Skott v. Bank of America Illinois, S96A0066
| Citation | 266 Ga. 532,468 S.E.2d 359 |
| Decision Date | 08 April 1996 |
| Docket Number | No. S96A0066,S96A0066 |
| Parties | SKOTT v. BANK OF AMERICA ILLINOIS, f/k/a Continental Bank et al. |
| Court | Georgia Supreme Court |
Dekalb County Superior Trial Judge: Hon. Linda Warren Hunter, No. 9548468.
William H. Arroyo, William H. Arroyo & Associates, Tucker, for Skott.
Joseph R. Manning, Morris, Manning & Martin, Atlanta, James C. West, III, Decatur, Ann R. Schildhammer, Morris, Manning & Martin, Atlanta, for Bank of America Illinois.
This is an appeal from a judgment declaring rights of title to real property and permanently enjoining an attempted foreclosure on the property.
Juan C. and Suzette Williams purchased residential property in DeKalb County, Georgia on June 11, 1993. To effectuate the purchase, they obtained a loan in the original principal amount of $99,000 from Modern Mortgage and Investors Corporation (Modern Mortgage). The installment note evidencing this debt provided for a "balloon" payment on June 11, 1994 and required payments to be made to Modern Mortgage "as servicing agent." A deed to secure debt dated June 11, 1993 conveying the property was recorded on June 14, 1993, in Deed Book 7701, page 309.
A separate document dated October 11, 1993 entitled "Transfer and Assignment" executed by Modern Mortgage was recorded on October 27, 1993. It purports to transfer and assign to Myron Skott a deed to secure debt and the note which it secures from the Williams to Modern Mortgage "which has been filed of record in Deed Book 7701, page 301." It does not further identify the purported assigned deed in any manner, either by date, amount of indebtedness or legal description of the land. Prior to a letter from Skott's attorney dated February 17, 1995, neither Skott nor Modern Mortgage notified the Williams of any assignment and the Williams continued to make the required monthly payments to Modern Mortgage.
Prior to the "balloon" payment coming due, Modern Mortgage sent the Williams a letter offering to extend the note to fifteen years because of the Williams' "excellent payment history." There was no mention of the assignment to Skott. The Williams decided to refinance their loan with EquiCredit Corporation of Georgia (EquiCredit) for the sum of $111,500. After obtaining information on the status of the original loan from Modern Mortgage, EquiCredit issued a check payable to Modern Mortgage for the full amount owed under the loan on March 15, 1994. Modern Mortgage accepted payment and made no mention of the assignment. The Williams executed a security deed in favor of EquiCredit, which was recorded on April 1, 1994. 1
Eleven months after the refinance, the Williams received a letter dated February 17, 1995 from Skott's counsel informing them of the Modern Mortgage assignment to Skott on October 11, 1993, and notifying them that the indebtedness allegedly due under the Modern Mortgage loan was being accelerated, with the balance immediately due and payable. The letter further stated:
On February 21, 1995, Skott attempted to re-record the original transfer and assignment. He typed on the face of the document that it was being re-recorded to evidence the correct page cite of the Modern Mortgage security deed transferred and assigned. Thereafter, Skott sought to foreclose on the Williams' property. The Williams filed a complaint seeking injunctive relief. The superior court permanently enjoined Skott from foreclosing on the Williams' property and found that the assignment as re-recorded was improper and did not suffice to correct the erroneous information contained in the original assignment; that Skott did not have a valid security interest in the property; that Modern Mortgage, as the authorized agent of Skott, had the actual and apparent authority to receive payments under the original loan, including the payoff check; and that even if Skott had a valid security interest in the property by virtue of the assignment, such interest was satisfied by the payment in full to Modern Mortgage. Skott appeals, challenging the superior court's findings and the issuance of the permanent injunction.
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