Curl v. Federal Savings & Loan Ass'n

244 S.E.2d 812, 241 Ga. 29, 1978 Ga. LEXIS 871

• Court: Supreme Court of Georgia
• Decided: March 8, 1978
• Docket: 33276
• Status: Published

Opinions

Hall, Justice.

Appellant is seeking to set aside the foreclosure sale of her house, which resulted in the loss of her substantial equity in the property. The trial court granted summary judgment to the defendants. In our opinion there are triable issues of fact, including but not limited to those discussed below, and we reverse.

Appellant contends that a quasi new agreement had been formed in the course of the execution of the loan contract. Code § 20-116. First Federal had accepted late and irregular payments for several years, preferring to contact appellant and convince her to make up the defaults (at least in part). No notice was given of First Federal’s intention to insist on compliance with the exact terms of the agreement prior to a letter dated October 28, 1976, in which the Savings & Loan Association accelerated the balance of the debt. In this letter First Federal offered to reinstate the loan on payment of $260.79 plus a $25 late charge. Appellant paid what she believed was past due ($210) on November 9th, and First Federal accepted the payment. Nevertheless, First Federal forwarded the account to an attorney for collection that day, and the house was sold resulting in the loss to appellant of most of her (allegedly) more than $20,000 equity.

Argued February 14, 1978 Decided March 8, 1978. G. Hughel Harrison, John F. Doran, Jr., for appellant. Telford, Stewart & Stephens, J. Douglas Stewart, Walter W. Calhoun, for appellees.

Appellant argues that the Savings & Loan had accepted similar late payments and reinstated the loan on prior occasions, and that this created a quasi new agreement to work out defaults without foreclosure. She believed that by accepting the $210 payment First Federal agreed to reinstate the loan on this occasion. First Federal’s own evidence shows that prior defaults had been handled in a similar manner.

Appellees have failed to establish the nonexistence of any essential element of appellant’s cause of action under Code § 20-116. Verner v. McLarty, 213 Ga. 472 (99 SE2d 890) (1957); Byrd v. Prudential Ins. Co. of America, 182 Ga. 800 (3) (187 SE 1) (1936); Prothro v. Walker, 202 Ga. 71 (42 SE2d 114) (1947). Moreover, there is a dispute as to whether appellant was given reasonable notice of First Federal’s intention to return to the exact terms of the agreement. Reasonable notice requires more than the assertion of an acceleration clause, for the other party must be given a reasonable opportunity to cure any deviations from the exact terms before foreclosure can be commenced due to defaults which were tolerated under the quasi new agreement.

In light of the fact that this case must be remanded for trial, we express no opinion as to the merits of appellant’s arguments under Code § 37-607. See Delray, Inc. v. Reddick, 194 Ga. 676 (22 SE2d 599) (1942).

Judgment reversed.

All the Justices concur, except Bowles and Marshall, JJ., who dissent.