Poteat v. Butler

• Court: Georgia Supreme Court
• Writing for the Court: UNDERCOFLER
• Citation: Poteat v. Butler, 231 Ga. 187, 200 S.E.2d 741 (Ga. 1973)
• Decision Date: 04 October 1973
• Docket Number: No. 28165,28165
• Parties: James M. POTEAT et al. v. Foster L. BUTLER et al.

Page 741

200 S.E.2d 741

231 Ga. 187

James M. POTEAT et al. v. Foster L. BUTLER et al.

No. 28165.

Supreme Court of Georgia.

Oct. 4, 1973.

Robert N. Dokson, Atlanta, for appellants.

Storey and Obenschain, Samuel Obenschain, Jack Speilberg, Atlanta, for appellees.

Syllabus Opinion by the Court

UNDERCOFLER, Justice.

The only question involved in this case is whether a secondary security deed given as purchase money for certain real estate purchased by the appellants is usurious under the provisions of Code Ann. § 57-202(d). This Code section provides: '(d) Interest may be charged on the principal amount of the loan as hereinbefore defined at any rate not greater than the greater of: (i) six percent per annum computed in accordance with the provisions of Code section 57-116, as amended, relating to interest on loans to be repaid in monthly, quarterly or yearly installments, as amended; or (ii) eight percent per annum if said rate is computed upon the unpaid principal balance outstanding at the time each payment is made, with such payment being applied first to the payment of interest and the balance to principal reduction.' Ga.L.1966, pp. 574, 576; 1967, pp. 637, 638.

Code Ann. § 57-203 provides: '(a) If any loan secured by a secondary security deed on real estate is made in violation of the provisions of this Chapter, except as a result of a bona fide error, the lender shall forfeit the entire principal amount of the loan plus interest and other charges. In addition thereto, the lender shall also refund any payments on the loan which have been made by the borrower. (b) Any agreement whereby the borrower waives the benefits of this Chapter or release any rights he may have acquired by virtue thereof shall be deemed to be against public policy and void.' Ga.L.1966, pp. 574, 577.

The trial court dismissed the appellants' complaint which in effect held that the secondary security deed and note given as purchase money for certain real estate and providing for the payment of $4100 at 8 1/2 percent per annum interest was not controlled by the provisions of Code Ann. §§ 57-202(d) and 57-203. The appeal is from this judgment. Held:

1. The cardinal rule in the construction of legislative enactments is to ascertain the true intention of the General Assembly in the passage of the law. Gazan v. Heery, 183 Ga. 30, 187 S.E. 371, 106 A.L.R. 498. All statutes are presumed to be enacted by the General Assembly with full knowledge of the existing condition of the law and with reference to it, and are therefore to be construed in connection and in harmony with the existing law, and as a part of a general and uniform system of jurisprudence, and their meaning and effect is to be determined in connection, not only with the common law and the Constitution, but also with reference to other statutes and decisions of the courts. Botts v. Southeastern Pipe-Line Co., 190 Ga. 689, 10 S.E.2d 375; Nelson v. Roberts, 217 Ga. 613, 124 S.E.2d 85 and Buice v. Dixon, 223 Ga. 645, 157 S.E.2d 481; Plantation Pipe Line Co. v. City of Bremen, 227 Ga. 1, 178 S.E.2d 868.

In Garner v. Sisson Properties, Inc., 198 Ga. 203, 31 S.E.2d 400, this court decided a very similar situation. For construction by the court in that case was Code § 57-116 which provided: 'Any person, natural or artificial, in this State, lending money to be paid back in monthly, quarterly, or yearly instalments, may charge interest thereon at six percent per annum or less for the entire period of the loan, aggregating the principal and interest for the entire period of the loan, and dividing the same into monthly, quarterly, or yearly instalments . . .' In that case this court held that this section was in derogation of Code § 57-101 and should be strictly construed. It was also held (p. 206, 31 S.E.2d p. 402)...