GA Code § 13-4-80 (2021)
2021 Georgia Code|Title 13 - Contracts|Chapter 4 - Modification, Extinguishment, and Renewal|Article 5 - Release|§ 13-4-80. Release of Another Bound Jointly or Primarily or Acceptance of Higher Security for Same Debt

 A release may result by operation of law. When a creditor releases another who is bound jointly with or primarily to a debtor or accepts from a debtor a higher security for the same debt, not intended to be collateral thereto, a release results by operation of law.   (Orig. Code 1863, § 2803; Code 1868, § 2811; Code 1873, § 2862; Code 1882, § 2862; Civil Code 1895, § 3715; Civil Code 1910, § 4309; Code 1933, § 20-910.)   Law reviews.   - For note, "Lackey v. McDowell: The Effect of Releases on Non-Parties Under Georgia Law," see 44 Mercer L. Rev. 975 (1993).   JUDICIAL DECISIONS    Under this statute, as at common law, release of one joint debtor releases the other. Atlantic C.L.R.R. v. Ouzts, 82 Ga. App. 36, 60 S.E.2d 770 (1950) (see O.C.G.A. § 13-4-80).   Technical release and agreement not to sue distinguished.   - Technical release executed by one of several persons jointly liable as original debtors, destroys obligation as to all parties; but if effect of transaction is mere agreement or covenant not to sue, there is no discharge of others; but payment so made must be credited as against other coobligators. In re Kimbrough-Veasey Co., 292 F. 757 (N.D. Ga. 1923).    Contract of release not prevented by provision in original contract regarding method for effecting changes. Redpath Chautauguas, Inc. v. Parks, 33 Ga. App. 415, 126 S.E. 551 (1925).    Release of one jointly liable operates, prima facie, as release of others, and obligation is apparently no longer enforceable against them. Middlebrooks v. Phillips, 39 Ga. App. 263, 146 S.E. 653 (1929).    Where payee of promissory note releases one joint maker, other maker is discharged. Ward v. Fleming, 18 Ga. App. 128, 88 S.E. 899 (1916).    Release of one defendant jointly liable on judgment operates as release of other joint debtor. Powell v. Davis, 60 Ga. 70 (1878).   Right to recoup taxes forfeited.    - Superior court did not err in reversing the decision of the Georgia Department of Revenue that a corporate officer was liable for a restaurant's sales and use taxes pursuant to O.C.G.A. § 48-2-52 because the release of and refund payment to the majority owner of the restaurant operated as a release of the officer; under O.C.G.A. § 13-1-13, by voluntarily paying the owner a settlement amount with full awareness of any potential joint claim the Department had against the officer, the Department forfeited any right the Department had to recoup from the officer the payment the Department made to the owner. Ga. Dep't of Revenue v. Moore, 317 Ga. App. 31, 730 S.E.2d 671 (2012).    Covenant to indemnify one partner may be consistent with continuance of obligation of all parties. Kendrick v. J.B. O'Neil, Foster & Co., 48 Ga. 631 (1873).    Third parties cannot dispose of chose in action belonging exclusively to another without one's consent prior to disposition or one's ratification of the act thereafter. Rowland v. Lewis, 109 Ga. App. 755, 137 S.E.2d 387 (1964).   Employer's release and settlement of claims will not bar employee's right of action.    - Mere fact that employer chose to make settlement and obtained release of all claims purporting to release both employer and employee, following a motor vehicle collision, will not bar employee from the employee's own right of action. Rowland v. Lewis, 109 Ga. App. 755, 137 S.E.2d 387 (1964).   Retention of right to proceed.    - A consent agreement was not intended as a release for an assignee of a lessee where the lessee did not obtain full satisfaction from O.C.G.A. § 13-4-80 and expressly retained the right to proceed against the defendant assignee, and where the agreement expressly entitled the lessee to proceed against the assignee for the amount of the judgment unsatisfied by the lessor's contribution. Crim v. Jones, 204 Ga. App. 289, 419 S.E.2d 130 (1992).    Where a settlement agreement between a creditor and one of two guarantors of a note clearly provided that the guarantor's payments were not a full satisfaction of amounts due on the note and that the creditor retained the right to proceed against the second guarantor, the agreement could not be construed as a general release of the second guarantor O.C.G.A. § 9-13-74 or O.C.G.A. § 13-4-80. Groover v. Commercial Bancorp, 220 Ga. App. 13, 467 S.E.2d 355 (1996).   Release normally does not relate to a future or contingent claim.   - If a "release" speaks in terms of future or contingent claim, it is more accurately denominated "a covenant not to sue." Thus, a covenant not to sue is appropriately described as an agreement not to sue, given in exchange for lawful consideration. At the time such an agreement is given, there is no claim in existence to be released. It speaks of future, not of present or past. Since no liability exists, none can be released. Wade v. Watson, 527 F. Supp. 1049 (N.D. Ga. 1981), aff'd, 731 F.2d 890 (11th Cir. 1984).    Cited in Coleman v. Davies, 45 Ga. 489 (1872); Wilkinson v. Conley, 133 Ga. 518, 66 S.E. 372 (1909); Register v. Southern States Phosphate & Fertilizer Co., 157 Ga. 561, 122 S.E. 323 (1924); Kent v. Hair, 60 Ga. App. 652, 4 S.E.2d 703 (1939); Jordan v. Wiggins, 66 Ga. App. 534, 18 S.E.2d 512 (1942); Pennsylvania Threshermen & Farmers Mut. Cas. Ins. Co. v. Hill, 113 Ga. App. 283, 148 S.E.2d 83 (1966); Duncan v. Georgia Money Corp., 222 Ga. 643, 151 S.E.2d 769 (1966); Paris v. Coggin, Haddon, Stuckey & Thompson, 143 Ga. App. 829, 240 S.E.2d 201 (1977); Lester v. Groves, 162 Ga. App. 590, 291 S.E.2d 785 (1982); Graves v. Graves, 252 Ga. 27, 310 S.E.2d 901 (1984); J & S Properties, Inc. v. Sterling, 192 Ga. App. 181, 384 S.E.2d 194 (1989); Progressive Elec. Servs. v. Task Force Construction, Inc., 327 Ga. App. 608, 760 S.E.2d 621 (2014).   RESEARCH REFERENCES   Am. Jur. 2d.   - 66 Am. Jur. 2d, Release, § 1 et seq.   ALR.    - Return or tender of consideration for release or compromise as condition of action for rescission or cancelation, action upon original claim, or action for damages sustained by the fraud inducing the release or compromise, 134 A.L.R. 6.    Release of (or covenant not to sue) one tort-feasor as affecting liability of others, 148 A.L.R. 1270.    Failure to revive judgment against a number jointly, as to some of them, as making applicable the rule that a release of one is a release of all, 160 A.L.R. 678.    Compensation as alternative relief upon denial of rescission to purchaser of land, 175 A.L.R. 686.   Collision insurance: insured's release of tort-feasor before settlement by insurer as releasing insurer from liability, 38 A.L.R.2d 1095.   What constitutes reservation of right to terminate, rescind, or modify contract, as against third party beneficiary, 44 A.L.R.2d 1270.   Interest on consideration returned or tendered as condition of setting aside release or compromise, 53 A.L.R.2d 749.   Prospective buyer's release of prospective seller from liability for injuries resulting from trial use or inspection of product for sale, 93 A.L.R.3d 1296.   Refusal to pay debt as economic duress or business compulsion avoiding compromise or release, 9 A.L.R.4th 942.   Release of, or covenant not to sue, one primarily liable for tort, but expressly reserving rights against one secondarily liable, as bar to recovery against latter, 24 A.L.R.4th 547.