Court Opinion

ID: 5578053
Source: CourtListenerOpinion
Date Created: 2022-01-11 01:30:28.103517+00
Date Added: 2024-06-11T08:36:00.043007
License: Public Domain

Fish, C. J.
(After stating the foregoing facts.)
1. Some courts have sought to establish a distinction between a contract of a principal to indemnify his surety against damage merely and nothing more, and a contract by which a principal undertakes to indemnify his surety against any liability for the fail-, ure of the principal to do a certain act or pay a certain sum of money at a stated time; and have held that in instances of the first character damage must be shown before the surety is entitled to. recover; but in cases of the latter kind the surety upon the default of his principal has a right of action though he has not been damnified. This distinction, however, has not been recognized by. all-courts. and even whore it has been adopted the different courts *840ihaye not agreed as to the measure of damages the surety is entitled tp,.recover, in cases falling within the latter classification. In the view-we take of the case now before us, it is unnecessary to commit onrsplves as for or against the doctrine above stated. The mortgagees in the present case-adopted the statutory proceeding for the foreclosure of a chattel mortgage, which is, that: “Any person hplding a mortgage -on personal property, and wishing to foreclose the -same, shall, either in person, or by his agent, or attorney in fact or at law, go before some officer, of this State who is authorized by law to administer oaths, . . and make affidavit to the amount of principal and interest due on such mortgage, . . and when such mortgage, or sworn copy, with such affidavit annexed thereto, shall be filed in the office of the clerk of the superior court of the county wherein the mortgagor resides at the date of the foreclosure, . . it shall -be the duty of such clerk to issue an execution . . commanding the sale of the mortgaged property to satisfy the principal and interest, together with the cost of the proceedings to foreclose the said mortgage.” Civil Code (1910), §.3286. This section clearly contemplates that the affidavit shall be made as to the amount of principal and interest due to the holder of. the mortgage; and it follows that a chattel mortgage can not he foreclosed,, under the statutory proceeding, for a debt owing to' any one other than the holder of the mortgage. In the case under review there was no covenant that Jones, the mortgagor, should pay to the Nortons, the mortgagees, any of the indebtedness evidenced by the notes which Jones as principal and the Nortons as his sureties had given the bank. Jones owed such indebtedness to the bank, and there was no contingency in the mortgage upqn the happening of which he would owe it to the Nortons, except their payment of it to.the bank. The mere fact that Jones covenanted in the mortgage that all of the notes remaining unpaid should become due upon his default as to the payment of taxes, etc.,- did not, upon such default, make him indebted to the Nortons for what he owed the bank, especially as the bank was not a party to such covenant. If Jones, in order to secure the Nortons, had given them a note for the sum of the notes given to the bank, or had entered into a covenant with them to pay such sum, then a different question would be presented. Even in such a case, there is a difference of judicial opinion as to whether the mortgagees *841could recover before judgment had been rendered against them, or they had been damaged. Nor are the courts, which hold that the mortgagees in such .circumstances may recover, unanimous as to the method by which the mortgagor should be protected from the possibility of having subsequently to pay the same debt to the creditor. In the case under consideration, the Nortons tendered, and the trial judge approved, a bond given by the Nortons, the mortgagees, to Jones, the mortgagor, to indemnify Jones against any loss by reason of the notes held by the bank against Jones as principal and the Nortons‘as sureties; but our statute does not recognize or provide for such a bond. The ordinary rule stated in our code is: “If the principal executes any mortgage or gives other security to the surely or indorser to indemnify him against loss by reason of his suretyship, the surety or indorser may proceed to foreclose such mortgage, or enforce such other lien or security as soon as judgment shall be rendered against him on his contract.” Civil Code (1910), § 3555. Under this section no foreclosure can lie had ordinarily until after judgment against the mortgagee. Importers & Traders Bank v. McGhees, 88 Ga. 702 (16 S. E. 27). Our conclusion is that the Nortons did not have the right, under the statutory proceedings to foreclose chattel mortgages, to foreclose the mortgage held by them for the amount of the notes given by Jones as principal and themselves as sureties, which notes the bank held.
The mortgagees, however, did have the right to foreclose the mortgage, under the statutory proceedings, upon the default of the mortgagor to pay taxes due on the mortgaged property, or failure to discharge the judgments rendered against him, or for the indebtedness represented by so many of the series of $50 notes given by the mortgagor to 'the mortgagees and remaining unpaid at the time of such default, and which were given by the mortgagor to the mortgagees in consideration of their suretyship on the notes given by the mortgagor to the bank. This series of notes represented an indebtedness of the mortgagor to the mortgagees, the payment of which was secured by the mortgage; and their maturity was accelerated, in accordance with the covenant in the mortgage, upon the default of the mortgagor as above stated. The facts, that no levy had been made to collect the unpaid taxes, and that the same were paid prior to the trial, and that the judgments *842against the mortgagor were obtained subsequently to the ■ record of the mortgage, and that no execution had been issued for the city license, were not valid reasons why the mortgage should not he. foreclosed for the indebtedness due to the mortgagees under the mortgage and the covenant contained therein. There is no merit in any of the other assignments of error, nor do they require special consideration.
2. The mortgagor offered an amendment to his affidavit of illegality, which was disallowed by the court. Error is assigned upon this ruling, in the bill of exceptions. However, the proferred amendment is not set out therein, nor attached thereto as an exhibit, but is sought to be brought up only as a part of the record. As has been frequently decided, such assignment of error presents no question for review. Williford v. Denby, 127 Ga. 786 (56 S. E. 1010).
It follows from what has been said, that the judgment, in so far as it authorized the defendants in error to proceed to collect, in the foreclosure proceedings, the sum of $2300, the indebtedness represented by the notes given to the bank with interest thereon, must be Beoersed.

Beck, J., absent. The other Justices concur.