Summary
In Small Equipment Co. v. Walker, 126 Ga. App. 827 (192 S.E.2d 167), this court affirmed, holding that there remained genuine issues of material fact as to whether the judicial sale was infected with fraud, irregularity, or error, to the injury to the defendant in that the property sold for $100 instead of a possible $4,000 to $6,000 valuation.
Summary of this case from Small Equipment Company v. WalkerOpinion
47271.
SUBMITTED MAY 23, 1972.
DECIDED JULY 14, 1972. REHEARING DENIED JULY 28, 1972.
Action for deficiency judgment. Houston Superior Court. Before Judge Hunt.
Thomas H. Wall, III, for appellant.
Joel A. Willis, Jr., for appellee.
In this action for a deficiency judgment, the trial judge properly overruled the plaintiff's motion for summary judgment where the pleadings, interrogatories, and affidavit on file show that there are genuine issues of material facts as to whether the judicial sale under power was infected with fraud, irregularity, or error to the injury of the defendant, so as to authorize its being set aside.
SUBMITTED MAY 23, 1972 — DECIDED JULY 14, 1972 — REHEARING DENIED JULY 28, 1972 — CERT. APPLIED FOR.
The plaintiff company filed a foreclosure proceeding in 1964 against the defendant debtor based on a conditional sale contract executed in 1960, covering commercial laundry equipment, including a number of large washing machines and dryers. The defendant filed an affidavit of illegality and a forthcoming illegality bond and the trial judge granted the plaintiff a summary judgment, which this court affirmed with direction that the case be remanded to the trial court to have the judgment modified so as to make it clearly an in rem, rather than a general, judgment. Walker v. Small Equipment Co., 114 Ga. App. 603 ( 152 S.E.2d 629). Thereafter, the plaintiff obtained a judicial sale of the property, at which the plaintiff bought it for its own high bid of $100, then filed the present action for a deficiency judgment in the amount of $8,496.50.
The defendant's amended answer and counterclaim denied liability to the plaintiff and alleged substantially that the judicial sale of the property should be set aside and canceled for the reasons that (1) the property had depreciated in value from $7,000 to $6,000 from November, 1966, when the Court of Appeals upheld the plaintiff's right to foreclose, to the time of the judicial sale in June, 1967, which delay was caused by the nonresident plaintiff's failure to pay the advance cost of the advertisement of the sale, as required by Code § 39-1106; (2) that, although the advertisement indicated that the property would be at the courthouse in Perry for the sale, it was in fact left in Warner Robins during the sale; and (3) that the plaintiff chilled the sale by bidding, through its agent, only $100 for property having a reasonable value of $6,000.
The defendant's answers to the plaintiff's interrogatories, show substantially that the defendant requested the sheriff to transfer the property from the defendant's building in Warner Robins to the courthouse in Perry, but that, because the sheriff was unable to locate anywhere else to store the property, he left it in said building, later placing it outside under some trees until after the sale was completed at the courthouse; that, prior to the sale, the defendant objected to the sheriff about the foregoing procedure; that, on the night before the sale, the defendant tried unsuccessfully to contact the plaintiff's attorney to make such objections to him.
The plaintiff filed a motion for summary judgment, supported by certified copies of the defendant's answer and motion for summary judgment, including supporting affidavit, in the plaintiff's action for damages based on the forthcoming illegality bond. The defendant's answer and plea of estoppel alleged substantially that, even though a forthcoming bond had been executed, the sheriff, by agreement with the plaintiff's attorney made known to the defendant on the night before the sale, had left the property continuously since the levy and during the sale under his lock and key in the same commercial building in which it was located when it was originally levied on by him, since it was heavy, cumbersome and he had no other place to store it; that the plaintiff thereby waived the requirement of the forthcoming bond, of the defendant's delivering the property to the courthouse; that the plaintiff's attorney had waived for his client the requirements of the bond, hence the right to recover thereon, by his failure to make any objection to the manner of the sale and the absence of the property at the courthouse by bidding thereon (at a very low figure in order to create a deficiency).
The supporting affidavit of the sheriff was to the effect that the property was not brought to the courthouse for the sale as advertised because on the day before the sale the plaintiff's attorney advised him that, since the property was extremely heavy, large and cumbersome, it would be just as well to leave it where it was and that, if anyone wanted to see it before making a bid, he could be told where it was.
The plaintiff appeals from the judgment of the trial court overruling its motion for summary judgment.
The present transaction having been entered into prior to the effective date of the Uniform Commercial Code, its enforcement is governed by pre-UCC law. Code Ann. § 109A-10-102 (Ga. L. 1962, pp. 156, 427); Chas. S. Martin c. Co. v. First State Bank, 114 Ga. App. 693, 695 ( 152 S.E.2d 599).
"`Courts shall have full power over their officers making execution sales; and whenever satisfied that a sale made under process is infected with fraud, irregularity, or error to the injury of either party, the sale shall be set aside.' Code § 39-1316. Mere inadequacy of price is not of itself sufficient ground for setting aside a sale ( Palmour v. Roper, 119 Ga. 10 (5) ( 45 S.E. 790)), but where coupled with other circumstances showing fraud, accident or mistake tending to bring about such inadequacy, a sufficient reason is presented. Smith v. Ga. Loan c. Co., 114 Ga. 189 ( 39 S.E. 846); Interstate Trust Co. v. Citizens' Bank, 166 Ga. 537 ( 143 S.E. 577)." Warren Co. v. Little River Farms, Inc., 125 Ga. App. 332, 333 ( 187 S.E.2d 568).
Code Ann. § 39-1201 provides in part as follows: "... [I]n all cases where any sheriff, coroner, or other levying officer shall levy any execution or other legal process upon any corn, lumber, timber of any kind, bricks, machinery, or other articles difficult and expensive to transport, said officer may sell said property without carrying and exposing the same at the courthouse door on the day of the sale, but the levying officer shall give a full description of the property and the place where it is located in the advertisement of the sale." (Emphasis supplied.) Insofar as the record shows, the advertisement of the present sale merely gave notice that the sale was to be at the courthouse at a certain time, and neither fully described the property to be sold nor the place where it was to be located. It cannot be said as a matter of law that this did not work injury on the defendant merely because the sheriff may have informed any prospective bidders where they might view the property as he had been instructed to do. It is possible that some prospective bidders might have gone by the situs of the property to inspect and assess it before bidding at the sale if they had known of its location, whereas one attending the sale expecting to view the property at the courthouse might well be unwilling to travel 17 miles to view it, especially since it might be sold in the meanwhile.
Nor can it be held as a matter of law, that the defendant breached the forthcoming illegality bond by not "delivering" the property levied upon at the time and place of sale, as is required by Code § 39-301. A jury might find that the defendant had delivered custody to the sheriff by the facts that, apparently by mutual consent of all parties, the property was stored in the defendant's building under the sheriff's lock and key because it was so heavy, large, and cumbersome, and that the sheriff was requested to deliver it to the courthouse for the sale. Could the defendant be required, under such circumstances, to have forcefully broken the sheriff's lock and re-seized possession of the property from the sheriff's lawful custody? We think not. It was a jury question likewise as to whether the facts showed a waiver by the defendant of any or all alleged irregularities in the sale, including the absence of the property from the place of the sale. The mere fact that the defendant was informed prior to the sale that the property was not to be exhibited at the place of the sale, would not alone show waiver, without evidence that no bona fide effort was made to raise the objection. The defendant alleges that such an effort was unsuccessfully made. Neither is such waiver proved by the fact, standing alone, that the defendant urged that the plaintiff had waived all irregularities in the sale with regard to his action on the forthcoming bond. This is not an admission by the defendant that the sale was regular, but a contention that the plaintiff, not the defendant, had waived any irregularities.
Similarly, while the mere facts that the plaintiff bid for and bought the property worth at least $4,000 (according to the bond) for only $100, and that the sale was delayed some seven months because of the plaintiff's failure to pay the advance cost of advertising, if proven, might not demand a finding of irregularity in the sale so as to authorize its being set aside, these facts, when added to the totality of circumstances above referred to, could authorize a verdict and judgment for the defendant.
It follows that the trial judge did not err in his judgment overruling the plaintiff's motion for a summary judgment.
Judgment affirmed. Bell, C. J., and Evans, J., concur.