Alropa Corp. v. Goldstein

• Court: Georgia Court of Appeals
• Writing for the Court: MacINTYRE, Judge.
• Citation: Alropa Corp. v. Goldstein, 69 Ga.App. 168, 25 S.E.2d 116 (Ga. App. 1943)
• Decision Date: 19 March 1943
• Docket Number: 29781.
• Parties: ALROPA CORPORATION v. GOLDSTEIN.

25 S.E.2d 116

69 Ga.App. 168

ALROPA CORPORATION v. GOLDSTEIN.

No. 29781.

Court of Appeals of Georgia, Division No. 1.

March 19, 1943

Ivey & Nathan, of Atlanta, for plaintiff in error.

Samuel Eplan and Arnold Kaye, both of Atlanta, for defendant in error.

MacINTYRE Judge.

The petition shows that a mortgage under seal was given to secure a note not under seal. The note was barred by the statute of limitations while the mortgage was not. The petition states "that this action is brought and specifically based upon the right of the plaintiff to recover on the covenant contained in the mortgage deed," which covenant is "to pay all and singular the principal and interest and other sums of money payable by virtue of said promissory notes and this deed, or either, promptly and on the days respectively the same severally become due." The question is whether an independent action for a personal judgment can be maintained on a mortgage where the note is barred by the statute of limitations.

"A mortgage in this State is only security for a debt and passes no title." Code, § 67-101. "When a mortgage has been taken, to secure the payment of a promissory note, and the remedy on the note is barred by the Statute of Limitations, is the remedy on the mortgage also barred? We think not, for the reason, that the creditor stipulated, by contract, for two remedies against his debtor to enforce the collection of his demand. One remedy was by suit upon the note, and having obtained judgment for the

amount of the note, such judgment would bind all the property of the defendant. The other remedy was upon the mortgage, by petition and foreclosure, in the manner pointed out by the Statute. By this latter remedy, the creditor can sell the mortgaged property, in satisfaction of his debt. The creditor may pursue both remedies at the same time [italics ours] until he obtains satisfaction of his debt. Although the remedy on the note may be barred, after the expiration of six years, yet, the debt is not extinguished." Elkins v. Edwards, 8 Ga. 325. "This court has ruled that the bar of the statute might attach upon a promissory note secured by mortgage, and the mortgage itself be still enforceable against the specific property [italics ours], the proceeding to foreclose being commenced before the mortgage also was barred." Allen v. Glenn, 87 Ga. 414, 13 S.E. 565. But the plaintiff in error contends: "An indebtedness evidenced by a promissory note may in turn be merged into and extinguished by a different form of obligation, but not necessarily so. A promissory note indebtedness which is secured by a mortgage or deed to secure debt is not extinguished by the mortgage or deed to secure debt, but the two instruments exist as separate and complementary instruments. The creditor has his remedy under either. Payment of the note will extinguish the obligation...