Case Name: BENSON BROTHERS COMPANY v. JOHNSON et al.
Court: Supreme Court of Georgia
Jurisdiction: Georgia
Decision Date: 1926-12-15
Citations: 163 Ga. 434
Docket Number: No. 5657
Parties: BENSON BROTHERS COMPANY v. JOHNSON et al.
Judges: All the Justices concur.
Reporter: Georgia Reports
Volume: 163
Pages: 434–439

Head Matter:
BENSON BROTHERS COMPANY v. JOHNSON et al.
No. 5657.
December 15, 1926.
Rehearing denied January 15, 1927.
B. T. Frey and J. F. Mozely, for plaintiffs.
L. M. Blair and Fred Morris, for defendants.

Opinion:
Beck, P. J.
(After stating the foregoing facts.) We are of the opinion that the court should have granted an interlocutory injunction, and have thus held the matters in controversy in statu quo until the issues made under the pleadings and evidence could be determined at a final trial. The contract under which E. H. Johnson went into possession of the land involved in this controversy is set forth in the statement of facts, certain immaterial portions being omitted. It seems to us, notwithstanding the wording of this instrument, that it should be construed as being in effect a conditional sale. It is unnecessary to set forth in this place any of the language of the instrument; it can be read in this connection as it is set forth above. Whether this instrument was a lease, or a sale upon condition that Johnson should make Fowler the payments stipulated, must be determined not merely by the reading of the language employed in framing the contract, but from a consideration of the whole instrument. Thus, though the amounts to be paid are termed "rentals," when we consider the entire instrument it appears that they were instalments of the purchase-price agreed upon by the parties. These instalments increased yearly in amount. For the year 1924 a part of the crop grown upon the place must be paid; for the year 1925 the sum of $72. The cash payment gradually increased in amount until the amount stipulated to be paid in the year 1929 was $486. And it was agreed by Fowler that when the last payment was made he would make to Johnson "a deed of gift to said premises." True, it is stipulated in words that "this agreement shall in no event be construed as a contract of sale of the land, nor shall it be construed as a bond for title," etc. This last stipulation can not avail to conceal the real nature of the instrument under consideration. A question substantially the same as that which we have before us was decided by this court in the case of Hays v. Jordan, 85 Ga. 741 (11 S. E. 833, 9 L. R. A. 373). And the full discussion of the question there renders unnecessary an elaborate discussion here. In fact a lengthy discussion was scarcely necessary there. The principle upon which we base our ruling has been frequently stated, which is, that in determining the real character of a contract courts will look to its purpose rather than to the name given it by the parties. Hervey v. Locomotive Works, 93 U. S. 664, 672 (23 L. ed. 1003). See also the numerous authorities cited in Hays v. Jordan, supra.
IJp to the time that the contract between Fowler and R. H. Johnson was made the property was Fowler's, and title was in him. But when he executed that paper and R. H. Johnson made payments in accordance ' with the terms thereof, the latter became vested with an interest in the property, and he could not transfer it to his brothers except by a bona fide sale, even by the circuitous method of surrendering the contract to Fowler and having him convey to the brothers of the defendant Johnson. If Fowler thought, and had reasonable ground to think, that Johnson could not comply fully with the contract by making all the payments, and that he might sustain loss in consequence of this failure on the part of Johnson to make future payments, or have other good reasons satisfactory to himself, he would have had the right to accept the surrender of the instrument in question and agree to transfer the title to the brothers of Johnson, if that was necessary to save him from loss. But in this case a court of equity will consider the fact that the plaintiffs offered to pay the balance due under the written contract between Johnson and Fowler if the latter would deed the property to them. No fraud is charged against Fowler; nor is it charged that he is insolvent. Even though innocent of any fraud, he can not, as against these plaintiffs, be made the means of transferring the title to this property to brothers of the defendant Johnson, who has an interest in the property. ' We think, therefore, the court should have granted the injunction. Fowler will not be hurt by this; he can be protected by the terms of the injunction. Fowler will not be injured nor suffer loss by this action of a court of equity, but Johnson will be prevented from having the title to the property passed into the hands of his nonresident brothers.
Judgment reversed.
All the Justices concur.