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Owen v. Bank of the Ozarks

Court of Appeals of Georgia

October 20, 2014

OWEN
v.
BANK OF THE OZARKS

Cert. applied for.

Note. Haralson Superior Court. Before Judge Murphy.

Dangle, Parmer & Rooks, Thomas E. Parmer, for appellant.

Stites & Harbison, Ronald J. Stay, for appellee.

McFADDEN, Judge. Andrews, P. J., and Ray, J., concur.

OPINION

Page 894

McFadden, Judge.

This appeal is from a grant of summary judgment to a bank on two promissory notes signed by appellant in favor of the bank's predecessor. Appellant's defenses are barred by the D'Oench, Duhme doctrine, which generally renders oral agreements between debtors and failed banks unenforceable against banking authorities and their assignees. Consequently there are no genuine issues of material fact, and we affirm.

Summary judgment is proper when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. OCGA § 9-11-56 (c). " A de novo standard of review applies to an appeal from a grant of summary judgment, and we view the evidence, and all reasonable conclusions and inferences drawn from it, in the light most favorable to the nonmovant." Wooden v. Synovus Bank, 325 Ga.App. 876, 876-877 (756 S.E.2d 19) (2014) (citation omitted).

So viewed, the record shows that appellant Benjamin Carl Owen executed two promissory notes in favor of First Choice Community Bank. On April 10, 2009, he executed a note for $288,000, and on December 22, 2009, he executed a note for $513,560.97. On April 29, 2011, First Choice failed, and the FDIC was appointed as its receiver. The FDIC assigned Owen's notes to appellee Bank of the Ozarks (" the bank" ), via allonges and a Purchase and Assumption Agreement.

Owen defaulted on the notes, and the bank demanded payment. After Owen failed to pay, the bank filed the instant complaint. Finding that Owen did not dispute the existence of the loans, his execution of the loan documents, and the bank's calculation of the balance due, the trial court determined that the bank had established a prima facie case as a matter of law. See L. D. F. Family Farm v. Charterbank, 326 Ga.App. 361, 363 (756 S.E.2d 593) (2014). The court then held that Owen had not established a valid affirmative defense and granted summary judgment in favor of the bank. Owen appeals.

[329 Ga.App. 315] Owen argues that whether the parties had modified the repayment terms of the notes was a question of fact. Specifically, he argues that First Choice had agreed that Owen would pay interest on the loans during their terms; that Owen would pay the principal when the properties securing the loans were sold; and that First Choice would continue to renew the loans until then. As evidence of this agreement, Owen points to his own affidavit. Owen does not allege that this agreement was in writing, nor does he point to any writing in the record reflecting the agreement. He also argues that because of this oral agreement, the bank was estopped from enforcing the terms of the notes and had a duty to mitigate its damages by foreclosing on the properties securing the notes.

The trial court ruled that Owen's defenses were barred by the doctrine announced in D'Oench, Duhme & Co. v. Fed. Deposit Ins. Corp., 315 U.S. 447 (62 S.Ct. 676, 86 LE 956) (1942) and by 12 U.S.C. § 1823 (e), a provision of the Financial Institutions Reform, Recovery and Enforcement Act that codified the D'Oench, ...


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