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Yellow Creek Investments, LLC v. Multibank 2009-1 CRE Venture, LLC

Court of Appeals of Georgia

November 13, 2014

YELLOW CREEK INVESTMENTS, LLC et al.
v.
MULTIBANK 2009-1 CRE VENTURE, LLC

Cert. applied for.

Foreclosure. Forsyth Superior Court. Before Judge Dickinson.

Eric S. Chofnas, for appellants.

Morris, Manning & Martin, Jason P. Wright, for appellee.

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

OPINION

Page 729

McFadden, Judge.

This is an appeal from the confirmation of a foreclosure sale. The debtors and guarantors maintain that the sale should not have been confirmed and therefore that they should not be liable for any deficiency of the sale price to satisfy the secured debt.

The present case is the second confirmation proceeding arising out of the foreclosure at issue. In 2011, Multibank 2009-1 CRE Venture, LLC (" Multibank" ) unsuccessfully sought to confirm a foreclosure sale of property securing a loan evidenced by a promissory note executed by Yellow Creek Investments, LLC and guarantied by two individuals (collectively, " Yellow Creek" ). The trial court instead ordered a resale of the property, which Multibank conducted in early 2013, resulting in the sale of the property to its wholly-owned subsidiary, MB REO-GA Land, LLC. The trial court confirmed the 2013 sale, and Yellow Creek appeals.

Yellow Creek argues that Multibank lacked title to the property at the time of the 2013 sale because the trial court did not rescind the 2011 sale, but the trial court's resale order had the effect of setting aside the 2011 sale and Yellow Creek's challenge to Multibank's title falls outside the ambit of a confirmation proceeding. Yellow Creek argues that Multibank's advertisement of the 2013 sale was defective as a matter of law because its description of the property did not match the legal description in the deed to secure debt, but we find that the evidence authorized the trial court to find the advertisement's description was sufficient. Finally, Yellow Creek argues that Multibank did not show that it consummated its sale of the property to MB REO-GA Land, but the evidence authorized the trial court to find that the sale was consummated. Accordingly, we affirm.

In ruling on a confirmation petition, a trial court " is required not only to determine whether the property sold brought its true market [329 Ga.App. 578] value but also to pass upon the legality of the notice, advertisement, and regularity of the sale." Martin v. Fed. Land Bank of Columbia, 173 Ga.App. 142 (325 S.E.2d 787) (1984) (citations and punctuation omitted); see OCGA § 44-14-161. " The trial court is the trier of fact in a confirmation proceeding, and an appellate court will not disturb its findings if there is any evidence to support them. We apply a de novo standard of review to any questions of law decided by the trial court." Citizens Bank of Effingham v. Rocky Mountain Enterprises, 308 Ga.App. 600, 601 (708 S.E.2d 557) (2011) (citations and punctuation omitted).

So viewed, the record shows that in 2011, Multibank (the successor to original lender Magnet Bank) initiated foreclosure proceedings on two tracts of property after Yellow Creek defaulted on its obligations under a promissory note and guaranties. After selling the property at foreclosure to MB REO-GA Land, Multibank sought confirmation of the sale. Errors were identified in the legal description of the property found in the deed to secure debt from Yellow Creek to Magnet Bank; the deed's legal description omitted a land lot reference and did not match the metes and bounds survey of the property in other respects. Yellow Creek argued that these errors invalidated the foreclosure sale, but the trial court did not agree, instead finding that " [n]o evidence has been introduced that the errors in the legal description were discovered prior to the sale or that the errors affected the bidding," and concluding that the " foreclosure procedures complied with the legal requirements as to notice, advertisement and regularity of the sale." Nevertheless, the trial court was persuaded by Yellow Creek's expert appraisal witness that the property's true market value was higher than what it had brought at foreclosure and, accordingly, denied confirmation. The trial court also ordered that the property be resold.

Accordingly, in January 2013 Multibank advertised a second foreclosure sale of the property, this time using a description that corrected the errors previously identified ...


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