158 Ga. App. 804 | Ga. Ct. App. | 1981
This is the second appearance of this case before this court. Davidson v. Baier Corp., 151 Ga. App. 314 (259 SE2d 707) (1979). The facts, insofar as relevant to the issues on this appeal, are as follows: Davidson purchased a tract of land for which he executed a note and deed to secure debt for the balance of the purchase price, subject to four prior deeds to secure debt on the property. Both the note and the loan deed contained the following clause:
“Notwithstanding any other provision of this note, the undersigned shall have no obligation or liability for the payment of this note beyond the undersigned’s interest in the real property described in the deed to secure debt hereinabove mentioned, including the rents, issues and profits thereof and the proceeds from a sale of said real property. By the acceptance of this note and said deed to secure debt, holder agrees that in the event of a default hereunder holder will rely solely for the payment hereof on the collateral securing this note pursuant to said deed to secure debt and will not sue or otherwise seek recourse against the undersigned for any deficiency remaining after a foreclosure of said deed to secure debt and a sale of said real property; provided, however, that at the time such foreclosure is commenced the undersigned is not in default for nonpayment of principal or accrued interest under any note which is secured by a deed to secure debt having a lien on said real property with a priority senior to the lien of the deed to secure debt securing this note. The foregoing provisions concern the liability of the undersigned and do not in any manner, and shall not be interpreted or construed to, affect or impair the rights of holder to pursue any
It is undisputed that Davidson subsequently defaulted in the payment of one or more of the prior secured debts on the property and foreclosure under those deeds resulted in 1976. After foreclosure under the prior senior deeds had taken place, Davidson’s note was assigned by the holder to Baier Corporation (Baier) and the deed to secure debt was subsequently transferred to Baier in 1977. Thereafter, Baier instituted “foreclosure” proceedings under the deed which were dismissed. Baier then instituted suit against Davidson on the note which was in default and, after discovery, Baier moved for summary judgment. “Davidson in his affidavit opposing the motion for summary judgment aver [red] that the intent of the instrument was to exculpate him from liability, leaving the [holder] only the property itself as security, unless after foreclosure of the deed to secure debt extant between the parties there was a deficiency established in a confirmation sale combined with a default on a prior lien occurring at the time the foreclosure was initiated. The affidavit of [Baier’s assignor], on the other hand, state [d] that the intent of the parties was to impose personal liability upon J. Dean Davidson if he should jeopardize the underlying collateral by defaulting on any indebtedness which was secured by a senior lien against the property.” Davidson v. Baier Corp., 151 Ga. App. 314, 315, supra. On this evidence summary judgment was granted to Baier. On appeal this court reversed because “the parties to the contract, by their diverse affidavits, have created a jury issue as to what their intent actually was if in fact a prior default had resulted in foreclosure by a third party before the seller or his assignee foreclosed, assuming a default to exist. Should it eventuate on the trial, however, that there was no intent, either express or implied, which covered the situation here existing, then the exculpatory clause, being construed as entire and indivisible, must necessarily fail.” Davidson v. Baier Corp., 151 Ga. App. 314, 316, supra.
After the grant of summary judgment to Baier was reversed by this court, the case was returned to the trial court and a bench trial was held. The trial court, after making extensive findings of fact and conclusions of law, entered judgment for Davidson. It is from this judgment that Baier appeals in the instant case.
We find meritless Baier’s assertion that, in contravention of the law of the case as established in the prior appeal, the trial court erroneously entered judgment for Davidson after finding that the
It is thus apparent that the trial court found that the parties intended that Davidson escape personal liability on the note except in the limited situation where foreclosure proceedings had been instituted by the holder at a time when Davidson was in default under a senior secured note. Through no fault of Davidson there was a failure to perform this condition precedent to his personal liability, resulting in the foreclosure of the senior deeds and making foreclosure of Baier’s deed to secure debt a “rather useless exercise.” Thus it may be said of the instant case that “[t]he evidence fails to disclose that the contingencies have occurred, or... ever will occur in a manner which obligates [Davidson] to pay [Baier] the balance on the [note], in view of [the prior] foreclosure proceedings on the property involved ...” ABCO Builders v. Peavy Concrete Products, 123 Ga. App. 167, 168, supra. It was not error, for any reason urged on
Judgment affirmed.