Court Opinion

ID: 9586733
Source: CourtListenerOpinion
Date Created: 2023-08-21 23:14:23.896762+00
Date Added: 2024-06-11T17:32:49.029940
License: Public Domain

Townsend, Judge.
Properly construed, this petition sets out an action for money had and received, which lies in every instance where another has come into possession of money to which the plaintiff is entitled in equity and good conscience, and which the defendant is not otherwise entitled to retain. Zapf Realty Co. v. Brown, 26 Ga. App. 443 (106 S. E. 748); A. D. Adair & McCarty Bros. v. Central Bank & Trust Corp., 20 Ga. App. 811 (93 S. E. 542). Even though paid out under a mistake of fact it is recoverable if the recipient by retaining it would be unjustly enriched. Atlanta Tel. & Tel. Co. v. Fain, 16 Ga. App. 475 (85 S. E. 791); Stern v. Howell, 33 Ga. App. 693 (127 S. E. 775). And even if paid out because of a negligent mistake, this will not prevent recovery if the plaintiff’s negligence violates no positive legal duty which he owes the defendant. Dobbs v. Perlman, 59 Ga. App. 770 (2 S. E. 2d 109).
The property in question was illegally sold as the property *882of the defendant Milam for the reason that there was an outstanding security deed in favor of one Morgan and hence there was no leviable interest in the land in Milam. Morgan v. Todd, 214 Ga. 497 (106 S. E. 2d 37). However, in doing so both the plaintiff in fi. fa. and the purchaser were proceeding under a mistake of law, in that they relied on certain acts of the legislature (Code, Ann., § 67-1308) as having caused title to revert to the defendant. In Todd v. Morgan, 215 Ga. 220, supra, the acts comprising this Code section were held unconstitutional in so far as they applied to the property in question. The effect of the decision was to affirm the judgment of the trial court in favor of the true owner who sought cancellation of the sheriff’s deed in favor of the plaintiff Todd, constituting an adjudication that the sale was void and that Todd received nothing thereunder. It is also an adjudication that the defendant Milam had no legal title to the property and no interest therein which could have been affected by the void sale.
The defendant contends, however, that, since the doctrine of caveat emptor applies to all judicial sales, whether the defendant in fi. fa. has defective title or no title at all, he is entitled to retain the surplus which the sheriff paid over to him, and is thus entitled to be enriched in the sum of $738.75, to which fund he has no claim other than the fact that the money was delivered to him by the sheriff before the sale was adjudicated void. While a purchaser at a void sale cannot recover from the sheriff the sums paid out by him from a sale later adjudicated to be void because of an excessive levy (Brady v. Smotherman, 51 Ga. App. 480, 180 S. E. 862), and while such funds when paid into court are considered the money of the defendant when applied to the satisfaction of executions and other liens where the sale is good but the title failed (McWhorter v. Beavers, 8 Ga. 300; Pinkston v. Harrell, 106 Ga. 102, 31 S. E. 808, 71 Am. St. R. 242), yet, as stated in the Pinkston case, the purchaser, when sued on his bid “can defend by showing either that there was no sale, or a state of facts which would, either legally or equitably, preclude the defendant in fi. fa. from claiming any benefit under the alleged sale.”
*883The distribution of the funds arising from the sale in the hands of the sheriff proceeds on equitable principles, taking account of the priorities of the various creditors. Code §§ 39-201; 24-211. Where the parties to a judicial sale conduct the same, and a bid is made, under a mistake of law, the purchaser is not bound absolutely thereby, but may plead the mistake of law as a defense against an action to enforce his first bid. See Collier v. Perkerson, 31 Ga. 117, citing as authority Culbreath v. Culbreath, 7 Ga. 64, which latter case was an action for money had and received. The defendant in fi. fa. is not entitled to the surplus resulting from a levy and sale simply by virtue of that position, but the surplus is to be paid over to the true owner thereof under equitable principles. Fulcher v. Felker, 28 Ga. 252.
This case closely resembles Holbrook v. Stewart, 55 Ga. App. 720 (191 S. E. 165) where it was held: “Before an execution can be levied legally on land given as security the lender must reconvey the land to the borrower, and have the deed of re-conveyance recorded. A sale made under a levy without such deed of reconveyance is void, and will be set aside at the instance of the borrower. The effect of cancellation of the deed to the purchaser at the sheriff’s sale, by a court of equity on this ground, is to nullify the proceedings had under the judgment from the time of the illegal levy.”
The doctrine of caveat emptor does not apply where the sale is void and the purchaser, by reason of the invalidity of the sale, on the ground of a void levy, or otherwise, acquires no title. 23 C. J. 655, § 623; 30A Am. Jur. 1009, Judicial Sales, § 181. The case of Methvin v. Bexley, 18 Ga. 551, stands for the doctrine that where an execution sale is valid, the purchaser obtains whatever the defendant in fi. fa. had, and under the doctrine of caveat emptor is bound to the contract and cannot recover the purchase money which he paid to the sheriff. The only thing complained of in that case was that the defendant in fi. fa. had no title to the property sold under the fi. fas. There was no contention that the levy or sale was otherwise invalid. The dissent by Judge Stephens, in Brady v. Smotherman, 51 Ga. App. 480, 489, supra, states the true law as to the *884facts in this case. That case decided that where a levy was excessive the purchaser could not recover from the officer making the sale after the. officer had paid the purchase money over to the plaintiff in execution. The ruling by the majority in that case is not controlling in this case because this is not a case of an excessive levy. If the doctrine of caveat emptor applies to the sale in this case the Supreme Court could not have ruled as it did in McCord v. McGinty, 99 Ga. 307 (25 S. E. 667). There the court ruled that the sale was void because a deed was not filed and recorded conveying the land to the vendee and that the one who bid off the land could not be compelled to pay the amount of his bid and to accept the sheriff’s deed to the property. The court in that case cited four older cases to the same effect. If the rule of caveat emptor applied in such a case, then the purchaser should have been held to be bound by this bid. See Corley v. Jarrell, 36 Ga. App. 225 (136 S. E. 177). Without further quoting from Judge Stephens’ dissent in the Btady case it should read in toto in connection with the decision of this case. See also, Powell on Actions for Land, Revised Edition by Powers & Mitchell, Chapter 10.
It follows that here, the defendant having no legal, moral, or equitable right to the surplus fund in question, after the judicial sale in question has been set aside and the deed canceled, the doctrine of caveat emptor will not preclude an action to recover it of him as for money had and received, brought by or on behalf of one better entitled to it than himself. The first three grounds of demurrer are without merit.
Since the right of action to' recover the fund is nominally in the sheriff who disbursed it, while the right to the fund is in Todd, the petition should properly have been brought in the name of Adams suing for the use of Todd. Ground 4 of the demurrer based on a misjoinder of parties plaintiff should have been sustained.
The conclusion in paragraph 7 that “Because of the ruling [of the Supreme Court in this case] the deed from the plaintiff Adams to the plaintiff Todd is a nullity” is a conclusion of law amply supported by the facts alleged and the decision in that case, and is accordingly not subject to attack.
*885By cross-bill of exceptions error is assigned on the sustaining of a special demurrer to a paragraph alleging that the plaintiff has recovered from the plaintiff in fi. fa. the sum of $1,210 disbursed to her by the sheriff. Since this statement is irrelevant to the cause of action sued upon, it was not error for the court to sustain the special demurrer to this paragraph of the petition.
The trial court did not err in overruling the general demurrer and certain special demurrers to the petition, but erred in overruling special demurrer numbered 4 as pointed out in division 2 hereof.

Judgment affirmed in part and reversed in part on the main bill of exceptions. Judgment affirmed on cross-bill.

Felton, C. J., Gardner, P. J., Nichols, Bell and Frankum, JJ., concur. Carlisle, J., dissents.