Darling Int'l, Inc. v. Carter

• Decision Date: 27 January 2014
• Docket Number: No. S13A1745.,S13A1745.
• Citation: 294 Ga. 455,754 S.E.2d 347
• Court: Georgia Supreme Court
• Parties: DARLING INTERNATIONAL, INC. v. CARTER et al.

294 Ga. 455
754 S.E.2d 347

DARLING INTERNATIONAL, INC.
v.
CARTER et al.

No. S13A1745.

Supreme Court of Georgia.

Jan. 27, 2014.

[754 S.E.2d 349]

Robert Bates Lovett, Heather Nicole Hammonds, Hunter, MaClean, Exley & Dunn, P.C., Savannah, for appellant.

Ken W. Smith, Smith, Ramay & Bennett, Hazlehurst, for appellees.

BENHAM, Justice.

This case involves a dispute over title to a 7.63 acre parcel of land located in Bacon County. The parcel was originally part of a 95.125 acre parcel owned by H.S. Carter, now deceased, that was taken by Bacon County via eminent domain proceedings commenced in 1973. As a result of the condemnation proceedings, Bacon County acquired a total of 2522.3 acres for the purpose of creating a public recreation project known as Lake Alma and the 95.125 acre Carter parcel was just one of the parcels condemned for this purpose. The record shows that the proposed Lake Alma was part of a larger urban development project that received funds from the Federal Model Cities Program so that the City of Alma and Bacon County could execute a development plan that included, among other things, an industrial park, a waste water treatment plant, and improvement of the local airport, in addition to construction of Lake Alma. The other projects were completed but, due to protracted litigation and other reasons, the Lake Alma project was abandoned and never constructed. In the meantime, in 1985, the county granted an undivided one-half interest in the Lake Alma tract to the City of Alma. After the project was abandoned, at the request of the city and county, the General Assembly passed an amendment to OCGA § 36–9–3, effective July 1, 1992, that permitted counties to sell back to the original owners land that had been acquired for creation or development of a lake, such as the Lake Alma project, but the legislation failed to provide for repurchase of land by the heirs of the original owners. See Ga. L.1992, p. 1348, § 1. By that time, H.S. Carter was deceased and the 95.125 acre parcel originally owned by him was apparently one of the only parcels

[754 S.E.2d 350]

condemned for construction of Lake Alma that was not repurchased by the original owner.

The chain of title to the 7.63 acres at issue in this appeal reflects the following conveyances: On December 31, 2003, the county and city each executed quitclaim deeds purporting to convey the 7.63 acres to the Bacon County Development Authority and on that same day the Development Authority executed a warranty deed for the property to Southeastern Maintenance and Construction, Inc. In 2005, Southeastern Maintenance granted an easement over a portion of the property to appellant Darling International, Inc. Also in 2005, Southeastern Maintenance executed a warranty deed purporting to convey 3.048 acres of the disputed property to Darling and in 2007 it executed a warranty deed conveying the remainder of the 7.63 acres to Darling.

On July 1, 2010, OCGA § 36–9–3 was amended to grant the heirs of the original landowners the right to repurchase land such as that which was condemned for Lake Alma (OCGA § 36–9–3(g)(3)(B)). See Ga. L.2010, p. 746, § 1/HB 703. Shortly thereafter, certain heirs of H.S. Carter sought to repurchase Mr. Carter's original 95.125 acre parcel. On December 21, 2010, the City of Alma executed a quitclaim deed to Bacon County conveying its undivided interest in the 95.125 acres and, that same day, Bacon County executed a quitclaim deed conveying all of its undivided interest in the property to the H.S. Carter heirs who are the appellees herein. The quitclaim deed states that Bacon County intends “to convey to Grantees only all properties which it obtained from their father Hoke Carter by condemnation ... Less & Except any portion of said properties which have been previously legitimately conveyed by the Grantor.” The Carter heirs then filed a petition to quiet title and for ejectment against Darling and Southeastern Maintenance with respect to the 7.63 acres. The parties stipulated to the undisputed material facts and each party filed a motion for summary judgment. Darling asserted it was entitled to summary judgment with respect to the Carter heirs' quiet title action and their claim for ejectment because, as a result of the county's previous conveyance of the disputed property to the Development Authority and the subsequent chain of conveyances by which Darling ultimately obtained title, the Carter heirs do not have title to that property. The Carter heirs asserted they were entitled to summary judgment, and that Darling's motion should be denied, because the previous conveyances are not valid. The Carter heirs argued that the previous conveyance to the Development Authority was invalid as a result of the county's failure to follow the requirements of OCGA § 36–9–2 to enter an order on its minutes authorizing disposal of the real property. They further argued that the conveyance of the previously condemned property to Southeastern Maintenance was invalid because it amounted to a legally impermissible sale of condemned property to private developers for private use and was not a transfer for a proper alternative public use.¹ Darling argued that these previous conveyances are legally valid. Further, Darling asserted it was entitled to judgment in its favor because it was a bona fide purchaser of the property without knowledge of the Carter heirs' interest in the property.²

Without addressing Darling's bona fide purchaser argument, the trial court entered judgment in favor of the Carter heirs along with a decree that title to the property vests in them and is superior to Darling's claim of title. The court found that the county's 2003 conveyance to the Development Authority

[754 S.E.2d 351]

was invalid and did not serve to pass title because the county failed to follow the procedures required by OCGA § 36–9–2 to record on its minutes the authorization to convey the property, which deficiency was never corrected by ratification. Further, the court found that the subsequent attempt to transfer the property to Southeastern Maintenance was invalid because neither the county nor the city ever formulated an economic development plan that encompassed an alternative public use of the property.

1. (a) The first issue raised on appeal is whether, despite Bacon County's failure to comply with the requirements of OCGA § 36–9–2 when it conveyed its undivided one-half interest in the property to the Development Authority, Darling is a bona fide purchaser for value and without notice of this irregularity so that its title is superior to that of the Carter heirs. Pursuant to OCGA § 23–1–20, “[a] bona fide purchaser for value without notice of an equity will not be interfered with by equity.” At the time Darling purchased the property for value, no other outstanding interest was reflected in the recorded chain of title. At the time of the 2003 conveyance of the property to Southeastern Maintenance, the 2010 amendment to OCGA § 36–9–3(g), permitting disposition to the heirs of the original owner of property that had been condemned for construction of a recreational lake but which was no longer needed for such a purpose, had not yet been passed. See Ga. L.2010, p. 746, § 1/HB 703. “[F]ailure to use the lands for the purpose for which they were condemned does not cause title to revert to the original owners.” Galloway v. Bd. of Commrs. of Banks County, 246 Ga. 472, 473, 271 S.E.2d 784 (1980), citing Sadtler v. Atlanta, 236 Ga. 396, 223 S.E.2d 819 (1976). Accordingly, Darling asserts the Carter heirs' interests did not arise until 2010 and thus were nonexistent at the times of Darling's purchases in 2005 and 2007 and that it was an impossibility for Darling to have notice of an interest that did not yet exist.

First, relying upon Head v. Lee, 203 Ga. 191, 201(4), 45 S.E.2d 666 (1947), the Carter heirs assert that because Bacon County failed either to record authority for the sale to the Development Authority on its minutes as required by OCGA § 36–9–2, or to ratify the sale at any time before the 2010 conveyance to them, the purported 2003 conveyance to the Development Authority did not pass title and the Development Authority's title is void. In West v. Fulton County, 267 Ga. 456, 457(1), 479 S.E.2d 722 (1997), this Court noted “[t]here are no exceptions set forth in OCGA § 36–9–2 to the requirement that authorization for the conveyance of county-owned property must be duly entered on the minutes of the proper county authority.” But in West, it was the county that sought to void the mistaken conveyance of county-owned property in a tax sale because the property, having been owned by the county, was not subject to taxation and should not have been the subject of levy and sale by the tax commissioner. And in neither Head nor West was the issue of the purchaser's status as a bona fide purchaser without notice raised or considered by this Court.

In asserting the title conveyed to the Development Authority was void, the Carter heirs analogize...