Hamilton State Bank v. Nelson

• Court: Supreme Court of Georgia
• Decided: February 16, 2015
• Docket: S14A1892
• Status: Published

Opinion

296 Ga. 572 FINAL COPY

S14A1892. HAMILTON STATE BANK v. NELSON et al.

BLACKWELL, Justice.

Jimmy R. Nelson and Dolph Nelson, Jr. (the “Nelsons”) are members of

Nelson and Nelson Building Acct., LLC (the “LLC”) and shareholders of

Nelson’s Appliances and Home Furnishings, Inc. (the “Corporation”). The

Nelsons executed promissory notes in favor of Hamilton State Bank (the

“Bank”), and to secure the repayment of those notes, the Bank obtained a

security interest in real property owned by the LLC and the Corporation, upon

which the Nelsons operated an appliance and furniture store. The Bank also

obtained a security interest in the store’s accounts receivable, inventory,

furniture, and fixtures. In two separate actions, the Bank obtained judgments

against the Nelsons on the notes in the approximate amount of $2.9 million

each, and those judgments apparently are the subject of two appeals that are

currently pending in the Court of Appeals. Based on the terms of the security

deeds and security agreements, the involvement of third-party creditors, and a

belief that the store was being moved and its ownership and corporate structure being changed, the Bank filed a verified complaint against the Nelsons, the

LLC, and the Corporation for the appointment of a receiver and an

accompanying emergency motion for such appointment. Despite the Bank’s

protests, the trial court denied the receivership sought by the emergency motion

and instead directed the Nelsons “to turn over to [the Bank] the keys to and

possession of the real property . . . .” The Bank appeals from that order, and we

affirm.

Most important, the Bank does not challenge the denial of a receivership.

Rather, the Bank argues only that it does not want immediate possession of the

store and that the trial court was without authority to order the Bank to accept

possession. Nowhere in the order, however, does the trial court require the Bank

to accept possession. See Gwinnett County v. McManus, 294 Ga. 702, 704 (755

SE2d 720) (2014). The trial court only directed the Nelsons to tender possession

of the property to the Bank. Under Georgia law, the mere tender of possession

to another does not work a transfer of possession unless and until possession is

accepted by the transferee. See Smiway, Inc. v. Dept. of Transp., 178 Ga. App.

414, 418 (6) (343 SE2d 497) (1986) (quoting Lamb v. Gorman, 16 Ga. App.

663, 663 (3) (85 SE 981) (1915) in the context of a landlord-tenant

2 relationship). Cf. Ledsinger v. Burke, 113 Ga. 74, 77 (1) (38 SE 313) (1901). To

the extent the trial court erred in ordering the Nelsons to tender possession, the

trial court never required the Bank to take possession, and so, any such error

could not have harmed the Bank. Consequently, the Bank cannot be heard to

complain about the order, which was directed only to the Nelsons. See Martin

v. Hendon, 224 Ga. 221, 222-223 (3) (160 SE2d 893) (1968); Rush v. Southern

Property Mgmt., 121 Ga. App. 360, 361 (2) (a) (173 SE2d 744) (1970).

Judgment affirmed. All the Justices concur.

Decided February 16, 2015.

Equity. Bartow Superior Court. Before Judge David K. Smith.

Balch & Bingham, Jamie L. Cohen, Matthew B. Ames, Walter E. Jones,

for appellant.

Howick, Westfall, McBryan & Kaplan, Louis G. McBryan, Virginia B.

Bogue, for appellees.