Court Opinion

ID: 5640405
Source: CourtListenerOpinion
Date Created: 2022-01-11 06:14:06.53745+00
Date Added: 2024-06-11T08:38:10.408764
License: Public Domain

Carley, Judge,
concurring specially.
I concur in the judgment of the majority reversing the trial court’s grant of summary judgment in this case solely because of what I perceive to be our Supreme Court’s adoption of a rather liberal standard of construction for due on sale clauses, as manifested by its decision in Chilivis v. Tumlin Woods Realty Assocs. 250 Ga. 179 (297 SE2d 4) (1982).
Initially, I must emphasize that the literal meaning of the words in the due on sale clause involved in the instant case would simply not be applicable to the land sales contract entered into between Norton and the Randalls. This is true because the due on sale clause here hinges upon “title” becoming “vested” in someone other than the grantor. The concept of vesting of title has always been treated esoterically and as signifying the ultimate attainment of all indicia of ownership. Thus, although most elements necessary to establish “vesting of title” are present in the land sales contract here involved, by the plain wording of the agreement, title simply did not “vest.”
At first reading, Chilivis appears to be distinguishable. In Chilivis the no further encumbrance clause referred not to vesting or even transfer of title, but to the placing of encumbrances on the *41property. As the appellees readily admit, the land sales contract at issue here would not pass judicial muster if viewed in light of the clause involved in Chilivis. However, the concept of “encumbrance” is more inclusive than the rather definitive idea of “vesting of title.”
Nevertheless, in order to ascertain what the Supreme Court is telling us in Chilivis, we must look carefully at the language of the clause in Chilivis and then to the interpretation of that clause in light of the transaction involved in Chilivis. The Chilivis clause was as follows: “Tf Grantor further encumbers the premises by any mortgages, loans or security deeds securing loans made to Grantor without notice to and prior written permission from Grantee, such will constitute an event of default. . .’ ” (Emphasis supplied.) The clause does not proscribe all further encumbrances but prohibits only encumbrances “by any mortgages, loans or security deeds.” Nevertheless, the Supreme Court held that the “Agreement for Deed” in Chilivis, while really more analogous to a bond for title, did for the purposes of the due on sale clause constitute an “encumbrance” which was prohibited by that clause. Thus, if under the “letter” of Chilivis, a document having the effect of a bond for title was equated to a mortgage, loan or security deed for the purposes of the “no further encumbrance” clause, the spirit of that decision requires that we treat the land sales contract in this case as triggering the envisioned event of title becoming vested in a person or entity other than the grantor. However, I would observe that the better practice for lenders is to draft their due on sale clauses in a more comprehensive fashion so as to encompass any event which would change the character of the ownership status of the mortgagor.