Opinion
12823.
OCTOBER 19, 1939. REHEARING DENIED NOVEMBER 17, 1939.
Equitable petition. Before Judge Edwards. Franklin superior court. February 18, 1939.
George L. Carter Goode, for plaintiff.
L. P. Webb and William Hall, for defendants.
A petition by the obligor in a bond for title, against the beneficiaries of a year's support set apart to the widow and children of the deceased obligee to the extent of his interest in the realty described in the bond for title, praying for receivership, sale of the property to pay remainder of purchase-price, and other equitable relief, held subject to demurrer as failing to state a cause of action for the relief sought.
No. 12823. OCTOBER 19, 1939. REHEARING DENIED NOVEMBER 17, 1939.
Mrs. Anna Addison filed her petition against Mrs. Anna Little and her minor children represented by C. D. McEntire as guardian ad litem, alleging substantially the following: The petitioner is the owner of described real estate in Carnesville, Franklin County. On September 4, 1934, she executed and delivered to A. C. Little her bond to make title to said real estate, for the consideration of $1800, payable $150 cash on the date the bond for title was executed, the balance represented by six notes, one for $200 due December 1, 1935, one for $200 due December 1, 1936, one for $250 due December 1, 1937; one for $250 due December 1, 1938, one for $350 due December 1, 1939, and one for $400 due December 1, 1940; said notes bearing interest from date of execution, which was contemporaneous with date of execution of bond for title. The obligee in the bond went into possession of the real estate on September 4, 1934, and died while in possession under the bond, on January 18, 1938, insolvent. At the March term, 1938, of the court of ordinary of Franklin County all the estate of A. C. Little, including his interest or equity in said real estate, was set apart as a year's support to his widow and minor children. They are in possession thereof under that judgment. Before that time, the widow was appointed and qualified as temporary administratrix of the estate of A. C. Little, and had in her possession as such, at the time the year's support was set apart, all property of the deceased of every kind, and all such property was set apart, leaving no property in her hands as temporary administratrix, and no permanent administration has been applied for. In no event would an appointment of a permanent administrator affect the rights of petitioner, for the reason that there are no assets upon which to administer. There now remains due and unpaid the notes due on December 1, 1937, and notes with maturity dates subsequent thereto, amounting to $1250 principal, and accrued interest of $318.75 (up to date of filing), total balance due, $1568.75, of which $627.50 is past due (on date of filing), being notes due December 1, 1937, and December 1, 1938, besides accrued interest. The beneficiaries of the year's support fail and refuse to pay any part of the amount past due, or to deliver possession of the property to petitioner. Said property, consisting of a city lot with dwelling-house and outbuildings thereon, is deteriorating in value; it is not insured against fire; the monthly value thereof is $15; part of the dwelling-house is rented, defendants living in the remainder; said property is worth less than the balance due of the purchase-price, with accumulated interest, and the widow is insolvent.
The widow and minor children were named defendants. A guardian ad litem was appointed by the court for the minor children, and accepted the appointment. The petitioner alleged that she was entitled to have the property sold and the proceeds of sale applied to satisfaction of the amount of the purchase-price past due, and the remainder, if any, impounded and held by decree of the court to satisfy unmatured notes as the same become due; that petitioner was without adequate remedy at law; that a multiplicity of suits and circuity of actions would result should a court of equity fail to take cognizance of her rights; and that in order to preserve and protect the property and the rights of all parties a receiver should be appointed to collect rents and insure said property. The prayers were: for a receiver to collect rents and insure the property against fire; for appointment of a guardian ad litem to represent the interest of the minor defendants; that petitioner have judgment against said property for the amount due to her; that the property be ordered sold and the proceeds of sale applied to petitioner's debt as the same matures; and for general relief. The defendants demurred on the grounds that the petition set forth no cause of action, and showed no matter of equity jurisdiction, but showed that the plaintiff had full, complete, and adequate remedy at law, and showed no reason why a court of equity should oust the court of ordinary from administering the estate, and that the action was brought prematurely and within less than twelve months after the death of A. C. Little. The demurrer was sustained, and the action dismissed. The plaintiff excepted to that judgment.
1. Where a purchaser of land from the owner thereof, having paid part of the purchase-price and executed a series of notes for the balance, is admitted into possession under a bond for title obligating the vendor to execute a deed conveying the land on payment of the notes, he thereby acquires an equitable interest in the land, including a right to possession and the rents and profits.
2. If the obligee dies before payment of the balance of the purchase-money, and his interest is set apart to his widow and minor children as a statutory year's support, such interest passes to them in virtue of the year's support. Winn v. Lunsford, 130 Ga. 436 (3) ( 61 S.E. 9).
( a) The obligee's right to possession and rents and profits, acquired under bond for title to land, is equal to that which a grantor retains where he conveys legal title to land as security for debt. In such latter case it has been held: "Where one executed to a named grantee a security deed, and subsequently, upon the death of the grantor, his widow became his administratrix, and a year's support was duly set apart to the widow, embracing all the right, title, and interest of the decedent in the lands conveyed by the security deed, she, remaining in possession, was entitled to the rents and profits growing out of the land, until the institution of an action to recover the land or other appropriate proceedings by the grantee in the security deed to subject the land and mesne profits to the debt due him." Stevens v. Worrill, 137 Ga. 255 ( 73 S.E. 366). See Mitchell v. LaGrange Banking Trust Co., 166 Ga. 675, 677 ( 144 S.E. 267). Under this rule, the right of beneficiaries, under the provision for statutory year's support, to possession, rents, and profits, will yield to the right of the owner, being the obligor in the bond for title under which they claim, where such owner institutes action to recover the land or other appropriate proceeding to subject the land and rents and profits to payment of the debt.
( b) An action for receiver to sell the land and collect rents and profits thereof is an appropriate proceeding for collection of the debt, which if well founded would render the rents and profits subject to the debt.
3. Where in a proceeding of the character mentioned above, instituted by the obligor in the bond for title against the beneficiaries of the year's support, the petition alleged insolvency of the obligee, and that the property was deteriorating in value, and prayed for appointment of a receiver and for sale of the property, the proceeds thereof to be applied in part to the discharge of past-due notes given by the obligee, and that a sufficiency of the purchase-price be impounded to discharge other notes given by him which are not due, but did not allege that the insolvency of the obligee occurred since the date of the bond, or that any waste was being committed, or that the deterioration was other than natural wear and tear, the petition failed to allege a cause of action for the relief sought, and the general demurrer was properly sustained. Jordan v. Beal, 51 Ga. 602. See also Williams v. Stewart, 56 Ga. 663 (3); Tumlin v. Vanhorn, 77 Ga. 315 ( 3 S.E. 264); Rosenberg v. Wilson, 160 Ga. 399 ( 128 S.E. 178); Goff v. National Bank of Tifton, 170 Ga. 691 ( 153 S.E. 767).
( a) Unless expressly provided by the contract, an obligee in a bond for title is not under a duty to the obligor to insure the property against loss by fire. Neither are the beneficiaries under the provision for statutory year's support, to whom the equity of the obligee was set apart after his death, under such duty to insure the property. Accordingly, allegations that the improvements on the property are not insured, and that the beneficiaries refuse to insure, do not aid the petition for equitable relief.
( b) The case differs from McCurry v. Pitner, 159 Ga. 807 ( 126 S.E. 781), and cit., where the suit in equity sought Personal judgment against the obligee in the bond for title, before maturity of all the purchase-money notes, and sale of the property, and impounding of the proceeds, to pay notes as they should mature in the future. In the instant case there was no suit against the obligee in the bond for title.
Judgment affirmed. All the Justices concur.