Wachovia Mortgage Co. v. Moore ( 1976 )

Stolz, Judge.

The trial judge’s discretion when exercised in confirmation of judicial sales must be "sound legal discretion.” Hall v. Taylor, 133 Ga. 606 (66 SE 478); Wingfield v. Bennett, 36 Ga. App. 27 (134 SE 840). The denial of confirmation — on the ground that the sale to the mortgagee failed to bring the true market value of the land as required by Code Ann. § 67-1504 (Ga. L. 1935, p. 381) — was an abuse of discretion in this case.

"As a general rule the price brought at a public sale, after proper and lawful advertisement, is prima facie the market value of the property sold, absent anything to indicate that there was chilling of the bidding, fraud, or the like adversely affecting the sale.” Thompson v. Maslia, 127 Ga. App. 758, 764 (195 SE2d 238) and cit. There is no indication of any factors adversely affecting the present sale, for a price of $70,000. The defendant mortgagor testified that he paid $5,000 per acre for the 22.6-acre tract ($113,000) in 1972. The security deed securing an indebtedness of $220,000 did not establish as a matter of law a prima facie case for a value in excess of the purchase price, since the record shows that the $220,000 was a development and acquisition loan, the acquisition portion being $113,000. Nor was the lot release provision in the security deed evidence of value, inasmuch as it contemplates a developed piece of property, whereas the evidence is that the property was undeveloped at the time of the foreclosure sale and there was no evidence as to how many lots the defendant even contemplated developing.

"We judicially know that values do fluctuate, sometimes up and sometimes down.” Thompson v. Maslia, supra, p. 764. The trial judge expressly recognized the fact that real estate values have dropped drastically within the last few years, including the two years between the loan and the foreclosure sale, yet found that the subject property had a true market value exceeding $133,560, or over $20,000 higher than the purchase price! The plaintiff mortgagee’s expert witness testified that the property had a true market value as of the March 4, 1975 foreclosure sale of only $63,000. The defendant mortgagor was allowed to testify, over objection, that in his opinion the land was worth $7,500 an acre, or $169,500. Upon questioning as to why he had not sold the land for this price and avoided a default, however, he admitted that it was because he "didn’t have a buyer.” "The market value is the price which it will bring when it is offered for sale by one who desires, but is not obliged, to sell it, and is bought by one who wishes to buy, but is not under a necessity to do so.” Central Ga. Power Co. v. Stone, 139 Ga. 416, 419 (5) (77 SE 565). Where the defendant admitted that no one would buy the property at $7,500 an acre, this unsubstantiated, self-serving figure could not represent the "true market value.”

Furthermore, even if it be considered that there was some evidence of inadequacy of price, "[inadequacy of price paid upon the sale of property under power will not of itself and standing alone be sufficient reason for setting aside the sale. It is only when the price realized is grossly inadequate and the sale is accompanied by either fraud, mistake, misapprehension, surprise or other circumstances which might authorize a finding that such circumstances contributed to bringing about the inadequacy of price that such a sale may be set aside by a court of equity.” Giordano v. Stubbs, 228 Ga. 75, 79 (3) (184 SE2d 165) and cits. There was little if any basis for a finding of inadequacy of price; much less for gross inadequacy, and no evidence of such circumstances as are mentioned in Giordano, supra.

Accordingly, the order denying the confirmation of the foreclosure sale is reversed.

Judgment reversed.

Quillian, Clark, Webb and Marshall, JJ., concur. Bell, C. J., Deen, P. J., and Evans, J., dissent. Pannell, P. J., not participating. Argued September 29, 1975 Decided February 18, 1976 Rehearing denied March 12, 1976. Smith, Cohen, Ringel, Kohler & Martin, John A. Howard, for appellant. Albert A. Roberts, Robert P. Midtlyng, for appellees.