SECOND DI VI SI ON

A NDREWS, P. J.

, M C F A D DEN and RA

Y, JJ.

N O T IC E : M otions for r e c ons i de r a tion m us t be

ph y sic a l ly r e ce iv ed i n our c le r k ’s offic e w ithin te n

da y s of the da te of de c is ion to be de e m ed tim e ly file d.

http://w w w .ga a ppe a ls .us /r ule s /

Nov em ber 14, 2014



# I n th e Co u r t o f

A p p eals o f

G eo r g ia

A1 4 A1 40 3

. THOM AS et al

. v

. STATE BAN K AND TRUST

COM PANY.

M C F A D D E N , J u d g e.

Th i s ap p eal ch al l en g es t h e g ran t o f s u m m ary ju dg m en t t o a b an k o n i t s cl ai m s

fo r b reach o f t wo pro m i s s o ry n o t es an d a gu aran t y

. Becau s e t h e m o v an t b an k fai l ed

t o m eet i t s b u rd en o f s h o wi n g t h at t h ere ex i s t s no g en u i n e i s s u e o f m at eri al fact t h at

i t is t h e cu rren t h o l der o f t h e n o t es an d g uaran t y

, we rev ers e.

“ Su m m ary j u d gm en t i s p ro p er wh en t h ere i s n o g en u i n e is su e o f m at eri al fact

an d t h e m o v an t i s en t i t l ed t o ju d g m en t as a m at t er o f l aw. W e rev i ew a t ri al co urt ’ s

g ran t o f s u m

m ary ju d g m en t d e n ov o

, co n s tru i ng t h e ev i d en ce, an d al l reas o n ab l e

co n cl u s i o n s an d i n feren ces d rawn fro m i t

, i n fav or o f t h e n o n m o v a n t .” Cl a y v.Oxen d i ne

, 2 8 5 G a. Ap p

. 5 0 (6 4 5 SE2 d 5 5 3 ) (2 0 0 7) (ci tat i o n s an d pu n ct u at i o n

o m it t ed ).

So v i ewed

, th e ev i d en ce sh o ws t h at o n J u l y 2 1, 2 0 09

, St an l ey Th om as o b t ai n ed

a l o an fro m Th e Bu ck h ead Co m m un i t y Ban k an d s i g n ed a p ro m is s o ry n o t e p ro m i s i n g

t o rep ay t h e pri n ci pal am o u n t o f $ 3 5 5,0 1 5

. On Sep t em b er 1 5

, 2 00 9

, Kev i n Cas e al s o

o b t ai n ed a l o an fro m Th e Bu ck head Co m m u n i ty Ban k an d s i g n ed a p ro m i s s o ry n o t e

p ro m i s i n g t o rep ay t h e p ri n ci pal am o u n t o f $ 35 ,6 8 6 .7 9. Th o m as ex ecu t ed a g u aran t y

t o rep ay Cas e’ s n ot e.

Th e Bu ck head Co m

m u n i t y Ban k s u bs eq u en t l y fai l ed

, an d t h e Fed eral Dep o s i t

In s u ran ce Co rp o rat i o n (“ FDIC”) was ap p o i n t ed recei v er fo r t h e fai l ed b an k

. On

Decem b er 4

, 2 0 0 9

, th e FDIC en t ered i n t o a Pu rch as e an d As s um p t i on A g reem en t

wi t h St at e Ban k an d Tru s t Co m p an y

, wh i ch p ro vi d ed t h at St at e Ban k d e s i red to

p u rch as e cert ai n as s et s an d as s u m e cert ai n l i ab i l i ti es o f t h e fai l ed Bu ck h ead

Co m m u n i t y Ban k

, an d t h at t h e FDIC as si g n ed i t s i nt eres t s i n t h e fai l ed b an k ’ s as s et s

t o St at e Ban k

.

On M arch 2 5

, 2 0 1 1

, St at e B a n k fi l ed t h e i n s t an t act io n ag ai n s t Th o m as an d

Cas e, cl ai m i ng d efau l t an d s eek i n g reco very un d er t h e Bu ck head Co m m u ni t y Ban k

p ro m i s s o ry no t es an d gu aran t y. O n M arch 1 2

, 2 0 1 2

, St at e Ban k fi l ed a m o t i o n fo r

2s u m

m ary ju d gm en t

, cl ai m in g t h at t h e n o t es an d g u aran t y h ad been t ran s ferred t o i t by

t h e Pu rch as e an d As s u m p t i o n Ag reem e n t

. Th o m as an d Cas e o p p os ed t he m o t i o n,

a s s e r t i n g t h at t h e b an k h ad n o t s h o wn i t was i n fact t h e h o l d er o f t h e n o t es a n d

g u aran ty b ecau s e th e Pu rch as e an d As s u m pt io n Ag reem en t d i d n o t i d en t i fy t h e as s et s

t ran s ferred an d i t p ro v id ed t h at t h e act u al co n vey an ce o f t h e as set s s hal l b e m ad e by

a r e c e i ver’ s d eed o r a recei v er’ s b i l l o f s al e, n ei t h er o f wh i ch was p res en t i n t h e

reco rd

.

On J un e 2 6, 2 0 1 2

, a h eari n g was h el d o n t h e m o ti o n fo r s u m m ary j u d gm en t

. At

t h e h eari ng

, co u n s el fo r St at e Ban k s t at ed t h at t h e “ recei ver’ s as s i g n m en t o f n o t e an d

d eed t o secu re d eb t i s p art o f t h e real es tat e reco rd s o f t h e cl erk o f t h e s up eri o r co u rt

o f Fu l t on Co u nt y [.] ” Sh e t h en ci t ed t o a c o u n t y d eed bo o k an d p ag e n u m b er an d

fu rt her s t at ed

, “ Th e recei v er as s i g n m en t o f no t e an d d eed t o s ecu re d eb t w as fi l ed o f

reco rd b ack i n M ay o f 2 0 1 0

. An d s u b jec t t o t h at as s i g n m en t o f no t e, al l n o t es an d

d eed t o secu re d eb t

, fi n an ci n g st at em en t s an d o t h er co l l at eral were al l t ran sferred to

St at e Ban k an d Tru s t .”

Co u ns el fo r t h e b an k g a v e a co p y of t h e referen ced p ag e t o co u n s el fo r t h e

d efen s e. Ho wev er, t h e b an k d i d n o t t en der t h e d o cu m en t t o t h e co u rt an d i t was n ot

ad m i t t ed i n t o ev id en ce. Co u n s el fo r Th om as an d Cas e o b ject ed t o an y co n s i d erat i o n

3b y t h e co u rt of t h e p u rp o rt ed as s i g n m en t reco rd

, n o t i n g t h at i t h ad n ot b een cert i fi ed

,

an d h ad n o t been t i m el y fi l ed i n s u p p o rt o f t h e m o t i o n o r s erv ed o n th e d efen s e.

Defen s e co u n s el fu rt h er arg u ed t h at t h e ab s en ce o f s u ch an as s i g nm en t d o cu m en t in

t h e reco rd p ro v ed h i s p o i n t t h at t h e Pu rch as e an d As su m p t io n Ag reem en t i t s el f d id

n o t co nv ey

t h e n o t es an d g u aran t y i n q u es t i o n , an d t h us t h e b an k h ad n o t p res en t ed

p ro p er ev i d en ce o f t h e d o cu m en t act u al l y effect u at i n g t h e t ran s fer o f t h e as s et s

.

Th e t ri al co u rt t h ereaft er en t ered i ts o rd er g ran t i n g th e m o t i o n f o r s u m m ary

ju d g m en t in fav o r o f St at e Ban k

, fi n d i n g t hat t he n o t es an d g u a ran t y h ad b een

t ran s ferred t o t h e b an k pu rs u an t t o t h e Pu rch as e an d As s u m p t i o n Ag reem en t

. Th o m as

an d Cas e ap p eal

.

1

. Co n veya nce o

f n o tes an d

g u a ra n ty.

Th e ap p el l an t s as s ert t h at t h e t ri al co u rt erred i n g ran t in g s u m m ary ju d g m en t

b ecau s e t h ere ex i s t g en u in e i s s u es o f m at eri al fact as t o wh et h er t h e ban k pro v ed t h e

n o t es an d g u aran ty h ad b een co n v ey ed to i t an d th at i t i s t h e cu rren t h o ld er o f t h e

n o t es an d g u aran t y . W e ag ree.

St at e Ban k arg u es t h at t h e n o t es an d g u aran t y were co n v ey ed t o i t by Sect i o n

3 .1 o f t h e Pu rch as e an d As s um p t i o n Ag reem en t

. Sect i o n 3 .1 st at es t h a t t h e FDIC

“ h ereb y s el l s

, as si g ns

, tran s fers

, co n v ey s

, an d del i v ers t o [St at e Ban k ]

, al l ri g h t

, t i t l e,

4an d i n t eres t o f t h e [FDIC] i n an d t o al l o f t h e as s et s

. . . o f t h e Fai l ed

Ban k.

. . . Sch ed u l e 3

. 1 at t ach ed h eret o an d i n co rp o rat ed h e r e i n s et s fo rt h cert ai n

cat eg o ri es o f As s et s p u rch as ed h ereu n d er.”

Co n trary t o t h e b an k ’ s arg u m en t, t h e p l ai n l an g u ag e o f t h i s s ect i o n as s i g n ed t h e

FDIC’s r i g h t, t i tl e a n d i n t er es t i n t h e as s et s o f th e fai led b an k

, b u t d i d n o t co n v ey t h e

as s et s th em s el v es

. M o reo ver, i t d i d n o t i d en t i fy t h e sp eci fi c as s et s i n wh i ch t h e FDIC

h ad an i n teres t ; an d t h e referen ced Sch ed u l e 3 .1 l i k ewi s e d id n o t i d en t i fy an y s p eci fi c

as s et s. Th u s

, wh i l e Sect io n 3 .1 cl earl y as s i g n e d t he FDIC’ s i n t eres t i n t h e as s et s o f

t h e fai l ed b an k t o St a t e B a n k

, i t d i d no t i d en ti fy t h e su b j ect n ot es an d g u aran t y as

as s et s i n wh i ch t h e FDIC h ad an i n t eres t an d i t d i d no t t ran s fer th o se sp eci fi c as s et s

t o St at e Ban k

.

Rat h er, th e act ual co n v ey an ce o f t h e fai led b an k ’ s as s et s i s g o ve r ne d by Sect i o n

3 .3 of th e Pu rch as e an d As s u m p t i o n Ag reem en t

. W e no t e t h at t h i s i s t h e o n l y s ect i o n

o f t h e ag reem en t t h at i s g i v e n s p e ci al em p h as i s b y b ei n g wri tt en in al l cap i t al an d

b o l d ed l et t ers

. It p r o v i d es : “ THE CONVEYANCE OF ALL ASSETS,

I N C L U D I N G R E A L A N D P E R S O N A L P R O P E R T Y I N T E R E S T S

,

PURCHASED BY [STATE BANK] UNDER THI S AGREEMENT SHALL BE

5MADE, AS NECESSAR Y

, BY RECEI VER’S DEED OR RECEI VER’S BI LL

OF SALE [.] ”

It is u n d i s pu t ed t h at n o s u ch recei ver’ s deed o r b i l l of s al e i s co n t ai n ed i n t h e

reco rd

. As reco u n t ed ab o v e, at t he s u m m ary ju dg m en t h eari ng

, co u ns el fo r St at e Ban k

referred t o a recei v er’ s as s i g n m en t o f n o te an d d eed

, cl ai m ed th at i t h ad b een reco rd ed

i n a co u n t y d eed b o o k

, an d as sert ed t h at “ s u bject t o t hat as s i g n m en t o f no t e, al l n o t es

an d d eed t o s ecu re d eb t, fi n an ci n g s t at em en t s an d o t her co l lat eral w ere al l tran s ferred

t o St at e Ban k an d Tru s t .” (Em p h as i s s u p p l i ed .) H o wev er, t h e b an k ’ s co u n s el d i d n ot

i n t ro du ce an y su ch d ocu m en t i n t o ev i d en ce an d d i d n o t as k t h e co urt t o t ak e ju d i ci al

n o t i ce o f t h e p u rp o rt ed co un t y reco rd

. Th u s, th ere i s n o ev i d en ce in t h e reco rd o f an y

recei v er’ s d eed

, b i l l o f s al e o r as s i g n m en t of no t e an d d eed s h o wi ng a t ran s fer o f t h e

n o t es an d g u aran t y t h at fo rm t h e b as i s o f St at e Ban k ’ s cl ai m s ag ai ns t Th o m a s a n d

Cas e.

St at e Ban k at t em

p t s t o fi l l t h i s v o i d i n t he ev i d en ce b y p o i nt i n g t o t h e affi d av i t

o f J u s t i n Perry

, a St at e Ban k em p l o y ee ap po i n t ed as an at to rn ey -i n-fact b y th e FDIC,

wh o s t at ed t h at on Decem b er 4

, 2 0 0 9

, t h e as s et s o f t h e fai led Bu ck h ead Co m m u n i t y

Ban k, i n cl u d i n g t h e n o t es an d g u aran t y o f Th om as an d Cas e, were t ran s ferred t o St at e

Ban k b y t h e Pu rch as e an d As su m p t io n Ag reem en t

. Ho we v e r

, a s ex p l ai n ed ab o ve,

6wh i le th e Pu rch as e an d A ss u m p t i o n A greem en t as s i g n ed t h e FDIC’ s i n t eres t i n t h e

fai l ed b an k ’ s as s et s t o St at e Ban k , i t d i d n ot act u al ly t ran s fer t h e as s et s t h em s el v es

.

M o reo v er, i t d o e s n o t ap pear t h at Perry h ad an y p ers on al in v ol v em en t i n o r

k n o wl ed g e o f th e P u r c h a s e an d As s u m p t i o n Ag reem en t s i nce, as h e p l ai n l y

ack n owl ed ge s i n hi s affi d av i t

, h e was n o t ap p o i n t ed as at t o rn ey -i n -fact u n t i l

No v em b er 2 2

, 2 0 1 0

, n earl y a y ear aft er t h e ag reem en t h ad b een ex ecu ted

. “ [I] f i t

ap p ears t h at an y po rt i on o f t he affi d av it was n o t m ad e u p o n t h e affi an t ’ s p ers o n al

k n o wl ed g e, o r i f i t do es n o t affi rm at iv el y ap p ear t h at i t was so m ad e, t h at po rt i o n i s

t o b e di s reg ard ed in co n s i deri n g t h e affi d a v i t i n co n nect i o n wi th t h e m o t i o n fo r

s u m m ary ju d g m en t .” G r een s tei n v. Ba n k o f t h e Oz a r

ks

, 3 26 G a. A p p

. 64 8

, 6 5 1 (2 )

(7 5 7 SE2 d 2 5 4 ) (2 0 1 4 ) (ci tat io n s o m i t t ed ).

Fu rt herm o re, t h e d o cu m en t ap p o i n ti n g Perry as an at t o rn ey -i n -fact

, wh i ch was

at t ach ed as an ex h i b i t t o hi s affi d av i t

, act u al l y co n t rad i ct s th e cl ai m t h at t he n o t es an d

g u aran ty at i s su e were co n v ey ed by t h e Pu rch as e an d A s s u m pt i o n A g reem en t

.

In s t ead

, co ns is t en t wi t h Sect i o n 3 .3 o f t h e ag r e e m e n t

, t h e at to rn ey -i n -fact

ap p oi n t m en t s h o ws t h at t h e t ran s fer of s u ch as set s w as req u i red t o b e d o n e by

i n s t ru m en t s ot her t h an th at ag reem en t

. Th e a ttor n e y

- in- f a c t a ppoin t m en t p ro v i d es t h at

Perry was g i ven t h e au t h o ri ty t o ex ecu t e, o n b eh al f o f t h e FDIC,

7al l i n s t ru m en t s o f t ran s fer an d co nv ey an ce, i n cl u d i n g b ut n o t l i m it ed t o

d eed s

, as s i g n m en ts

, s at i s fact i o n s

, an d tran s fers

, ap p ro p ri at el y

c o m p l e t e d

, w i t h a l l o r d i n a r y o r n e c e s s a r y e n d o r s e m e n t s

, ack n o wl ed gm en t s

, affi d av i t s a n d s u p p o rt i n g d ocu m en t s as m ay be

n eces s ary o r ap p ro pri at e t o ev i d en ce t h e s al e an d t ran s fer o f an y as s et s

o f Th e Bu ck h ead Co m

m un i t y Ban k i n cl u d i n g al l l o an s fo rm erl y h el d b y

Th e Bu ck h ead Co m

m u n i t y Ban k t o St at e Ban k [.]

In h i s affi dav i t

, Perry

d o es n o t av er t h at h e ex ecu t ed an y s u ch i n s tru m en t s o f

t ran s fer an d co n v ey an ce o r t h at h e h as p ers o n al k n o wl ed g e o f an y as s et s h av i n g b een

s o co nv ey ed

. T h u s

, h is affi d av i t p ro v i d es n o ev i d en ce t h at t he n o t es an d g u aran t y

were ap pro p ri at el y t ran s ferred t o St at e Ban k

.

In co n t ras t t o t h e d efi ci en t ev i d en ce i n t h i s cas e was th e ev i d en ce p res en t ed by

t h e as s i g n ee b an k i n Bo b i ck v. Co mmu n it y & So u t h er n B an k

, 3 2 1 Ga. Ap p

. 8 5 5 (7 4 3

SE2 d 5 1 8 ) (2 0 13 ). In t hat cas e, we affi rm ed s u m m ary ju d g m en t i n fav o r o f a b an k o n

i t s cl ai m s fo r breach o f an as si g n ed p ro m is s o ry n o t e wh ere t h e b an k “ s u b m i t t ed

d o cu m en t s refl ect i n g a co m p let e ch ai n o f as s i g nm en t fo r t h e p ro m i s s o ry n o te at

i s su e

, ” i n c l u di n g n o t on l y t h e Pu rch as e an d As s u m pt i o n Ag reem en t b et ween t h e

FDIC an d t he b an k

, b u t al so “ t h e As si g n m en t Ag reem e n t i n w h i ch t h e FDIC

. . . as s i g ned t h e p ro m i s so ry n ot es an d s ecu ri ty i n s t ru m en t s

. . . t o [t h e b an k ] .” Id

. at

8 6 0 (2 ). See al so Ken s i n g t o n Pa r t n er s v. Bea l Ba n k Neva da

, 3 1 1 Ga. Ap p

. 1 9 6

, 1 9 7

(1 ) (7 1 5 SE2 d 4 91 ) (2 0 1 1 ) (s u m m ary ju d g m en t affi rm ed wh ere ev i d en ce o f t ran s fer

8i n cl u d ed wri t t en as si g nm en t o f d eed fro m FDIC t o b an k an d a n o t e al l o n g e at t ach ed

t o t he p ro m i s s o ry

n ot e i den t i fy i n g t h e b an k as as s i g n ee).

In t h i s cas e, t h ere i s n o t s u c h a c o m pl et e ch ai n o f as s i g n m en t b ecau s e St at e

Ban k h as fai l ed t o s u b m i t an y co m pet en t ev i d en ce o f t he act u al t r a n s f er o r

co n vey an ce o f t h e p r o m i s s o ry n o t es an d gu aran ty u p o n wh i ch i t res t s i t s cl ai m s

.

B e c au s e t h e b an k h as fai l ed t o carry i t s b urd en o f es t ab l i sh i n g a co m p l et e c h a i n o f

as s i g n m en t an d tran s fer o f t h e as s et s at i s su e, t h ere ex i s t s a g en u i n e i s s u e o f m at eri al

fact as to an “ es s en t i al el em en t [] o f [t h e b an k ’ s ] cas e[, an d w ] e t h erefo re rev ers e t h e

t ri al co u rt ’ s o rd er g ran ti n g s u m m ary ju d g m en t i n fav o r o f [t h e b an k ] .” W i r t h v. Ca s h,

LLC

, 3 0 0 Ga. Ap p

. 48 8

, 4 9 1 (6 8 5 SE2 d 4 3 3 ) (2 0 0 9 ) (ci t at i o ns an d pu n ct u at i o n

o m it t ed ).

2

. Rema in i n g

a r g umen t s

.

In l i g ht o f o u r h o ld in g ab o v e, we d o n o t reach t h e ap p el l an t s ’ rem ai n i n g

arg u m en t s

.

Ju d g men t rever

s ed

. An dr ews

, P. J., co n cu r s

, a n d Ra

y, J., co ncu r

s i n t h e

j u d g men t o n l y.

9