Court Opinion

ID: 3407018
Source: CourtListenerOpinion
Date Created: 2016-07-05 19:22:50.520905+00
Date Added: 2024-06-11T13:42:36.921126
License: Public Domain

The petition in this case is defective, (1) in that it does not allege that the defendant knew of the condition of the incompetent at the time the release was executed, and (2) in that it is not alleged that the incompetent cannot possibly restore the benefits received from the release agreement. Under the ruling in Atlanta Banking  Savings Co. v.Johnson, 179 Ga. 313 (175 S.E. 904, 95 A.L.R. 1436), in equity there must be a restoration of benefits received by the incompetent where the opposite party dealt in good faith. The opinion intimated that at law the rule might be different and cited several cases. As I read them, they declare no rule different from the equity rule. In Joiner v. Southern LandSales Corp., 158 Ga. 752 (124 S.E. 518), it does not appear that the question was raised that the incompetent received any benefits she would be required to restore before attempting a rescission. In Orr v. Equitable Mortgage Co., 107 Ga. 499
(33 S.E. 708), it does not appear that the incompetent received a cash or other present consideration for the execution of the mortgage. The same is expressly ruled in Woolley v. Gaines,144 Ga. 122 (39 S.E. 892, 88 Am. St. R. 22). In Warren v.Federal Land Bank, 157 Ga. 464 (122 S.E. 40, 33 A.L.R. 45), there were no benefits to restore. It was held in Watkins
v. Stulb, 23 Ga. App. 181 (98 S.E. 94), that, under the allegations similar to those in this case, restoration was necessary. In Strodder v. Southern Granite Co., 94 Ga. 626
(19 S.E. 1022), the petition was dismissed because it did not show continuity of incompetency and absence of ratification upon restoration to sanity. In Fields v. Union Central L. Ins.Co., 170 Ga. 239 (152 S.E. 237), the petition contained nostatement of inability to make restitution and no sufficientallegations that the defendant knew of the incompetency. See, in this connection, Cheves-Green  Co. v. Horton, 177 Ga. 525
(170 S.E. 491). The effect of the majority opinion is to hold that the contract of an incompetent person prior to an adjudication of incompetency is absolutely void. Insofar as I can find, the ruling in American Trust c. Co. v. Boone,102 Ga. 202 *Page 831 
(29 S.E. 182, 40 L.R.A. 250, 66 Am. St. R. 167), has never been authoritatively interpreted as so holding, and in nearly if not every later case it has been held that such a contract is merely voidable, and the Code, § 20-206, has been written to follow the rulings of the courts. Hamilton v. First NationalBank, 54 Ga. App. 707 (188 S.E. 840), and cases cited.
The cases followed by the majority are based on facts and reasoning not present in the instant case. In those cases the jury was authorized to find that the money was not paid in consideration of a contract of release, but in connection with an entirely different contract. If that is true, then obviously there is no need to get rid of a purported contract of release which may seem to stand in the way of the action. In this case there was admittedly a contract of release. The fact that it was entered into by an incompetent before adjudication makes no difference. It is presumed to be valid until an actual adjudication that it was not. Before a court, either of law or of equity, will determine whether or not it is invalid or valid, the person proceeding for the incompetent must allege knowledge on the part of the other party of the incompetency, so as to preclude the necessity of restitution of the benefits received, or inability on the part of the incompetent to restore the benefits of the contract, etc. Dean v. Goings, 184 Ga. 698
(192 S.E. 826); Fields v. Union Central L. Ins. Co., supra;Cheves-Green  Co. v. Horton, supra. The petition did not allege inability to restore benefits. The mere fact that the particular benefits had been spent and that the incompetent had no money would not mean complete inability to restore. If he had other assets which would make restoration possible, it would be necessary for him to make restoration. In the instant case, neither of these allegations was present, and the petition was subject to demurrer.