Windland Co. v. Federal Deposit Ins. Corp., 58498

• Decision Date: 26 November 1979
• Docket Number: No. 58498,58498
• Citation: 151 Ga.App. 742,261 S.E.2d 407
• Parties: WINDLAND COMPANY et al. v. FEDERAL DEPOSIT INSURANCE CORPORATION.
• Court: Georgia Court of Appeals

Page 407

261 S.E.2d 407

151 Ga.App. 742

WINDLAND COMPANY et al. v. FEDERAL DEPOSIT INSURANCE CORPORATION.

No. 58498.

Court of Appeals of Georgia.

Submitted Sept. 6, 1979.

Decided Oct. 1, 1979.

Rehearing Denied Oct. 16, 1979.

Certiorari Granted Nov. 26, 1979.

James O. Wilson, Jr., Charles T. Autry, Decatur, for appellants.

Thomas E. Prior, Atlanta, for appellee.

DEEN, Chief Judge.

The appellee FDIC, following its appointment as receiver of the assets of the Hamilton National Bank of Chattanooga in the U.S. District Court for the Eastern District of Tennessee, exercised a power of sale in a deed to secure debt to certain DeKalb County real estate by the grantor Windland Company. Confirmation of the foreclosure sale was applied for in and granted by the U.S. District Court for the Northern District of Georgia. The present action for deficiency judgment was then filed in the Superior Court of DeKalb County. The appellee applied for and obtained a summary judgment from which Windland Co. and its guarantor Hanes appeal. Held :

1. Code § 67-1503 requires, when real estate is foreclosed on and sold under power without legal process, that "no action may be taken to obtain a deficiency judgment unless the person instituting the foreclosure proceedings shall, within 30 days of such sale, report the sale to the judge of the superior court of the county in which the land lies for confirmation and approval, and obtains an order of confirmation and approval thereon." The U.S. District Court for the Northern District of Georgia in its Confirmation Order No. C77-914A dated December 13, 1977, held that "federal jurisdiction exists over confirmation proceedings by Ga.Code § 67-1503 . . . despite language in the Georgia statute specifically requiring that the report of the foreclosure sale be made to the judge of the Georgia Superior Court of the county where the land lies," citing FDIC v. Honea, 440 F.Supp. 1064. In that case federal jurisdiction of a proceeding seeking a confirmation after foreclosure sale was challenged. The court held that the federal court had jurisdiction despite the language of Code § 67-1503 limiting it to superior courts of counties where the real estate is situated, because FDIC was a party and because the application was a civil action to wind up the affairs of an insolvent national bank. It further held, citing Markham v. City of Newport News, 292 F.2d 711 (4th Cir. 1961) that where a state provides a substantive right and attempts to limit the remedy for its enforcement to a proceeding in a state court, the controversy may be adjudicated in any United States district court which would otherwise have jurisdiction had such restriction not been placed thereon. It then held that Code § 67-1503, although requiring a confirmation of sale by the superior court of the county where the land lies as a condition precedent to an action for deficiency judgment should be construed as allowing the confirmation proceedings to be brought in any United States district court which would otherwise present an available forum. No ruling was made as to the bringing of any subsequent deficiency action.

Insofar as these opinions held that ...