Schneider v. Smith

• Decision Date: 10 January 1940
• Docket Number: 12982
• Citation: 7 S.E.2d 76,189 Ga. 704
• Parties: SCHNEIDER v. SMITH.
• Court: Georgia Supreme Court

7 S.E.2d 76

189 Ga. 704

SCHNEIDER v. SMITH.

12982

Supreme Court of Georgia

January 10, 1940

Rehearing Denied Feb. 19, 1940.

D. W. Mitchell, of Dalton, for plaintiff in error.

R Carter Pittman and Jack B. Ray, both of Dalton, for defendant in error.

Syllabus Opinion by the Court.

REID Chief Justice.

1. An absolute deed made in consideration of a promise by the grantee to support the grantor for life may be canceled by the superior court in the exercise of its equitable powers (English v. Little, 164 Ga. 805(2, a), 139 S.E 678), on a petition brought by the grantor for this purpose where it is made to appear that the grantee has breached his agreement and is insolvent. Lindsey v. Lindsey, 62 Ga. 546(2); McCardle v. Kennedy, 92 Ga. 198, 17 S.E 1001, 44 Am.St.Rep. 85; Rountree v. Williams, 99 Ga. 222(2), 25 S.E. 323; Jones v. Williams, 132 Ga. 782(2), 64 S.E. 1081; Wyatt v. Nailer, 153 Ga. 72(4), 111 S.E. 419; Fletcher v. Fletcher, 158 Ga. 899(3), 124 S.E. 722; Hall v. Tyson, 160 Ga. 381, 128 S.E. 187; Burkhalter v. De Loach, 171 Ga. 384(2), 155 S.E. 513; Morris v. Fain, 165 Ga. 879(2), 142 S.E. 119; Brinson v. Hester, 185 Ga. 761, 196 S.E. 412. This does not contravene the rule prevailing in this State (for authorities in other States see, 112 A.L.R. 671 n), that 'An absolute deed of conveyance will not, at the instance of the grantor, be canceled merely because of a breach by the grantee of a promise made by him, in consideration of which the deed was executed' (Brand v. Power, 110 Ga. 522, 36 S.E. 53; Thompson v. Lanfair, 127 Ga. 557, 56 S.E. 770; Whidby v. Willis, 151 Ga. 43, 105 S.E. 470; Brinson v. Hester, 185 Ga. 761, 196 S.E. 412; Wood v. Owen, 133 Ga. 751, 66 S.E. 951; Davis v. Davis, 135 Ga. 116, 69 S.E. 172; Self v. Billings, 139 Ga. 400(2), 77 S.E. 562; Christian v. Ross, 145 Ga. 284, 88 S.E. 986), since, under the rule first above stated, cancellation of the deed is not permitted merely because of the breach by the grantee of the covenant to support, but because of this and the additional fact of the insolvency of the grantee. See Cain v. Varnadore, 171 Ga. 497(5), 156 S.E. 216.

2. In canceling the deed the court must, as nearly as possible, restore the parties to their original status. The grantor is chargeable with any money paid and for the value of services rendered under the contract by the grantee. The grantee is to be charged with the damages occasioned by his breach, and a fair rental value of the land during the time it was held in possession under the agreement. Lytle v. Scottish American Mortg. Co., 122 Ga. 458, 50 S.E. 402; Couch v. Crane, 142 Ga. 22, 28, 82 S.E. 459; McMillan v. Benfield, 159 Ga. 457, 126 S.E. 246; McDaniel v. Gray, 69 Ga. 433; Gray v. McDaniel, 73 Ga. 118; Blitch v. Edwards, 96 Ga. 606, 24 S.E. 147; Enterprise Distributing Corporation v. Zalkin, 154 Ga. 97, 110, 113 S.E. 409; Snook v. Raglan, 89 Ga. 251, 15 S.E. 364; Scott v. Glover & Co., 7 Ga.App. 182, 66 S.E. 380; Rhodes & Son Furniture Co. v. Jenkins, 2 Ga.App. 475, 58 S.E. 897; Hays v. Jordan, 85 Ga. 741, 11 S.E. 833, 9 L.R.A. 373; 3 Black on Rescission and Cancellation, §§ 616, 633, 634, 688, 695. Where the reasonable value of the use of the property to the defendant, measured by its fair rental value and the value of timber cut from the premises and sold by the grantee, is in excess of a sum paid, and the reasonable value of the services rendered by the grantee under the agreement, the grantor is entitled, on rescission and cancellation of the deed, to recover the excess. Therefore the petition in the present case, which contained allegations of the above import, and which sought cancellation of the deed and a judgment for such excess, was not duplicitous as attempting to rescind the contract and recover damages for its breach.

3. It follows from what is said above that the allegations of the petition as to the value of the use of the property, the value of timber cut from the property and sold by the grantee, and the value of services rendered by the grantee under the contract, were not subject to demurrer as irrelevant and immaterial to the cause of action declared on.

4. The allegations attacked by grounds 2 and 4 of the demurrer were not subject to the objection that they were irrelevant and immaterial. While these allegations did not set forth issuable facts essential to the cause of action declared on, and therefore need not have been made, it was not improper to do so, since the matters set out were not entirely disconnected from and unrelated to the principal and controlling issues.

5. An allegation that the defendant is insolvent is an allegation of an ultimate fact, and not a conclusion of the pleader, and accordingly is not subject to demurrer on that ground. H. C. & W. B. Reynolds Co. v. Reynolds, 190 Ala. 468, 67 So. 293; Bramwell v. Rowland, 123 Or. 33, 261 P. 57; Chicago, etc., R. Co. v. Kenney, 159 Ind. 72, 62 N.E. 26. Greenberg-Miller Co. v. Everett Shoe Co.,

138 Ga. 729, 75 S.E. 1120, to the effect that such an allegation is a conclusion of the pleader, was not necessary to the decision, and does not require a different ruling. See Ellison v. Lucas, 87 Ga. 223, 13 S.E. 445, 27 Am.St.Rep. 242. Compare Battle v. Williford, 160 Ga. 289, 127 S.E. 763.

6. The theory underlying the rule that equity will intervene to cancel a deed made in consideration of a promise by the grantee to support the grantor for life, where the grantee breaches the covenant and is insolvent, is that by reason of the insolvency of the grantee a judgment for damages would not in the usual course of events be collectible, and accordingly would be inadequate to compensate the grantor or place him in status quo. Harrell v. Parker, 186 Ga 760, 769, 198 S.E. 776. This being true, and since an absolute deed operates to vest legal title to the property in the grantee, subject to his debts (Rountree v. Williams, 99 Ga. 222, 25 S.E. 323), it seems clear that the property conveyed by the deed sought to be canceled should be considered as the property of...