Navy Federal Credit Union v. Pearl McCrea

FIFTH DIVISION
PHIPPS, P. J.,
DILLARD and PETERSON, JJ.
NOTICE: Motions for reconsideration must be
physically received in our clerk’s office within ten
days of the date of decision to be deemed timely filed.
http://www.gaappeals.us/rules
May 4, 2016
In the Court of Appeals of Georgia
A16A0332. NAVY FEDERAL CREDIT UNION v. MCCREA.
DILLARD, Judge.
In this interlocutory appeal, Navy Federal Credit Union (“NFCU”) seeks
reversal of the trial court’s denial of its motion for reconsideration of the court’s
earlier denial of its motion for summary judgment in its declaratory-judgment action
against Pearl McCrea involving a dispute over title to land.1 On appeal, NFCU argues
1
An application for interlocutory appeal was the proper avenue for obtaining
appellate review at this stage in the proceedings. See Mayor & Aldermen of City of
Savannah v. Norman J. Bass Constr. Co., 264 Ga. 16, 17 (1) (441 SE2d 63) (1994)
(“[A]n order denying a motion for reconsideration [of the denial of a motion to
dismiss] is an interlocutory order that, just as any other interlocutory order, can be the
subject of an application for interlocutory appeal if a certificate of immediate review
is obtained from the trial court.”); Rollins v. Communications v. Henderson, Few &
Co., 140 Ga. App. 504, 504 (1) (231 SE2d 412) (1976) (holding that an appellant
properly sought interlocutory review of the trial court’s denial of a motion for
reconsideration of a prior order that was not a final, appealable judgment).
that it was entitled to summary judgment because the undisputed evidence shows that
it owns the subject property and that McCrea has no interest in it. NFCU further
contends that McCrea presented no evidence to support any of her counterclaims. For
the reasons set forth infra, we reverse the trial court’s denial of summary judgment
to NFCU.2
Viewing the evidence in the light most favorable to McCrea, the nonmoving
party,3 the record shows that on January 30, 2007, McCrea purchased the subject
property, which is located in Ellenwood, Georgia (the “property”), and she obtained
a warranty deed from the seller. On the same day, McCrea executed a “Joint Tenancy
with Survivorship Warranty Deed,” conveying the property in fee simple to Gary and
Vickie Fox. A few months later, in June 2007, the Foxes used the property to secure
2
NFCU initially filed its appeal in the Supreme Court of Georgia, seeking to
invoke that Court’s jurisdiction over cases respecting title to land. But the Supreme
Court transferred the appeal to this Court, explaining that the case did not fall within
its title-to-land jurisdiction because, although NFCU sought to establish the validity
of its title to land, it had not “filed an ejectment or other similar action that seeks to
recover possession of the land from [McCrea].” See, e.g., Graham v. Tallent, 235 Ga.
47, 49 (218 SE2d 799) (1975) (“[T]he case before us is not a case respecting title to
land for the reason that this case is not an action of ejectment or a statutory substitute,
and it seeks sale by foreclosure rather than recovery of the land.”).
3
See, e.g., Vratsinas Const. Co. v. Chitwood, 314 Ga. App. 357, 357-58 (723
SE2d 740) (2012).
2
a loan from NFCU for $70,000 and executed a security deed in favor of NFCU to that
effect.
In 2011, McCrea filed suit against the Foxes for, inter alia, breach of contract,
undue influence, and fraud (the “Foxes Case”), claiming that the Foxes fraudulently
induced her to purchase the property and convey it to them in exchange for promises
that they would take care of her and the property. McCrea alleged that the Foxes did
not fulfill their promises, and she was unaware that they secured a loan with the
property. In addition to damages, McCrea requested that the property be returned to
her free and clear of any liens or encumbrances incurred by the Foxes. On April 25,
2011, McCrea also filed a notice of lis pendens regarding her dispute with the Foxes
over the property. And although the Foxes Case had not yet been resolved, on January
25, 2012, McCrea executed a quitclaim deed purporting to transfer title to the
property to Ellen Wood. Eventually, in August 2012, the Foxes Case proceeded to a
jury trial, and the jury found in favor of McCrea, awarding her $88,300 in damages.
The trial court then issued an order, affirming the jury’s verdict and awarding McCrea
a total of $88,575 in damages, interest, and costs.
Thereafter, on December 4, 2012, NFCU, which was not a party to the Foxes
Case, sold the property in a foreclosure sale because the Foxes defaulted on their
3
loan. Then, on June 26, 2013, NFCU filed this action against McCrea to quiet title to
the property and to set aside her lis-pendens notice. McCrea filed an answer, asserting
several affirmative defenses, as well as counterclaims for intentional infliction of
emotional distress, unjust enrichment, and stubborn litigiousness. NFCU next filed
an amended complaint, removing its quiet-title claim and adding a claim for
declaratory relief. On December 3, 2013, McCrea filed a motion for summary
judgment, and after responding to the motion, NFCU filed a second amended
complaint, seeking only a declaratory judgment that it owns the property
unencumbered by any claim of interest made by McCrea. In her response, McCrea
added an additional counterclaim for the foreclosure sale to be declared void and set
aside.
Subsequently, NFCU filed a competing motion for summary judgment, arguing
that the outcome of the Foxes Case had no bearing on its ownership of the property
and that McCrea’s counterclaims, which were all derivative of her claimed interest
in the property, lacked evidentiary support. Ultimately, the trial court denied summary
judgment to both parties, noting only that there were “genuine issues of material fact,
including, but not limited to, any notice that [NFCU] may have had of the particular
legal encumbrances on [the] property.” The order, however, did not mention
4
McCrea’s counterclaims. NFCU then filed a motion for reconsideration, which the
court also denied. Thereafter, we granted NFCU’s application for an interlocutory
appeal, and this appeal follows.
At the outset, we note that summary judgment is proper when “there is no
genuine issue of material fact and the movant is entitled to judgment as a matter of
law.”4 Additionally, a de novo standard of review applies to an appeal from a grant
or denial of summary judgment, and we “view the evidence, and all reasonable
conclusions and inferences drawn from it, in the light most favorable to the
nonmovant.”5 With these guiding principles in mind, we turn now to NFCU’s specific
claims of error.
1. NFCU first argues that the trial court erred in denying its motion for
summary judgment as to its request for declaratory relief because the undisputed
evidence establishes that it owns the property free and clear of any claimed interest
by McCrea. We agree.
In the case sub judice, McCrea, who has not filed an appellate brief, essentially
argued to the trial court that the warranty deed she executed, transferring the property
4
Id. at 357 (punctuation omitted).
5
Id. at 357-58 (punctuation omitted).
5
to the Foxes, was “declared void” in the Foxes Case, and, as a result, they had no
interest in the property to convey to NFCU in the security deed. Moreover, she
contended below that NFCU was not a bona fide purchaser of the property because
it had notice of the Foxes Case and yet chose not to intervene. However, there is no
evidence in the record to support these assertions. As previously noted, the trial court
found that there was a genuine issue of material fact regarding whether NFCU had
notice of any legal encumbrances on the property. But the only “legal encumbrance”
ever identified by McCrea of which NFCU could have been notified was the
pendency and outcome of the Foxes Case, and contrary to her claims, the final
judgment in that case had no bearing on the validity of any deeds relevant to this case.
In support of her motion for summary judgment, McCrea submitted the trial
court’s initial judgment in the Foxes Case, which merely awarded damages to McCrea
on her breach-of-contract and tort claims against the Foxes. However, on April 15,
2014, during the pendency of this case, the trial court in the Foxes Case modified its
initial judgment to declare that the warranty deed in dispute was void.6 Thereafter,
6
We note that the modified order itself was never presented to the trial court,
and the parties presented no other evidence referencing the modification or
suggesting that the warranty deed to the Foxes was ever “declared void” until NFCU
filed its motion for reconsideration.
6
NFCU filed a motion to intervene in the Foxes Case and set aside the modified
judgment. Then, on December 15, 2014, one day before summary judgment was
denied in this case, the trial court in the Foxes Case granted NFCU’s motion to
intervene, vacated the modified order, and reinstated its initial judgment. In doing so,
the trial court in the Foxes Case noted that, by declaring the warranty deed void, the
modified judgment made a substantial and impermissible change to the jury’s verdict,
which only awarded monetary damages to McCrea. And in support of its motion for
reconsideration of the denial of summary judgment in this case, NFCU submitted the
final judgment by the trial court in the Foxes Case to establish that the warranty deed
transferring the property to the Foxes was not declared void by that court.
Here, the entire basis for McCrea’s claimed interest in the property stems from
the outcome of the Foxes Case, but she presented no evidence to show that she ever
regained any interest in the property after she conveyed it to the Foxes as a result of
that lawsuit or otherwise. Instead, the undisputed evidence referenced supra
establishes that, although McCrea was awarded monetary damages in her action
against the Foxes, the court ultimately did not declare her transfer of the property to
7
the Foxes void because such a judgment was unauthorized by the jury’s verdict.7 And,
of course, it is well settled that summary judgment cannot be avoided based on
“speculation or conjecture; once the pleadings are pierced with actual evidence, the
[nonmovant] must point to admissible evidence showing a genuine issue of fact.”8
Here, McCrea simply failed to present any such evidence.9
Finally, to the extent that the trial court’s cursory summary-judgment order
suggests that there was a genuine issue of material fact as to whether McCrea’s lis-
7
See Erdmier v. Eunice, 143 Ga. App. 505, 507 (3) (239 SE2d 192) (1977)
(holding that the trial court was unauthorized to add interest to the jury’s award of
damages absent direction to do so in the verdict); Fried v. Fried, 208 Ga. 861, 861 (3)
(69 SE2d 862) (1952) (“After the dispersal of the jury[,] the judge has no power either
to add to or take from their findings, and has not the power, by amendment or
reformation, to supply substantial omissions or make substantial changes in the
verdict as rendered by the jury.”), reversed on other grounds by Massengale v.
Massengale, 209 Ga. 154 (71 SE2d 211) (1952); see also OCGA § 9-12-9
(“Judgment and execution shall conform to the verdict.”).
8
Cowart v. Widener, 287 Ga. 622, 633 (3) (c) (697 SE2d 779) (2010);
accord McManus v. Taylor, 326 Ga. App. 477, 485 (4) (756 SE2d 709) (2014).
9
We note that NFCU also contends that, even if McCrea retained any interest
in the property after she conveyed it to the Foxes, she transferred that interest to
someone else via a quitclaim deed during the pendency of the Foxes Case, and, as a
result, she lacks standing to dispute its claim for declaratory relief or to assert her
counterclaim for setting aside the foreclosure sale. While this may have been an
alternative basis upon which the trial court could have granted summary judgment to
NFCU, we need not address it separately because NFCU was also entitled to summary
judgment for the reasons set forth herein.
8
pendens notice informed NFCU that there was a “legal encumbrance” on the property,
we note that the doctrine of lis pendens, which has been codified in OCGA § 44-14-
610 et seq, merely “impute[s] to all third parties constructive notice of the litigation
and of the claims against property being asserted in the pleadings and [binds] third
parties to the outcome of the litigation.”10 And here, even assuming that NFCU had
either actual or constructive knowledge of McCrea’s claims regarding the property
in the Foxes Case, the outcome of that case did not ultimately create a legal
encumbrance on the property impacting any of the deeds executed in this case. Thus,
McCrea’s lis-pendens notice ultimately had no negative binding effect on NFCU’s
ownership of the property. For these reasons, the trial court erred by denying
summary judgment to NFCU as to its claim for declaratory relief.
2. In four separate enumerations of error, NFCU also argues that the trial court
erred in denying its motion for summary judgment on McCrea’s counterclaims
because they lacked any evidentiary support. Again, we agree.
10
Vance v. Lomas Mortg. USA, Inc., 263 Ga. 33, 35 (1) (426 SE2d 873) (1993),
accord Boca Petroco, Inc. v. Petroleum Realty II, LLC, 285 Ga. 487, 488 (678 SE2d
330) (2009); see Baxter v. Bayview Loan Servicing, LLC, 301 Ga. App. 577, 584 (1)
(b) (688 SE2d 363) (2009) (“One who purchases the property with notice of the lis
pendens . . . is then bound to the outcome of the pending litigation, even though they
were not otherwise a party to it.”).
9
As previously mentioned, McCrea asserted counterclaims against NFCU for
intentional infliction of emotional distress, unjust enrichment, stubborn litigiousness,
and setting aside the foreclosure sale. And all of McCrea’s counterclaims, except her
claim for unjust enrichment, hinged on her contention that the warranty deed she
executed transferring the property to the Foxes had been declared void. However, as
discussed in Division 1 supra, this claim was belied by the record. Moreover, as to
her unjust-enrichment claim, she alleged only that NFCU made a profit in the
foreclosure sale. Needless to say, even if that were true, it does not give McCrea, who
was not a party to that sale, a cause of action for unjust enrichment against NFCU.11
For all of the foregoing reasons, we reverse the trial court’s denial of NFCU’s
motion for reconsideration of the court’s summary-judgment order and instruct the
court to enter judgment in favor of NFCU as to its claim for declaratory relief and all
of McCrea’s counterclaims.
Judgment reversed. Phipps, P. J., and Peterson, J., concur.
11
See Tuvim v. United Jewish Communities, Inc., 285 Ga. 632, 635 (2) (680
SE2d 827) (2009) (“Unjust enrichment applies when as a matter of fact there is no
legal contract, but when the party sought to be charged has been conferred a benefit
by the party contending an unjust enrichment which the benefitted party equitably
ought to return or compensate for.” (punctuation omitted) (emphasis supplied));
Rommelman v. Hoyt, 295 Ga. App. 19, 20 (670 SE2d 808) (2008) (same); Engram v.
Engram, 265 Ga. 804, 807 (2) (463 SE2d 12) (1995) (same).
10