The Georgia Court of Appeals recently issued two opinions pertinent to the day-to-day operations of Georgia lenders. The following summaries of the opinions warrant review and consideration in order to avoid a number of potential pitfalls.
- The failure to present competent evidence as to the “regularity” of a non-judicial foreclosure sale will result in the Superior Court refusing to confirm the sale.
In what appears to be a marked reaction to the record number of property foreclosures and bank closures in the state in recent years, on June 23, 2011, the Georgia Court of Appeals barred what was previously a common practice of banks in confirming foreclosure sales. In Franklin v. First Georgia Banking Company, First Georgia Banking Company (“FGBC”) attempted to confirm three non-judicial foreclosure sales. The Court of Appeals held that FGBC presented proper evidence as to notice of sales under power and as to the true market value of the subject properties. FGBC’s evidence as to the regularity (i.e., the occurrence and outcome) of the foreclosure sales, however, was deemed insufficient because FGBC failed to present first-hand testimony or other evidence from an actual witness to the sales. The statements of FGBC’s attorney as to the occurrence and outcome of the foreclosure sales were deemed insufficient to carry FGBC’s burden because the attorney did not actually witness the sales.