Jordan v. Flynt, s. 32501 and 32618

Decision Date05 December 1977
Docket NumberNos. 32501 and 32618,s. 32501 and 32618
Citation240 Ga. 359,240 S.E.2d 858
PartiesRobert S. JORDAN v. John J. FLYNT, Jr. John J. FLYNT, Jr. v. Robert S. JORDAN.
CourtGeorgia Supreme Court

Harland, Cashin, Chambers, Davis & Doster, Harry L. Cashin, Jr., Samuel F. Doster, Jr., Atlanta, for appellant.

Smalley & Cogburn, Robert H. Smalley, Jr., Griffin, Arnall, Golden & Gregory, Edward S. Sams, H. Fred Gober, Paula Abercrombie Ball, Atlanta, for appellee.

PER CURIAM.

This is an appeal from an order of the Superior Court of Spalding County, denying appellant's motion for summary judgment and granting appellee's motion for summary judgment; and cross appeal from that same order, denying appellee's motion to dismiss.

On May 5, 1973 a contract was entered into providing for the sale by appellee to appellant of 820 acres of land located in Hall County, Georgia. On May 30, 1973, the parties executed a first amendment to the purchase contract, which amendment revised the provisions of the contract concerning the purchaser's right to demand release of acreage from the security deed.

The purchase and sale of the land was closed on August 29, 1973. However, prior to closing, a revised sales contract was executed and back dated to May 5, 1973, it being the intent of the parties that the revised sales contract would supersede and replace the original contract and amendment thereto. The revised sales contract contained the identical release provisions as set forth in the first amendment to the original sales contract. 1

The purpose of the revised sales contract was to shift liability for the sales commission to appellant in return for a lower per acre price and smaller down payment. The net cash result to the parties, however, was not altered.

At the closing, the appellant executed a previously prepared deed to secure debt to appellee in the amount of $407,000, which contained release provisions substantially the same as, though not identical to those contained in the revised sales contract. The release provisions contained in the deed to secure debt provided that, "Grantee agrees to release portions of the property described herein from the lien of this instrument upon payment to him of the sum of $805.00 per acre for each acre sought to be released on the following terms and conditions: . . . (d) Grantee agrees to release one hundred forty-two (142) acres of the property on the terms and conditions set forth herein without any payment whatsoever upon the request of Grantor; and all payments made for the purpose of obtaining releases shall apply to the next maturing principal installment due under the note which this instrument was given to secure. The payment of the principal installments on the note which this instrument was given to secure as they mature shall entitle Grantor to releases, all of which shall be cumulative." Thus, the security deed provided that a release of property would be made "without any payment whatsoever," while the revised sales contract provided for releases based upon payments tendered in reduction of principal.

After nearly two years, appellant requested release of one hundred and forty-two (142) acres as provided for in paragraph (d) of the security deed. In accordance with the terms and conditions contained in that instrument, appellant furnished appellee with a quitclaim deed and survey of the acreage for which release was requested. Appellee responded that the request of January 12, 1976 would not be honored until 1975 real estate taxes had been paid. Appellant promptly paid those taxes, and by letters dated February 24 and March 24, 1976 reiterated his request for release. Appellee refused to execute the quitclaim deed despite appellant's continuing demands, and failed to advise appellant of any reasons for his refusal to release this requested acreage.

As a result of his refusal to release the requested acreage, appellant filed this action on April 14, 1976, seeking specific performance of the release provisions contained in the deed to secure debt, or, in the alternative, rescission, restitution and damages.

Appellee filed a motion to dismiss on grounds that the release provision was too vague to be enforceable. On August 29, 1976, while this case was pending, an interest payment came due. Appellant refused to make the payment because of appellee's refusal to execute the quitclaim deed, which refusal appellant contends was a prior breach of the contract. Appellee notified the appellant that the note was in default and shortly thereafter filed a motion for summary judgment. Appellee's motion asserted that according to the terms and conditions of the security deed, appellant's default relieved appellee of his duty to release the acreage requested. Appellant then filed a motion for summary judgment and a hearing on both motions was set for November 19, 1976. On November 18, 1976, one day before the scheduled hearing, appellant was served with an affidavit executed by appellee, which for the first time, advised appellant that the requests for release had not been executed because the quitclaim deeds tendered contained too much road frontage. Following notice of this defect, appellant tendered a revised quitclaim deed and survey in accordance with the terms of the security deed, which appellee refused to execute.

Subsequent to a hearing, the court overruled appellee's motion to dismiss, overruled appellant's motion for summary judgment and granted appellee's motion for summary judgment. It is from this order that the parties appeal.

1. The complaint, as finally amended, sought specific performance of paragraph (d) of the deed to secure debt, which provided for the release of one hundred forty-two (142) acres of encumbered property upon compliance with the terms and conditions set forth in the instrument. Appellant contends that the court erred in holding that there was no contract to release the one hundred forty-two (142) acres in question. It appears that the trial court based its conclusion upon the premise that the release provision sought to be enforced did not appear in the sales contract, but for the first time appeared in the deed to secure debt. The court recognizing that the sales contract had provided for the giving of a security deed, however, held that since the security deed was not a contract, the release provisions contained therein were unenforceable.

Both this court and the Court of Appeals have followed the general rule that antecedent sales contracts covering the purchase and sale of real property merge in a subsequent deed involving the same property. Thus, where in a contract for the sale of land the parties execute a preliminary sales contract and subsequently reduce that contract to a finality evidenced by a deed to secure debt, the terms of the preliminary contract, where not otherwise reserved, are merged into the deed, and those terms, conditions or recitals contained in the preliminary sales contract which are not included in the deed are considered as eliminated, abandoned or discarded. Keiley v. Citizens Savings Bank etc., Co., 173 Ga. 11, 159 S.E. 527 (1931); Taylor v. Board of Trustees, 185 Ga. 61, 194 S.E. 169 (1938); Loftis v. Clay, 164 Ga. 845, 139 S.E. 668 (1927); Augusta Land Co. v. Augusta Ry. & Co., 140 Ga. 519, 79 S.E. 138 (1913).

Accordingly, although the terms of the preliminary sales contract may vary from those contained in the deed to secure debt, the deed alone must be looked to for determination of the rights of the parties.

2. Appellee Flynt cross-appeals from the denial of his motion to dismiss and raises the sole issue of whether the release provisions contained in the security deed provide a sufficient means of identifying the property to be released so as to be capable of enforcement by specific performance.

The deed to secure debt contains numerous limitations with respect to size, road frontage and starting points of acreage which appellant could select to be released. 2

"The provision is sufficiently definite to be performed and hence is not so indefinite as to be unenforceable. 41 A.L.R.3d 7 at 44-54. No case . . . requires that the description of the property to be released from a deed to secure debt be as specific as the description of the property in the deed itself must be. See Honea v. Gilbert, 236 Ga. 218, 223 S.E.2d 115 (1976)." Cochran v. Teasley, 239 Ga. 289, 236 S.E.2d 635 (1977). The court did not err in denying appellee's motion to dismiss.

3. In granting appellee's motion for summary judgment, the trial court denied appellant's prayer for specific performance, "for the reason that under the undisputed evidence now before the court plaintiff has defaulted and is not now entitled to any relief sought, nor was he entitled to any relief when the complaint was filed, for the reason that the survey and quitclaim deed tendered by him to the defendant did not meet the requirements of the sales contract as to road frontage."

(a) We first consider whether the failure of appellant to make a payment due for the first time after suit was filed is a sufficient reason for denying specific performance, in light of the fact that he was current in his obligations at the time he filed suit. In Kirk v. First Georgia Investment Corp., 239 Ga. 171, 236 S.E.2d 254 (1977), we held that the decree of specific performance was improper since the plaintiff was in default at the time suit was filed, he remained in default at the time of the decree, and the decree of specific performance was not conditional on the plaintiff curing his default.

We hold now that where the plaintiff is not in default when he files suit, the occurrence of a subsequent default of the plaintiff is not by itself a sufficient reason for denying specific performance. The holding in Kirk was based on the equitable principle that in order to obtain equitable relief the petitioner must act equitably with regard to...

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