O.C.G.A. § 14-5-7 (2019)
Execution of instruments conveying interest in real property or releasing security agreement
(a) Instruments executed by a corporation conveying an interest in real property, when signed by the president or vice-president and attested or countersigned by the secretary or an assistant secretary or the cashier or assistant cashier of the corporation shall, notwithstanding the lack of a corporate seal, be conclusive evidence that the president or vice-president of the corporation executing the instrument does in fact occupy the official position indicated, that the signature of such officer subscribed thereto is genuine, and that the execution of the instrument on behalf of the corporation has been duly authorized. Any corporation may by proper resolution recorded with the instrument or otherwise filed of record and referenced on the face of the instrument authorize the execution of such instruments by other officers of the corporation. (b) Instruments executed by a corporation releasing or transferring a deed to secure debt, mortgage, or other security agreement, when signed by the president, vice-president, secretary, or assistant secretary of the corporation shall, notwithstanding the lack of a corporate seal, be conclusive evidence that the officer of the corporation executing the instrument does in fact occupy the official position indicated, that the signature of such officer subscribed thereto is genuine, and that the execution of the instrument on behalf of the corporation has been duly authorized. Any corporation may by proper resolution recorded with the instrument or otherwise filed of record and referenced on the face of the instrument authorize the execution of such instruments by other officers of the corporation.
History
(Ga. L. 1962, p. 516, § 1; Code 1933, § 22-5106, enacted by Ga. L. 1968, p. 565, § 1; Ga. L. 1982, p. 1197, §§ 1, 2; Ga. L. 1992, p. 1180, § 2; Ga. L. 2011, p. 430, § 5/SB 64.)
Annotations
Editor’s notes. - Ga. L. 1992, p. 1180, § 3, not codified by the General Assembly, provided that the amendment to subsection (a) is applicable to acts occuring prior to July 1, 1992, as well as to acts occuring on or after such date. Law reviews. - For survey article on business associations, see 34 Mercer L.
Rev. 13 (1982). For article, ‘‘2008 Annual Review of Case Law Development,’’ see 14 (No. 6) Ga. St. B. J. 28 (2009). For article, ‘‘2013 Georgia Corporation and Business Organization Case Law Developments,’’ see 19 Ga. St. B. J. 28 (April 2014). For article, ‘‘2015 Georgia Corporation and Business Organization Case Law Devel-
CORPORATIONS & PARTNERSHIPS
opments,’’ see 21 Ga. St. B. J. 30 (Apr. 2016). JUDICIAL DECISIONS Applicability to Uniform Commercial Code. - O.C.G.A. § 14-5-7 applies to the release of instruments securing interests in real property and interests created under former Article 9 of the Uniform Commercial Code (§ 11-9-101 et seq.). Goger v. Merchants Bank (In re Feifer Indus., Inc.), 155 Bankr. 256 (Bankr. N.D. Ga. 1993). Corporate seal not requirement for valid corporate assignment of deed. - Unlike the current version of O.C.G.A. § 14-5-7, the prior version (effective until June 30, 2011) lacked explicit language that a corporate seal was not required for a conclusively valid corporate conveyance; yet, the applicable Georgia law still revealed that a corporate seal was not a requirement for a valid corporate assignment of deed. Foster v. Homeward Residential Inc. (In re Foster), 500 B.R. 197 (Bankr. N.D. Ga. 2013). No presumption of officers’ authority without corporate seal. - If the corporate seal does not appear upon a deed executed by the president of a corporation and attested by the secretary, there is no presumption as to the officers’ authority to execute it. Village Creations, Ltd. v. Crawfordville Enters., Inc., 232 Ga. 131, 206 S.E.2d 3 (1974). Mere parol evidence is insufficient to prove authority. - In the absence of the corporate seal, mere parol evidence indicating that one is the president of the corporation involved in the transaction is insufficient to prove the authority to
transfer. In re Gray, 7 Bankr. 535 (Bankr. M.D. Ga. 1980). Fraudulent deed was facially regular and operated to release security interest. - A 2003 warranty deed that operated to release a prior lender’s security interest in the property was not a forgery but was signed by someone fraudulently assuming the authority of an officer of the prior lender and was regular on the deed’s face. Therefore, a subsequent lender that foreclosed on the property and purchased the property at the foreclosure sale was a bona fide purchaser for value entitled to take the property free of the prior lender’s security interest. Deutsche Bank Nat’l Trust Co. v. JP Morgan Chase Bank, N.A., 307 Ga. App. 307, 704 S.E.2d 823 (2010). Warranty deeds. - Although warranty deeds were not conclusive evidence of a vice president’s authority under the statute, there was no reversible error since the lender did not rely on the warranty deeds but on the opinion of counsel and the marked insurance binder. The lender was also a bona fide purchaser and would not be divested of its interest in the properties. R.W. Holdco, Inc. v. SCI/RW Holdco, Inc., 250 Ga. App. 414, 551 S.E.2d 826 (2001). Cited in Merrill v. Knight State Bank, 721 F.2d 1321 (11th Cir. 1983); Bald Mt. Park v. Oliver, 863 F.2d 1560 (11th Cir. 1989); Stoudemire v. HSBC Bank USA, N.A., 333 Ga. App. 374, 776 S.E.2d 483 (2015).
OPINIONS OF THE ATTORNEY GENERAL Cancellation of security deeds and writs of execution from record. - 1972 Op. Att’y Gen. No. U72-79. Cancellation of deeds to secure debt. - Under Ga. L. 1986, p. 754, amending O.C.G.A. §§ 44-14-3 and 44-14-67, dealing with deeds to secure debt and their cancellation, the release of
corporate security interests in real property or security interests under the UCC, signed by an officer or delegated agent, as provided in O.C.G.A. § 14-5-7(b), will continue to constitute conclusive evidence of corporate authorization for the release, and when the clerk is presented with such a release apparently so signed, in the
absence of overt signs of impropriety, it should be accepted for recording. 1986 Op. Att’y Gen. No. 86-17. RESEARCH REFERENCES Am. Jur. 2d. - 188 Am. Jur. 2d, Corporations, § 2005.
C.J.S. - 19 C.J.S., Corporations, § 745.