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CITIZENS BANK OF HAPEVILLE v. C. W. MATTHEWS CONTRACTING COMPANY et al.
37683.
Breach of contract. Clayton Superior Court. Before Judge Reynolds. March 3, 1959.
FELTON, Chief Judge.
The petition did not allege the breach of a joint obligation by the defendants which gave rise to a joint cause of action in favor of the plaintiff. Since the action was filed in Clayton County and the defendant C. W. Matthews Contracting Company resided in Cobb County the court had no jurisdiction of this company. The court did not err in sustaining this defendant's general demurrer and its special demurrer on the ground of misjoinder of parties defendant, and in dismissing the action.
Citizens Bank of Hapeville, Georgia, instituted an action in the Superior Court of Clayton County, against D. W. Bailey Contracting Co., Inc., a resident of Clayton County, and C. W. Matthews Contracting Company, a resident of Cobb County, to recover $20,000 principal, plus interest, as damages for the breach of the following contract executed by D. W. Bailey Contracting Co., Inc., Citizens Bank of Hapeville, and C. W. Matthews Contracting Company: "For and in consideration of the mutual promises herein contained and the further consideration of Citizens Bank of Hapeville, a Georgia corporation, making a loan in the amount of $20,000 same being a revolving loan totaling $20,000 each month the parties being D. W. Bailey Contracting Company, Inc., and Citizens Bank of Hapeville, a Georgia corporation. This instrument is an assignment of a certain contract entered into on the 25th February, 1957, by and between D. W. Bailey Contracting Company, Inc., a Georgia corporation of Forest Park, Georgia, and C. W. Matthews Contracting Company a Georgia corporation of Marietta, Georgia. C. W. Matthews Contracting Company is the prime contractor of certain contracts for the date Highway Department of Georgia and D. W. Bailey Contracting Company, Inc., is a subcontractor under the said C. W. Matthews Contracting Company all as described in the contract aforesaid. D. W. Bailey Contracting Company has already, under the contract aforesaid, performed work amounting to $116,782.68 and there remains to be completed work totaling $166,142.52 under the contract which D. W. Bailey Contracting Company agrees to perform and the proceeds thereof is hereby transferred and assigned to the Citizens Bank of Hapeville, Georgia, to secure the indebtedness aforesaid. C. W. Matthews Contracting Company hereby agrees to the assignment of the funds under this contract with Citizens Bank of Hapeville, Georgia, making said checks payable both to D. W. Bailey Contracting Company and Citizens Bank of Hapeville, Georgia. C. W. Matthews Contracting Company hereby agrees to notify Citizens Bank of Hapeville, Georgia, immediately in case of any breach of any provisions in the original contract. This the 1st day of August, 1957." Attached to the petition also is a copy of a contract between D. W. Bailey Contracting Company, referred to as "Bailey", and C. W. Matthews Contracting Company, referred to as "Matthews", whereby Bailey agreed to subcontract from Matthews the construction of certain items of road work to be done as a part of a contract held by Matthews with the State Highway Department of Georgia for construction of 12.278 miles of grading and paving and three bridges on the Forsyth to Monticello Road, being project No. PRS-0772 (3). The subcontract agreement is attached to the petition as exhibit "B". The only undertakings on the part of Matthews in exhibit "B" are as follows: " 'Matthews' agrees to: (1) make payment in the amount of ninety (90%) percent of the estimate as turned in by the Resident Engineer for Marame and Jasper County to 'Bailey' within five (5) days after receipt of payment from the State Highway Department of Georgia. (2) Make final payment of the retain-age withheld by the State Highway Department of Georgia approximately five (5) days after completion, acceptance and payment by the State Highway Department of Georgia." The petition alleged that Matthews failed to make checks as agreed for the 10% retained and for the 90% of the estimate for work done by Bailey after the date of the assignment of the subcontract to the plaintiff, and alleged that after August 1, 1957, a breach of the subcontract occurred and Matthews failed and refused to notify the plaintiff and that such failure to give notice
of the breach was the direct and proximate cause of the damage alleged. The court sustained the general and special demurrers of Matthews, and the plaintiff excepted.
Only one question need be decided and that is whether there was a joint cause of action against both defendants so as to give Clayton County jurisdiction over Matthews, a resident of Cobb County. A general demurrer reaches the question of jurisdiction of the person without specially setting forth that the court was without jurisdiction. Ruis v. Lothridge, 149 Ga. 474 (2) (100 S. E. 635). The petition in this case does not state a cause of action against Bailey under any theory, not even on its direct obligation to the plaintiff. Assuming that the assignment contract is valid in toto, no breach of it or of the subcontract is alleged against Bailey. The plaintiff could under no circumstances have a cause of action under the assignment or subcontract against Bailey because Bailey assigned his rights (and not his obligations) to Matthews for the sole purpose of securing his obligation to the plaintiff. A breach of duties by Matthews under the assignment and subcontract could not give rise to a cause of action in favor of the plaintiff against Bailey because the plaintiff stood in Bailey's shoes as to the nights assigned and since Bailey assigned no rights against himself and no breach by him under any kind of contract was alleged, no cause of action existed in favor of the plaintiff against Bailey under the contracts attached to the petition. It follows that the court was without jurisdiction over Matthews in Clayton County, since no joint cause of action was alleged against the two defendants. All civil cases, with certain exceptions, shall be tried in the county wherein the defendant resides. This case does not come under any of the exceptions. Clark v. Hilliard, 19 Ga. App. 514 (91 S. E. 926). Even if we concede that the cause of action against Bailey is his direct obligation to the plaintiff, then the special demurrer directed at the petition under Code 3-110 was properly sustained. "Distinct and separate claims of or against different persons shall not be joined in the same action . . ." For the tort rule see Chitty v. Jones, 210 Ga. 439 (80 8. E. 2d 694).
The court did not err in sustaining the general demurrer and the special demurrer referred to in the opinion and in dismissing the action.
The petition shows on its face that no joint cause of action ex contractu exists against the two defendants. The court did not have jurisdiction against C. W. Matthews Contracting Company in Clayton County as it is a resident of Cobb County, and the two alleged separate and distinct claims against the two defendants were improperly joined in the same action. No ruling on the sustaining of the other special demurrers is necessary. This is without prejudice to either party as to any future action.
Judgment affirmed. Quillian and Nichols, JJ., concur.
Lee Hutcheson, Hicks & Henderson, Harold S. Willingham, contra.
Preston L. Holland, for plaintiff in error.
DECIDED MAY 28, 1959.
Saturday May 23 00:35 EDT


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