought, or from an equitable administration of Gordy’s property. The remedy invoked by the petition is, at best, a harsh one, and consequently one of which the plaintiffs should not be permitted to avail themselves without showing clearly an equitable right to insist upon it as necessary to their protection. J udgment affirmed.