344 Ga. App. 69
Ga. Ct. App.2017Background
- Norton executed a $258,000 purchase money note secured by a security deed to Y. C. Development, Inc. (YCD) on October 21, 2010.
- The note stated default occurs if Norton fails to pay or defaults under the security deed and continues to do so for 10 days after her "receipt of [YCD’s] written notice" for payment defaults or 30 days after "receipt" for other defaults.
- The note incorporated the security deed’s procedures for giving notice, and the security deed provided that notices are "deemed to have been duly given" (i) on personal delivery or (ii) two days after deposit in the U.S. Mail by certified mail with return receipt requested, addressed to the listed address.
- Norton’s notice address block in the security deed was blank, but both parties agreed Norton had designated her primary residence for notice; YCD sent certified-mail notices to that residence (and other addresses) on February 3 and February 26, 2016; many mailings were returned undeliverable.
- Norton sued for wrongful foreclosure after YCD foreclosed nonjudicially and bought the property at sale, arguing the contract required actual receipt of notice and YCD failed to provide it; the trial court granted Norton summary judgment.
- The appellate court reversed, holding the contract’s notice provisions deem certified-mail notice "duly given" two days after deposit, so actual receipt was not required and YCD complied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the contract required actual receipt of default notice before foreclosure | Norton: the note’s "receipt of written notice" language requires actual receipt | YCD: the note incorporates the security deed which deems certified-mail notice "duly given" two days after mailing; actual receipt not required | The court held actual receipt was not required; certified-mail notice is "deemed" given two days after deposit per the security deed |
| Whether YCD complied with contract notice procedures before exercising power of sale | Norton: YCD failed to give constitutionally/contractually required notice because she never received it | YCD: it sent certified-mail notices to Norton’s designated address and therefore complied with the deed’s procedure | The court held YCD complied by mailing certified notices to Norton’s designated address and was entitled to foreclose |
Key Cases Cited
- Clark v. AgGeorgia Farm Credit ACA, 333 Ga. App. 73 (Ga. Ct. App.) (security deed is a contract and its provisions control rights of parties)
- Matson v. Bayview Loan Srv., LLC, 339 Ga. App. 890 (Ga. Ct. App.) (summary judgment standards and construing evidence in favor of nonmovant)
- Genone v. Citizens Ins. Co. N.J., 207 Ga. 83 (Ga.) (parties may contract that mailing constitutes sufficient proof of notice)
- Queen Ins. Co. of Am. v. Nalley Discount Co., 215 Ga. 837 (Ga.) (mailing to address in policy without proof of actual receipt can effect cancellation when policy specifies mailing is sufficient)
- Puryear v. Farmers’ Mut. Ins. Ass’n, 137 Ga. 579 (Ga.) (general rule that mailing is presumptive but not definitive proof of receipt unless contract provides otherwise)