Case Name: ALROPA CORPORATION v. POMERANCE
Court: Supreme Court of Georgia
Jurisdiction: Georgia
Decision Date: 1940-03-25
Citations: 190 Ga. 1
Docket Number: No. 13050
Parties: ALROPA CORPORATION v. POMERANCE.
Judges: All the Justices concur, except Bell and Grice, JJ., who concur in the result, but dissent from the ruling in division % of the decision.
Reporter: Georgia Reports
Volume: 190
Pages: 1–17

Head Matter:
ALROPA CORPORATION v. POMERANCE.
No. 13050.
March 25, 1940.
J ones, J ones & Sparks and Gumming, Harper & Nixon, for plaintiff.
Hammond, Kennedy & Tow, for defendant.

Opinion:
Atkinson, Presiding Justice.
The rulings announced in head-notes 1, 3, 4, 5, 6, and 7 do not require elaboration.
There is no question about Alropa being a successor in title to the notes and mortgage executed by Warde to Mack, or that the notes and security were outstanding at the time of the deed from Warde to Pomerance. That deed contained the blause: "This deed is made subject to a first mortgage in the sum of three thousand ($3000) dollars, from Paul C. Warde and wife, to Chas. D. Mack, which as part of the consideration for this conveyance grantee assumes and agrées to pay." A question arises, did the foregoing clause in the deed duly signed by the grantor, but not by the grantee, amount to assumption or agreement to pay the debt of Warde to Mack? Mack'was not a party to that transaction, and consequently Pomerance did not purport to agree with him to assume the debt of Warde. Whether Pomerance promised Warde, as a part of the consideration of the deed to him, to pay the debt of Warde to Mack depends on the provisions of the deed, and application of the law. It is declared in-the Code, § 29-102: "When a grantee accepts a deed and enters thereunder, he will be bound by the covenants contained therein, although the deed has not been signed by him." This language first appeared in the Code of 1895, § 3600. That Code was adopted by the legislature, and in virtue thereof its provisions became binding as a statute. Central of Georgia Railway Co. v. State, 104 Ga. 831 (2) (31 S. E. 531, 42 L. R. A. 518); Elder v. Home Building & Loan Asso., 188 Ga. 113 (3 S. E. 2d, 75, 122 A. L. R. 738). A marginal reference to § 3600 embodied a principle involved in Georgia Southern Railroad v. Reeves, 64 Ga. 492, showing that it was founded on that principle. The facts of the case referred to were that Eeeves executed to the Selma, Eome and Dalton Eailroad Company a deed conveying a right of way through his land, for location of the company's railroad. The company was to build the road and pay Eeeves $25 in money. -It was provided in the deed that "a depot and station" should be permanently located on the land, to be used by Beeves and his assigns and the general public. Under that conveyance the company proceeded "to enter upon, locate, grade, and construct" the railroad, but failed to establish the station and build the depot. By proper conveyance the Georgia Southern Bailroad Company succeeded to all the rights, privileges, franchises, and property of the Selma, Borne and Dalton Bailroad Company; and the successor company having also failed to establish the station and build the depot, Beeves brought his action against that company. It was held by this court: "Where the grantor, in consideration of $25, and of the building of the railroad, conveyed to a company, its successors or assigns forever, in fee simple, the right of way through his land, and added in the deed the following words: 'It is hereby agreed and understood a depot and station is to be located and given to said Osborne Beeves, on the land or strip above conveyed, to be permanently located for the benefit of said Osborne Beeves and his assigns, and to be used for the general purposes of the railroad company,' the grantee, by accepting such deed, entered into a covenant to comply with its terms, and this covenant ran with the land and became obligatory upon any second company which became the purchaser, under proper legal direction, of all the rights, privileges, franchises, and property of the former."
It will be perceived that while the facts showed acceptance of! the deed by the grantee, and entry of possession of the land by the grantee by constructing and maintaining the railroad on the right of way so granted, the language of the decision by this court went so far as to say "the grantee, by accepting such deed, entered into a covenant to comply with its terms," omitting express reference to the additional matter of entry of possession thereunder. When the legislature went to deal with the matter as in the Code, § 29-102, it could have stopped with the language "when a grantee accepts a deed" he will be bound, etc., as the decision of this courtJ declared in effect; but the legislature did not stop there. It added, "and enters thereunder," etc., thus declaring the whole principle that the facts of the case involved. The purport of the statute was | to put in the mouth of the grantee, by implication, a promise not expressed nor signed by him, but with the qualification that he "enters thereunder." These qualifying words can not be written out of the statute, but must be given effect. If they could be writ ten out of the statute, the preceding words which they qualify "when a grantee accepts a deed," could just as well be written out. If either were excluded, it would obviously defeat the legislative design. The qualifying words refer to entry of actual possession of the land, as was the fact in the Beeves case that called forth the enactment. On proper construction of the Code, § 29-102, applied to the instant ease, there was no binding covenant in the deed from Warde to Pomerance that the grantee should pay the debt of Warde to Mack. This accords with the rulings in Union City Realty & Trust Co. v. Wright, 138 Ga. 703 (76 S. E. 35); Williams Co. v. American Tie & Timber Co., 139 Ga. 87 (76 S. E. 675); Louisville & Nashville Railroad Co. v. Nelson, 145 Ga. 594, 598 (89 S. E. 693); Anderson v. Higginbotham, 174 Ga. 565 (163 S. E. 477); Smith v. Kingsley, 178 Ga. 681 (173 S. E. 702); Wiggins v. First Mutual Building & Loan Asso., 179 Ga. 618 (176 S. E. 636); Federal Land Bank of Columbia v. Paschall, 180 Ga. 224 (178 S. E. 659); Interstate Investment Co. v. McCullough, 188 Ga. 206 (3 S. E. 2d, 733); Austell Bank v. National Bondholders Cor., 188 Ga. 757 (4) (4 S. E. 2d, 913), in which assumption of a debt by a grantee owed by a grantor to a third person, in virtue of a covenant expressed in a deed to the grantee, depended on both' his acceptance of the deed and his possession of the property thereunder. If it is opposed to the ruling in National Mortgage Cor. v. Bullard, 178 Ga. 451 (173 S. E. 401), and First National Bank of Quitman v. Rountree, 173 Ga. 117 (159 S. E. 658), both decided on demurrer, or to Ottauquechee Savings Bank v. Elliott, 172 Ga. 656 (158 S. E. 316), the attention of the court was not called in those cases to § 29-102, supra, and that section was not construed or otherwise mentioned by the decisions rendered in those cases. Neither of those decisions is a binding precedent for construing or applying that provision of the Code; and consequently the rulings that it was erroneous to sustain the demurrers and dismiss the petitions do not require a ruling in the instant case that the clause of the deed in question amounted to a promise by Pomerance to pay the debt of Warde.
Judgment reversed.
All the Justices concur, except Bell and Grice, JJ., who concur in the result, but dissent from the ruling in division % of the decision.