Craft v. Drake

• Decision Date: 02 October 1979
• Docket Number: No. 35070,35070
• Citation: 244 Ga. 406,260 S.E.2d 475
• Parties: CRAFT et al. v. DRAKE et al.
• Court: Georgia Supreme Court

Page 475

260 S.E.2d 475

244 Ga. 406

CRAFT et al. v. DRAKE et al.

No. 35070.

Supreme Court of Georgia.

Submitted June 22, 1979.

Decided Sept. 10, 1979.

Rehearing Denied Oct. 2, 1979.

Richard L. Fullerton, Newnan, for appellants.

William E. Anderson, George C. Rosenzweig, Newnan, for appellees.

BOWLES, Justice.

This appeal is taken from an order granting summary judgment in favor of appellees First National Bank of Newnan and Julian F. Roberts, an officer and agent of said bank.

In 1972, appellee L. T. Drake and appellant Charles H. Craft, Jr. entered a business venture for the development of a subdivision, and in furtherance thereof executed a promissory note to the First National Bank of Newnan for the principal sum of $4,000. Appellant Craft granted a security interest in his home as collateral for the loan. He transferred the home to his wife on February 4, 1977. The combination note and security agreement were complete when executed.

Thereafter, Craft and Drake executed other new money and renewal notes of indebtedness in furtherance of the business venture in favor of the defendant bank. The last of these renewal notes was executed on June 17, 1977. In October, 1977, appellants Charles H. Craft, Jr. and Mrs Craft received a letter from the bank's attorney demanding payment of $41,372.56 on the June 17, 1977 note and giving notice of the bank's intention to foreclose on their home. Thereafter, foreclosure proceedings were instituted pursuant to a power contained in the security deed.

On November 29, 1977, appellants filed suit against Drake and his wife, and appellees First National Bank of Newnan and Roberts, alleging fraud, misrepresentation, deceit, and slander of title to real estate, and alleging conspiracy as between appellees. Appellants also alleged violations of Regulation "Z" (12 C.F.R. § 226.1 et seq.). As specifically concerns the two appellees involved in this appeal, the complaint alleged that appellee Roberts while acting as an officer and agent of the appellee bank did fraudulently induce appellant Craft to execute certain notes while misrepresenting to appellant that his home was not collateral for the note, and that some notes were executed in blank and later filled in with amounts larger than authorized by appellant. Appellants prayed that the bank's foreclosure on their home be enjoined, and asked for a recission of the security agreement and cancellation of the June 17, 1977 promissory note.

Appellees First National Bank and Roberts filed a motion for summary judgment, contending that the allegations of appellants' complaint have been pierced so that no genuine issue of material fact remains for decision. In support of their contention, the appellee bank and appellee Roberts cite the deposition of appellant Charles Craft, taken on December 20, 1977, wherein appellant admitted executing the completed February 29, 1972 promissory note and security deed, which note contained a "retention of security interest" clause. Appellant also acknowledged the genuineness of his signature on the June 17, 1977 note, which note was the subject of the initial foreclosure action, as well as stating that his signatures on the copies of all notes and security deeds appearing as exhibits in the case...