Derrick Stoudemire v. HSBC Bank USA, N.A. , 333 Ga. App. 374 ( 2015 )

THIRD DIVISION
ELLINGTON, P. J.,
DILLARD and MCFADDEN, 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/
June 3, 2015
In the Court of Appeals of Georgia
A15A0091. STOUDEMIRE et al. v. HSBC BANK USA.
MCFADDEN, Judge.
Derrick and Sonya Stoudemire filed an action against HSBC Bank USA, N.A.
seeking to rescind an allegedly wrongful foreclosure and to quiet title. They based
their complaint on the assertion that Wells Fargo’s assignment of their security deed
to HSBC was ineffective, so that HSBC did not have a valid interest in the security
deed and thus did not have the legal right to foreclose. The trial court granted HSBC’s
motion to dismiss on the ground that the Stoudemires lacked standing to challenge
the assignment of the security deed because they were not parties to the assignment.
We agree and therefore affirm.
The Stoudemires signed a promissory note for $187,000 in favor of Wells
Fargo and granted Wells Fargo by security deed an interest in their property. The
security deed was recorded on September 27, 2005. On September 30, 2006, Wells
Fargo assigned its interest in the security deed to HSBC. The assignment was
recorded September 29, 2010. The Stoudemires defaulted on the loan. HSBC sold the
property at foreclosure on October 5, 2010. The Stoudemires filed this action,
alleging that HSBC lacked the authority to foreclose because the purported
assignment from Wells Fargo to HSBC was void on its face.
The Stoudemires acknowledge that we have held that a person who is not a
party to an assignment lacks standing to contest its validity. Montgomery v. Bank of
America, 321 Ga. App. 343, 346 (2) (740 SE2d 434) (2013) (plaintiff lacked standing
to contest validity of assignment of note and security deed because assignment was
a “contract between MERS and [loan servicing company]”); Breus v. McGriff, 202
Ga. App. 216 (1) (413 SE2d 538) (1991) (“Appellants are strangers to the assignment
contract between appellee and [the bank] and thus have no standing to challenge its
validity.”). They argue that Montgomery is incompatible with Scott v. Cushman &
Wakefield of Georgia, 249 Ga. App. 264 (547 SE2d 794) (2001), in which this court
held that an obligor had standing to challenge an assignment even though he was not
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a party to the assignment. In Scott, however, the obligor did not challenge the validity
of an assignment, but challenged the existence of such an assignment in the first
place. In Montgomery, as in the instant case, there is no question that an assignment
exists.
The Stoudemires argue that the rule that only parties can challenge an
assignment’s validity should not apply to facially void assignments. This assignment,
they argue, is void on its face because it is a forgery and it was not signed by the
necessary corporate officers. We need not decide whether facially void assignments
are excepted from the rule because the Stoudemires have not shown that their
assignment is facially void.
A void contract is one that has no effect whatsoever and is incapable of being
ratified, while a voidable contract is one that is unenforceable at the election of the
injured party. See Dal-Tile Corp. v. Cash N’ Go, 226 Ga. App. 808, 811-812 (487
SE2d 529) (1997) (Beasley, J., concurring specially). Contracts to do illegal or
immoral things, contracts against public policy, and gambling contracts, for example,
are void. OCGA §§ 13-8-1, 13-8-2, 13-8-3. On the other hand, for example,
fraudulent contracts and contracts entered under duress are voidable at the election
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of the injured party. OCGA §§ 13-5-5, 13-5-6. The kind of procedural irregularities
that the Stoudemires contend infect this assignment render it, at most, voidable.
The Stoudemires rely on the notary seal to support their claim that the
assignment is a forgery. They assert that the notary seal shows that the notary’s
commission was to expire on August 5, 2014, that notary commissions are limited to
four years under OCGA § 45-17-5 (a), and that the assignment was dated September
30, 2006. They argue that because notary commissions cannot exceed four years, the
notary could not have witnessed the signatures on September 30, 2006. We agree with
the Stoudemires that these facts raise a serious question about the attestation of the
signatures on the assignment. But questions about the validity of a signature do not
render a document void on its face. Keogh v. Bryson, 319 Ga. App. 294, 298 (3) (735
SE2d 293) (2012) (“Whether a signature is valid is a factual issue that requires
resolution by a jury.”). And in any case, improper attestation of an assignment does
not render it void. Budget Charge Accounts v. Peters, 213 Ga. 17, 19 (4) (96 SE2d
887) (1957).
The Stoudemires argue that the assignment was invalid under the applicable
version of OCGA § 14-5-7 because it was not signed by a secretary, assistant
secretary, cashier, or assistant cashier of Wells Fargo. (The statute was amended in
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2011. Ga. L. 2011, p. 430, § 5.) Although former OCGA § 14-5-7 (a), which is set out
in the margin,1 provided “that the presence of a corporate seal and attestation by
another corporate officer is conclusive evidence that said officers signing are duly
authorized to execute and deliver the same[,] [t]he lack of corporate seal and
attestation . . . is not conclusive evidence that the corporate officer executing a deed
lacks corporate authority to do so.” Hacienda Corp. v. White, 260 Ga. 879, 880 (2)
(400 SE2d 323) (1991) (emphasis in original). Consequently, any defect in this regard
did not render the assignment void on its face.
1
Former OCGA § 14-5-7 (a) provided:
Instruments executed by a corporation conveying an
interest in real property, when signed by the president or
vice-president and attested or countersigned by the
secretary or an assistant secretary or the cashier or assistant
cashier of the corporation, shall be conclusive evidence
that the president or vice-president of the corporation
executing the document does in fact occupy the official
position indicated; that the signature of such officer
subscribed thereto is genuine; and that the execution of the
document on behalf of the corporation has been duly
authorized. Any corporation may by proper resolution
authorize the execution of such instruments by other
officers of the corporation.
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As the Stoudemires have not alleged facts showing that their assignment is
facially void, we need not decide whether to adopt their proposed exception to the
rule that only persons who are parties to an assignment have standing to challenge its
validity. The trial court did not err in dismissing the complaint.
Judgment affirmed. Ellington, P. J., and Dillard, J., concur.
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