Syllabus by the Court.
The
payment of a debt secured by deed to land revests in the
grantor in such deed such interest and title therein as can
be levied upon under an execution issuing upon a judgment
junior in date to such deed, without a reconveyance of the
land to the grantor, and, in case of cancellation, without
the record of the cancellation of the security deed.
(a)
Quære, whether an entry upon a security deed in which full
payment of the secured debt is acknowledged and cancellation
of the deed is authorized is such cancellation as is required
under section 3309 of the Civil Code.
Where
one purchases land incumbered by two security deeds and by a
judgment junior to such security deeds, on which execution
has issued and has been properly recorded on the general
execution docket, under an agreement by which he is to pay
for the land the amount of the debts secured by such deeds
and in pursuance of such agreement does pay such debts, but
receives from the seller no conveyance, and thereafter the
land is levied upon under such execution, the purchaser is
not entitled to be subrogated to the rights of the holders of
such debts; there being no agreement between such holders and
himself, or between the debtor and himself, by which he is to
be subrogated to the rights and titles of the grantees in
such deeds, the purchaser having constructive, if not actual
notice of the existence of such junior judgment.
Error
from Superior Court, Early County; M. J. Yeomans, Judge.
Execution
proceeding by the Citizens' Mercantile Company against
Mrs. R. A. Easom, in which Otho Easom filed claim. Judgment
for claimant, and plaintiff brings error. Reversed.
Russell
C.J., dissenting.
An
execution in favor of the Citizens' Mercantile Company
against Mrs. R. A. Easom was levied upon a described tract of
land as the property of the defendant in fi. fa. Otho Easom
filed his claim to this property. By agreement between the
parties the trial of the claim was submitted to the trial
judge, without the intervention of a jury, upon an agreed
statement of facts and the testimony of the claimant. That
statement of facts is as follows:
"On December 29, 1914, the defendant in fi. fa., Mrs. R
A. Easom, who is the same person as Mrs. Emma Easom, acquired
title, under a deed made to her as grantee by one J. S.
Barnett as grantor, said deed being recorded on February 19,
1915 in Deed Book 30, page 13, in the office of the clerk of
the superior court of Early county, to the following
described real estate: A tract of land in the twenty-sixth
district of Early county, Ga., containing 65 acres, described
as follows: Beginning at a point on the east line of lot of
land No. 124 in said district, said point being 22 yards
south of the northeast corner of said lot of land No. 124;
thence due west, across said lot of land, to the west line
thereof; thence north to the land of the estate of J. J.
Hill; thence east 76 3/4 yards; thence north 115 yards, to
line of Ben Easom; thence east 143 1/2 yards; thence south
315 yards, to dividing line of Jesse Easom and Mattie Lou
Easom; thence east, to the east line of lot No. 125; thence
due south, to point of beginning--sixty (60) acres of said
land lying in lot No. 125 and five (5) acres lying in lot No.
124. She remained in possession of said lands until January
1, 1923, such possession being continuous from the date of
said deed. On December 27, 1922, the Citizens' Mercantile
Company obtained a judgment against said Mrs. Easom, in the
city court of Blakely, of Early county, for $327.08
principal, $31.61 as interest thereon to the date of
judgment, $35.86 as attorney's fees, and $13.85 as costs
of court. Execution regularly issued on this judgment on
December 27, 1922, and was on the same day duly recorded on
page 75 of General Execution Docket No. 3 in the office of
the clerk of the superior court of Early county.
On the day that this execution issued the said Mrs. Easom
owned and was in possession of the lands above described, but
the Bank of Donalsonville held two certain security deeds,
passing title to said land into them, over said land, each of
said security deeds being executed by Mrs. Easom to said
bank, the one dated November 15, 1921, recorded on November
30, 1921 in Mortgage Book SS, page 401, in said clerk's
office, and the other dated December 10, 1921, recorded on
December 21, 1921, in the same book in said office, on page
411 of said mortgage book. The first of said
security deeds was given to secure an indebtedness of Mrs.
Easom to the bank of $224.86, and the latter an indebtedness
of $102.50. Neither of said security deeds has ever been
canceled of record, and neither of them has ever been
presented to the clerk of the superior court of Early county
for the purpose of having it canceled of record. Each of said
security deeds bears two entries indorsed on the back
thereof, which entries were all made by I. R. Aultman,
assistant cashier of the Bank of Donalsonville, on the dates
they purport to have been made. Said entries are as follows
on each deed: 'The debt secured by this deed being paid,
cancellation of same is hereby authorized. This 28th day of
March, 1923. Bank of Donalsonville (Donalsonville, Ga.), I.
R. Aultman, Asst. Cashier. Georgia, Seminole County. On March
28, 1923, Otho Easom paid Bank of Donalsonville the debt
secured by within deed, requesting that we enter cancellation
on same. Now, on September 10, 1923, comes Otho Easom with
the original papers, without exercising cancellation of same,
and now requests us to transfer same to him, as request
for cancellation was asked by him in error, and that what he
desired was a transfer, he having paid the debt to us. Now,
for value received on March 28, 1923, we to-day transfer the
within deed to Otho Easom, with all rights and privileges, as
well as the land therein conveyed, without recourse on us.
This September 10, 1923. Bank of Donalsonville, by I. R.
Aultman, Asst. Cashier. Witnesses: Jos. P. Howard, H. G.
Rawls, N. P.'
That on August 24, 1923, said above-described land was levied
on by S.W. Howell, deputy sheriff of Early county, under and
by virtue of the execution above described in favor of the
Citizens' Mercantile Company against Mrs. R. A. Easom,
said land being levied upon as the property of said Mrs.
Easom. That I. R. Aultman, cashier of the Bank of
Donalsonville, a corporation, on the 28th day of March, 1923,
and continuously since that time, and that the assistant
cashier of said bank had authority to receive for said bank
any money due it, and to mark any security deed held by said
bank, or in which said bank was grantee, paid or satisfied,
and to authorize the cancellation thereof for said bank, and
to make transfers of security deeds held by said bank."
The
claimant testified as follows:
"On March 28, 1923, I paid the Bank of Donalsonville the
full amounts due it by my mother, Mrs. R. A. Easom, who is
the same person as Mrs. Emma Easom; said amounts being
represented by notes secured by two certain security deeds.
These two security deeds are those described and referred to
in the agreed statement of facts in this case. The money I
thus paid the bank was my own. I had a farm that my father
had given me, and I put it in the 'long loan' and
borrowed money on it. I paid off the security deeds of my
mother's at the Bank of Donalsonville with part of the
proceeds from this 'long loan' I had made on my own
farm. As soon as I paid these two security [deeds] off, I
went into possession of the land described in the security
deeds, and have been continuously in possession of it ever
since that time. My mother and I knew that the two security
deeds to the bank had to be paid; and my mother told me that,
if I wanted to pay them off, I could have the land described
in the security deeds; that she did not think that any of the
other children would object. My mother and I did not have any
agreement that, if I paid the bank the amounts due it under
these two security deeds, I could have the two deeds
transferred to me; nor did I have any agreement with the bank
at the time I paid the two deeds off, nor prior to that date,
that I should have the two security deeds transferred to me.
However, it was satisfactory with my mother and with the bank
that I pay them off. My mother did not ask me to pay the
security deeds off, but told me that, if I did pay them off,
I could have the land described in them. My mother was with
me when I paid them off at the bank's place of business
in Donalsonville on March 28, 1923. As soon as I paid the
bank, Mr. Aultman, the assistant cashier, to whom I paid the
money, handed me the two security deeds; each having on it an
entry he made at the time, reciting that they had been paid.
After I took possession of the land the Citizens'
Mercantile Company had it levied on under their fi. fa.
against my mother. Subsequently I carried the two security
deeds to the bank, and had Mr. Aultman, the assistant
cashier, make new entries on the back of the deeds for the
purpose of having them transferred to me by the bank. With
the exception of the entry of filing on the back of each of
these deeds, these two entries are the only entries that
appear on the back of each of said deeds."
At the
conclusion of the evidence, and after argument, the judge
found the property not subject, and the plaintiff excepted to
this judgment and assigns error thereon, on the ground that
it was contrary to the evidence and the law.
W. L.
Bryan, of Donalsonville, and Lowrey Stone, of Blakely, for
plaintiff in error.
H. G.
Rawls, of Donalsonville, for defendant in error.
HINES,
J. (after stating the facts as above).
Mrs
Easom, the...
