Court Opinion

ID: 6331070
Source: CourtListenerOpinion
Date Created: 2022-04-13 19:01:40.464954+00
Date Added: 2024-06-11T09:23:08.182071
License: Public Domain

USCA11 Case: 20-13615      Date Filed: 04/07/2022   Page: 1 of 12

                                                     [PUBLISH]
                            In the
         United States Court of Appeals
                  For the Eleventh Circuit

                   ____________________

                          No. 20-13615
                   ____________________

In Re: Virginia Sue Lindstrom,
                                                         Debtor.
___________________________________________________
PINGORA LOAN SERVICING, LLC,
LOANDEPOT.COM, LLC,
                                             Plaintiffs-Appellees,
versus
CATHY L. SCARVER, Trustee,
                                           Defendant-Appellant.
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2                     Opinion of the Court               20-13615

                    ____________________

          Appeal from the United States District Court
             for the Northern District of Georgia
             D.C. Docket No. 1:19-cv-03979-MLB
                   ____________________

Before WILLIAM PRYOR, Chief Judge, GRANT, and HULL, Circuit
Judges.
GRANT, Circuit Judge:
      Georgia property law includes a remedial statute that gives
those holding defective deeds a chance to cure them. Here two
loan companies argue that they have produced what the statute
requires to save a problematic deed: an affidavit from a
“subscribing witness.”
       That term, we conclude, describes only witnesses who attest
a deed and not those who are merely involved in its
acknowledgment. Here the loan companies concede that the
attorney who produced the affidavit they rely on did not attest
the deed and only certified its acknowledgment. Without a
subscribing witness, the remedial statute is not satisfied, so we
reverse the decision below.
                                I.
      Defining “subscribing witness” requires a quick primer on a
few key terms. When it comes to property deeds, an attestation is
“the act of witnessing the actual execution of a paper and
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20-13615               Opinion of the Court                        3

subscribing one’s name as a witness to that fact.” White & Co. v.
Magarahan, 87 Ga. 217, 219 (1891), overruled on other grounds by
Leeds Bldg. Prods., Inc. v. Sears Mortg. Corp., 267 Ga. 300 (1996).
Put differently, to attest a deed means to see it signed and then add
one’s own signature as a declaration of that fact.
        The other term to know is acknowledgment, which is “the
act of a grantor in going before some competent officer and
declaring the paper to be his deed.” Id. To prove an
acknowledgment, “the certificate of the officer that it has been
made” must be added to the deed. Id. By that certification the
official testifies to the acknowledgment, but not to the execution
of the deed itself.
       With that context in mind, the facts of this case are much
easier to digest. When Virginia Lindstrom needed to put up
collateral for a $174,500 loan from LoanDepot.com, LLC, she
executed a security deed for a piece of property in Lawrenceville,
Georgia. As part of that process, her sister attested the deed,
signing that she had witnessed its execution. At some point later
that same day, Lindstrom also acknowledged the deed to her
closing attorney (a public notary), who certified the
acknowledgment on the deed’s final page.
       Although no one recognized it then, the deed was invalid on
its face. Under Georgia law, a deed must be attested by two
witnesses, and at least one of them needs to be an official such as a
notary or court clerk. O.C.G.A. §§ 44-2-15, 44-14-61. The attorney
was a notary, but he failed to attest the deed. And his certification
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4                       Opinion of the Court                  20-13615

of Lindstrom’s acknowledgment was not enough to make the deed
valid.
       There is likely an easy, if unsatisfying, explanation for this
oversight: a statutory amendment. Indeed, had the deed been
signed only a few weeks earlier, it would have been completely
valid. At that time Georgia law permitted deeds to be either
attested by or acknowledged before an official. See O.C.G.A. § 44-
14-61 (1931) (amended July 1, 2015); O.C.G.A. § 44-14-33 (1995)
(amended July 1, 2015). Lindstrom had acknowledged the deed,
but the old law no longer governed.
        The error was discovered a few years later when Lindstrom
filed for Chapter 7 bankruptcy. Under federal law a bankruptcy
trustee may void a deed if it is voidable by a bona fide purchaser.
See 11 U.S.C. § 544(a)(3). The missing attestation signature made
the deed here voidable, so when the trustee managing Lindstrom’s
estate noticed the problem, she sued LoanDepot and Pingora Loan
Servicing, LLC (who had purchased the deed from LoanDepot) to
keep the property with the bankruptcy estate.
       The loan companies retreated to a remedial statute in hopes
of salvaging the deed. Under Georgia law, a defective deed can be
cured if “a subscribing witness” signs an affidavit, before an official,
stating that the deed was validly executed and attested. O.C.G.A.
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20-13615                     Opinion of the Court                               5

§ 44-2-18. 1 The loan companies argued that the attorney who
certified the acknowledgment on the deed qualified as a
“subscribing witness” because the certification process involved
signing his name. The deed, they claimed, could be validated by
his affidavit, which testified to the execution and attestation of the
deed.
        At summary judgment, the district court held that the
remedial statute saved the deed, which meant that the trustee’s
claims failed. In so doing it reversed the bankruptcy court’s partial
grant of summary judgment to the trustee and obligated the
bankruptcy court on remand to grant summary judgment to the
loan companies on all claims. The district court concluded that “a
subscribing witness is the same as an attesting witness.” But it then
determined that the attorney qualified as an attesting witness by
relying on his signed affidavit—which showed that he had
“witnessed the execution of the deed”—and on the fact that he had
certified Lindstrom’s acknowledgment of the deed.

1   Section 44-2-18 of the Georgia Code sets out the full remedial exception:
          If a deed is neither attested by nor acknowledged before one
          of the officers named in Code Section 44-2-15, it may be
          recorded upon the affidavit of a subscribing witness, which
          affidavit shall be made before any one of the officers named in
          Code Section 44-2-15 and shall testify to the execution of the
          deed and its attestation according to law. A substantial
          compliance with the requirements of this Code section shall
          be held sufficient in the absence of all suspicion of fraud.
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6                      Opinion of the Court                 20-13615

      The trustee appeals.
                                 II.
       As the second court of review in the bankruptcy context, we
apply the same standard of review the district court applied. In re
Kim, 571 F.3d 1342, 1344 (11th Cir. 2009). We review a grant of
summary judgment de novo, viewing all evidence in the light most
favorable to the nonmoving party and resolving reasonable
inferences in that party’s favor. In re Optical Techs., Inc., 246 F.3d
1332, 1334–35 (11th Cir. 2001). Summary judgment is proper when
“the moving party is entitled to judgment as a matter of law.” Id.
(quotation omitted).
                                 III.
       No one disputes that the deed was missing the required
attestation by an official. As a result, the trustee can “avoid” the
deed unless the loan companies find a way to save it. See 11 U.S.C.
§ 544(a)(3). They rely on section 44-2-18 of the Georgia Code,
which permits them to show that the deed is valid by the “affidavit
of a subscribing witness.” That means the loan companies must,
among other things, prove that the closing attorney who produced
the affidavit was a subscribing witness to the deed.
       When we interpret state law, we do so according to the
State’s rules of statutory interpretation. See Robbins v. Garrison
Prop. & Cas. Ins. Co., 809 F.3d 583, 586 (11th Cir. 2015). Under
Georgia law, to understand who qualifies as a “subscribing
witness,” we look to the meaning of the term at the time the statute
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20-13615               Opinion of the Court                        7

was enacted. See Seals v. State, 311 Ga. 739, 740 (2021). Given that
words never operate in a linguistic vacuum, one “primary
determinant” of a term’s meaning is its context, so we also consider
“the other provisions of the same statute, the structure and history
of the whole statute, and the other law—constitutional, statutory,
and common law alike—that forms the legal background.” FDIC
v. Loudermilk, 295 Ga. 579, 588 (2014) (quotation omitted). This
holistic inquiry often leads us to an ordinary meaning, but in some
instances it suggests that the words are a term of art. O.C.G.A.
§ 1-3-1(b) (defaulting in statutory interpretation to ordinary
meaning, except for “words of art or words connected with a
particular trade or subject matter”).
        The context here reveals that “subscribing witness” is a term
of art. For centuries it has carried a particular meaning when used
in the context of legal documents like wills, mortgages, and
security deeds. The term long predates this statute. See Webb v.
United-Am. Soda Fountain Co., 59 F.2d 329, 330–31 (5th Cir. 1932)
(discussing Van Cortlandt v. Tozer, 17 Wend. 338 (N.Y. Sup. Ct.
1837)); Harris v. Cannon, 6 Ga. 382, 389 (1849); Doe ex dem.
Truluck v. Peeples, 1 Ga. 1, 2–3 (1846); Tulloch’s Ex’rs v. Nichols,
1 N.C. 4, 4 (N.C. Super. Ct. L. & Eq. 1787); Rice v. Jones, 8 Va. 89,
90 (1786); Cox v. Edwards, 14 Mass. 492, 495 (1782). And by
studying this pedigree we learn that a person who attests a legal
document is a subscribing witness. See, e.g., January Assignee v.
Goodman, 1 Dall. 208, 209 (Pa. Ct. Com. Pl. 1787) (describing a
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8                      Opinion of the Court                20-13615

document as “being attested by subscribing witnesses”); McDill’s
Lessee v. McDill, 1 Dall. 63, 63–64 (Pa. 1782).
       Law dictionaries provide a helpful starting point because
“subscribing witness” is a precise and ubiquitous legal term.
Dictionaries from around 1850, when the remedial statute was
enacted, provide a consistent definition: for a deed, a “subscribing
witness” is a person who attests to its execution by signing his name
to that fact. See, e.g., Subscribing Witness, 2 John Bouvier, A Law
Dictionary 555 (11th ed. 1862) (“One who subscribes his name to a
writing in order to be able at a future time to prove its due
execution; an attesting witness.”); Subscribing Witness, Archibald
Brown, A New Law Dictionary 345 (1874) (“He who witnesses or
attests the signature of a party to an instrument, and in testimony
thereof subscribes his own name to the document.”); Subscribing
Witness, 2 Stewart Rapalje & Robert L. Lawrence, A Dictionary of
American and English Law 1230 (1888) (“He who witnesses or
attests the signature of a party to an instrument, and in testimony
thereof subscribes his own name to the document.”); see also
Subscription, 2 Alexander M. Burrill, A New Law Dictionary and
Glossary 952 (1851) (“The writing of the name or signature under,
or at the foot of an instrument, by way of execution or
attestation.”).
      This means that attestation—signing as a witness to a deed’s
execution—is the only way a person can qualify as a “subscribing
witness.” As a result, the terms “attesting witness” and
“subscribing witness” are synonymous. See, e.g., Attestation, 1
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20-13615               Opinion of the Court                         9

John Bouvier, A Law Dictionary 103 (1st ed. 1839) (“[T]he act of
witnessing an instrument of writing, at the request of the party
making the same, and subscribing it as a witness.”); Attestation, 1
Alexander M. Burrill, A New Law Dictionary and Glossary 112
(1850) (“The testifying to, or witnessing the signature or execution
of a deed or other instrument, by the witnesses; including the
subscription of their names.”); Attesting Witness, 1 Stewart Rapalje
& Robert L. Lawrence, A Dictionary of American and English Law
96 (1888) (“One who, at the request of the parties to a written
instrument, signs his name thereto as a witness to the execution
thereof.”).
       The Supreme Court of Georgia has reached the same
conclusion for nearly two hundred years. In one of its earliest
cases, decided in 1846, that court described a deed as having been
validated in part by “the attestation of two subscribing witnesses.”
Truluck, 1 Ga. at 2–3. And in 1891, the court defined attestation as
“the act of witnessing the actual execution of a paper and
subscribing one’s name as a witness to that fact.” White & Co., 87
Ga. at 219. Four years after that, the court used the terms “attesting
witness” and “subscribing witness” interchangeably. McVicker v.
Conkle, 96 Ga. 584, 585 (1895). As one example, it explained that
“an instrument purporting to be attested by a subscribing witness”
or witnesses must be proved by their testimony unless their
absence—“the absence of all the attesting witnesses”—can be
accounted for. Id. (emphasis added).
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10                     Opinion of the Court                20-13615

       The broader remedial scheme also confirms that a
subscribing witness is a person who attests a deed. The
subscribing-witness statute is paired with another remedial statute,
which permits any “third person” to remedy a deed—but only
when every subscribing witness is unreachable. O.C.G.A. § 44-2-
19. And the third person’s affidavit must contain different
information than a subscribing witness’s affidavit: the third party
must testify “to the genuineness of the handwriting of the
subscribing witness,” instead of to the deed’s “attestation according
to law.” Compare id. § 44-2-19, with id. § 44-2-18. This variation
only makes sense if the subscribing witness’s signature plays the
same role as an attestation in proving the validity of the deed—
acting as evidence of the deed’s proper execution. Comparing
these remedial statutes therefore confirms that a subscribing
witness always attests the deed; otherwise her signature would not
be written proof that the deed was properly attested.
        The loan companies argue that certifying a deed’s
acknowledgment also transforms a person into a subscribing
witness, but attestation and acknowledgment are not equivalent.
For one thing, Georgia’s recording statute now rejects
acknowledged deeds. And for another, even though a deed and its
certification are related, the attestation of one document “cannot
be substituted for the proper attestation” of any related or
integrated document. See Wells Fargo Bank, N.A. v. Gordon, 292
Ga. 474, 476 (2013).
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20-13615                 Opinion of the Court                            11

        Indeed, the Georgia Supreme Court has long distinguished
between a signature of a subscribing witness and an official’s
certification of an acknowledgment. Shortly before the remedial
statute was first enacted, the Georgia Supreme Court dealt with a
deed that included “the attestation of two subscribing witnesses,
accompanied with the acknowledgment of the feoffor in the
presence of the magistrate.” Truluck, 1 Ga. at 2–3. The distinction
the court drew is unmistakable. Only the two individuals who had
attested the deed—and not the magistrate who had certified the
acknowledgment of the deed—qualified as subscribing witnesses.
See White & Co., 87 Ga. at 219.
      That is grim news for the loan companies. The closing
attorney never attested the deed. He certified that Lindstrom
acknowledged the deed, but that is a separate—and now defunct—
method of validating a deed. 2 The district court thus erred when it
concluded that the attorney’s certification, bolstered by content in

2 This acknowledgment creates another problem for the loan companies.    The
remedial statute only applies to deeds “neither attested by nor acknowledged
before” an officer. See O.C.G.A. § 44-2-18 (emphasis added). That exclusion
means that the companies’ acknowledged deed enters limbo—no longer good
enough to be recorded, but too good to be saved. When the Georgia assembly
cut acknowledgment from the recording statute, it failed to expand the
remedial statute to cover acknowledged deeds. See O.C.G.A. § 44-14-61.
That’s likely an oversight, for if anything an acknowledged deed is more
trustworthy, not less—the lineage of acknowledgment traces back nearly 500
years to England under Henry VIII. See Webb, 59 F.2d at 331. So it might “be
well for the general assembly to consider the wisdom of adopting another”
remedial rule for acknowledged deeds. See McVicker, 96 Ga. at 588.
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12                     Opinion of the Court                 20-13615

his affidavit, qualified him as a subscribing witness. Although
subscribing witnesses must also produce a sufficient affidavit to
satisfy the remedial statute, the only way to qualify as a subscribing
witness is to attest the deed itself. The closing attorney did not. So
he is not a subscribing witness, and the loan companies’ attempt to
save the deed fails.
                           *        *     *
       A person becomes a subscribing witness only when she
attests a deed—when she signs her name as a witness to its
execution. See White & Co., 87 Ga. at 219. Because the closing
attorney whose signature Pingora and LoanDepot rely on did not
attest the deed, they have not produced an affidavit by a
subscribing witness as required by section 44-2-18 of the Georgia
Code. As a result, the loan companies’ interest in Lindstrom’s real
property is voidable by the trustee because the security deed is
defective. We therefore REVERSE the decision of the district court
and REMAND for proceedings consistent with this opinion.