Category: Real Estate Litigation

Easements by Adverse Possession or Prescription

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Georgia law allows a party to obtain a private way, also known as an easement, over the land of another through a process known as prescription (also sometimes called adverse possession). See OCGA Section 49-4-40 et seq. This requires seven years of uninterrupted use through improved lands. To show prescription, however, the party seeking an easement must show (1) uninterrupted use of the alleged private way, (2) that the private way is no more than twenty feet wide, (3) that they have kept the private way in repair, (4) and that the use was public, continuous, exclusive, peaceable, and accompanied by a claim of right. Finally, the use of the alleged easement must be adverse. This means that there cannot be adverse possession if the owner gives permission to use the property.

To obtain an easement over another’s land, the party seeking an easement must prove each of the above elements. All things being equal, the courts will favor the property owner over the party claiming an easement. This makes sense. Obtaining a legal right to go over someone else’s property should not be easy. On the other hand, a property owner has some responsibility to know how his or her property is being used by another and to prevent unauthorized use.

A recent Georgia Court of Appeals case decided this issue. In Wilkes 581 Farms, LLC v. McAvoy, A20A1225 (September 18, 2020), a party claimed an easement over a road belonging to another party. The court ruled against an easement over the road because the property owner had permitted the party claiming the easement to use the road. Thus, the claim was not “adverse.” In other words, if a property owner gives permission, there cannot be adverse possession or prescription.

Secondarily, the court ruled that the party seeking an easement lost because he could not show that the use of the road was exclusive. Instead, the evidence showed that others used the road. Finally, the court ruled that the alleged use was not adverse because the party claiming the easement had not notified the other property owner that he was claiming an ownership interest in the property owner’s property. The court explained that merely using a road for seven years is not enough to create adverse use. Instead, the party claiming an easement must make repairs or take other action to notify the property owner that someone else was claiming an ownership interest in his land.

If you have an easement question or dispute, please call us at 404-382-9994.

Georgia easements: Do you know what a bridle path is?

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This issue came before the Georgia Court of Appeals. See Doxey v. Crissey, et al, A20A0443 (June 26, 2020). For those of you who do not know (the author included), a bridle path is “a trail for horseback riding.” The American Heritage Dictionary, 5th ed. (2020). See also Merriam-Webster Online Dictionary (2020) (bridle path is “a trail suitable for horseback riding”).

This case involved the enforceability of an easement originally intended as a bridle path, which the owner of the easement wanted to convert to a walking path. The case highlights two important principles related to real estate easements:

(1) To interpret the scope of an easement, the rules of contract construction apply; this is a question of law for the court. The cardinal rule of construction is to ascertain the parties’ intent. Here, the Court of Appeals found that the term “bridle path” has only one meaning, which is a trail for horseback riding. Thus, per the terms of the easement, the only allowed use under the easement was to ride a horse.

(2) As is typical in the law, there is an exception to the above rule. This occurs when use of the easement changes over time, so long as the change is not so substantial as to cause unreasonable damage to the servient estate or unreasonably interfere with its enjoyment. The servient estate is the property that granted or give the easement. This rule applies even without the consent of the servient estate. So, if the easement became a walking trail over time, and the change did not harm the party who granted the easement, then the easement converts to a walking path.

If you have any questions regarding an easement, please call us at 404-382-9991.

In Georgia, can a security interest in real estate expire?

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Yes. A security interest in real estate expires (in other words, become unenforceable) seven years after expiration of the maturity of the debt. Or, if the language in the security deed contains an affirmative statement with the intent of establishing a perpetual security interest, then the expiration date is the later of (a) seven years from the maturity of the debt or (b) 20 years from the date of the conveyance. See O.C.G.A. § 44-14-80(a).

If a security deed expires based the above paragraph, the property reverts back to the borrower. This means the lender loses its security interest in the property and cannot foreclose.

An additional consideration is what happens if the loan is extended. O.C.G.A. § 44-14-80(b) answers this: as long as the loan is extended before the seven or 20 years—and, importantly, the extension is recorded on the public record—then the security interest is also extended by seven or 20 years (depending on the language in the security deed).

The import of recording an extension was the subject of a recent Georgia appellate decision. Bell v. Freeport Title & Guaranty, A20A0133 (May 1, 2020). In Bell, the loan and security went into default in 2007. However, the borrower signed two extensions. These extensions were never recorded on the public record. The lender foreclosed on the loan in 2015. The Georgia of Court of Appeals ruled that because the two extensions were not recorded, the lender’s security interest expired in 2014. Thus, the reversion of the property back to the borrower in 2014 voided the 2015 foreclosure.

Although mentioned in a footnote, Bell makes an important point, which is the grantee (here, the lender) has the duty to record its deed. Reidling v. Holcomb, 225 Ga. App. 229, 230-231 (1997). By failing to record the extensions, the lender had no one to blame but itself.

Please call Gomez & Golomb at 404-382-9994 if you have any questions about title to your property.

The Actual Tax Sale in Georgia

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As a general rule, tax sales are held on the first Tuesday of the month. However, not every county has a tax sale every month. Generally, the tax sales are conducted between the hours of 10 am and 4 pm  on the steps of the county courthouse. If the first Tuesday of the month falls on a legal holiday, the sale is held the next day, Wednesday.

The opening bid for a particular property is the amount of tax due, plus penalties, interest, fi. fa. cost, levy cost, administrative levy fee, certified mail cost, advertising cost, and tax deed recording fees. The property is sold to the highest bidder.

Immediately following the conclusion of the tax sale all purchasers must pay in full the amount bid at the auction. Payment must be in the form of cash, certified check, or cashier’s check. Normally, the purchaser to sign a statement attesting to the fact that certain property was purchased for a certain price. After all payments are processed, the count will provide a Tax Deed and the Real Estate Transfer Tax form.

According to O.C.G.A. § 9-13-170, any person who becomes the purchaser of any real or personal property at any sale made at public outcry who fails or refuses to comply with the terms of the sale when requested to do so, shall be liable for the amount of the purchase money. It shall be the county’s option either to proceed against the purchaser for the full amount of the purchase money or to resell the real or personal property and then proceed against the first purchaser for any deficiency arising from the sale.

Investa Services of GA, LLC: Tax Sale Case

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Anyone who deals with excess tax sale funds or tax deeds in Georgia knows that Investa and/or affiliated entities play a significant role with regard to tax sales. Plaintiffs filed a class action against, among others, Investa. In this lawsuit, Investa was accused of improperly levying on tax executions for delinquent property taxes. The initial tax assessments were later reduced via a property tax appeal.

The trial court dismissed the lawsuit and Investa appealed. See B.C. Grand, LLC v. Investa Services of GA, LLC, A19A1297 (GA Ct of App, October 29, 2019). On appeal, the court ruled in favor of Investa et al., finding that B.C. Grand “failed to allege that the [Tax] Commissioner cancelled the tax executions or that they are void as a matter of law based on the post-issuance reduction in the tax assessment.” Because B.C. Grand failed to pay the taxes at issue while pursuing its appeal of the assessment. Instead, it waited to receive a refund (which it did receive), the full amounts owed remained valid. B.C. Grand also failed to plead the executions were void as a matter of law. So Investa was authorized to levy the executions at the full purchase price amount. Chalk one up for Investa.