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Bowman v. Poole

Supreme Court of Georgia
Feb 14, 1956
212 Ga. 261 (Ga. 1956)

Opinion

19212.

ARGUED JANUARY 11, 1956.

DECIDED FEBRUARY 14, 1956. REHEARING DENIED FEBRUARY 29, 1956.

Equitable petition. Before Judge Guess. DeKalb Superior Court. September 29, 1955.

Jas. L. Moore, for plaintiff in error.

Edwin Pearce, Poole, Pearce Hall, Margaret Fairleigh, contra.


1. The holder of a junior security deed is equitably entitled, when it is necessary for his protection, to pay the holder of a prior security deed who is proceeding to sell the pledged property under a power of sale contained in his security deed, the principal, interest and all costs due thereon, and demand a transfer thereof. In other words, the holder of a junior security deed, where the property is being sold under a power of sale contained in a senior security deed, has a right, in order to protect his interest, to redeem the property and be subrogated to all of the rights of the senior incumbrance. Tillman v. Stewart, 104 Ga. 687 ( 30 S.E. 949, 69 Am. St. Rep. 192); Bank of Brooklet v. Motor Liens Incorporated, 164 Ga. 314 ( 138 S.E. 582); Thurman v. Lee, 181 Ga. 408 ( 182 S.E. 609). In this case, as the petition shows, the property involved was not being sold at a judicial sale by the sheriff, but was being sold by the holder of the senior security deed under a power of sale contained therein. At such a sale the purchase price would come into his hands and not into the hands of the sheriff, and for the same reason which was given for the ruling in Cromley v. Motor Liens Incorporated, 164 Ga. 16) (137 S.E. 778), it was necessary for the plaintiff to redeem the property in order to protect the interest of her intestate and obtain full relief by an adequate remedy.

2. The allegations of the amended petition are sufficient to show that a valid tender of the full amount due him was made to the holder of the senior security deed; and in such a case, it is well settled by the ruling in Thurman v. Lee, supra, and the authorities there cited, that a sale of the property thereafter made to one with notice of such tender is a nullity. In Bouquin v. Bouquin, 120 Ga. 115 ( 47 S.E. 639), it was held that, "where the creditor has collateral mortgage, or other form of security upon the property of the debtor, the failure to accept legal tender discharges the lien which was intended to secure payment." The same principle is applicable to a tender made by the owner, under Code § 92-8301, for the purpose of redeeming his property from a tax sale. Thereafter the purchaser's inchoate, qualified, or defeasible estate terminates. Durham v. Crawford, 196 Ga. 381 (3) ( 26 S.E.2d 778), and citations. The allegations of the amended petition in the case at bar are sufficient to show that the power to sell, which was vested in the holder of the senior security deed, terminated when he refused to accept the amount due him upon tender thereof; that the sale of the property involved to the defendant Poole is void for want of a valid subsisting power of sale; and that the deed he received in consequence thereof passed no title to him and should be canceled.

3. "Attorney's fees as expenses of litigation are not punitive or vindictive damages, but stand alone, are regulated by Code § 20-1404, and the jury may allow them if the defendant has acted in bad faith in the transaction out of which the cause of action arose." Williams v. Harris, 207 Ga. 576 (3) ( 63 S.E.2d 386). The allegations of the petition are sufficient to show that the defendant Poole acted in bad faith when he refused to accept the amount due him on the secured debt and thereafter sold the pledged property under a power of sale contained in the security deed which had been transferred and assigned to him.

4. The amended petition stated a cause of action for the relief sought, and the trial judge erred in dismissing it on general demurrer.

Judgment reversed. All the Justices concur.

ARGUED JANUARY 11, 1956 — DECIDED FEBRUARY 14, 1956 — REHEARING DENIED FEBRUARY 29, 1956.


This litigation was instituted by Dora Lee Bowman, as administratrix of Fred E. Bowman's estate, against John J. Poole, and in substance her amended petition alleges: Fairview Terrace, Inc., on February 7, 1944, conveyed certain described realty in the City of Atlanta to Atlanta Federal Savings Loan Association to secure a debt of $4,700. On December 10, 1946, Fairview Terrace, Inc., conveyed the same property by warranty deed to Frank K. Bowman, and the grantee as a part of the consideration therefor assumed payment of the balance due on the Atlanta Federal Savings Loan Association's loan. Frank K. Bowman by a loan deed, which was executed on April 26, 1946, conveyed the same property to Fred E. Bowman to secure a loan of $1,080. Since May 4, 1948, and until December, 1954, Fred E. Bowman and the plaintiff have regularly paid the monthly instalments of $46.05 due on the Atlanta Federal Savings Loan Association's loan. On December 19, 1954, Mrs. Margaret Hills Fairleigh and Poole, Pearce Hall, attorneys, claiming a lien on the property in question for legal services rendered Joanne W. Bowman, widow of Frank K. Bowman, by court order, obtained possession of it. They received the rents from it, but failed and refused to pay the instalments due on the Atlanta Federal Savings Loan Association's loan for the months of January and February, 1955. On February 3, 1955, the defendant Poole paid Atlanta Federal Savings Loan Association $3,378.80 as the balance due on the loan and took a transfer and assignment of its note and security deed from Fairview Terrace, Inc. Under an accelerating clause in the loan instruments, the defendant Poole declared the entire debt due, and pursuant to a power of sale contained in the assigned security deed, advertised the property for public sale on the first Tuesday in March, 1955. In order to protect the interest of her intestate, as the holder of a junior security deed, the plaintiff, on February 25, 1955, tendered the defendant Poole $3,771.68, the full amount then due him as transferee of the assigned loan, and demanded a transfer of it to her. The defendant Poole took the tendered money, counted it, handed it back to the plaintiff and refused to make a transfer and assignment of the loan instruments. On the first Tuesday in March, 1955, he exposed the property for public sale, bid it in for a consideration of $4,975, and as attorney in fact for Fairview Terrace, Inc., conveyed it to himself. By his refusal to accept the full amount due him on the assigned loan, and by his subsequent sale of the property at public auction, the defendant Poole acted in bad faith, and the plaintiff is entitled to recover from him the sum of $500 as attorney's fees. By her petition, the plaintiff made a continuing tender of the full amount due the defendant Poole.

There are prayers that the sale of the property be declared null and void; that the deed made pursuant thereto be canceled; that the defendant Poole be required to transfer the loan instruments to the plaintiff on payment of the full amount due him; that the plaintiff have a judgment for $500 against the defendant Poole for attorney's fees; and that she be granted such other and further relief as may be meet and proper.

The petition was dismissed on general demurrer, and the plaintiff excepted.


Summaries of

Bowman v. Poole

Supreme Court of Georgia
Feb 14, 1956
212 Ga. 261 (Ga. 1956)
Case details for

Bowman v. Poole

Case Details

Full title:BOWMAN, Administratrix, v. POOLE

Court:Supreme Court of Georgia

Date published: Feb 14, 1956

Citations

212 Ga. 261 (Ga. 1956)
91 S.E.2d 770

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