Nalley Chevrolet, Inc. v. California Bank, Transferee., 100 Ga. App. 197, 110 S.E.2d 577 (1959)

Status: DECIDED

Docket Number: 37870

Parts: Claim. Fulton Civil Court. Before Judge Camp. J...

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Joel J. Fryer, contra.Smith, Field, Doremus & Ringel, Arthur B. L. Martin, H. A. Stephens, Jr., for plaintiff in error.

1. While an election on the part of a plaintiff to rescind the contract and sue in tort will bar a later action based on an affirmance of the contract, it is necessary, in order to show that such election of remedies has been made, that the same party or one in privity therewith instituted both actions. It does not appear from this record that Bank of California, Inc., the plaintiff in the trover action to recover the property in question from Nalley Chevrolet, Inc., is the same entity as or bound by the actions of California Bank, the plaintiff in this proceeding to foreclose the property as the property of the conditional vendee, Frank Lee.

2. Where, the law of a foreign state is not pleaded and proved, such state not being one of the original thirteen colonies nor carved out of land embraced therein, it will be presumed that the law of such state is the same as the law of Georgia.

3. (a) A conditional bill of sale executed by the parties is valid as between them, but, unless properly attested or acknowledged, cannot be admitted to record and does not constitute notice to a third party acquiring the property in good faith and without actual knowledge of the outstanding title. Such an instrument may subsequently be re-executed and thereafter, if in proper form, admitted to record. On this instrument, immediately below the space in which the conditional verdict re-signed his name, appears the signature of a notary public and his seal with the words preceding such signature: "Sworn to and subscribed before me this 26th day of Dec., 1957." The language is sufficient as an attestation by an official witness to allow the instrument to be filed of record.

(b) Such signing and attestation amounts to a re-execution if the instrument, and, when recorded thereafter, it constitutes constructive notice of the conditional vendor's outstanding security title from the date of record.

4. While the evidence did not support a finding that the claimant in this case had constructive notice of the vendor's claim at the time of its first purchase of the automobile in question, or that it had actual notice of such outstanding title at any time, the evidence demands a finding that it did have constructive notice thereof at the time of its repurchase of the vehicle after the conditional bill of sale was re-executed and recorded. A verdict for the plaintiff in the foreclosure action being demanded by the evidence, the remaining assignments of error, even though meritorious, would not work a reversal of this case.

This is a foreclosure proceeding commenced by California Bank, transferee of Charles Soderstrom, Inc., upon a 1955 Plymouth automobile, motor number P 26205191 as the property of W. Frank Lee and J. E. Pratt for the balance owing on the purchase price of $998.43, which action was filed in the Civil Court of Fulton County. Nalley Chevrolet, Inc., filed a claim to the property and the trial was upon the issue thus joined. The court hearing the case without a jury returned a judgment for the plaintiff. The claimant filed its motion for new trial on the general and several special grounds, and the denial is assigned as error.

1. While an election on the part of a plaintiff to affirm a contract of sale by means of a foreclosure against the property as the property of the defendant constitutes such an election of remedies as would bar the plaintiff from later repudiating the contract and bringing an action in trover to recover the property on the theory that title remained in the plaintiff (Kennedy v. Manry, 81 Ga. App. 185 (2), 58 S. E. 2d 465), it must be presumed that the automobile was still in Fulton County on December 26, when the conditional bill of sale was recorded. Had Lee been a non-resident, then the instrument would have been recorded in the proper county under that part of Code 67-108 which provides that if the mortgagee is a nonresident it shall be recorded in the county where the mortgaged property is at the time of recordation. (See Evans Motors of Ga. v. Gump Finance Corp., 80 Ga. App. 836, 57 S. E. 2d 506). Being a resident, the county of his residence was, under the Code section, the proper place to have it filed for record. That part of the section which provides that "chattel mortgages of stocks of goods, wares, and merchandise, or other personal property, shall be recorded, in case the same is upon property or goods located in some other county than that of the mortgagor's residence, in the county where said personal property is located at the time of the execution of said mortgage, in addition to the record of said mortgage in the county of the mortgagor's residence" applies to stocks of goods and like personalty, not to an automobile where the mortgagor is not in the business of buying and storing automobiles. General Motors Acceptance Corp. v. Monday, 79 Ga. App. 609 (54 S. E. 2d 479). Therefore, the instrument would not have been required to be recorded in DeKalb County even if the plaintiff did not have the benefit of the presumption that it was located in Fulton County at the time it was filed for record.

The last sentence of Code 67-108 provides: "Where a mortgage either upon realty or personalty is executed to secure the payment of money or other thing of value, and the same is not recorded as provided by law, but such mortgage is renewed or re-executed, in every case of renewal or re-execution of a mortgage which has not been recorded, such mortgage shall operate as a lien upon the property of the mortgagor only as against the mortgagor himself and those having actual notice of such mortgage, except from the date of the record of such mortgage." This document as first executed was not entitled to record because Lee, the mortgagor, had failed to execute it or have it attested or proven before a notary public or other like officer. The defect was cured on December 26, when he re-executed the instrument before a notary public who signed it as an official witness. This, under the last above quoted provision of the Code section constituted a re-execution of the document which entitled it to record. Saranac Mach. Co. v. Heyward, 293 F. 499. The constructive notice afforded by such recordation then dates from the date of record, since until it is re-executed it is not such an instrument as can impart constructive notice to any third party. "If the mortgage was improperly recorded for lack of due attestation, and the same is afterwards properly attested, the mortgage must be recorded anew, because its registration would date from that time and not from the time of its original improper record." Donalson v. Thomason, 137 Ga. 848, 852 (74 S. E. 762). Applying this law to the facts of this case, accordingly, it appears that at the time the claimant purchased and resold the automobile the first time in September, 1957, it had no constructive notice of the outstanding paramount title, nor did the recordation in December, although within six months of the time the property was brought into the State, cast such notice upon it since it could have no effect prior to a proper execution and recordation. When it was filed for record, however, under the last sentence of Code 67-108, it did become constructive notice as of the date of record. It continued as such, and when the claimant repurchased the vehicle in October, 1958, the record was constructive notice of the rights of California Bank as to it, from which it follows that its claim cannot prevail over the claim of the conditional vendor. The trial court did not err in holding that the instrument was properly recorded and in entering up judgment in favor of the plaintiff in foreclosure.

4. The remaining assignments of error deal with the court's admission of certain testimony and documentary evidence, and complaint is also made of the finding by the court that the claimant had actual knowledge of the plaintiff's title. This finding was error, being based on the fact that the vehicle was equipped with California license tags at the time of its first purchase by the claimant, and on the fact that the defendant Lee testified he delivered his California title certificate to the claimant's agent. Foreign license plates would not put the claimant on notice of the plaintiff's title. The copy of the title certificate was inadmissible in evidence over the objection that the motor number of the vehicle was shown as 25191094 whereas the number of the vehicle being foreclosed under the conditional bill of sale was P26205191. Having a different motor number, the title certificate could not constitute actual notice of the claim to the vehicle which the defendant sold to the claimant. Neither this nor any of the other assignments of error, however, would be sufficient to work a reversal of the case since the claimant was, upon its purchase in October, 1958, bound by the constructive notice of the plaintiff's rights afforded by the recordation of the conditional bill of sale.

The trial court did not err in denying the motion for new trial.

Judgment affirmed. Gardner, P. J., and Carlisle, J., concur.