JPMorgan Chase Bank, N.A. v. Cronan

• Decision Date: 18 June 2020
• Docket Number: A20A0378
• Citation: 355 Ga.App. 556,845 S.E.2d 298
• Parties: JPMORGAN CHASE BANK, N.A. v. CRONAN.
• Court: Georgia Court of Appeals

355 Ga.App. 556

845 S.E.2d 298

JPMORGAN CHASE BANK, N.A.

v.CRONAN.

A20A0378

Court of Appeals of Georgia.

June 18, 2020

The Gilroy Firm, Monica K. Gilroy, Matthew F. Totten, for appellant.

Coppedge Michmerhuizen Rayburn, Warren N. Coppedge, Jr., Stephen Michmerhuizen, for appellee.

Aldridge Pite, T. Matthew Mashburn, amicus curiae.

Rickman, Judge.

JPMorgan Chase Bank, N. A., appeals several rulings by the trial court in consolidated actions filed by Chase concerning which of two parcels of real property owned by Michael Cronan was used as security for a loan from Chase. Because admissible evidence raises an issue of fact regarding Chase's claims, we reverse the trial court's rulings in favor of Cronan and affirm the denial of Chase's motion for summary judgment on its claim of equitable subrogation.

Construed in favor of Chase, the record shows that in 2003, Cronan took title to a 29.71-acre parcel of property with the address 2215 Dawnville Beaverdale Road (hereinafter "2215 Dawnville") and, in a separate transaction, an adjoining 4.37-acre parcel of property that later became associated with the address 2253 Dawnville Beaverdale Road (hereinafter "2253 Dawnville"). In 2005, Cronan utilized a 3.14-acre portion of the 29-acre tract as collateral for a $350,000 construction loan from Synovus Bank for the purpose of building his primary residence thereon; a survey of the 3.14-acre parcel is in the record. The Synovus Security Deed describes the associated collateral by reference to the survey.

In 2009, Cronan corresponded with Chase and expressed interest in consolidating the Synovus loan and a separate line of credit. In July 2009, an appraisal was prepared for Chase "for the real property at: 2215 Dawnville ..."; the appraisal indicated that the owner lived at the premises shown in attached pictures, which Cronan identified as his home, but it also referenced the appraised property with the parcel ID and acreage for 2253 Dawnville.

The closing of the Chase loan occurred in January 2010, at Cronan's residence. Cronan reviewed documents prepared by Chase and told Chase's attorney/representative that the property description in the proposed security deed described 2253 Dawnville, not the real estate on which his primary residence was located, i.e., 2215 Dawnville. Cronan averred that the Chase attorney "indicated that he understood what I was telling him," made notes in his file, advised that he would inform someone at Chase of the information, and stated that Chase had a ten-day grace period to approve or decline the executed security deed.

Cronan then signed the closing documents for the $417,000 loan, including the loan application, a promissory note, the Chase Security Deed, and a HUD-1 Settlement Statement. Under a section entitled "Transfer of Rights in the Property," the Chase Security Deed listed a parcel ID number associated with 2253 Dawnville, but gave the property address of 2215 Dawnville; the same section of the deed referenced an attached legal description. The attached legal description, by reference to a plat/survey and by metes and bounds, described 2253 Dawnville, but it added, "Commonly known as: 2215 Dawnville Beaverdale R, Dalton, GA 30721."

The promissory note referred to the relevant secured property as 2215 Dawnville. The loan application indicated that the purpose of the transaction was to refinance an existing loan on the primary residence. And the HUD-1 gave the borrower's mailing address and, separately, a "property location," both of which were identified as 2215 Dawnville. Following the closing, the Synovus Security Deed was cancelled of record.¹

In 2012, Cronan defaulted on the Chase loan, and Chase foreclosed on 2253 Dawnville.² Shortly thereafter, Chase signed and recorded two affidavits of title, asserting that it had intended the security deed to encumber 2215 Dawnville and to foreclose on that property.

Chase eventually filed two actions that were later consolidated in which it sought reformation, a declaratory judgment, and equitable relief seeking to correct the legal description in the security deed, void the foreclosure sale, reinstate the security deed, and return the parties "to their respective positions and holding their respective interests in the property." In the alternative, Chase sought equitable subrogation. Chase asserted that the primary theory underlying its claims was "mutual mistake." Cronan answered and filed counterclaims, including one to quiet title in 2215 Dawnville. See Cronan v. JP Morgan Chase Bank , 336 Ga. App. 201, 784 S.E.2d 57 (2016) (in which this Court reversed the dismissal of Cronan's counterclaim), overruled on other grounds by SRM Group v. Travelers Property Cas. Co. of America , 308 Ga. ––––, 841 S.E.2d 729 (2020).

In several orders, the trial court held that Chase failed to show a genuine issue of material fact as to its assertion of mutual mistake and therefore granted summary judgment to Cronan on Chase's claims for a declaratory judgment and reformation of the security deed. The court further held that Chase failed to present evidence of a mutual agreement that it would assume a previous encumbrance on 2215 Dawnville, and it therefore granted summary judgment to Cronan on Chase's claim of equitable subrogation and denied Chase's cross-motion on the same issue. Finally, the trial court granted summary judgment in favor of Cronan on his claim to quiet title to 2215 Dawnville. Chase appeals each of these rulings.

Summary judgment is proper "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law[.]" OCGA § 9-11-56 (c).

Summary judgments enjoy no presumption of correctness on appeal, and an appellate court must satisfy itself de novo that the requirements of OCGA § 9-11-56 (c) have been met. In our de novo review of the grant [or denial] of a motion for summary judgment, we must view the evidence, and all reasonable inferences drawn therefrom, in the light most favorable to the nonmovant.

(Citations and punctuation omitted.) Cowart v. Widener , 287 Ga. 622, 624 (1) (a), 697 S.E.2d 779 (2010).

1. Chase contends that when granting summary judgment in favor of Cronan and refusing to reform the security deed, the trial court erred by ignoring the affidavit of its corporate representative, Theresa Rundquist, and, consequently, by concluding that Chase failed to provide any evidence to rebut Cronan's assertion that he did not make a mistake about the collateral.

At a hearing on Cronan's first motion for summary judgment, Cronan objected to introduction of the Rundquist affidavit on the ground that it was not based on personal knowledge.³ In the ensuing order, the trial court held that Rundquist "did not write her affidavit based on personal knowledge of what the parties intended in executing the [Chase] Security Deed" and that, therefore, Chase had not submitted any admissible evidence to contradict Cronan's affidavit in which he averred that he intended for 2253 Dawnville to be collateral for the 2010 Chase loan. We agree with Cronan that the trial court did not err in finding that parts of the affidavit were inadmissible because they were not shown to be based on personal knowledge.

Rundquist averred that her affidavit was "based upon knowledge gained from my review of the records," that she was employed by Chase "as a Legal Specialist III," and that she was "authorized to execute this [a]ffidavit on behalf of [Chase]." Rundquist then recited a history of the loan transaction based on her review of the attached 19 documents. Among the history, however, there are numerous statements regarding the parties’ execution of the 2010 Chase loan and Chase's intent with respect to the collateral.⁴

Affidavits supporting or opposing motions for summary judgment "shall be made on personal knowledge, shall set forth such facts as would be admissible in the evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein." OCGA § 9-11-56 (e).⁵ Affidavits from corporate representatives are subject to the same rule. See Lubbers v. Tharpe & Brooks, Inc. , 160 Ga. App. 709, 710, 288 S.E.2d 54 (1981). In lieu of a statement that the affidavit is based on personal knowledge, the requirement may be satisfied where the contents of the affidavit show that statements are based on personal knowledge. See Mathews v. Brown , 235 Ga. 454, 456, 219 S.E.2d 701 (1975) ; Holland v. Sanfax Corp. , 106 Ga. App. 1, 5 (1), 126 S.E.2d 442 (1962).

(a) Here, Rundquist never averred that her statements were based on personal knowledge, and nothing in the contents of the affidavit shows that she had personal knowledge of what Chase intended as collateral in the 2010 loan transaction. Accordingly, the trial court did not abuse its discretion by finding that these parts of Rundquist's affidavit were not admissible. See Greenstein v. Bank of the Ozarks , 326 Ga. App. 648, 652-653 (2), 757 S.E.2d 254 (2014) (portions of affidavit not based on personal knowledge were inadmissible); see also Langley v. Nat'l Labor Group , 262 Ga. App. 749, 751 (1), 586 S.E.2d 418 (2003) ("[I]f it appears that any portion of the affidavit was not made upon the affiant's personal knowledge, or if it does not affirmatively appear that it was so made, that portion is to be disregarded in considering the affidavit in connection with the motion for summary judgment.") (citation and punctuation omitted).

(b) Rundquist also averred that "Chase would not have made the 2010 Chase Loan if the collateral was 2253 Dawnville." This comment pertains to Chase's general practices as opposed to what the parties to the relevant transaction intended. Nevertheless, there is nothing in Rundquist's affidavit showing that she had personal knowledge of Chase's general business practices. Rather, her...