254 F. 278 | 5th Cir. | 1918
Lead Opinion
Phoenix Planing Mill, December 22, 1909, purchased land in Atlanta from J. F. Deary, taking bond for title. On March 22, 1913, Phoenix Planing Mill assigned and delivered the bond for title to Dowry National Bank to secure debt. March 25,
The trustee has the rights of a judgment creditor with a lien. These rights were fixed prior to a record of the assignment to secure debt to the Atlanta National Bank of the bond for title executed by Leary. There is no requirement in the Georgia law that a bond for title be recorded. Executed with certain formalities, its record is permitted. Sections 4213 and 4214, Civil Code of Georgia of 1910. The litigation, however, deals, not with the record of a bond for title, but with the failure to record the assignment of a bond for title; the assignment being made to secure debt.
The legal effect of an assignment to secure a debt of a bond for title is to create a mortgage. The mortgage results from and is evidenced by the assignment; the bond for title defines and limits the rights which the mortgagor has, and upon which he fixes a lien. That this interest is capable of being subjected to a mortgage is indicated by Owens v. Kenney, 146 Ga. 257, 91 S. E. 65, in which it is held that the grantor in a security deed has an interest which he may convey by deed, and by Wood v. Dozier, 142 Ga. 538, 83 S. E. 133, in which a distinction is made between a mortgage of the equity resulting from a security deed with bond for reconveyance, and a mortgage on the “entire interest or estate.”
The change in procedure effected by this act apparently has no effect in creating or preventing a lien. This would seem to be definitely determined by O’Connor, Executrix, v. Georgia Railroad Bank, 121 Ga. 88, 48 S. E. 716, wherein it is held that:
“Regardless of the inability of A.’s creditors to levy on the equity of redemption, the lien- of'their judgments attached to his interest in the land from the-date of rendition; * * * and the right of the creditors to subject the surplus realized under the sale under the security deed to the payment of their judgments was superior to the claim of the transferee of the bond to reconvey, whose interest was acquired subsequently to the date of their judgments.”
It is clear that there may be a lien, notwithstanding the absence of a “leviable interest.” To this effect also is Va. Car. Chemical Co. v. Rylee, 139 Ga. 668, 78 S. E. 27. The trustee has had, since the date of the bankruptcy, the status of a lien creditor. The transfer of the bond for title, being a mortgage, and not having been recorded prior to that date, is without effect in so far as his rights are concerned. ‘
In this case the remedy of the statute is superseded by the remedies of the Bankruptcy Law. All liens against the property having precedence over the rights of the trustee have been discharged. Procedure under the statute requires that such liens be paid as may be required for placing the legal title in the defendant in execution. If a lien exists, payment of which is necessary to give legal title, but which is subordinate to the judgment lien, the 'judgment creditor would not, of course, be without a remedy.
The judgment is reversed, for proceedings to conform herewith.
Reversed.
Dissenting Opinion
(dissenting). Considering the facts and circumstances of this case, I have serious doubts as to whether this court has jurisdiction of this appeal.
The proceeding in the bankruptcy court was one for marshaling liens on property and funds within the custody of the court, administrative in character, in which there was no contest over the amount of any claim, and the only contest was as to the rank of the lien of the Atlanta National Bank, and therefore it seems to me that no appeal lies from the final decision of the court. The right to appeal must be found in section 25 of the Bankruptcy Law (Act July 1, 1898, c. 541, 30 Stat. 553 [Comp. St. 1916, § 9609]), and, as that section has been construed by the courts, no appeal lies thereunder in administrative proceedings. In re Whitener, 105 Fed. 180, 44 C. C. A. 434; Coder, Trustee, v. Arts, 213 U. S. 223, 29 Sup. Ct.
If the court has jurisdiction in the case, I dissent from the reasoning and conclusion of my Brethren denying the lien of the Atlanta National Bank, because the same was not duly recorded. The question presented arises, and should be decided, under Georgia law, and under that law I think the decision in the lower court was correct. ' The reasoning and authorities are fully stated in the opinion of Judge Newman, found in the transcript, and I concur with him as to the conclusion reached.