Tennessee, Alabama & Georgia Railway Co. v. Zugar

1. "Damages are given as compensation for the injury done, and generally this is the measure where the injury is of a character capable of being estimated in money." Code, § 105-2001. However, "In every tort there may be aggravating circumstances, either in the act or the intention, and in that event the jury may give additional damages, either to deter the wrong-doer from repeating the trespass or as compensation for the wounded feelings of the plaintiff." Code, § 105-2002.

2. With respect to damages for a trespass by cutting and carrying away timber, the measure of damages has been definitely fixed by the Code, § 105-2013, which specifically defines the measure to be applied in such a case, both where the trespass is wilful and where it is innocently made, as follows: "Where plaintiff recovers for timber cut and carried away, the measure of damages is: (1) Where defendant is a wilful trespasser, the full value of the property at the time and place of demand or suit, without deduction for his labor or expense. (2) Where defendant is an unintentional or innocent trespasser, or innocent purchaser from such trespasser, the value at the time of conversion, less the value he or his vendor added to the property. (3) Where defendant is a purchaser without notice from a wilful trespasser, the value at the time of such purchase." See Parker v. Waycross Florida R. Co., 81 Ga. 387, 395 (8 S.E. 871); Milltown Lumber Co. v. Carter, 5 Ga. App. 344 (63 S.E. 270); Wooden-Ware Co. v. U.S., 106 U.S. 432 (1 Sup. Ct. 398, 27 L. ed. 230).

3. In such a case, a wilful trespasser can be defined in general terms as one who knows that he is wrong, while an innocent trespasser is one who believes that he is right. 45 Words Phrases, 341, and cit. The question as to whether the trespass was wilfully or innocently done is generally for the jury to determine, except in those cases where the trespasser acts with such entire want of care and reckless indifference as would clearly amount to a disregard of the rights of the other party. Yahoola River Hydraulic Hose Mining Co. v. Irby, 40 Ga. 479 (2); Georgia Railroad Banking Co. v. Gardner, 115 Ga. 954 (42 S.E. 250); s. c. 118 Ga. 723, 724 (45 S.E. 600); Southern Railway Co. v. O'Bryan, 119 Ga. 147, 149 (45 S.E. 1000), and cit.; Investment Securities Corporation v. Cole, 186 Ga. 809, 810 (199 S.E. 126), and cit.; Strickland v. Miller, 12 Ga. App. 671 (78 S.E. 48); Ingram v. Smith, 62 Ga. App. 335 (7 S.E.2d 922, 923); 45 Words Phrases, 331 et seq.

4. Applying the foregoing rules to the facts of the instant case, it can not be said as a matter of law that the trespass on the premises by the persons in possession under a sheriff's deed was wilful and made in bad faith, even though it appears that at the time the timber was cut the plaintiff had brought the equitable proceeding described in the statement of facts against the transferees, in possession, from the purchaser at the sheriff's sale.

5. Especially would this be true, where it appears that, after the grant of a temporary restraining order in that proceeding, the judge on a motion by the defendants, alleging that they were "in possession of said real estate in good faith, under a claim of right," had dissolved this order; and where no further order was taken until the trial, which also resulted in a decision in their favor until its reversal by this court; and where all the cutting of the timber involved in the present suit for damages against the vendee was done by the vendors in the interval between the dissolution of the temporary restraining order and the decision of this court. See, in this connection, Georgia Loan Trust Co. v. Johnston, 116 Ga. 628 (43 S.E. 27); Short v. Spragins, 104 Ga. 628 (30 S.E. 810); Spires v. Spires, 30 Ga. App. 228 (117 S.E. 255); Roberts v. Willys-Overland Inc., 27 Ga. App. 304, 306 (108 S.E. 138); McElreath v. Gross, 23 Ga. App. 287, 289 (98 S.E. 190).

No. 13921. JANUARY 14, 1942. REHEARING DENIED FEBRUARY 12, 1942. In 1934 the sheriff of Walker County levied on certain land as the property of Max Zugar and wife, Sara Zugar, to satisfy fi. fas. for state and county taxes. The property was sold by the sheriff at public outcry, and was bid in by the tax-collector, who afterward directed that the sheriff's deed be made to T. M. Quillian; and the deed was executed in accordance with this direction. Subsequently Quillian conveyed the property to T. P. Scarbrough, whose heirs after his death entered upon the property and began to cut timber therefrom. In 1937 Max Zugar and Sara Zugar filed in the superior court a petition against the Scarbrough heirs in possession, and others, to enjoin the cutting of this timber; alleging that the tax sale was invalid because of excessive levy, and that the period of redemption had not expired because the purchase-money had not been paid to the sheriff. After the grant of a temporary restraining order, the judge dissolved the order, on motion of the defendants alleging that they were "in possession of said real estate in good faith, under a claim of right." At the trial the judge directed a verdict for the defendants, and this court reversed the judgment, holding that the sale had not been completed and the period of redemption had not expired, because the purchase-money had been paid to the tax-collector instead of to the sheriff. Zugar v. Scarbrough,186 Ga. 310 (197 S.E. 854).

Within the interval between the dissolution of the temporary restraining order and this decision, the defendants cut certain timber from the property, manufactured it into cross-ties, and sold them to the Tennessee, Alabama Georgia Railway Company. After the decision by this court, Max Zugar brought the instant suit against the company for the value of the cross-ties which had been manufactured from timber cut on the property. The company in its answer insisted that it was an innocent purchaser of the cross-ties; and insisted that Scarbrough and his associates, who cut the cross-ties from plaintiff's land, were innocent trespassers, for the reason that they had entered upon the land and cut the timber therefrom in good faith, believing that they had a good and valid title, this belief being fortified and sustained by the judgment of the superior court dissolving the restraining order, and by the verdict and judgment finding in their favor, in the injunction suit.

On the trial of the present action for the value of the cross-ties, the plaintiff insisted that he was entitled to recover from the defendant vendee the full value of the cross-ties at the time and place of delivery to the defendant, without any deduction on account of the enhancement in value by the labor of Scarbrough and his associates in manufacturing the timber into cross-ties. The defendant insisted that, since Scarbrough and associates were innocent trespassers, it was liable only for the value of the timber at the time it was severed from the realty. The judge, in submitting the issues to the jury, charged the provisions of the Code, § 105-2013, with respect to the measure of damages, and left it to the jury to determine whether, from all of the facts, the trespass was wilful or innocent. The jury, by the amount of the verdict, indicated that in their opinion the trespass was innocent, and that the correct measure of damages was the value of the cross-ties at the time of the conversion, less the value added thereto by Scarbrough and his associates, who sold the cross-ties to the defendant.

After the refusal of a new trial to the plaintiff, he carried the case to the Court of Appeals. The case was submitted to that court on a statement by counsel for both sides that the sole question to be determined was whether the evidence demanded a finding that Scarbrough and his associates were wilful trespassers; counsel for the plaintiff insisting that the filing of the previous equity suit attacking the sheriff's deed constituted Scarbrough and associates wilful trespassers; and that on account of the pendency of this suit, they could not have been innocent trespassers, notwithstanding the fact that they believed in good faith that they had a valid title to the property, and that the injunction had been dissolved and a verdict and judgment had been entered in their behalf.

The court of Appeals by its majority opinion, one Judge dissenting, held that, because the suit was pending at the time of the cutting and removal of the timber from the property, the trespass was wilful; that the plaintiff was entitled to recover the full value of the cross-ties, without deduction on account of the added value brought about by the labor of the trespassers; and that such a verdict was demanded. 65 Ga. App. 658 (16 S.E.2d 149).

The case is before this court after the grant of a writ of certiorari. The rulings by this court in Richards v.Edwardy, 138 Ga. 690 (4), 703 (76 S.E. 64), and Walton v.Sikes, 165 Ga. 422, 427 (141 S.E. 188), are not in conflict with the principles announced in the cases cited in division 3 of the syllabus, or with the principles herein announced. The two cases mentioned do not deal with the respective measures of damages against wilful and innocent trespassers. They deal with the right of defendants in ejectment to set off the value of permanent improvements. The Code, § 33-107, provides: "Bona fideholder may set off the value of permanent improvement; verdict. — In all actions for the recovery of land, the defendant who has bona fide possession of such land under adverse claim of title may set off the value of all permanent improvements bona fide placed thereon by himself or other bona fide claimants under whom he claims; and in case the legal title to the land is found to be in the plaintiff, if the value of such improvements at the time of the trial exceeds the mesne profits, the jury may render a verdict in favor of the plaintiff for the land and in favor of the defendant for the amount of the excess of the value of the improvements over the mesne profits. (Acts 1897, p. 79.)" This statute, while in conformity with what had become recognized equitable principles (Dudley v. Johnson, 102 Ga. 1, 29 S.E. 50; Harper v. Durden, 177 Ga. 216, 170 S.E. 45;Graham v. Lanier, 179 Ga. 744, 746, 177 S.E. 574), is nevertheless contrary to the early common-law rule (18 Am. Jur. 124, § 159); and by the terms of the statute, the right to an equitable set-off was greatly enlarged and extended. Mills v.Geer, 111 Ga. 275 (36 S.E. 673, 52 L.R.A. 934). Accordingly, the use in the statute of the words "permanent improvements bona fide placed thereon" must be given its strict rather than a liberal and general interpretation. In theRichards case it was held that "In order to entitle the defendant in an ejectment suit, claiming to be a bona fide holder, to the provisions in his favor contained in the Code section just quoted, he must show that he is not only a bona fide holder, but that the improvements upon the property have been ``bona fide placed thereon;'" and that since at the time the improvements were made the defendant had already received "full notice of the defects in his title and complete notice of the rights of this plaintiff" by the filing of the ejectment suit, he could not be heard to say that the improvements had been "bona fide placed" on the premises. The words "bona fide" as used in the sense of bona fide holder, or bona fide purchaser, carry as their technical, primary connotation the absence of notice or knowledge of an outstanding adverse claim. 5 Words Phrases, 628, 631, 636, and cit. In those cases where the words "bona fide holder" and improvements "bona fide placed" are thus used in their primary, technical, and limited sense, one can not be a bona fide holder of land unless he be ignorant of the definite adverse claim of another; and this is true, however reasonable his own claim of title may be, and however honestly it may be asserted in the erection of the improvements. Since the statute formulating and enlarging the right to set off permanent improvements must be taken as using the words "bona fide placed thereon" in their primary technical sense, clear and definite notice of an adverse claim, as by a suit in ejectment (as distinguished from imperfect notice, as in Moate v. Rives, 146 Ga. 425 (3), 429, 91 S.E. 420), will nullify the right of the holder to claim that the improvements were bona fide erected. In the Richards case the court appears to have had in mind the technical distinction we have outlined, since it was careful not to entrench upon the well-settled general principle as to what constitutes bona fide possession, by pointing out that "not only" must the possession be bona fide, but the improvements must be "bona fide placed thereon." That mere notice or knowledge of an adverse claim does not destroy the bona fide character of a reasonable and honest claim by one in possession is unquestionable. In Lee v.Ogden, 83 Ga. 325, 329 (10 S.E. 349), this court said: "When the doctrine of prescription is involved in a suit in ejectment, good faith is one of the main elements in the case; and as we have uniformly held, mere notice of an outstanding title is not evidence of bad faith. Good faith is not inconsistent with such notice." See also Latham v. Fowler, 192 Ga. 686, 692 (16 S.E.2d 591), and cit. If, then, it be true that notice of an adverse claim is not inconsistent with the good faith of a holder of land, it would seem, a fortiori, that one holding in good faith would not be guilty of a wilfultrespass in exercising the rights of ownership. A wilful trespass has been characterized as a wanton trespass and as one made in bad faith. Georgia Railroad Banking Co. v. Gardner,115 Ga. 954 (42 S.E. 250); Southern Ry. Co. v. O'Bryan,119 Ga. 147 (45 S.E. 1000); Investment SecuritiesCorporation v. Cole, 186 Ga. 809, 810 (199 S.E. 126), and cit.; 45 Words and Phrases, 331, and cit. This could not be true if the premises were honestly claimed in good faith.

In the very able opinion of the Court of Appeals, now under review, certain decisions of foreign jurisdictions are cited and quoted from, which seem to fully sustain the majority view. These cases appear to hold, in effect, that after notice of a doubtful but valid adverse claim has been had by the holder in possession, his possession can no longer be accounted as bona fide, however reasonable his own assertion of title might be, and however honestly asserted; that in order to be in good faith one must also be right; that acts thus committed under an error of judgment, however reasonably, honestly, and innocently done, amount always to a wilful trespass committed in bad faith. If this be the correct rule, what, it might be inquired, can the statute mean when it speaks of an "innocent trespasser"? Code, § 105-2013 (2). To be a trespasser, one must be in the wrong; and if being wrong, however innocently, means bad faith and a wilful disregard of the rights of another, it does not seem that § 105-2013 could serve any purpose at all in prescribing different measures of damages as between wilful and innocent trespassers. The application of legal maxims, such as that every one is presumed to know the law, can easily be overextended. While it is true enough that a trespasser who has innocently misjudged the strength of his own title can not exculpate himself from the penalty of the actual damages merely because he thought he was right when he was in fact wrong, the maxim does not say or suggest that if one misjudges the law he necessarily does so wilfully and in bad faith, and should be mulcted in punitive damages as for wilful misconduct.

Judgment reversed. All the Justices concur.