Strother Ford, Inc. v. First Nat. Bank of Maryland, 49396

• Decision Date: 03 July 1974
• Docket Number: No. 49396,No. 1,49396,1
• Citation: 132 Ga.App. 268,208 S.E.2d 25
• Parties: STROTHER FORD, INC. v. FIRST NATIONAL BANK OF MARYLAND
• Court: Georgia Court of Appeals

Page 25

208 S.E.2d 25

132 Ga.App. 268

STROTHER FORD, INC. v. FIRST NATIONAL BANK OF MARYLAND.

No. 49396.

Court of Appeals of Georgia, Division No. 1.

July 3, 1974.

Edwards, Awtrey & Parker, Robert J. Grayson, Marietta, for appellant.

Cotton, Katz & White, J. Timothy White, Atlanta, for appellee.

Syllabus Opinion by the Court

CLARK Judge.

We are here called upon to decide rights under a Maryland motor vehicle certificate of title as between a Georgia automobile dealer and a Maryland lender, both of whom were innocent victims of an individual who obtained a Georgia title certificate showing the automobile to be free of liens, which fraud he accomplished by altering a Maryland document to show the bank's interest to have been satisfied.

On November 17, 1972, First National Bank of Maryland financed a purchase in Maryland of a 1972 Ford automobile for one James D. Farmer. A certificate of title was issued December 1, 1972, to Farmer by the Maryland Motor Vehicle Administraction stating the automobile to be subject to a security interest held by the bank. This certificate shows the residence of Farmer as 704 Elmwood Road, Baltimore, Maryland. Subsequently Farmer forged a satisfaction of lien and delivered the fraudulent alteration to the State of Maryland, the document stating 'Lien satisfied Date 1/9/73.' (R. 5). This was done at a time when the contract was in default.

At some date thereafter Farmer apparently moved to Georgia, for on or about February 21, 1973, he applied to the Georgia Motor Vehicle Department for a certificate of title. This was issued to him lien free in reliance upon the fraudulently altered Maryland document. This Georgia certificate shows his residence to be in Marietta Georgia. Using the Georgia title certificate Farmer traded the automobile to Strother Ford, Inc. Later the dealer sold the automobile to another party.

The Maryland bank filed suit in the Civil Court of Fulton County for the value of the automobile attaching as exhibits the original title certificate, certified copies of the applicable Maryland law and its original valid unsatisfied security interest certificate. Thereafter it moved for a summary judgment based upon the pleadings, affidavits and interrogatories. Its motion was sustained and defendant automobile dealer has taken this appeal from that judgment.

1. This priority of motor vehicle security interests which have been perfected in states other than Georgia is governed by Code Ann. § 68-421a(d) ¹ which provides: 'If a vehicle is subject to a security interest or lien when brought into this state, the validity of the security interest or lien is determined by the law of the jurisdiction where the vehicle was when the security interest attached . . .' Since plaintiff has shown that its security interest was created in the State of Maryland, we must look to the laws of that state to determine whether the interest was properly perfected.

In order to perfect a vehicular security interest in the State of Maryland, 'The secured party shall thereafter record the lien in the record office of the clerks of the courts in and for the jurisdiction in the place of residence of the owner of the vehicle . . . The security interest is perfected as of the time of its creation if delivery and payment to the Department are completed within ten (10) days of the date of its creation and subsequent delivery and payment within twenty-one (21) days to the record office of the clerks of the courts as hereinbefore provided, otherwise as of the time of its delivery and payment.' Md. Code Ann., Art. 66 1/2, § 3 -203(2). (Emphasis supplied.) Thus, to perfect a security interest under Maryland law, the secured party must record the interest in the jurisdiction of the owner's residence. If the interest is recorded in that jurisdiction within 21 days, it is perfected as of the date of its creation.

In the case at bar, plaintiff bank recorded its security interest in the Office of the Clerk of the Superior Court of Baltimore City on January 3, 1973. It is apparent that this recordation date came well after the 21 day grace period during which a Maryland security interest may be perfected as of the day it was created. Defendant dealer asserts that since the recordation was not made within the grace period plaintiff must affirmatively show, in order to prevail on its summary judgment motion, that Farmer resided in Baltimore City on the date of the recordation. For, if Farmer left his Baltimore residence prior to January 3, 1973, the security interest could not have been perfected in accordance with the statutory residence requirement. This assertion is not meritorious.

'Presumptions of law are conclusions and inferences which the law draws from given facts. Code 1933 § 38-113. In case of a legal presumption, the law does the reasoning and draws the inference. While such a presumption is only prima facie true and may be rebutted, if it is not rebutted the law draws the conclusion . . .' Goode v. Tuggle, 52 Ga.App. 510, 513, 183 S.E. 850, 852. Two such legal presumptions which apply to the case at bar are the presumption of continuity and the presumption of obedience to the law. Code § 38-118.

Under the doctrine known as the presumption of continuity . . . a status, when proved to exist, will be presumed to have continued to exist.' Griffin v. Miller, 29 Ga.App. 585(1), 116 S.E. 339. Therefore, until evidence is introduced to the contrary, it is presumed that a person has not changed his residence or domicile. Clark v. Baker, 186 Ga. 65, 74, 196 S.E. 750; General Motors etc. Corp. v. Williams, 103 Ga.App. 109, 111, 118 S.E.2d 708. Although defendant demonstrated that Farmer resided in Marietta on the date upon which the Georgia title certificate was issued (February 21, 1973), this evidence is not sufficient to rebut the presumption that Farmer continued to reside in Baltimore through the recordation date of January 3, 1973.

Furthermore, 'Unless and until there be facts or circumstances to indicate to the contrary, it will be presumed that every person obeys the mandates of law and performs all of his official and social duties.' Georgia Casualty Co. v. McRitchie, 45 Ga.App. 697, 698(3), 166 S.E. 49. Sub judice, defendant has failed to rebut the presumption that plaintiff recorded its security interest in compliance with Maryland law.

As defendant has failed to rebut the presumptions of continuity and obedience to the law, no genuine factual dispute emerges on the issue of proper recordation, and we must presume that plaintiff's security interest was perfected in accordance with Maryland law. See Walker v. Hall, 123 Ga.App. 457,...