Dixon v. Murphy , 259 Ga. 643 ( 1989 )

Gregory, Justice,

dissenting.

I respectfully dissent from the majority opinion in S89A0231.

The evidence in this case is conflicting. Appellate courts should follow the rule that they must accept the facts as found by the fact finder, if supported by any evidence, and they should construe any conflicting evidence in the record in favor of the factfinder’s verdict. Pendley v. Pendley, 251 Ga. 30, 31 (302 SE2d 554) (1983). In this case, unfortunately, the majority has substituted itself for the fact finder. Therefore, a review of the record as the jury apparently viewed it may be useful.

This property has been through several transfers, and these transfers give a clear picture of Dixon’s understanding, or lack thereof, of the differences between legal and equitable title. Dixon first transferred the property to Chapman for Chapman’s use as collateral for a loan with which to start a restaurant. This transfer occurred before bankruptcy. Dixon and Chapman had an oral understanding that Chapman would reconvey the property back to Dixon when the restaurant failed or was no longer needed. Dixon testified at trial, during direct and cross-examination, that she believed Chapman could have conveyed the property to anyone because she owned it. It is clear from the record that Dixon understood that she had a promise, but that she did not understand this gave her an ownership interest. Equitable ownership was clearly not a familiar concept to her.⁴ Chapman then took out a loan on the property and started her business. Sometime thereafter, Dixon filed for bankruptcy. In her petition, she claimed no interest in the property. While Dixon was in the bankruptcy court, Chapman sought to fulfill her promise by offering to reconvey the property to Dixon. At that time, however, Dixon’s son needed some collateral for his new business.⁵ Therefore, Dixon asked Chapman to convey the property to Murphy, and Dixon and Murphy would assume the loan Chapman had taken out on the property. This was done with the full knowledge of Chapman’s creditor. Dixon testified that Murphy agreed he would have the use of the property until the “Chapman” loan was paid. Dixon testified during direct examination, and the jury apparently believed, that she, not her son, paid off the loan. Almost immediately after Chapman conveyed the property to Murphy, he conveyed it to Freeman, who conveyed it back to Murphy a little more than two years later.⁶ This suit arose after Dixon had paid off the loan and Murphy refused to convey the property to Dixon.⁷

Decided November 22, 1989 Reconsideration denied December 5, 1989. Brown & Romeo, H. Eugene Brown, Robert T. Romeo, for appellants.

From these facts, the majority finds “fraud” because Dixon failed to amend her bankruptcy petition to disclose her equitable interest that arose from the Chapman to Murphy deed that conveyed the legal title to Murphy. The courts have held many times that there can be no fraud absent an intent to defraud. E.g., McDaniel v. Green, 156 Ga. App. 549, 552 (275 SE2d 124) (1980).⁸ Mistake and misunderstanding of legal and equitable concepts do not give rise to an action for fraud.

The transcript supports the jury’s determination that there was no intention to defraud. The jury was charged on the Doctrine of Unclean Hands, and it still entered a verdict in her favor. Therefore, because the majority finds fraud where the jury did not, Murphy, who paid nothing for the property, now has it all. Dixon, who acquired it twice, paying close to $12,000 the second time, now has nothing. Dixon’s fight is not with her creditors, but with Murphy. The creditors, whom the majority thinks were defrauded, also now have nothing, and Murphy, who failed to keep his promise to his mother, gets it all.

This is simply a case properly tried before a jury where the necessary factual questions were resolved. This court should not so lightly substitute its opinion of the evidence for that of the jury.

I am authorized to state that Justice Bell joins in this dissent.

Emory B. Bazemore, for appellee.

4 During cross-examination, Dixon was asked:

Q. What do you interpret that to mean when they say a statement of all of your property?

A. In other words, it’s everything that’s in my name that I own, my equipment, my trucks, any material I had. . . .

Q. You stated just a few minutes ago that you owned this property. Why didn’t you list that?

A. Sir, I didn’t own this property. I had sayso over [it] is all.

5 The purpose of this transaction was much the same as for Chapman.

6 This conveyance occurred while Dixon was still in the bankruptcy court. Murphy’s counsel asked Dixon on cross-examination:

Q. Did you own the property during that period of time [while Freeman held it]?

A. Evidently if Mr. Murphy had the right to transfer it, they considered I didn’t.

Q. So you didn’t have — when Mr. Freeman held this property, you didn’t have the

right to tell Mr. Freeman anything what to do with this property —

A. No, Sir. I had nothing to do with that. That was Mr. Murphy’s transaction.

7 This dispute was brought to a head when Murphy demanded that Dixon start paying rent in order to remain in the house.

8 It is interesting to note that the cases the majority cites for the Doctrine of Unclean Hands, at p. 644, n. 2, all involve collusion and intentional misconduct between the parties. The record in this case contains no such evidence, conflicting or otherwise. The argument that the majority creates a new rule of law, one can have fraud absent intent, is supported by the absence of a cite to any authority, controlling or persuasive.