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WYLEY LOOSE LEAF COMPANY v. BIRD

Supreme Court of Georgia1924-11-14No. No. 4524
159 Ga. 246

Summary

Holding. The judgment was reversed. Brownlee's deed conveying the land to Piedmont Investment Company, read together with the contemporaneous promissory note, created a valid lien on the land to secure the unpaid purchase-money, and this lien bound all subsequent owners including Bird.

Brownlee received a promissory note from Piedmont Investment Company for $200 as part-payment for a 100-acre tract of land in Candler County, Georgia. The next day, Brownlee conveyed the same land back to Piedmont Investment Company, with a deed recital stating the conveyance was "subject to a mortgage note of two hundred dollars payable to G. W. Brownlee or order." Brownlee later transferred his rights in the note to Wyley Loose Leaf Company, which sued and obtained a judgment against Piedmont Investment Company and Brownlee. When the land was levied upon to satisfy the judgment, the current owner, Bird, claimed the land was free from the lien.

The trial court directed a verdict in Bird's favor, finding no valid lien. The court reversed, holding that when the note and deed are read together, Brownlee plainly intended to create and reserve a lien on the land to secure the unpaid purchase-money. Georgia law requires only minimal formality to establish a mortgage or lien—it is sufficient to clearly indicate the intent to create a lien, specify the debt secured, and identify the property affected. The deed recital bound not only the original parties but also subsequent owners of the land, preventing Bird from escaping the lien that attached when Brownlee conveyed the property.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

  • Whether a purchase-money lien was created by a deed recital combined with a contemporaneous promissory note
  • What formality is required under Georgia law to create a mortgage or lien
  • Whether deed recitals bind subsequent owners of the property

Procedural posture

The case arose from a claim hearing on execution levied to satisfy a judgment obtained on a promissory note, in which the trial court directed a verdict for the current landowner, and the judgment creditor appealed.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion

majority opinion

Hines, J.

On December 14, 1915, T. J. Eady conveyed, by his deed to G. W. Brownlee, the land in dispute. On July 2, 1920, the Piedmont Investment Company executed and delivered to Brownlee its note for $200, payable to Brownlee or order, which recited that it was given for “part of purchase-money for 100-acre tract of land in Candler County, Georgia.” On July 3, 1920, Brownlee by his deed conveyed^ this land to the Piedmont Investment Company. This deed contained this recital: “This deed is subject to a mortgage note of two hundred dollars payable to G. W. Brownlee or order.” This deed was recorded August 6, 1920. On August 11, 1920, the Piedmont Investment Company by its deed conveyed this land to Harry Goldberg, who, on January 11, 1921, by his deed conveyed this land to George M. Bird, the claimant. Brownlee transferred in writing all his “rights, title, and interest to this purchase-money note,” without designating the transferee. Wyley Loose Leaf Company brought suit on this note against the Piedmont Investment Company as maker, and Brown-lee as indorser, to the March term, 1923, of the municipal court of Atlanta. The complaint in this case alleged that this notewas given for part of the purchase-money of the premises in dispute, and fully described the same. On March 29, 1923, plaintiff obtained judgment against the defendants. This judgment was made a special lien on this land. Execution was duly issued upon this judgment, to be levied generally of the property of the defendants, and especially of the premises in dispute in accordance with the judgment. This execution was duly levied, and the entry of levy recited that the claimant was in possession. On the hearing of the claim, the above facts appearing from the evidence introduced by the plaintiff, the claimant introducing no evidence, the trial judge directed a verdict in favor of the claimant. To this judgment theplaintiff excepted.

Did the able trial judge err in directing a verdict for the claimant? This depends upon whether Brownlee, in conveying this land to the Piedmont Investment Company, reserved a lien thereon for the unpaid purchase-money due him by said company. On one day this company executed to Brownlee its note in which it was recited that it was given to him in part payment of the land in .dispute. The next day Brownlee by his deed conveyed to this company this land, with the recital therein that it was made “subject to a mortgage note of two hundred dollars, payable to Gr. W. Brownlee or order.” It is true that this note was not by its terms a mortgage note; but it was for the same amount as the note referred to in the deed, was payable to the same payee or order, was for part of the purchase-money of a tract of the same acreage, and located in the same county of this State, as conveyed by this deed. Taking the note and the deed together, the plain.purpose of the maker of the deed was to reserve a lien or charge on the land to secure the payment of the purchase-money of the land thereby conveyed. Atlanta Land & Loan Co. v. Haile, 106 Ga. 498 (32 S. E. 606); George v. Dortch, 149 Ga. 20 (98 S. E. 605). Little formality is required in this State to create a mortgage, or to charge land with a lien. It is sufficient, to create a mortgage, to clearly indicate the creation of a lien, to specify the debt to secure which it is given, and the property upon which it is to take effect. Civil Code (1910), § 3257. Becitals in deeds bind not only the parties

thereto, but their privies in estate. Civil Code (1910), § 5736; Lamar v. Turner, 48 Ga. 329; Cruger v. Tucker, 69 Ga. 557; George v. Dortch, supra. So the claimant was bound by the recital in the deed from Brownlee to the Piedmont Investment Company; and he can not escape the lien or charge created on this land by that conveyance. It follows that this land was subject to that lien or charge, and was subject to the judgment setting up this lien thereon, and to the levy of the execution which issued on this judgment.

Judgment reversed.

All the Justices concur, except Atkinson, J., dissenting.