Dempsey v. Etowah Bank

Carley, Presiding Judge. The relevant facts in the instant appeal are as follows: Appellant-defendant purchased three motor vehicles and a boat from one Jerry McBride d/b/a Fleet Recovery. In payment, appellant gave McBride a check in the amount of $5,600. McBride endorsed the check and deposited it into the checking account that Fleet Recovery maintained with appellee-plaintiff. Appellee immediately credited Fleet Recovery’s account with the amount of appellant’s check. Subsequently, appellant issued a stop-payment order on the check but, by the time that appellee received notification, there was only $401.15 remaining in Fleet Recovery’s account. Appellee then brought the instant suit against appellant, seeking to recover the $5,198.85 balance. Appellant answered and, after discovery, appellee moved for summary judgment. The trial court granted appellee’s motion and appellant appeals. If appellee were merely a holder of appellant’s check to Fleet Recovery, then appellee would hold that check subject to the defenses enumerated in OCGA § 11-3-306. Tidwell v. Bank of Tifton, 115 Ga. App. 555, 556 (1) (155 SE2d 451) (1967). Under the undisputed evidence of record, however, appellee is a holder in due course as defined in OCGA § 11-3-302 (1). In good faith, appellee gave value for the check and, at the time it did so, it had no notice of appellant’s stop-payment order or of appellant’s defense against payment to Fleet Recovery for the three motor vehicles and the boat. Pazol v. Citizens Nat. Bank of Sandy Springs, 110 Ga. App. 319, 320 (1) (138 SE2d 442) (1964). Accordingly, appellee took the check free from the defenses enumerated in OCGA § 11-3-306 and subject only to the defenses enumerated in OCGA § 11-3-305 (2). Under the evidence of record, no genuine issue of material fact remains as to the viability of any of the defenses enumerated in OCGA § 11-3-305 (2). It follows, therefore, that the trial court correctly granted summary judgment in favor of appellee. Judgment affirmed. Pope and Johnson, JJ., concur. *50 Bishop & McElyea, M. Ellen McElyea, for appellee.