Chason v. O'Neal

Hines, J.

(After stating the foregoing facts.)

Did the plaintiffs acquire title to these lands, subject to the prior security deed of the Empire Loan & Trust Company, under the sale made in pursuance of the power of sale contained in the junior security deed in favor of Chason? After having made the first security deed, Coachman could convey his equitable estate in these' lands, either absolutely or to secure debt. Owens v. Keeney, 146 Ga. 257 (91 S. E. 65). The sale of the lands under the power in the junior security deed, and the execution of the deed in pursuance of such sale to the purchasers, vested in them a good and valid title to these lands, subject to the senior security deed. Williams v. Foy Mfg. Co., 111 Ga. 856 (36 S. E. 927); Beckcom v. Small, 152 Ga. 149 (108 S. E. 542); Cook v. Georgia F. & O. Co., 154 Ga. 41 (113 S. E. 145).

While the purchasers at the sale of these lands, under the power of sale contained in the junior security deed, and under the deed executed in pursuance of such sale, acquired a title to these lands on May 22, 1923, did they obtain title to the crops then growing on these lands? Prior to the act of August 21, 1922 (Acts 1922, p. 114), which declares all crops, matured or unmatured, to be personalty, such purchasers would have acquired title to such crops, if they were grown and owned by the grantor in the security deed. A sale made under such power would have the same force and effect as if made by the vendor in such deed; and crops, whether mature or immature, prior to. said act, were parts of the realty and passed by a sale of the land, in the absence of eontractual reservation of the crops. Newton County v. Boyd, 148 Ga. 761 (98 S. E. 347); Griffin v. Leggett, 153 Ga. 663, 664 (112 S. E. 899). But if the grantor had, prior to such sale, rented these lands in good faith to others who had grown such crops, the purchasers at such sales would not acquire title thereto. In Blitch v. Lee, 115 Ga. 112 (41 S. E. 275), this court ruled that “A purbhaser at an execution sale of land which has been rented by the defendant in execution, though the contract of rental was made subsequently to the date of the judgment upon which the execution was founded, acquires the title of the owner in the land, but only the interest of such owner in the growing crop thereon. And where the owner under the contract of rent has only the right to collect a stated sum as rent for the year, the purchaser has a right to collect this amount from the tenant, but has no further claim against him and no other interest in the crops of the year than may be necessary to secure the payment of the amount due by the tenant as rent under the contract with the owner.” In Garrison v. Parker, 117 Ga. 537 (43 S. E. 849), this court made the same ruling in a case where the sale was under an execution which issued upon a judgment rendered upon a debt secured by a deed to lands, the judgment in that case being rendered subsequently to the date of the contract of rental between the grantor in the security deed and the tenant. This being so, under the law as it existed prior to the above-cited act, the purchasers in this case at the sale, made in pursuance of the power of sale in the junior security deed, would have acquired the title of the owner to these lands, subject to the senior security deed, but only the interest of the owner in the crops growing thereon, and against the tenant, if there were in fact a tenancy, the right to collect the rent for the’ year in which the sale took place.

The purchaser of the land therein embraced at a sale had under a power of sale created by such deed would have acquired the crops then grown on the land, if they were made and owned by the vendor, and would likewise have acquired the interest of the owner in these crops when they were grown and owned by the tenant of the vendor. This principle was based upon the theory that crops, especially when unmatured, were parts of the realty and passed with the sale thereof. Should the above-cited act be so construed as to deprive the vendee in a security deed of older date than the act of these important rights and security ? Paragraph 2 of section 3 of article 1 of the constitution of this State declares: “No . . ex post facto law, retroactive law, or law impairing the obligation of contracts” shall be passed. Civil Code (1910), § 6389. “Laws prescribe only for the future; they can not impair the obligation of contracts, nor generally have a retrospective operation.” Civil Code (1910), § 6. It is a well-recognized canon of statutory construction, that if the statute is susceptible of two constructions, one which renders it constitutional and another which would render it unconstitutional, the former will be preferred, since the intent to pass an unconstitutional act will not be ascribed to the legislature. In order to avoid collision with the above constitutional provision, we hold that the above-cited act should be construed not to be applicable in determining the rights of the vendee in a security deed which had been executed prior to the date of that act. The rights of the vendee were fixed and determined by the law in force at the date of the execution of the security deed. This being so, the purchaser, under the power of sale embraced in such deed, acquired title to .the crops then growing upon the land therein embraced, if they were made and owned by the vendor in the security deed. If the crops which were growing on the land at the date of such sale were made in fact by a tenant of the vendor in such deed, then such purchaser would not acquire a title to' such crops, but only such interest as the landlord had therein for the payment of the rental of the land for the year in which the crops were' grown.

Counsel for the intervenor rely upon Blitch v. Lee and Garrison v. Parker, supra; and assert, that, as under the alleged arrangement as to rent between the grantor in the security deed and his wife and children, the latter were to pay no rent, these purchasers are not entitled to recover any rent' out of the crops grown on the place for that year. We do not think this contention is sound in law and morals. The grantor in the security deed does not become the tenant of the grantee or of his vendee by the mere making of such deed. Ray v. Boyd, 96 Ga. 808 (22 S. E. 916). Neither would the tenant of the grantor in such a deed become a tenant of the grantee before the latter had acquired an absolute title to the lands embraced in such deed. The tenant of the grantee in the security deed, however, rented the premises embraced in sucb deed subjéct to such deed, and to the right of the grantee to terminate the lease by sale of such premises under judgment obtained on the secured debt, or by the sale of the premises under a power of sale contained in such deed. Garrison v. Parker, supra. When the lease of the tenant is thus terminated.! by a sale in either of the above ways, the right of the tenant roí the premises ceases; and the purchaser at such sale can eject both the grantor in the sechrity deed and his tenant therefrom. If, after such sale, the grantor and the tenant remain in possession of the premises, an obligation on the part of the grantor in the security deed and his tenant to pay rent will be implied. Civil Code (1910), § 3692. The grantee in such deed thus becomes the landlord, and the grantor, or the latter’s tenant, the tenant of the purchasers; and the law gives to such landlord a special lien on the crop growing on the land for the rent during the year in which they were grown. Civil Code (1910), § 3340. In Ray v. Boyd, supra, the vendee in the security deed had not acquired title by sale under such deed. Such lien exists and is effective irrespective of the levy of a distress warrant. Cochran v. Waits, 127 Ga. 93 (56 S. E. 241). If the tenant of the grantor in the security deed remains in possession of the premises after the grantee has acquired the' absolute title thereto by sale thereof, he will not be in any better position than the grantor would be in; and if he continues to cultivate and grow crops upon such land, these crops will be subject to the lien of the purchasers of the premises for the rent thereof. Under such circumstances, the purchasers of these lands would be entitled, as between them and such tenant, to collect, from the crops grown thereon, such an amount as may appear to be fair and reasonable under the circumstances for the rent of the premises for the year. Rome R. Co. v. Chattanooga R. Co., 94 Ga. 422 (21 S. E. 69). Such purchasers would not be bound by a contract between the grantpr and his tenants by which the latter were to pay no rent for these premises. Such an agreement would amount to a mere gift of the use of the land by the debtor, which could not be enforced against such purchasers, especially when the grantor was insolvent when the arrangement was made, and where such agreement was clearly intended to defraud the grantee or other person who might acquire the absolute title to the premises under a sale had in pursuance of the power embraced in the security deed. Civil Code (1910), § 4149. The true equity, between such purchasers and the tenant, would be to permit the purchasers of these lands to recover from the proceeds of the sale of the crops in the hands of the receiver such an amount as would appear, to be fair and reasonable for the rent of these lands for the year in which these crops were grown.

Now what are the rights of the purchaser of these crops from the tenants? As between the landlord and the tenant, title to the crop is in the tenant. Wadley v. Williams, 75 Ga. 272. The landlord has a special lien on such crops for the rent of the land during the year in which they were grown. Civil Code (1910.), § 3340. A bona fide purchaser of the crop from the tenant, without notice of the lien of the landlord, will be protected against the same. Worrill v. Barnes, 57 Ga. 404; Thornton v. Carver, 80 Ga. 397 (6 S. E. 915); Holmes v. Pye, 107 Ga. 784 (33 S. E. 816); Lancaster v. Whiteside, 108 Ga. 801 (33 S. E. 995); Bennett L. Co. v. Martin, 132 Ga. 491 (64 S. E. 484). The burden was on the intervenor to establish his contention that he was a bona fide purchaser of these crops without notice of the lien of the plaintiffs for rent. Curtis &c. Co. v. United States, 262 U. S. 215 (43 Sup. Ct. 570). In the absence of proof that he was such, the court erred in ordering the rents turned over to the intervenor. The introduction by the intervenor of a bill, of sale from the tenants to him of the crops would not alone be sufficient to carry this burden.

Where the grantor in the security deed, after the lands therein embraced have been duly sold under a power of sale therein contained, wrongfully refuses to deliver possession thereof to the purchasers, who are compelled to bring ejectment to obtain possession, and where such grantor is insolvent and is collecting and dissipating the rents, a court of equity should grant the prayers of a petition, which is ancillary to the action of ejectment, for an injunction to restrain the defendant' from collecting the rents of the lands, and for the appointment of a receiver to take charge of the lands, collect and preserve the rents, and hold them to abide the final judgment in the case.

The seventh headnote needs no elaboration.

Judgment reversed.

All the Justices concur.