Order of distribution of insolvent bank.

- Order of distribution of assets upon insolvency of a bank which grants payment of debts due depositors priority over payment of state taxes is not an unconstitutional violation of Ga. Const. 1976, Art. VII, Sec. I, Paras. I, III, IV (see now Ga. Const. 1983, Art. VII, Sec. I, Paras. I, III and Art. VII, Sec. II). Felton v. McArthur, 173 Ga. 465, 160 S.E. 419 (1931).

Statute is general law.

- Ga. L. 1927, p. 195, § 5 (see now O.C.G.A. § 7-1-202) does not violate Ga. Const. 1976, Art. I, Sec. II, Para. VII (see now Ga. Const. 1983, Art. III, Sec. VI, Para. IV) and is a general law and not a special law; and it was competent for the legislature to pass this general law without violating this provision of the constitution. Felton v. McArthur, 173 Ga. 465, 160 S.E. 419 (1931).

Georgia Law 1927, p. 195,

§ 5 does not attempt to exempt property from taxation. - Georgia Law 1927, p. 195, § 5 (see now O.C.G.A. § 7-1-202) may render execution issued by tax collector unfruitful, in view of fact that claims which are given priority may exhaust property classed among assets of the bank; but no attempt is made by the statute to exempt property from taxation; even though the statute fixes priority of other claims relative to taxes. Baggett v. Mobley, 171 Ga. 268, 155 S.E. 334 (1930).

Priorities set by Ga. L. 1927, p. 195, § 5 supersede O.C.G.A. §§ 48-5-28 and 48-2-56. - Priorities of payment established by Ga. L. 1927, p. 195, § 5, (see now O.C.G.A. § 7-1-202) which allow payment to depositors before payments of state taxes supersede the provisions of former Code 1933, §§ 92-5707 (see now O.C.G.A. § 48-5-28) and 92-5708 (see now O.C.G.A. §§ 48-2-56 and 48-5-28) which make tax collection a priority above other debts. Felton v. McArthur, 173 Ga. 465, 160 S.E. 419 (1931).

Property in possession of liquidating agent of bank cannot be levied upon. Gormley v. Askew, 176 Ga. 210, 167 S.E. 600 (1933).

Equity will enjoin levy on fieri facias against insolvent bank.

- Equity will enjoin tax collector and sheriff from trying to enforce by levy and sale collection of tax fieri facias against insolvent bank taken over by superintendent of banks (now commissioner of banking and finance) for liquidation. Gormley v. Askew, 176 Ga. 210, 167 S.E. 600 (1933).

"Debts due depositors" must mean all depositors and there are several kinds. There are general deposits, special deposits, and deposits for specific purposes. Gormley v. Board of Comm'rs of Rds. & Revenues, 178 Ga. 439, 173 S.E. 667 (1934).

Effect of liquidation upon liability on checks deposited for collection.

- When principal-agent relationship exists between the bank and the depositor for purpose of collecting a check and an agency ceases due to the failure of the bank and takeover of the bank by the superintendent of banks (now commissioner of banking and finance), the check and the check's proceeds are property of the depositor and not subject to the provisions of this section. Hogansville Banking Co. v. Ware, 171 Ga. 167, 155 S.E. 4 (1930).

Ad valorem taxes on bank's assets are not administrative obligation or expense incurred by receiver but are a charge imposed by the sovereign. Taxes are referred to as expenses of administration only because it is a duty of the receiver to pay the taxes. Tharpe v. Gormley, 184 Ga. 605, 192 S.E. 211 (1937).

Taxes payable only after expenses of liquidation and claims of depositors.

- State taxes are payable only after all costs and expenses of the administration of the liquidation or dissolution, and the payment of the claims of depositors. Roberts v. Gunter, 251 Ga. 276, 304 S.E.2d 369 (1983).

Waiver of state's right to first collect taxes extends to assets.

- If, in administration of assets of insolvent bank, the superintendent of banks (now commissioner of banking and finance), comes into possession of deeds given to the bank conveying title to the land, leaving debtor to bank owner of a mere equity in premises conveyed, the state's waiver of the state's right to first collect the state's taxes (in favor of depositors' claims), as embodied in Ga. L. 1927, p. 195, § 5, naturally extends so as to include such taxes as are a liability upon the assets in the hands of the superintendent of banks. Gormley v. Askew, 176 Ga. 210, 167 S.E. 600 (1933).

Credit union acting as receiver violates section by preferring unsecured creditor.

- Credit union deposit insurance corporation, acting as receiver or deputy receiver of member credit union, cannot purchase an unsecured note with the assets of the credit union since such purchase would give an unsecured creditor priority over the depositors and other more senior claimants. 1977 Op. Att'y Gen. No. 77-7.

Am. Jur. 2d.

- 11 Am. Jur. 2d, Banks and Financial Institutions, §§ 1120, 1124.

C.J.S.

- 9 C.J.S., Banks and Banking, §§ 152 et seq., 214.

ALR.

- Right of owner of check which the drawee bank held for him at time it closed its doors, to a preference, 17 A.L.R. 196.

Right of depositor to rescind, or to claim a trust in respect of a deposit because of insolvency of bank when it was made, 20 A.L.R. 1206; 81 A.L.R. 1078.

Balance due other banks on clearing house settlement as preferred claim against insolvent bank, 44 A.L.R. 1535.

Right, in absence of statute, to preference in respect of deposit of public funds in insolvent bank, 51 A.L.R. 1336; 65 A.L.R. 690; 90 A.L.R. 184; 103 A.L.R. 621; 167 A.L.R. 640.

Prerogative right of county or other political subdivision to preference in assets of insolvent, 52 A.L.R. 755; 90 A.L.R. 208.

Trust or preference in assets of insolvent bank or trust company in respect of funds which it held as executor, administrator, or testamentary trustee, 56 A.L.R. 806; 83 A.L.R. 1110; 94 A.L.R. 1123.

Deposit of funds except from claims of creditors of depositor, as entitled to preference out of the assets of insolvent depositee, 71 A.L.R. 1181.

Right of holder of cashier's check to preference out of assets of insolvent banks, 73 A.L.R. 66; 95 A.L.R. 676.

Right of depositor to preference in assets of insolvent bank because dissuaded by bank officials or employees from withdrawing deposit after insolvency, 80 A.L.R. 795.

Rights and preference in respect of assets of insolvent bank or trust company as affected by its division into departments, 81 A.L.R. 1479; 89 A.L.R. 1218; 114 A.L.R. 680.

Constitutionality of statute relating to preferences in assets of insolvent bank, 83 A.L.R. 1080.

Garnishment of deposit by depositor's creditor as entitling latter to trust or preference out of assets of insolvent garnishee bank, 83 A.L.R. 1085.

Preference in assets of insolvent bank in respect of deposits of veterans' compensation or war-risk insurance proceeds or pension money, 83 A.L.R. 1089; 84 A.L.R. 1530.

Trust or preference in assets of insolvent bank or trust company in respect of deposit by receiver, 83 A.L.R. 1097.

Trust or preference in assets of insolvent bank or trust company as to deposits by trustee in bankruptcy, 83 A.L.R. 1105.

Trust or preference in assets of insolvent bank or trust company in respect of funds which it held as executor, administrator, or testamentary trustee, 83 A.L.R. 1110; 94 A.L.R. 1123.

Waiver of right of government to preference in the assets of insolvent debtor by taking security, 83 A.L.R. 1119.

Right of surety who discharges obligation due to government to be subrogated to priority or preference of latter, 83 A.L.R. 1131.

Rights of owners of securities deposited in bank upon its insolvency, 84 A.L.R. 1534; 126 A.L.R. 625.

Construction and effect of statutes or constitutional provisions in relation to priority or preference of deposits in assets of insolvent bank or trust company, 86 A.L.R. 1310; 93 A.L.R. 1017.

State's prerogative right of preference at common law, 90 A.L.R. 184; 167 A.L.R. 640.

Prerogative right of county or other political subdivision to preference in assets of insolvent, 90 A.L.R. 208.

Right of holder of cashier's check to preference out of assets of insolvent bank, 95 A.L.R. 676.

Trust or preference in assets of insolvent bank in respect of money deposited or left on deposit pursuant to agreement of bank to purchase bonds or make other investment for depositor, 105 A.L.R. 516.