Where the undisputed evidence shows that one, by a series of partial payments paid the entire debt secured by a first security deed upon an agreement with the debtor that he would be subrogated to the rights and remedies of the creditor when payment in full was made, it was not error for the trial judge to take this question from the jury and decree that the deed was a first lien for the full amount of such payments, and to deny a later motion to set aside such decree.
This is the second appearance of this case in this court. The first appearance was to review the first grant of a motion for new trial and was affirmed by the court in Dunn v. Gilbert, 217 Ga. 358 (122 SE2d 93)
. The case seeks the cancellation of a security deed by the holder of a second loan deed against the same property. The petitioner alleges that the debt upon which the first loan deed was based has been paid in full, marked satisfied by the grantee and should be delivered up and canceled, but the same has now been transferred to the defendant who is seeking to exercise the power of sale contained therein, and he is therefore proceeding illegally against the property on which petitioner now claims a first lien. The prayers are for temporary injunction to stop the sale, for the security instrument thus paid in full to be delivered up and canceled, and for the petitioner's loan deed to be declared a first lien against the property. The answer, as amended, denies, in the main, the allegations of the petition and alleges that the creditors are indebted to him in the amount of $5,600 and the debt has been transferred to him, and by cross-action alleges further that the debt which the petitioner claims against the property has been paid in full and the loan deed constitutes a cloud upon the title and should be delivered up and canceled.
At the new trial the court only submitted to the jury the issue as raised by the cross-action as to whether or not the second debt had been paid, reserving the other questions as matters of law from the evidence submitted. After the jury found for the petitioner that the second debt was still due and had not been paid, the court entered its final decree declaring the first loan deed sought to be canceled of record had not been satisfied, was a good transfer to the defendant and secured an indebtedness of $3,260 and was a first lien against the property for the above amount with the second debt as found by the jury being an inferior lien second to it.
The petitioner being dissatisfied with the judgment as to the ruling by the court on the questions taken from the jury but satisfied with the jury verdict and the portion of the judgment based thereon, filed a motion for reconsideration and to set aside the judgment on grounds that (1) it was contrary to law; (2) decidedly and strongly against the weight of the evidence; and (3) the evidence demanded a judgment in favor of the petitioner after the jury found in favor of the existence of the second debt, the first debt having been paid in full and the security deed should be delivered up and canceled after it had been marked paid in full; and the judgment should be remolded in favor of the contentions of the movant. After a hearing thereon, the motion was overruled and the exception is to that judgment.
In the hope that all decisions of this court concerning subrogation might be explained and reconciled, this court in McCollum v. Lark, 187 Ga. 292 (200 SE 276), reviewed many of them and concluded that subrogation was of two classes, to wit: (1) legal subrogation which takes place as a matter of equity without any agreement to that effect made with any person paying the debt; and (2) conventional subrogation which is applied where an agreement is made that the person paying the debt shall be subrogated to the rights and remedies of the original creditor; citing Wilkins v. Gibson, 113 Ga. 31, 42 (38 SE 374, 84 ABR 204); Cornelia Bank v. First Nat. Bank of Quitman, 170 Ga. 747, 750 (154 SE 234). It was further held in the McCollum case that subrogation will arise only in those cases where the party claiming it advanced the money to pay the debt which, in the event of default by the debtor, he would be bound to pay, or where he has some interest to protect, or where he advanced the money under an agreement, express or implied, made either with the debtor or creditor, that he would be subrogated to the rights and remedies of the creditor; citing Wilkins v. Gibson, supra; Ragan v. Standard Scale Co., 128 Ga. 544 (58 SE 31); Lutes v. Warren, 146 Ga. 641 (92 SE 58); Lee v. Holman, 182 Ga. 559 (186 SE 189). The law as thus plainly stated is placed beyond doubt. Its application to the facts here determines the proper judgment to be rendered. We have carefully weighed the question as to whether payment under an agreement means a lump sum or in a series of payments, and our conclusion is that it is immaterial whether payment is made by one sum or a number of payments. The heart of the question in that respect is whether or not the subrogee discharged the debt, and the manner in which this was accomplished is immaterial. Therefore, the manner in which the debt was paid, which was a number of payments, satisfies the law as to payment. The remaining question is whether or not such payments were made upon an agreement with the debtor that the payer would be subrogated to the rights and remedies of the creditor. On this question there is no evidence contradicting the testimony showing such an agreement.
Therefore, no issue of fact for decision by the jury remained as to the existence of the first lien, and the trial judge did not err in failing to submit this question to the jury and thereafter entering a decree holding the first deed to be a lien prior to the second, since equity will set aside a cancellation of such security and revive the same for his benefit. McCollum v. Lark, 187 Ga. 292 (3), supra, and cases cited in headnote 3. Thus the court did not err in further overruling the motion to set aside this portion of the decree.
Judgment affirmed. All the Justices concur.