---
title: O.C.G.A. § 18-2-40. Right of debtor to prefer creditors.
collection: code
id: 18-2-40
cite_as: O.C.G.A. § 18-2-40 (2025)
canonical_url: https://georgiacommons.org/code/18-2-40
md_url: https://georgiacommons.org/code/18-2-40.md
text_url: https://georgiacommons.org/code/18-2-40/text
source_url: https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t18-t19-(v16)-2022-pdf.pdf?sfvrsn=b0848ebd_0#page=33
date: 2025
status: active
corpus_version: 2025-supplement-89aa39ab3c68
license: CC0-1.0
publisher: Georgia Commons, an independent project of Georgia Civic Data. Not the State of Georgia. Not legal advice.
up: https://georgiacommons.org/code/18-2.md
previous: https://georgiacommons.org/code/18-2-25.md
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index: https://georgiacommons.org/code/index.md
version: the only printed version
in_force: true
current_through: Including Acts of the 2025 Regular Session of the General Assembly
heading_path: DEBTOR AND CREDITOR / DEBTOR AND CREDITOR RELATIONS / PREFERENCES AND ASSIGNMENTS FOR BENEFIT OF CREDITORS
---

# O.C.G.A. § 18-2-40. Right of debtor to prefer creditors.

A debtor may prefer one creditor over another; and to that end he may rightfully give a lien by mortgage or other legal means, sell in payment of the debt, or transfer choses in action as collateral security, where the surplus in such cases is not reserved for the debtor’s own benefit.

## History

Orig. Code 1863, § 1955; Code 1868, § 1943; Code 1873, § 1953; Code 1882, § 1953; Civil Code 1895, § 2697; Civil Code 1910, § 3230; Code 1933, § 28-301.

## Law Reviews

For note discussing assignments for benefit of creditors, see 12 Ga. L. Rev. 814 (1978).

For article, “Preparing the Georgia Farmer (or Other Small Entrepreneur) for Bankruptcy,” see 22 Ga. St. B.J. 186 (1986).