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Chase Manhattan Bank v. Lafray

A stay of a garnishment proceeding based on a consent order between the plaintiff and one defendant relieved the remaining defendant from its obligation to answer the garnishment complaint.

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We granted The Chase Manhattan Bank’s discretionary appeal of a state court’s order denying its motion to set aside a default judgment in this complex garnishment case. The issue turns on the effect of a stay granted by the trial court in the second of two garnishment proceedings.

Kenneth C. Lafray sued Scott Crownover and obtained a money judgment. LaFray then filed a garnishment proceeding the “first garnishment proceeding” naming Crownover as defendant and Crownover’s employer, Atlantic Mutual Insurance Company, as the garnishee, seeking to collect on the judgment. Atlantic Mutual failed to answer, and LaFray obtained a default judgment pursuant to OCGA § 18-4-90. LaFray then filed another garnishment proceeding the “second garnishment proceeding” naming Atlantic Mutual as defendant and its bank, Chase Manhattan, as the garnishee, seeking to collect on the judgment against Atlantic Mutual.1

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