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Call Now: 904-383-7448If the principal executes any mortgage or gives other security to the surety or endorser to indemnify him against loss by reason of his suretyship, the surety or endorser may proceed to foreclose such mortgage or enforce such other lien or security as soon as judgment shall be rendered against him on his contract.
(Orig. Code 1863, § 2142; Code 1868, § 2137; Code 1873, § 2164; Code 1882, § 2164; Civil Code 1895, § 2983; Civil Code 1910, § 3555; Code 1933, § 103-305.)
- This section prescribes a rule which was intended to be general, and the section comprehends all cases of the class mentioned. Importers & Traders Bank v. McGhees & Co., 88 Ga. 702, 16 S.E. 27 (1892).
- This section simply provides a remedy for the endorser or surety in the absence of any stipulations in the contract between the principal and the surety on the subject. Jones v. Norton, 9 Ga. App. 333, 71 S.E. 687 (1911).
- Mortgage given to indemnify a surety may, under this section, be foreclosed by the surety when judgment is rendered against the surety on the contract. Conley v. State, 85 Ga. 348, 11 S.E. 659 (1890).
- Under this section, no foreclosure can be had ordinarily until after judgment against the mortgagee. Importers & Traders Bank v. McGhees & Co., 88 Ga. 702, 16 S.E. 27 (1892); Jones v. Norton, 136 Ga. 835, 72 S.E. 337 (1911).
- By clear implication, this section negatives any right of foreclosure until the surety or endorser has paid something on the debt or judgment has been rendered against the surety on the surety's contract. Importers & Traders Bank v. McGhees & Co., 88 Ga. 702, 16 S.E. 27 (1892).
- This section recognizes the right of the principal to give to the principal's surety or endorser a mortgage or other security to secure and protect the surety on the surety's endorsement or suretyship, and, if it is legal for such a mortgage to be given, it can be provided in the mortgage that it may be foreclosed or enforced in such way as the parties may stipulate, without reference to the statutory right referred to. Jones v. Norton, 9 Ga. App. 333, 71 S.E. 687 (1911).
- When the security to a promissory note was indemnified by a mortgage executed by the principal, and after the note became due, the security voluntarily gave the security's own note to the creditor, which was accepted by the security in full payment of the joint debt, and the joint note was given up to the security, the security was allowed to foreclose the security's mortgage against the principal and collect from the security what was actually due on the note in the hands of the original creditor. Mims v. McDowell, 4 Ga. 182 (1848).
- Principal debtor may make any defense to the note which the debtor could have made against the original creditor. Mims v. McDowell, 4 Ga. 182 (1848).
- Creditor, prior to obtaining judgment, cannot proceed in the creditor's own behalf to enforce the mortgage, even though the principal debtor and the endorser both are insolvent, the rights of the creditor depending, not upon the law of trust, but upon the law of subrogation. Importers & Traders Bank v. McGhees & Co., 88 Ga. 702, 16 S.E. 27 (1892); Burnett v. Gainesville Nat'l Bank, 28 Ga. App. 255, 110 S.E. 753 (1922).
- In the absence of any judgment against the surety upon the indebtedness represented by a note, there was no right in the surety to enforce any lien against the property arising out of a deed to secure a debt to the surety from the principal, and therefore no right existed in the surety to which the creditor could be subrogated. Burnett v. Gainesville Nat'l Bank, 28 Ga. App. 255, 110 S.E. 753 (1922).
- Creditor cannot, prior to obtaining judgment according to this section on the creditor's debt, maintain a bill or petition to impound the mortgaged assets to await the recovery of such judgment. Up to the rendition of judgment, the right to preserve the security is one personal to the endorser, and to which the creditor is not subrogated. Importers & Traders Bank v. McGhees & Co., 88 Ga. 702, 16 S.E. 27 (1892).
- Since a deed of trust to two of 16 accommodation endorsers was a voluntary assignment for the benefit of creditors and was not a mortgage or mere security under former Code 1882, § 2164, a compliance with the essential requirements of former Civil Code 1895, § 2700 et seq. was necessary to the security's validity. Johnson v. Brewer, 134 Ga. 828, 68 S.E. 590, 31 L.R.A. (n.s.) 332 (1910).
- Right of surety or his privies to require creditor to resort to security given by principal before enforcing security given by surety, 37 A.L.R. 1262.
No results found for Georgia Code 10-7-44.