Wells Fargo Bank, N.A. v. GordonAnnotate this Case
In 2006, debtor Denise Codrington executed a security deed with appellant Wells Fargo that was recorded with the Clerk of the Superior Court of Fulton County on October 13, 2006. The deed provided: "[i]f one or more riders are executed by Borrower and recorded together with this Security Instrument, the covenants of each such rider shall be incorporated into ...this Security Instrument as if the rider(s) were a part of this Security Instrument." The security deed specifically identified the "ARM Rider" as being incorporated. The last page of the deed was signed by the debtor, the co-debtor (Alvina Codrington), and a notary, but the signature line for an "Unofficial Witness" was left blank. Contemporaneously recorded with the security deed were a number of other exhibits, including a "Waiver of Borrower's Rights." The waiver provided that "the provisions hereof are incorporated into and made a part of the security deed." The parties agreed that the waiver was signed by the debtor, the co-debtor, an unofficial witness, and a notary. In June 2008, the debtor filed for Chapter 7 bankruptcy. Appellee Neil Gordon, Trustee for the debtor's bankruptcy estate, commenced an adversary proceeding against Wells Fargo seeking to avoid Wells Fargo's interest in the property. Appellee asserted that because the security deed lacked the signature of an unofficial witness, it was not duly recorded and it did not provide constructive notice to a subsequent bona fide purchaser, rendering the security deed avoidable per 11 U.S.C. 544. Wells Fargo moved for summary judgment, the bankruptcy court denied the motion, and the bankruptcy court entered judgment in favor of appellee. Wells Fargo appealed to the Eleventh Circuit Court of Appeals which certified two questions to the Georgia Supreme Court: (1) whether a security deed that lacks the signature of an unofficial witness should be considered "duly filed, recorded, and indexed" as required by OCGA 44-14-33; and (2) if no, whether such a situation would nonetheless put a subsequent hypothetical bona fide purchaser on inquiry notice. Upon review, the Supreme Court answered both certified questions in the negative.