Lee v. O'Quinn

• Decision Date: 10 March 1937
• Docket Number: 11620.
• Citation: 190 S.E. 564,184 Ga. 44
• Parties: LEE et al. v. O'QUINN.
• Court: Georgia Supreme Court

190 S.E. 564

184 Ga. 44

LEE et al. v. O'QUINN.

No. 11620.

Supreme Court of Georgia

March 10, 1937

Error from Superior Court, Jeff Davis County; Gordon Knox, Judge.

Suit by Rebecca Lee and others against J. J. O'Quinn. To review a judgment refusing an interlocutory injunction, the plaintiffs bring error.

Reversed.

Heath & Heath, of Douglas, for plaintiffs in error.

John Rogers, of Hazlehurst, for defendant in error.

Syllabus OPINION.

HUTCHESON Justice.

The plaintiffs in error jointly contracted for the purchase of certain property. A down payment was made, and the balance of the purchase price was to be paid in monthly installments of named amounts. The contract recited that the joint note given for the balance of the purchase price contained a stipulation that 'in the event of a default in any one installment which remains in default for five days, then and in that event all future installments will at once, without further notice or action, immediately become due and payable; and in the event of such a default in any one installment, said principal debt shall without further notice mature, and the entire amount shall be payable to the same extent as if the indebtedness had regularly matured.' The note actually contained the following provision: 'In case said installments, or any of them, are not paid within five days after the same become due, or a failure on the part of the makers of this note to faithfully perform each and every covenant of a contract of purchase of which this note is given for the balance of the purchase-price, the whole of said principal sum shall forthwith become due and payable at the option of the holder of this note.' The contract provided: 'Should the parties of the second part fail to pay any taxes or assessment against said property, * * * or fail to pay promptly when due any monthly installment on said purchase-money note, * * * and any such default continue for a period of five days, then and in such events or either of them, the party of the first part * * * may at once declare the entire balance of the purchase-price * * * due and payable at once, anything in this contract or the note representing said indebtedness to the contrary notwithstanding;' and that the power of sale contained therein may be exercised, 'In the event said indebtedness for the purchase-price * * * is not paid at maturity, or is declared due before maturity by reason of a failure to comply with any of the covenants in this contract.' Time was declared to be of the essence of the contract. Held:

1. The recitals in the contract as to the acceleration provisions contained in the note being in conflict with the actual provisions of the note, and with the provisions as to acceleration contained in the contract itself, the actual provisions of the note and the contract must prevail.

2. Under the provisions of the note and the contract, the entire indebtedness does not ipso facto become due five days after default, but it is necessary that some affirmative action be taken by the creditor evidencing his intention to take advantage of the acceleration clause; otherwise the provision has no operation, and the debtor has a right to tender the sums in default. The creditor cannot in his own mind effectively exercise the option to declare the whole prinicpal due; he must communicate his decision to the debtor, or manifest it by some outward affirmative act sufficient to constitute notice...