Sanusi v. Cmty. & S. Bank

• Decision Date: 04 December 2014
• Docket Number: No. A14A1905.,A14A1905.
• Citation: Sanusi v. Cmty. & S. Bank, 330 Ga.App. 198, 766 S.E.2d 815 (Ga. App. 2014)
• Court: Georgia Court of Appeals
• Parties: SANUSI v. COMMUNITY & SOUTHERN BANK.

330 Ga.App. 198

766 S.E.2d 815

SANUSI

v.COMMUNITY & SOUTHERN BANK.

No. A14A1905.

Court of Appeals of Georgia.

Dec. 4, 2014.

Schreeder, Wheeler & Flint, John A. Christy, Kelly Lynn Walsh, Atlanta, for Appellant.

Stites & Harbison, Melinda Agee, Atlanta, for Appellee.

Opinion

ELLINGTON, Presiding Judge.

Community & Southern Bank auctioned David Sanusi's property at foreclosure and then initiated confirmation proceedings.After a hearing, the Superior Court of Douglas County determined that the bank failed to prove that the property brought its true market value at the foreclosure sale and denied the bank's application for confirmation.In a subsequent order, the court granted the bank's motion for permission to resell the property.Sanusi appeals, contending that the trial court lacked jurisdiction over the bank's motion to resell the property and that the trial court abused its discretion in finding “good cause” for a resale of the property.For the reasons explained below, we affirm.

1.Sanusi contends that the issue of resale is always before the court in a confirmation proceeding.He contends that the trial court's order denying the bank's application for confirmation of the foreclosure, which was entered on September 3, 2013, was a final order and that “the trial court had no authority to continue to issue rulings after a final order had been entered which concluded the proceedings.”He contends that the bank's separate motion for resale, filed September 17, 2013, was “untimely.”

By arguing that the issue of resale is always before the court in a confirmation proceeding¹ and that the September 3, 2013 order was a final order that disposed of all matters that were before the trial court, Sanusi implicitly posits that, although the September 3, 2013 order was silent on the issue of whether the bank had shown good cause for a resale,² the order effectively prohibited any resale.In that case, the bank's motion for resale must be construed as a motion to modify that “final order” so as to permit a resale.It is well settled that

[a] trial judge has the inherent power during the same term of court in which the judgment was rendered to revise, correct, revoke, modify or vacate the judgment, even upon his own motion.Moreover, this inherent power may be extended beyond the term in which a judgment was entered when a motion [to modify, revoke, or vacate the judgment] is filed within that same term of court.

(Citations and punctuation omitted.)Todd v. Todd,287 Ga. 250, 253(2), 703 S.E.2d 597(2010).Because the bank filed its motion within the term of court that the order denying confirmation was entered,³the trial court was authorized to exercise its inherent power to modify the nonconfirmation order to address the issue of resale.Id.⁴

2.Sanusi contends that the stated basis for the resale order, which was that the bank “relied in good faith on a flawed appraisal,” does not support the trial court's ruling because the appraisal was not flawed.This argument lacks merit.

The record shows that the bank bought the subject property at the foreclosure auction for $1.4 million.It based its bid on an appraisal authored by Jerry Smith.After receiving evidence at the confirmation hearing, which included the testimony of another appraiser who valued the property at $1,535,000, the trial court determined that the true value of the property was at least $1.5 million.The trial court noted that the two appraisers had differing opinions regarding whether and to what extent certain unfinished storage space contributed to the total value of the property.

Sanusi contends that Smith's appraisal was not “flawed” merely because of this difference in “opinion.”As to value, however, the question in a confirmation proceeding is whether the foreclosure sale brought the fair market value of the property to be applied to the debt secured by the property.Community & S. Bank v. DCB Investments,328 Ga.App. 605, 608(1), 760 S.E.2d 210(2014).⁵

Because the trial court found that Smith's appraisal undervalued the property, it did not err in characterizing the appraisal as “flawed.”

3.Sanusi contends that the bank's good faith reliance on a flawed appraisal does not as a matter of law constitute “good cause” to order a resale under the applicable standard and that the trial court therefore erred in granting the bank's motion.

OCGA § 44–14–161(c)“confers upon the trial court broad legal discretion to grant or deny a resale.”(Citations omitted.)RES–GA LJY, LLC v. Y.D.I., Inc.,322 Ga.App. 607, 608, 745 S.E.2d 820(2013).We will not disturb a trial court's exercise of such discretion “unless it is clearly, patently, and manifestly abused....An abuse of discretion occurs where a ruling is unsupported by any evidence of record or where that ruling misstates or misapplies the relevant law.”(Citations and punctuation omitted.)Id. at 609, 745 S.E.2d 820.

“[T]here is no presumption in favor of resale and there is no entitlement to a resale[,]” either “for mere failure to show the sale brought true market value, for a mere ‘flawed’ appraisal, or for any reason.”(Citations and punctuation omitted.)Resolution Trust Corp. v. Morrow Auto Center,216 Ga.App. 226, 228(2), 454 S.E.2d 138(1995).⁶

As we noted in that case, holding that a lender is entitled to a resale whenever confirmation is denied “would obliterate the statute, would remove the trial court's discretion, and would encourage creditors to engage in any unfair practice at foreclosure sale, with the only penalty being a possible resale.”Id. at 227, 454 S.E.2d 138.Although a finding that, in buying property at foreclosure for less than its true market value, a buyer in good faith based its bid on an appraisal does not mandate resale, however, it can authorizea trial court to find good cause for resale.Adams v. Gwinnett Commercial Bank,238 Ga. 722, 235 S.E.2d 476(1977)(Where the trial court found that the creditor proved by a preponderance of the evidence that it had acted in good faith by having the property appraised before the foreclosure sale, the trial court did not abuse its discretion in ordering a resale.).⁷

Nothing in the record in this case indicates that the trial court failed to exercise its discretion out of a belief that the bank was entitled to a resalemerely because it had relied on a flawed appraisal.Rather, the trial court found that the bank relied on a flawed appraisal in good faith and that the bank had shown good cause for a resale.Sanusi does not contend that the bank engaged in any unfair practice in connection with the foreclosure sale, such that the trial court should have penalized it by denying a resale.Because Sanusi has not shown either that the trial court's ruling was unsupported by any evidence of record or that its ruling misstated or misapplied the relevant law, we cannot find that the trial court clearly, patently and manifestly abused its discretion.Greg A. Becker Enterprises v. Summit Investment Mgmt. Acquisitions I,314 Ga.App. 721, 723 –724(1), 725 S.E.2d 841(2012);The Village at Lake Lanier, LLC v. State Bank & Trust Co.,314 Ga.App. 498, 499 –501(1), 724 S.E.2d 806(2012);Gutherie v. Ford Equip. Leasing Co.,206 Ga.App. 258, 261(2), 424 S.E.2d 889(1992).

Judgment affirmed.

PHIPPS, C.J., and McMILLIAN, J., concur.

1SeeNicholson Hills Dev. v. Branch Banking & Trust Co.,316 Ga.App. 857, 861(2), 730 S.E.2d 572(2012)(“The issue of resale is before the court in every confirmation proceeding, whether or not it has been specifically pled, but only so long as the debtor is afforded the opportunity to defend against a resale.”)(citations and punctuation omitted).See footnote 4, infra.

2OCGA § 44–14–161(c)(After a confirmation hearing, “[t]he court may order a resale of the property for good cause shown.”).

3SeeOCGA § 15–6–3 (15.1)(Douglas...