Tollett v. Green Tree Acceptance, Inc., 77518

• Decision Date: 31 January 1989
• Docket Number: No. 77518,77518
• Citation: 190 Ga.App. 295,379 S.E.2d 2
• Parties: TOLLETT v. GREEN TREE ACCEPTANCE, INC.
• Court: Georgia Court of Appeals

Page 2

379 S.E.2d 2

190 Ga.App. 295

TOLLETT v. GREEN TREE ACCEPTANCE, INC.

No. 77518.

Court of Appeals of Georgia.

Jan. 31, 1989.

Rehearing Denied Feb. 14, 1989.

Certiorari Denied April 6, 1989.

King, Morriss, Talansky & Witcher, Joseph H. King, Jr., Atlanta, for appellant.

Walter Driver, Byron Attridge, King & Spalding, Gary J. Toman, Atlanta, for appellee.

BIRDSONG, Judge.

Appellant Linda D. Tollett filed a complaint on June 24, 1987, against appellee Green Tree Acceptance, Inc. (GTA) to recover the penalty imposed by OCGA § 10-1-38 for wilful violation of the Georgia Motor Vehicle Sales Finance Act (OCGA § 10-1-30 et seq.), alleging that GTA charged more than the maximum amount allowed by OCGA § 10-1-33(a) in financing her purchase of a mobile home. GTA denied any liability under the Act and moved for summary judgment on the basis of uncontroverted evidence that it was neither the original seller nor the current holder of appellant's financing contract. This appeal is from the grant of summary judgment to GTA. Held:

The undisputed facts show that Ms. Tollett entered into a retail installment contract with Landmark Mobile Homes on May 17, 1982 for the purchase of a new mobile home. Landmark assigned this contract to GTA on May 21, 1982, and on July 1, 1982, prior to any payments by Ms. Tollett, GTA reassigned her contract to the Government National Mortgage Association (GNMA). GNMA is a federally created corporation operated by the Department of Housing and Urban Development to purchase federally insured loans and guarantee securities backed by those loans. On May 20, 1982, GTA and GNMA had entered into an agreement whereby GNMA was to purchase and guaranty no more than $1 million principal amount of mobile home loans from GTA.

GTA assigned to GNMA "all rights, title and interest in and to the [Linda D. Tollett] Security Agreement-Retail Installment Sale Contract, the amounts payable thereunder, the property above-described, and the right therefrom ensuing, and also the right to apply for a certificate or duplicate certificate of title, and to register and/or transfer title in the above-described mobile home...." This assignment and sales contract were then delivered to GNMA's custodial bank under a custodial agreement by which the bank was required to "segregate and maintain continuous custody and control of all documents deposited with it on behalf of GNMA until the obligations are paid in full...." On July 1, 1982, GTA further contracted with GNMA to service the installment contracts assigned to it in the same pool with Ms. Tollett's contract. GTA agreed to collect payments for GNMA and set up a custodial escrow account for distribution to the certificate holders, GTA to receive a percentage of the amounts collected.

OCGA § 10-1-38(b) provides that a violation of the finance charge limitations imposed by OCGA § 10-1-33 "by the seller or holder shall bar recovery of any finance charge, delinquency, or collection charge on the contract." (Emphasis supplied.) The trial court found that GTA was not the seller of the mobile home to Ms. Tollett; and that the evidence showed at most that it was only the temporary holder of the assignment of her retail sales contract prior to reassignment of all financial interests to GNMA, after which it acted solely as a collection-service agent. We agree.

OCGA § 10-1-31(3) defines a "holder" of a retail installment contract as "the retail seller of the motor vehicle under the contract or, if the contract...