If one with notice sells to one without notice, the latter shall be protected. If one without notice sells to one with notice, the latter shall be protected, as otherwise a bona fide purchaser might be deprived of selling his property for full value.
(Civil Code 1895, § 3938; Civil Code 1910, § 4535; Code 1933, § 37-114.)
Cross references.- Power of person possessing voidable title to transfer goods to good faith purchaser for value, § 11-2-403.
JUDICIAL DECISIONSANALYSIS
General Consideration
Bona fide purchaser obtains good title notwithstanding forgery in chain of title.
- Bonner v. Norwest Bank Inc., 275 Ga. 620 (2002), is inconsistent with the Second Refuge Church Inc. v. Lollar, 282 Ga. 721 (2007), line of cases and is overruled to the extent that the case extends the bona fide purchaser for value doctrine to those acquiring title under a grantee in a forged deed; Mabra v. Deutsche Bank Inc., 277 Ga. App. 764, (2006), is likewise overruled as Mabra also runs contrary to the Lollar line of cases, which does not recognize that the bona fide purchaser for value doctrine may apply when forgery occurs between spouses. Brock v. Yale Mortg. Corp., 287 Ga. 849, 700 S.E.2d 583 (2010).
Cited in Malsby & Co. v. Widincamp, 24 Ga. App. 737, 102 S.E. 178 (1920); Luke v. Ashburn Bank, 40 Ga. App. 802, 151 S.E. 562 (1930); Gamble v. Brooks, 170 Ga. 662, 153 S.E. 759 (1930); Ryals v. Lindsay, 176 Ga. 7, 167 S.E. 284 (1932); Jones v. Edwards, 177 Ga. 723, 171 S.E. 285 (1933); Chestnut v. Weekes, 183 Ga. 367, 188 S.E. 714 (1936); Reynolds v. Smith, 186 Ga. 838, 199 S.E. 137 (1938); Lewis v. Patterson, 191 Ga. 348, 12 S.E.2d 593 (1940); Fraser v. Dolvin, 199 Ga. 638, 34 S.E.2d 875 (1945); Taylor v. Perdue, 206 Ga. 763, 58 S.E.2d 902 (1950); Mathis v. Blanks, 212 Ga. 226, 91 S.E.2d 509 (1956); Arnold v. Conner, 100 Ga. App. 503, 111 S.E.2d 638 (1959); Murray v. Johnson, 222 Ga. 788, 152 S.E.2d 739 (1966); Leachman v. Cobb Dev. Co., 226 Ga. 103, 172 S.E.2d 688 (1970); Jones v. Childs, 141 Ga. App. 552, 234 S.E.2d 87 (1977); Citizens & S. Bank v. Morris State Bldg. Corp., 243 Ga. 169, 253 S.E.2d 89 (1979); Bloodworth v. Sandersville Prod. Credit Ass'n, 245 Ga. 40, 262 S.E.2d 804 (1980); DOT v. Brooks, 254 Ga. 303, 328 S.E.2d 705 (1985); Anderson v. Streck, 190 Ga. App. 224, 378 S.E.2d 526 (1989); Dime Savs. Bank v. Sandy Springs Assocs., 261 Ga. 485, 405 S.E.2d 491 (1991); Farris v. Nationsbanc Mtg. Corp., 268 Ga. 769, 493 S.E.2d 143 (1997).
Sale to One Without Notice
A presumption of good faith attaches to one who is a purchaser for value, which remains until overcome by proof. Patellis v. Tanner, 199 Ga. 304, 34 S.E.2d 84 (1945).
Child born after execution of will and ability to contest purchase by third party.
- A son shown to have been born subsequently to the execution of a will is not entitled to recover in ejectment against a purchaser for a valid consideration who relied on the judgment of the court of ordinary (now probate court) probating the will in solemn form, and who purchased prior to any proceeding to set aside such judgment. Mitchell v. Arnall, 203 Ga. 384, 47 S.E.2d 258 (1948).
Administrator's buying property at sale.
- When an administrator sells decedent's estate at public outcry and the administrator buys back as an individual the property on the same day that one as administrator conveyed the property away, the fact that the deeds were made on the same day and recited the same consideration does not amount to a void administrator's sale, and notice of the alleged fraud is not presumed. When later purchasers of the land pay value in money for the land purchased, they are presumed to be bona fide purchasers without notice. Thomas v. Couch, 171 Ga. 602, 156 S.E. 206 (1930).
It was not error to refuse to charge the principle that, when one attests a deed with full knowledge of the deed's contents, one is estopped to assert an interest in the land conveyed outstanding in oneself against the grantee; the evidence that a witness to petitioner's tax deed was an agent of the owner and grantor of the defendant did not authorize it, and even if the act and knowledge of the agent were attributed to the owner, defendant, without notice thereof, would not be bound. McDonald v. Wimpy, 206 Ga. 270, 56 S.E.2d 524 (1949).
Purchaser of real estate is not bound by recitals in a deed executed by the grantor to realty not embraced in the purchaser's purchase, and which therefore does not constitute a muniment in his chain of title. Thompson v. Randall, 173 Ga. 696, 161 S.E. 377 (1931).
A bona fide sale of property, not made to hinder, delay, or defraud creditors, is not rendered invalid because the vendor may have been insolvent at the time. Wells v. Blitch, 184 Ga. 616, 192 S.E. 209 (1937).
Sale of real estate to innocent purchaser divests title of heirs.
- Superior court did not err in granting a purchaser summary judgment in an administrator's action alleging that the purchaser aided and abetted an executor's breach of fiduciary duties when it bought properties from the executor but did not meet its burden of proving payment merely by producing recitations of the alleged consideration; the probate court's order authorizing the executor to disburse estate property was valid on its face, the sale did not violate the terms of the power of sale in a testatrix's will, and the sale of real estate to an innocent purchaser divested the title of the heirs, although there could be irregularities. Witcher v. JSD Props., LLC, 286 Ga. 717, 690 S.E.2d 855 (2010).
Prior possession of land is not notice to a purchaser.
- Possession of real property which will charge a purchaser with notice is possession at the time the purchaser obtains title. McDonald v. Taylor, 200 Ga. 445, 37 S.E.2d 336 (1946).
The rule in this section is subject to a notable exception; and that is, a conveyance is not protected when made back to a former owner who had notice of the equity, and who did not originally derive title through a bona fide holder. Thompson v. Randall, 173 Ga. 696, 161 S.E. 377 (1931).
Impact of forgery upon bona fide purchaser.
- Trial court erred in holding that a mortgage company had a valid security interest as to the other one-half undivided interest in certain property because the company could not acquire a valid security interest in the entire property by virtue of the company's status, if any, as a bona fide purchaser for value; a bona fide purchaser for value, or a security deed holder occupying such position, obtains good title notwithstanding a forgery in the chain of title. Brock v. Yale Mortg. Corp., 287 Ga. 849, 700 S.E.2d 583 (2010).
A 2003 warranty deed that operated to release a prior lender's security interest in the property was not a forgery but was signed by someone fraudulently assuming the authority of an officer of the prior lender and was regular on the deed's face. Therefore, a subsequent lender that foreclosed on the property and purchased the property at the foreclosure sale was a bona fide purchaser for value entitled to take the property free of the prior lender's security interest. Deutsche Bank Nat'l Trust Co. v. JP Morgan Chase Bank, N.A., 307 Ga. App. 307, 704 S.E.2d 823 (2010).
Purchasers entitled to protection of bona fide purchaser for value.
- There was no error in the trial court's grant of summary judgment to a bank and nursery in a daughter's action to cancel deeds executed by her mother before her death to the bank and the nursery because they were entitled to the protection of bona fide purchaser for value under O.C.G.A. §§ 23-1-19 and23-1-20; the title search showed that the property was transferred to the mother via the will of the daughter's father through a trustees deed of distribution from the remainder trust to the primary beneficiary of the trust, and there was nothing in the chain of title or the trust instruments that would put either the bank or nursery on notice that there were any issues affecting title to the properties because the wording of the trusts allowed the trustees to sell or dispose of any property, at any time, for reasons the trustees deemed best, for the benefit of the mother. Kitchings v. Ameris Bank, 309 Ga. App. 837, 711 S.E.2d 392 (2011).
Agreement to supply water did not obligate purchaser without notice.
- Even if an agreement between property owners providing that the property with a well would supply water to the adjacent property was a covenant running with the land, a later purchaser of the well property did not have actual or constructive notice of that agreement and was not bound by that agreement because the agreement was recorded outside the chain of title. McLeod v. Clements, 297 Ga. 371, 774 S.E.2d 102 (2015).
Sale by One Without Notice
Protection of purchaser with notice predicated on bona fides of vendor.
- A purchaser of land with notice of outstanding equities, from one who was without notice thereof and was entitled to status of bona fide purchaser, will be protected in one's title on account of the bona fides of one's vendor, and it is wholly immaterial of what nature the equity is, whether it is a lien, or an encumbrance, or a trust, or any other claim; for a bona fide purchaser of an estate, for a valuable consideration, purges away the equity from the estate in the hands of all persons who may derive title to it. Thompson v. Randall, 173 Ga. 696, 161 S.E. 377 (1931).
A deed of prior date loses its priority over a subsequent deed from the same vendor, which is based on a valuable consideration, taken without notice of the existence of the first and is the second deed being the first to go to record in the office of the clerk of the superior court of the county where the land lies, and even if the vendee in the second deed took with notice, a grantee of the latter who took without notice would be protected. Patellis v. Tanner, 199 Ga. 304, 34 S.E.2d 84 (1945).
RESEARCH REFERENCES
ALR.
- Pledgee of corporate stock as security for an antecedent debt as a bona fide purchaser within the rule which protects such purchasers against the equities of third persons, 9 A.L.R. 1619.
Right of one who, with knowledge of outstanding equity, derived his interest in real property from or through a bona fide purchaser, to same protection as latter, 63 A.L.R. 1362.
Bona fides of purchaser of bill or note on an executory consideration, 100 A.L.R. 1357.
Reputation in the community as to title to or interest in land as charging one with notice or putting him on inquiry, as regards his status as innocent purchaser or mortgagee, 109 A.L.R. 746.
What constitutes notice to subsequent purchaser of real property of option to purchase contained in unrecorded lease, 17 A.L.R.2d 331.
Motor vehicle certificate of title or similar document as, in hands of one other than legal owner, indicia of ownership justifying reliance by subsequent purchaser or mortgagee without actual notice of other interests, 18 A.L.R.2d 813.
Rights as between purchaser of timber and subsequent vendee of land, 18 A.L.R.2d 1150.
Relative rights in real property as between purchasers from or through decedent's heirs or devisees and unknown surviving spouse, 39 A.L.R.2d 1082.
Knowledge or notice of inadequacy of consideration for conveyance in chain of title as affecting bona fide status of purchaser, 42 A.L.R.2d 1088.
Relative rights as between purchaser of chattel from one who had previously bought it with stolen money, and victim of the theft, 62 A.L.R.2d 537.
Right of vendee under executory land contract to lien for amount paid on purchase price as against subsequent creditors of or purchasers from vendor, 82 A.L.R.3d 1040.