Waters v. Lanier, 43036
Decision Date | 06 October 1967 |
Docket Number | No. 3,No. 43036,43036,3 |
Citation | 157 S.E.2d 796,116 Ga.App. 471 |
Parties | J. W. WATERS v. H. B. LANIER |
Court | Georgia Court of Appeals |
Syllabus by the Court
1. Although the note in question contained a promise to pay an amount included in a prior note and representing usurious interest, this defect was cured by the judgment, which on its face shows that it was in the amount of the debt less the interest.
2. The promissory note on which suit was brought, executed after the discharge of the defendant in a bankruptcy proceeding in which the debt was scheduled, constituted a new promise to pay under the provisions of Code § 3-902.
3. (a) The defendant's deed reciting that it was given in satisfaction of his obligation to the plaintiff, accepted by the latter, amounted to an accord and satisfaction.
(b) Where there was evidence that the value of the property was not sufficient to pay the balance due on the indebtedness, and the defendant thereafter voluntarily gave the plaintiff a promissory note for the difference, recognizing at the time that he owed a legal obligation which he intended to pay, such facts may amount to a good consideration sufficient to support the obligation as against the defense of nudum pactum.
On January 10, 1963, the defendant Waters delivered his promissory note in the amount of $4340.40 to H. B. Lanier in return for a loan of $3500, which note was secured by a junior deed to secure debt on a house owned by Waters and his wife. On May 9, 1963, Waters filed his petition in bankruptcy and was discharged December 15, 1964. Meanwhile, on August 17, 1963, he and his wife executed separate warranty deeds to Lanier conveying their equities in the property, each deed containing the following recital: 'The grantor herein conveys this one-half interest in satisfaction of his individual obligation to the grantee.' Thereafter, and whether before or after his discharge from bankruptcy does not appear, the defendant gave plaintiff a note in the amount stated by the plaintiff to be the sum remaining on the indebtedness after credit for payments made and for the value of the equity in the property. No payments were made on this note. It was surrendered and plaintiff executed another promissory note in the same amount ($2230) on April 24, 1965. On the trial judgment was entered up in favor of the plaintiff for $1389.60, and the defendant appeals.
Harvey & Rhodes, Leonard W. Rhodes, Decatur, for appellant.
Donald D. Smith, Marietta, for appellee.
1. Subtraction of $3,500 from the amount of the original note, $4,340.40, leaves a difference of $840.40, admitted by both parties to have been the interest charged. This is on its face usurious, and the penalty for usury is forfeiture of all interest. Code § 57-112. Subtraction of the amount of the judgment from that of the note on which suit was brought indicates that the trial court properly deducted therefrom the amount of $840.40, thus disposing of the usury issue.
2. It is contended that, as the debt in question was scheduled in the bankruptcy proceedings, sicne Code § 3-902 provides that a new promise to pay to be valid must be in writing, and this has been interpreted in Oglesby v. Trust Co. of Ga., 47 Ga.App. 749, 171 S.E. 393 and Moore v. Trounstine, 126 Ga. 116, 54 S.E. 810 to mean that the new promise 'must so plainly and clearly refer to or describe the very debt in question as to identify it with reasonable certainty,' the execution of the promissory notes, which do not in terms refer to the debt (although for the amount of the debt and admitted by both parties to have been executed for the purpose of paying off the balance of that debt) are not sufficient within themselves to amount to a new, enforceable promise to pay a debt otherwise barred by the bankruptcy proceeding. In Moore, a letter was held insufficient for the purpose because its language sounded 'more like the language of prophecy than of binding obligation': in other words, there was no distinct promise to pay involved. In Oglesby, the writing depended on, which was a salary assignment addressed to a third person, in no way identified the debt, either by amount or by name of the creditor, the assignment flowing to the benefit of another person than the one to whom the debt was owing. However, in Cameron v. Meador-Pasley Co., 39 Ga.App. 712, 713, 148 S.E. 309, 310, it was held: 'A promise to pay a debt which has been discharged in bankruptcy is alone a sufficient consideration for a promissory note by the debtor for the amount thereof.' Examination of the record in that case verifies the language of the opinion and shows that each of the promissory notes, which were to the creditors and for a sum certain, contained the balance on a debt otherwise unenforceable because of the debtor's bankruptcy. The notes did not in writing refer to the prior obligation, but all parties admitted that they were intended to do so. The circumstances of that case control here, and we conclude that, as to the specificity of the written promise to revive a debt otherwise barred by bankruptcy, when the writing is in the form of a promissory note, is made out to the creditor, is for the balance due on the debt, and there are no circumstances in the case authorizing any other conclusion, the promise is sufficiently specific to be enforceable.
3. As to the third defense, after the bankruptcy proceedings had been commenced...
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