Johnson v. Equitable Securities Co.

• Decision Date: 05 February 1902
• Citation: 40 S.E. 787,114 Ga. 604
• Parties: JOHNSON v. EQUITABLE SECURITIES CO. EQUITABLE SECURITIES CO. v. JOHNSON.
• Court: Georgia Supreme Court

40 S.E. 787

114 Ga. 604

JOHNSON v. EQUITABLE SECURITIES CO.

EQUITABLE SECURITIES CO. v. JOHNSON.

Supreme Court of Georgia

February 5, 1902

Syllabus by the Court.

A bona fide purchaser at sheriff's sale, who has paid the purchase money without notice of an equity, will be protected against the same.

Error from superior court, Webster county; Z. A. Littlejohn, Judge.

Claim case between the Equitable Securities Company and H. R Johnson. From the judgment both parties bring error. Judgment on main bill of exceptions affirmed, and cross bill dismissed.

COBB J.

This was a claim case, upon the trial of which the following facts appeared: On November 12, 1884, I. A. Whaley went into possession of a certain described tract of land under a bond for titles from Alex Chappell, and paid the larger portion of the purchase money. On November 9, 1887, a judgment was obtained against Whaley. Execution was issued on this judgment, and Johnson, the plaintiff in error, became the owner thereof as transferee. On March 5, 1888, Whaley transferred his bond for titles to Jowers to secure a debt due him. Whaley subsequently paid Jowers the amount due him and on November 6, 1888, Jowers transferred the bond for titles to Whaley's wife. On November 15, 1888, upon the payment of the balance of the purchase money, Chappell made Mrs. Whaley a deed to the land. Thereafter the Equitable Mortgage Company took from Mrs. Whaley a deed to this land to secure a loan made to her. A portion of the money obtained on this loan was used in paying the balance due Chappell on the purchase money of the land. Judgment was obtained by the Equitable Mortgage Company against Mrs. Whaley, and the land brought to sale, when the Equitable Securities Company, the defendant in error, became the purchaser. The execution issued on the judgment against Whaley obtained in 1887 was levied, and the property advertised to be sold in March 1900, when the Equitable Securities Company interposed a claim. The plaintiff in execution offered evidence tending to show that the Equitable Mortgage Company had notice at the time it took its deed from Mrs. Whaley that the larger portion of the purchase money of the land had been paid by her husband prior to the transfer of the bond for titles, and that such transfer was without consideration. Error is assigned upon the refusal to admit this evidence. The court directed a verdict finding the property not subject, and error is assigned upon this ruling. The uncontradicted evidence shows that the Equitable Securities Company, the claimant, at the time of its purchase of the property at sheriff's sale, had no notice whatever of the voluntary transfer of Chappell's bond for titles from Whaley to his wife; this being the effect of the transfer from Jowers to her. Whaley, of course, could not assert this equity against the Equitable Securities Company, for the simple reason that, as between him and his wife, the voluntary transfer of the bond for titles was valid and binding. Can a judgment creditor of Whaley assert his lien against the interest of Whaley in the land? There was a provision in the Code of 1882 that when a person held property under a bond for titles, and a portion of the purchase money had been paid, the property might be levied on under a judgment against such person, and the entire interest stipulated in the bond sold, the proceeds of the sale being appropriated, first, to the balance due on the purchase money, and the remainder to judgment liens against the obligee in the bond according to date. Code 1882, § 3586. Under this law it would seem that the judgment lien would attach to whatever interest the obligee in the bond for titles might have in the land after any part of the purchase money had been paid; and, if this is true, then at the date of the transfer by Whaley to his wife of the bond for titles in which he was obligee the lien of the judgment controlled by Johnson had attached to Whaley's interest in the land. But the provisions of the Code of 1882 above referred to are not to be found in the Code of 1895, and it would seem that it was the intention of the codifiers that the provisions of Civil Code, §§ 5432-5434, inclusive, should be exhaustive of the subject as to how the interest of the obligee under a bond for titles should be sold, whether such sale was had at the instance of the judgment creditor or the obligor. Under the sections just cited, when a judgment creditor of the obligee in a bond for titles desires to sell the property, it is incumbent upon him to take up the debt necessary to be paid by the obligee in order to give him the legal title by paying such debt with interest to date, if the debt is due, and interest to maturity if not due, and procure a conveyance to be made to the defendant in execution, or, if dead, to his legal representative, by the obligor in the bond, and, if he is dead, by his legal representative, and have the property levied upon and sold. The proceeds of the sale are to be appropriated, first, to the payment of liens superior to the claims taken up by the plaintiff in execution necessary to put title in the defendant, and the balance to the execution under which the property was sold and to other liens according to priority. It is contended by counsel for plaintiff in error that the provisions of the Code of 1882 above referred to are still of force, and that, therefore, the judgment controlled by Johnson was a lien upon the interest of Whaley in the land at the date of the transfer of the bond for titles to his wife, and that by complying with these provisions the whole interest in the bond for titles could be sold, and the money appropriated, first, to the payment to the Equitable Securities Company of the amount which was paid by the Equitable Mortgage Company in discharge of the balance due Chappell, and the remainder, or so much thereof as would be necessary, to the payment of the judgment controlled by Johnson. Under the view we have taken of the present case, it is unnecessary to determine whether the provisions of the Code of 1882 are still of force or not. If the ...