Ray v. Atlanta Trust & Banking Co., 147 Ga. 265

Ray v. Atlanta Trust & Banking Co.

147 Ga. 265 | Ga. | 1917

Gilbert, J.

(After stating the foregoing facts.)

1. The court correctly held that the deed from L. B. Bay to Mrs. A. F.. Bay conveyed no title, and po interest “except the equity which would have remained in L. B. Bay after paying the debt to said banking company.” At the time of the execution of this deed L. B. Bay had only an equity in the land, which entitled him to a deed conveying the full title upon the payment of his indebtedness to the bank. The bank, however, voluntarily entered into another transaction with Morris, by which it surrendered to Morris his bond to make title to L. B. Bay, receiving in lien thereof the defeasance deed and the escrow deed mentioned in the statement of facts. When the last purchase-money note of Bay to Morris was paid, the defeasance deed became void, and the escrow deed, having been filed for record by the bank, operated to convey the full title to Bay for general purposes. Atlanta Trust & Banking Co. v. Nelms, 115 Ga. 53, 61 (41 S. E. 250). The court, in deciding at that time the rights of the bank incident to this particular part of the transaction, said: “The bank thereby forever waived its right under the bond for title to demand from Morris an unconditional deed to itself, by which, it might have retained title until its demand against Bay upon the loan to him should be paid.” And further, as to the effect of the deposit of the escrow deed, the court said: “This, however, certainly did not operate *270as a lien upon the land, for it was merely the equivalent of a deposit as security of a bare muniment of title by a debtor with his creditor, to guarantee the' payment of a loan. Such a deposit operates neither to transfer to the creditor the debtor’s title, nor to establish in favor of the former any lien either legal or equitable upon the property described in such muniment of title. . . Certain it is, the title was no longer .in the bank.”

It was error to hold, that, “when the purchase-money was paid, Morris held the legal title, and under the statute of uses the law vested the title „in whoever held the beneficial interest; and that the Atlanta Trust & Banking Company being the owner of the beneficial title, the law vested in it the legal title.” It follows from what has been said that, the statute of uses does not apply to the facts of this ease, since the bank had voluntarily parted with all of its interest, legal and equitable.

2. The court erred in holding that the deeds made by the Atlanta Trust & Banking Company, for the purpose. of levy and sale, were “in the nature of escrow deeds.” The bank, having parted with its entire title, could convey none; and hence its deeds made and recorded for the purpose of making levy and sale were ineffectual for any purpose. This court, in passing-upon the effect of the escrow deed executed by Morris, said: “If the delivery of the escrow deed to the clerk had any effect at all, it effectually passed the Morris title into Bay for all general purposes, and.all judgment liens against Bay immediately attached.” Atlanta Trust & Banking Co. v. Nelms, supra.

3. The trial court correctly ruled that the execution, not having been signed by the clerk of the court, was void, and the sale thereunder was void, and the purchaser thereat obtained no title (Biggers v. Winkles, 124 Ga. 990, 53 S. E. 397); and that “said levy, and sale did not have the effect in any way to change the status of the judgment and property.”

4. The court erroneously ruled that L. B. Bay, “being a party to the present case, the judgment against him did not become dormant, and is therefore a valid and subsisting lien upon his property.” Our code declares, “No judgment shall be enforced after seven years from its rendition, when no execution has been issued upon it.” Civil Code (1895), § 3761. This was the law as it stood in 1898, when the judgment here involved was rendered. It *271also appears in the Code of 1910 as section 4355. In 1910 the General Assembly passed an act 'which changed the law requiring entries of executions to be made only on the general execution docket, but this act in no wise affects this case. The issuing of a void execution is the same as if no execution were issued.

5. The court held that “the money paid by the Atlanta Trust & Banking Company having been applied to discharge a good and subsisting lien upon the property in controversy, and the sale being void, therefore, before Mrs. Bay can recover the property, in equity and good conscience she is bound to reimburse the Atlanta Trust & Banking Company to the extent that its money was used to pay off a valid and subsisting lien upon that property.” Upon the original consideration of the case this court affirmed the ruling just quoted. The plaintiff in error filed a'motion for a rehearing; and a rule nisi was passed, requiring the defendant in error to show cause why the decision should not be set aside or modified. After considering the points made by the motion for a rehearing, and the response to the rule nisi, we are of the opinion that our former judgment was correct; but we have modified our opinion so as to eliminate an inadvertent statement therein, and to correct that portion of our decision to make it res#t upon a different basis.

It is insisted by the plaintiff in error that the Franklin execution, to which the proceeds of the sheriff’s sale were applied, was not a valid lien against the property, because the property was not that of L. B. Bay, but of the plaintiff in error, Mrs. Bay. If the relation of Mrs. Bay and her husband as to the use of her funds was not a trust relation, but was that of creditor and debtor, the equitable title was in L. E. Bay at the time the Franklin judgment and fi. fa. issued, on September 38, 1894. On March 31, 1895, Bay executed a deed conveying this property to his wife for a stated consideration of $5,000. Under the evidence in this case the trial court was authorized to find that Mrs. Bay loaned the money to her husband with which to buy the property, and that she elected to treat the matter between her husband and herself as one of debtor and creditor, and to accept the conveyance just mentioned as a payment on the debt. The testimony of L. E. Bay' and Mrs. Bay frequently refers to the debt, and the deed indicates the same thing. The Franklin judgment as soon as rendered became a lien *272on whatever interest Ray had in the property. O’Connor v. Georgia Railroad Bank, 121 Ga. 88 (48 S. E. 716). Ray’s conveyance to his 'wife did not divest the lien. The bank, therefore, having-paid its money, to the extinguishment pro tanto of a valid lien on the property, is entitled to be subrogated to the extent of its payment to the rights of that lienholder. The principle of subrogation here applied is not that of one lienholder paying off the claim of another; it is simply that of a purchaser at a void sale who pays his money to extinguish a lien, but who is deprived of obtaining the property because the sale is void. It is to be noted that the bank was not a volunteer in the transaction. We will not reverse this ruling of the trial judge. Perry v. Adams, 2 Am. St. R. 326, and note (98 N. C. 167, 3 S. E.. 729); Scott v. Dunn, 30 Am. D. 177, and note (21 N. C. 425); 16 R. C. L. 76; 37 Cyc. 454. The claim of subrogation made by the bank was not barred, as contended, because not asserted within a reasonable time.

6. It is insisted by the plaintiff in error that the Franklin lien is not valid, because the execution was not entered upon the general execution docket in the county of the residence of the defendant, as required by law. The law does not require an execution to be entered upon the general execution docket, in so far as it concerns the interests of the parties to the suit. The validity, therefore, of the lien upon the property as to L. R. Ray is not affected by a failure to enter the execution upon the general execution docket. We have already held that the trial court was authorized to find that Mrs. Ray was a purchaser under the deed of March 21, 1895. As such, the burden is upon her to show that she purchased bona fide, and without notice of the lien in question. Eason v. Vandiver, 108 Ga. 109 (33 S. E. 873). The trial court was authorized to hold that the plaintiff in error had failed to carry the burden.

Judgment affirmed in part, and reversed in part.

Evans, P. J., and Beck, Atkinson,'and Hill, JJ., concur. Fish, C. J., absent.