Tower Financial Services, Inc. v. Mapp

• Decision Date: 28 January 1991
• Citation: 402 S.E.2d 286,198 Ga. App. 563
• Parties: TOWER FINANCIAL SERVICES, INC. v. MAPP et al. A90A1819.
• Court: Georgia Court of Appeals

Page 286

402 S.E.2d 286

198 Ga.App. 563

TOWER FINANCIAL SERVICES, INC. v. MAPP et al.

A90A1819.

Court of Appeals of Georgia.

Jan. 28, 1991.

Rehearing Denied Feb. 13, 1991.

Glass, McCullough, Sherrill & Harrold, E. Paul Sabiston, R. Phillip Shinall III, Terrance McQuade, Betsy B. McCall, Atlanta, for appellant.

Antonio L. Thomas & Associates, Antonio L. Thomas, Kendall & Kendall, Alvin L. Kendall, Atlanta, for appellees.

CARLEY, Judge.

The relevant facts in the instant appeal are as follows: Johnny Lee Mapp died intestate. He was survived by his wife, Mrs. Beatrice Mapp, and by appellee-plaintiffs, his three children from a previous marriage. After the death of her husband, Mrs. Mapp applied for a loan from appellant-defendant. In connection with her application for the loan, Mrs. Mapp misrepresented that she held title in fee simple absolute as to certain realty inherited from her late husband. Appellant made the loan to Mrs. Mapp and took back a security deed to the property whereby she purported to convey fee simple absolute. Appellant recorded its security deed. After this transaction between appellant and Mrs. Mapp, appellees filed the instant tort action, alleging that appellant had negligently or wrongfully interfered with their interests in the realty. The case was tried before a jury and a verdict awarding appellees compensatory damages, punitive damages, and attorney's fees was returned. Appellant appeals from the judgment that was entered by the trial court on the jury's verdict.

1. Appellant enumerates the general grounds, urging that the evidence will not authorize a finding of its tort liability to appellees.

The evidence shows that, prior to making the loan to Mrs. Mapp, appellant commissioned an attorney to conduct a title search on its behalf. This title search failed to disclose the existence of appellees' interests in the property. Appellees urge that appellant's tort liability can be premised upon this allegedly negligent title search. However, the purpose of appellant's commission of the title search was exclusively to protect its own interests as a potential lender and there obviously is no evidence that appellees themselves otherwise relied to their detriment upon the results of that title search. See generally Badische Corp. v. Caylor, 257 Ga. 131, 356 S.E.2d 198 (1987); American Mut. Liability Ins. Co. v. Jones, 157 Ga.App. 722, 278 S.E.2d 410 (1981). If the title search was negligently conducted, it is appellant who was injured by its reliance thereon, insofar as appellant would not have the anticipated security for its loan to Mrs. Mapp.

It is of no consequence to appellant's tort liability that the title search was conducted by an attorney who was employed by it. Appellant could be held vicariously liable to appellees for the negligence of its employee if its employee had violated a duty that he owed to appellees. OCGA § 51-2-1. However, even assuming that the attorney was an employee rather than an independent contractor, it is clear that, in conducting the title search, he owed a duty to protect appellant's interests as a secured party, but he had no duty to appellees. See generally Horn v. Smith & Meroney, P.C., 194 Ga.App. 298, 390 S.E.2d 272 (1990).

Appellees further urge that their recovery in tort can be premised upon appellant's unlawful interference with their realty in violation of OCGA § 51-9-1. However, there is no evidence that appellant ever interfered with appellees' possessory interests in the realty. Compare Orr v. Floyd, 95 Ga.App. 401, 97 S.E.2d 920 (1957). Appellant's only act was to record a security deed from Mrs. Mapp. It is undisputed that Mrs. Mapp was appellant's debtor and that she did have an interest in the property. Thus, appellant's act of filing the security deed could be "wrongful" towards appellees only insofar as the security deed erroneously purported to convey to appellant a greater interest in the realty than Mrs. Mapp in fact owned. However, this error in the security deed had no legal effect whatsoever on appellees' actual...