Grier v. Skinner's Furniture Store of Newnan, Inc.

• Court: Georgia Court of Appeals
• Writing for the Court: CARLEY; McMURRAY, P.J., and POPE
• Citation: Grier v. Skinner's Furniture Store of Newnan, Inc., 349 S.E.2d 826, 180 Ga.App. 607 (Ga. App. 1986)
• Decision Date: 20 October 1986
• Docket Number: No. 72826,72826
• Parties: , 2 UCC Rep.Serv.2d 1391 GRIER v. SKINNER'S FURNITURE STORE OF NEWNAN, INC.

Page 826

349 S.E.2d 826

180 Ga.App. 607, 2 UCC Rep.Serv.2d 1391

GRIER v. SKINNER'S FURNITURE STORE OF NEWNAN, INC.

No. 72826.

Court of Appeals of Georgia.

Oct. 20, 1986.

Linnis I. Cook, Macon, Paul E. Kauffmann, Columbus, Phyllis J. Holmen, John L. Cromartie, Jr., Atlanta, for appellant.

Charles C. Witcher, Shelley Davidson, Newnan, for appellee.

CARLEY, Judge.

At different times, appellee sold to appellant several items of furniture and appliances. When appellant defaulted on her payment obligations as to the various items, she voluntarily surrendered some of them back to appellee. Appellee then sought a writ of possession from the magistrate's court for the remainder. In the meantime, the items of surrendered property were sold. As to the writ of possession, appellant answered on a form provided by the magistrate's court, placing an "X" in the box by the statement reading "I deny the allegations of the complaint because...." (Emphasis supplied.) In the space that followed, appellant wrote: "[Appellee] previously repossessed [several items] and has not credited my account." Appellant subsequently amended her answer and also added a counterclaim. She asserted that appellee's failure to provide the notice required by OCGA §§ 10-1-10 and 11-9-504(3) served both to bar the instant action as one seeking a deficiency, as well as to authorize a recovery by her of monetary damages pursuant to OCGA § 11-9-507(1). The magistrate's court granted the writ of possession and denied appellant's counterclaim. Appellant appealed to the superior court for a trial de novo. The superior court granted the writ of possession, from which order appellant applied to this court for discretionary appeal. Appellant's application was granted, resulting in the instant appeal.

1. Appellant contends that the superior court erred in granting the writ of possession because appellee never proved the existence of an enforceable security interest. OCGA § 11-9-203(1)(a) provides that a security interest is not enforceable against a debtor unless "the debtor has signed a security agreement which contains a description of the collateral...." No evidence of such a security agreement was ever presented to the superior court. Appellee contends that sales invoices, which stated that the sales were subject to a "charge agreement," were sufficient to prove the existence of the security interest. However, the sales invoices were never admitted into evidence in the superior court. Moreover, they do not constitute a security agreement, but merely give notice of the existence of one. In finding the existence of an enforceable security interest, the superior court erroneously relied on its personal knowledge of appellee's practice. A signed security agreement "is an absolute requisite to the enforceability of the security interest." McDonald v. Peoples Auto. Loan, etc., Corp., 115 Ga.App. 483, 487, 154 S.E.2d 886 (1967). See also Holloway v. Farmers, etc., Bank, 151 Ga.App. 424, 260 S.E.2d 380 (1979); Amoco Oil Co. v. G. Sims & Assos., 162 Ga.App. 307, 309-310, 291 S.E.2d 128 (1982).

Appellee's contention that appellant did not deny the existence of a security interest in the property is not supported by the record. On the answer form supplied by the magistrate's court, appellant indicated that she "den[ied] the allegations of the complaint." (Emphasis supplied.) This pleading must be construed "in the light most favorable to the pleader with all doubts resolved in [her] favor even though unfavorable constructions are possible. [Cit.]" DeKalb County v. Ga. Paperstock Co., 226 Ga. 369, 370, 174 S.E.2d 884 (1970). Appellant's general denial gave notice to appellee that it would have to prove all the elements of its case. OCGA § 9-11-8(b) permits such a general denial.

Appellee further asserts that appellant specifically admitted that appellee had a security interest in the goods which it sought to obtain. " 'Where the pleading is inconsistent, the admission, not the denial, prevails. [Cit.]' " Johnson v. Daniel, 135 Ga.App. 926, 928(2), 219 S.E.2d 579 (1975). Although appellant filled in the blanks following the general denial with the allegation that appellee had "previously repossessed [several items] and has not credited my account," this was not an admission in judicio as to the existence of a security interest. It was, at most, an admission of the existence of an account. Moreover, even if the above language could be construed as admitting the existence of a security interest, it would only be an...