Bull v. Johnson , 63 Ga. App. 750 ( 1940 )

1. In a claim case the burden of proof is on the plaintiff in execution. Where the entry on the execution recites that the property levied on was not in the possession of the defendant in execution, and where the plaintiff in execution fails to show either title in the defendant or possession in the defendant since the date upon which the judgment became a lien, a verdict in favor of the plaintiff in execution is not authorized.

2. Before a creditor can levy an execution upon personalty covered by a valid bill of sale made to secure a debt the creditor must first redeem the property by paying off in full the secured debt, and a levy made without a compliance with such condition precedent is void.

3. Where the plaintiff in execution fails to show any right to proceed with the execution, the claimant, upon showing "such an interest [in the property] as would be superior to the right of the plaintiff in fi. fa. to proceed with the execution," would be entitled as against the plaintiff in execution to maintain the claim.

DECIDED NOVEMBER 29, 1940. On August 3, 1939, an execution in favor of C. E. Johnson, trading as Johnson's Garage, and against Thomas Bull, issued on a judgment rendered on December 7, 1938, was levied on an automobile truck and trailer. Mrs. Thomas Bull, the wife of the defendant in execution, filed a claim to the property. The matter was tried before the judge without a jury. The plaintiff introduced in evidence the execution together with the entry of levy thereon, which recited that the execution had been levied on the truck and trailer as the property of the defendant in execution, in possession of D. L. Stone. Thereupon the claimant moved to dismiss the levy or to direct a judgment for the claimant, finding the property not subject, on the ground that the plaintiff in fi. fa. had not made out a prima facie case, for the reason that the entry of levy showed that the property levied on was in the possession of D. L. Stone and not in the defendant in execution. The court "tentatively" overruled this motion and permitted the plaintiff in execution to introduce in evidence the record of an uncanceled retention-of-title contract of August 17, 1936, between the defendant in execution and a named motor company covering the automobile truck. He also introduced in evidence the record of a bill of sale dated Oct. 15, 1938, from the defendant in execution to D. L. Stone, conveying the legal title to the truck and the trailer to secure debt. The plaintiff in execution then testified that he had seen the defendant in execution in possession of the truck before the rendition of the plaintiff's judgment; that he "thought" the truck belonged to the defendant in execution; that he had seen the truck and the trailer in the yard of the home of the defendant in execution since the rendition of the judgment; and that he had never heard of his wife owning the truck until the levy. The plaintiff in execution also testified that prior to the levy he offered to pay to Stone the amount of the indebtedness held by him against the truck, but that Stone informed him that he had taken the truck over in settlement of the indebtedness held by him against it. The claimant again moved to dismiss the levy, or direct a judgment finding the property not subject to the levy, for the reason that a prima facie case had not been made out, in that such additional evidence introduced by the plaintiff in execution in aid of the levy showed title outstanding in third persons, to wit, in Stone and in the motor company; and also for the reason that the plaintiff in execution had not taken up the prior claims against the truck and the trailer and reconveyed the property to the defendant in execution for the purpose of levy and sale. The court overruled the motion, to which ruling the claimant excepted.

The claimant introduced evidence to the effect that the truck and trailer belonged to her; that the defendant in execution used money belonging to her in making the initial payment to the motor company under the contract by which he bought the truck; that in making the monthly payments under the contract he used money belonging to her, and that there was an agreement or understanding between the defendant in execution and his wife, the claimant, that after the payment of the purchase-money in full the truck was to be her property. It further appeared that tax returns and tax payments on the truck were made by the claimant for the years 1937 and 1938, and that the property was returned by her for taxation for the year 1939. The claimant testified that she had purchased the trailer with her money and in her name. There was evidence to the effect that she consented to the bill of sale by her husband to D. L. Stone to secure the debt of her husband, and that before the levy of the execution on the property she delivered possession of the truck to Stone in settlement of the amount due him by her husband under the bill of sale, with the understanding that Stone was to pay her $25, as the difference between the value of the truck and the amount of the debt due him by her husband.

The claimant again moved orally to dismiss the levy on the ground that it affirmatively appeared from the evidence that the plaintiff in execution had no right to proceed with the levy. The court overruled this motion and rendered judgment for the plaintiff in execution, finding the property subject to the levy. The claimant filed exceptions pendente lite in which she excepted to the overruling by the court of the oral motion to dismiss the levy made at the conclusion of the evidence introduced by the plaintiff in execution, and to the oral motion to dismiss made at the conclusion of the evidence. The claimant's motion for new trial was overruled, and she excepts, assigning error also on the exceptions pendente lite. The burden of proof is on the plaintiff in execution in claim cases. Where it appears that the property levied on was, at the time of the levy, not in possession of the defendant in fi. fa., as shown by the entry of levy on the execution, the plaintiff must carry the burden of showing either that title was in the defendant in execution or possession in him since the date on which the judgment became a lien. Singer SewingMachine Co. v. Crawford, 34 Ga. App. 719 (131 S.E. 103);Newsome Lumber Co. v. Ramsey Motor Cor., 36 Ga. App. 194 (136 S.E. 166); Thompson v. Thompson, 31 Ga. App. 340 (121 S.E. 586). In addition to the introduction in evidence of the execution and entry thereon the plaintiff introduced evidence to the effect that on August 17, 1936, the defendant in execution purchased in his own name the truck levied on. There was also evidence to the effect that the plaintiff in execution had seen the defendant in execution in possession of the truck prior to the rendition of the plaintiff's judgment; that the plaintiff "thought" the truck belonged to the defendant; and that he had seen it and the trailer in the defendant's yard since the rendition of the judgment. The bill of sale to secure debt was made by the defendant in execution to D. L. Stone, and was dated October 15, 1938. The judgment on which the execution was issued was rendered December 7, 1938, which was subsequently to the bill of sale conveying the legal title out of the defendant in execution. The judgment was a common-law judgment, and there was no lien upon the truck at the time it was conveyed to Stone. No attack is made by the plaintiff on the bill of sale to Stone, and thereby the defendant in execution became divested of whatever interest he had in the truck to secure debt. It appeared without dispute that the trailer was purchased by the wife in her own name and the title was never in the husband, the defendant in fi. fa. Therefore the undisputed evidence shows that the plaintiff in fi. fa. was not entitled to proceed with the levy of the execution. There was no compliance with the law as to a levy upon and sale of any equity of the defendant in execution in the truck. The fact that the plaintiff, prior to the levy of the execution, offered to pay to the holder of the bill of sale, Stone, "what he had against the truck," which Stone would not accept, stating that he had "taken the truck over in settlement of the indebtedness due against it," does not show any compliance with the Code, §§ 39-201, 67-1301. "In order for a creditor to levy an execution upon property covered by a valid bill of sale made to secure a debt, the creditor must first redeem the property by paying off in full the security debt, and a levy made without a compliance with such condition precedent is void." Bank of LaGrange v. Rutland,27 Ga. App. 442 (3) (108 S.E. 821), and cit. Therefore the undisputed evidence shows that the plaintiff in fi. fa. was not entitled to proceed with the levy of the execution.

However, the claim is not interposed by the holder of the bill of sale, Stone, in whom the legal title to the property levied upon was vested, and who had actual possession thereof at the time of the levy, but is made by the wife of the defendant in execution. It is a general rule that a claimant, by showing title in a third person, can not defeat the prima facie case of the plaintiff in execution made by the introduction of the execution with entry of levy showing the property levied on in possession of the defendant in execution, but he must show title in himself and not in another. Stirks v. Johnson, 99 Ga. 298 (25 S.E. 648); Thompson v.Waterman, 100 Ga. 586 (28 S.E. 286); Rucker v. Hunt,44 Ga. App. 836 (4) (163 S.E. 612). But where, as here, the plaintiff in execution fails to show any right to proceed with the execution, the claimant, upon showing "such an interest [in the property] as would be superior to the right of the plaintiff in fi. fa. to proceed with the execution" (Rowland v. Gregg, 122 Ga. 819,821, 50 S.E. 949, and cit.), would be entitled, as against the plaintiff in execution, to maintain the claim. See Wade v. Hamilton, 30 Ga. 450. It appears from the evidence that the claimant had owned the trailer, a part of the property levied on, and the evidence at least authorized the inference that the claimant had owned the equitable title to the truck. The undisputed evidence was that the claimant consented to the transfer by her husband, by bill of sale, of both the truck and trailer to D. L. Stone, which was to secure a debt of her husband, and that Stone afterwards agreed with her that he would take possession of the truck in settlement of this debt and pay to the claimant a sum of money as the difference between the value of the truck and the amount of the debt. This gave the claimant the right to a purchase-money lien on the truck and perhaps the trailer. In so far as the claimant transferred or consented to the transfer of any interest she may have had in the truck and in the trailer as security for or in payment of the debt of her husband, such transfer, as against her, being in payment of her husband's debt, was void. She had the right to contest the transfer on this ground. The claimant has a right in the property superior to that of the plaintiff in fi. fa. It follows that the judge erred in rendering judgment for the plaintiff in fi. fa., and in overruling the claimant's motion for a new trial.

Judgment reversed. Felton, J., concurs, Sutton, J.,concurs in the judgment.