Georgia Home Appraisers, Inc. v. Trintec Portfolio Services, LLC

THIRD DIVISION
GOBEIL,
COOMER and HODGES, 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

March 12, 2019

In the Court of Appeals of Georgia
A18A1500. GEORGIA HOME APPRAISERS, INC. v. TRINTEC
PORTFOLIO SERVICES, LLC.

GOBEIL, Judge.

Georgia Home Appraisers, Inc. (“GHA”) appeals from two separate orders of

the Cherokee County Superior Court, both of which concern a piece of real property

(“the Property”) on which Trintec Portfolio Services, LLC (“Trintec”) held a first

priority lien. GHA contends that the trial court erred in finding that all interested

parties had not been provided with notice of the first judicial foreclosure sale of the

Property (at which GHA was the high bidder) and in relying on that finding to deny

confirmation of the first foreclosure sale. Additionally, GHA argues that the trial

court erred in denying GHA’s motion to confirm or set aside the second foreclosure
sale of the Property, based on the court’s finding that GHA lacked standing to bring

such a motion. For reasons explained more fully below, we find no error and affirm.

The facts relevant to this appeal are undisputed and show that the Property is

located in Cherokee County, in a residential subdivision known as The Villas at

Claremore Lake. In or about May 2011, the Property’s then-owner executed a

quitclaim deed transferring the property to Bank of America, N. A. (“BOA”).1 On

June 2, 2015, the Property was sold at a tax sale to Bay Point Capital Partners, LP.

After purchasing the lien held on the Property by The Villas at Claremore Lake

Homeowners Association (“the HOA”), Trintec redeemed the property by paying

$390,000 to Bay Point and receiving a quitclaim deed of redemption that granted

Trintec a first priority lien (also known as a super lien) on the Property.2 See OCGA

1
The parties have speculated that the Property was transferred to BOA in lieu
of BOA foreclosing on the Property.
2
Under Georgia law, if a property owner fails to pay county property taxes, the
county may conduct a sale of the property to satisfy the unpaid taxes. See OCGA §
48-4-1. After the tax sale, any party holding an interest in or a lien on the property
may redeem the property by paying to the tax sale purchaser the purchase price plus
any taxes paid and interest thereon. See OCGA § 48-4-42. If a creditor of the original
property owner redeems the property, the amount paid by the redeeming creditor
becomes a first lien on the property. See OCGA § 48-4-43. The redeeming creditor
then has a first priority to repayment – i.e., a “super lien” – in the amount of the
redemption price. Id. One who holds a super lien may proceed to foreclose against the
property to satisfy that lien. See National Tax Funding, L. P. v. Harpagon Co., 277

2
§ 48-4-43. Trintec then filed a complaint for judicial foreclosure in the Cherokee

County Superior Court (the “foreclosure action”), seeking to foreclose on its lien in

equity.

In the foreclosure action, Trintec served process on all entities with an interest

in the property, including HSBC Bank USA, N. A., FIA Card Services, N. A., BOA,

the HOA, and Nationstar Mortgage, LLC. Neither HSBC Bank nor FIA Card Services

filed an answer and therefore went into irrevocable default. BOA and the HOA each

signed a consent order stating that it had no objection to the foreclosure sale of the

Property. The consent order as to BOA dismissed BOA from the litigation and

relieved it from filing any further pleadings or making any further appearances. The

trial court thereafter entered a final consent order, agreed to by Trintec and Nationstar

Mortgage, that established a first priority lien in favor of Trintec in the amount of

$390,000, plus prejudgment interest from June 25, 2015; ordered the Cherokee

County Tax Commissioner to pay Trintec $316,052.79; and stated that Trintec was

entitled to foreclose on the balance of the lien “by conducting a public sale of the

Property on the Cherokee County Courthouse steps during the legal hours of sale,

after providing notice as [provided for in the order], and auctioning the Property to

Ga. 41, 43 (1) (586 SE2d 235) (2003).

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the highest bidder.” With respect to notice, the order provided that “[p]rior to

conducting the foreclosure sale, [Trintec] must advertise notice of the foreclosure sale

in The Cherokee Tribune once per week for four weeks preceding the foreclosure

sale.”

Trintec advertised the sale as required by the final consent order, but otherwise

did not provide notice of the sale to any other party with an interest in the Property.

At the first sale, which took place on January 5, 2016, GHA purchased the Property

with a high bid of $73,948. At the time of the first sale, GHA provided Trintec with

two cashier’s checks totaling $75,000.3

On February 17, 2016, Trintec filed a report of defective sale in the foreclosure

action and sought an order setting aside the first sale and allowing Trintec to resell

the property. In support of Trintec’s motion for resale, its attorney submitted an

affidavit in which he stated that as a result of an inadvertent error, no notice of the

sale was given to the owner of the Property (BOA) or any other entity with an interest

in the Property. The attorney further averred that because Trintec believed such notice

3
It is undisputed that the amount of GHA’s bid was sufficient to reimburse
Trintec the amount it was still owed on its lien.

4
was required by law,4 Trintec had rescinded the first sale on January 12, 2016,

pursuant to OCGA § 9-13-172.1.5

Before the trial court ruled on Trintec’s motion for resale in the foreclosure

action, GHA filed the current action against Trintec seeking to quiet title to the

Property (the “quiet title action”). GHA sought specific performance of the first sale

and also asserted claims for lost profits, punitive damages, and attorney fees and

costs. The trial court entered a consent order in the quiet title action, pursuant to

which the parties agreed that: (1) the court would hold an evidentiary hearing on the

confirmation of the first sale; (2) after that hearing, the court would either confirm the

sale and issue an order conveying title to GHA or deny confirmation and order

4
In its motion, Trintec asserted that such notice was required by OCGA § 9-13-
13. That statute provides that in “cases of levying on land, written notice of the levy
must be given personally or delivered by certified mail or statutory overnight delivery
to the tenant in possession and to the defendant if not in possession.” OCGA § 9-13-
13 (a). As the trial court implicitly recognized, however, OCGA § 9-13-13 is
inapplicable to this case, as this case involves a judicial foreclosure in equity, and not
a levy.
5
This statute does not authorize rescission, but instead serves to limit the
damages a buyer may recover in the event of a rescission, where the rescission is
based on, inter alia, “[t]he statutory requirements for the sale not being fulfilled.”
OCGA § 9-13-172.1 (d) (1).

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Trintec to conduct a resale; and (3) the parties would waive any remaining claims

they had in the quiet title action

After a hearing at which the parties stipulated to the facts, the trial court denied

GHA’s petition to quiet title and entered an order authorizing Trintec to conduct a

second sale of the Property. In that order, the court found that no notice of the first

sale had been provided to the owner or any other entity with an interest in the

Property. Accordingly, exercising its authority under OCGA § 23-4-35, the trial court

ordered that the property be resold at a second foreclosure sale. With respect to

notice, the order stated: “Prior to conducting the foreclosure sale, Trintec must cause

notice of the sale to be advertised in The Cherokee Tribune once per week for four

weeks preceding the foreclosure sale. Trintec shall also give all parties 30 days prior

written notice of such sale.” Additionally, the order provided that the trial court “shall

retain jurisdiction over this matter to direct the disbursal of any cash proceeds

generated from the foreclosure over and above the amounts necessary to satisfy the

sums owed Trintec.” The court certified its order for immediate review, and GHA

filed an application for an interlocutory appeal, which this Court denied.

6
 A second judicial foreclosure sale occurred on October 3, 2017, with the

property selling to a third party for approximately $275,000.6 After learning from

Trintec’s attorney that Trintec did not intend to seek a judicial confirmation of the

second sale, GHA filed a motion in the quiet title action to set aside or confirm the

second sale. GHA argued that because the resale was ordered pursuant to OCGA §

23-4-35, and because the trial court had retained jurisdiction over the case to direct

the disbursement of the sale proceeds, confirmation of the sale was required.

Following a hearing, the trial court denied GHA’s motion, finding that GHA did not

have standing to seek the relief in question. This appeal followed.7

6
GHA did not purchase the Property at the second sale.
7
It appears from the hearing on GHA’s motion to confirm or set aside the
second sale that, despite its prior ruling that it would retain jurisdiction of the case to
oversee the disbursement of funds generated from the second sale, the trial court was
declining to do anything further in this case. Accordingly, we view the trial court’s
order denying GHA’s motion as the final order in this case. See Standridge v.
Spillers, 263 Ga. App. 401, 403 (1) (587 SE2d 862) (2003) (“even though an order
does not specify that it is a grant of final judgment, it nevertheless constitutes a final
judgment . . . where it leaves no issues remaining to be resolved, constitutes the
court’s final ruling on the merits of the action, and leaves the parties with no further
recourse in the trial court”) (citation and punctuation omitted).

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 1. In its first enumeration of error, GHA asserts that the trial court erred in

finding that the first sale should be set aside based upon a lack of notice to all

interested parties. We disagree.

Unlike non-judicial foreclosure sales, judicial sales of property are usually

instituted by a party having the right to foreclose who seeks an order allowing or

requiring the sale of the property – i.e., a party who seeks equitable relief. See OCGA

§ 23-4-20 (“every person who is remediless elsewhere may claim the protection and

assistance of equity to enforce any right recognized by the law”). After such an order

is obtained, the sale of the property is governed primarily by the judicial sales statute,

OCGA § 9-13-140, et seq. And under both that statute and the statute dealing with

claims in equity (OCGA § 23-1-1, et seq.), a trial court is afforded broad discretion

either to confirm, deny confirmation of, or set aside a judicial sale of property.

Specifically, the equity statute provides that judicial sales “shall not be consummated

until confirmed” by the trial court, which “has a large discretion vested in [it] in

reference thereto.” OCGA § 23-4-35. Moreover, the judicial sales statute vests courts

with “full power over their officers making execution sales.” OCGA § 9-13-172. And

whenever a “court is satisfied that a sale made under process is infected with fraud,

irregularity, or error to the injury of either party, the court shall set aside the sale.” Id.

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 With respect to notice, the judicial sales statute provides:

The sheriff, coroner, or other officer shall publish weekly for four weeks
in the legal organ for the county, or if there is no newspaper designated
as such, then in the nearest newspaper having the largest general
circulation in such county, notice of all sales of land and other property
executed by the officer. In the advertisement the officer shall give a full
and complete description of the property to be sold, making known the
names of the plaintiff, the defendant, and any person who may be in the
possession of the property. In the case of real property, such
advertisement shall include the legal description of such real property
and may include the street address of such real property, if available, but
provided that no foreclosure shall be invalidated by the failure to include
a street address or by the insertion of an erroneous street address.

OCGA § 9-13-140 (a).

Relying on this language, GHA argues that the only pre-sale notice required

is the advertisement referenced in OCGA § 9-13-140, which is the same notice

required by the trial court’s order in the foreclosure action. GHA further contends that

in cases involving a judicial sale of property, all parties with an interest in the

property have received notice of the sale by virtue of the fact that they were parties

to the equitable action seeking an order authorizing the sale. Thus, given that the

property owner in this case (BOA) and the other, non-defaulting parties having an

9
interest in the property (the HOA and Nationstar) consented to the sale, they had

notice of the same. Accordingly, GHA argues that the trial court erred both in finding

that the notice requirement had not been met and then relying on that finding to set

aside the first sale.

GHA’s argument with respect to notice ignores several important facts. First,

although they consented to the foreclosure sale, the other interested parties retained

their rights in the Property. See Nat’l Tax Funding, L.P. v. Harpagon Co., 277 Ga. 41,

42-43 (1) (586 SE2d 235) (2003). Accordingly, they needed notice of the foreclosure

sale to give them an opportunity to protect those rights. Specifically, those parties

needed to be given the opportunity to purchase the Property at the foreclosure sale to

protect their own junior interest in that asset. And while the interested parties may

have conceded Trintec’s right to foreclose on its super lien, there is no evidence in

the record that any such party waived its right to receive notice of the foreclosure

sale.

Furthermore, it does not appear that any party other than Nationstar received

a copy of the final order in the foreclosure action. The record shows that the consent

order as to BOA relieved it from filing any further pleadings and from making any

further appearances in the case. And there is no evidence that BOA or the HOA

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received a copy of the final order, which was entered after they were no longer parties

to the foreclosure action. More importantly, the final order entered in the foreclosure

action does not mention the date or location of the sale. Rather, it simply states that

the sale shall be publicly advertised. Thus, even if received by all interested parties,

that order did not provide those parties with notice of the sale itself.

Bearing the foregoing in mind, we turn to the question of whether the trial

court abused its discretion in finding that the lack of notice to interested parties meant

the first sale was “infected with . . . error to the injury of [any] party.” OCGA § 9-13-

172. In deciding this question, we note that the United States Supreme Court has held

that

[n]otice by mail or other means as certain to ensure actual notice is a
minimum constitutional precondition to a proceeding which will
adversely affect the liberty or property interests of any party, whether
unlettered or well versed in commercial practice, if [that party’s] name
and address are reasonably ascertainable.

Mennonite Board of Missions v. Adams, 462 U.S. 791, 800 (II) (103 SCt 2706, 77

LEd2d 180) (1983) (emphasis supplied) (striking down as unconstitutional that part

of an Indiana statute providing that a mortgagee of property to be sold at a tax sale

could receive notice of the sale through publication; as a “mortgagee clearly has a

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legally protected property interest, he is entitled to notice reasonably calculated to

apprise him of a pending tax sale”). Thus, where a party has a substantial interest in

property that may be affected by sale of that property, notice of that sale “by

publication . . . is not sufficient to meet the requirements of due process.”

Funderburke v. Kellet , 257 Ga. 822, 823 (1) (364 SE2d 845) (1988) (holding that

former OCGA § 48-4-45 violated due process to the extent it allowed the notice

required to foreclose a property owner’s right to redeem property sold at a tax sale to

be made only by publication). See also, Hamilton v. Renewed Hope, Inc., 277 Ga.

465, 466 (589 SE2d 81) (2003) (to satisfy due process, a tax sale purchaser seeking

to foreclose the property owner’s right of redemption must, “before resorting to

[notice by publication],” “make reasonably diligent efforts beyond the use of tax and

real estate records . . . to ascertain the address of the [property owner]” and provide

that owner with actual, written notice).

Here, we note that a judicial foreclosure sale, like a tax sale or an action for

closing a property owner’s right to redeem property sold at such a sale, constitutes “a

proceeding that [would] adversely affect the . . . property interests” of BOA (as the

owner of the Property) and the HOA and Nationstar (as lien holders against the

Property). Thus, due process required that BOA, the HOA, and Nationstar all receive

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actual notice of that sale. Accordingly, we find no error in the trial court’s conclusion

that the first sale was tainted by an error in the notification process that failed to

protect the due process rights of all parties with an interest in the property. See

OCGA § 9-13-172. And given this finding, the trial court did not abuse its discretion

in refusing to confirm the first sale and instead setting it aside. See Chua v. Johnson,

336 Ga. App. 298, 299 (784 SE2d 449) (2016) ( “an abuse of discretion . . . occurs

where the trial court’s ruling is unsupported by any evidence of record or where that

ruling misstates or misapplies the relevant law”) (citation and punctuation omitted).

2. GHA further asserts that the trial court erred in finding that it lacked

standing to seek a set aside or confirmation of the second sale. Specifically, GHA

argues that because the trial court retained jurisdiction over the case to oversee the

disbursal of the funds from the second sale, the case remained pending and, as a party

to the litigation, GHA could seek the relief in question. Again, we disagree.

In challenging the trial court’s decision as to standing, GHA makes a cogent

argument that Trintec and/or the trial court failed to comply with the relevant statutes

following the second sale.8 Standing, however, “focuses on the party seeking relief

8
For example, as the trial court acknowledged in its order setting aside the first
sale, both sales were conducted under decrees in equity. And the law provides that
“[s]uch sales shall not be consummated until confirmed by [the trial court].” OCGA

13
and not on the issues the party wishes to have adjudicated.” Atlantic Specialty Ins.

Co. v. Lewis, 341 Ga. App. 838, 845 (1) (c) (802 SE2d 844) (2017) (citation omitted).

To have standing, the party seeking relief must demonstrate that: (1) it has personally

suffered some actual or threatened injury (an “injury in fact”); (2) the injury is

causally connected to the challenged wrong; and (3) a favorable decision is likely to

redress the injury. See Granite State Outdoor Advertising v. City of Roswell, 283 Ga.

417, 418 (1) (658 SE2d 587) (2008); Center for a Sustainable Coast v. Turner, 324

Ga. App. 762, 764 (751 SE2d 555) (2013). Here, GHA has no ownership or other

interest in the Property and, as reflected in the consent order, it has waived all claims

§ 23-4-35. Given this statutory provision, our Supreme Court has held that a judicial
sale “is not valid or binding, and confer[s] no right to the property, until confirmed
by the court. [Thus], [t]he accepted bidder acquires . . . no independent right to have
his purchase completed, but is merely a preferred proposer, until confirmation of the
sale by the court[.]” Leggett v. Ogden, 248 Ga. 403, 405 (2) (284 SE2d 1) (1981)
Here, however, Trintec did not seek a confirmation and the trial court announced at
the hearing on GHA’s motion that it did not intend to consider confirmation. And as
that order further recognized, under Georgia law, any funds realized from the second
sale that exceeded the amount owed Trintec had to be disbursed to other lien holders
on the property. See OCGA § 48-4-43 (the amount paid by a redeeming creditor of
a tax-sale property “shall constitute a first lien on the property and . . . shall be repaid
prior to any other claims upon the property” (emphasis supplied); DLT List, LLC v.
M7VEN Supportive Housing & Dev. Group, 301 Ga. 131, 134 (2) (800 SE2d 362)
(2017). It appears from the record that excess funds were realized, but there is no
indication as to how those excess funds were disbursed, and it does not appear that
the trial court oversaw any such disbursement.

14
for damages resulting from Trintec’s rescission of the first sale. Accordingly, GHA

cannot demonstrate that it will suffer injury if the second sale is neither confirmed nor

set aside and the trial court found correctly that GHA lacked standing to seek that

relief.

For the reasons set forth above, we affirm the order of the trial court setting

aside the first sale of the Property and ordering its resale, as well as the order denying

GHA’s motion to confirm or set aside the second sale of the Property.

Judgment affirmed. Hodges, J., concurs. Coomer, J., concurs in judgment

only. *

* THIS OPINION IS PHYSICAL PRECEDENT ONLY. COURT OF
APPEALS RULE 33.2(a).

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