INSTRUMENTS EXECUTED BY CORPORATIONS


9.1 Name Omitted from Signature


The signature to a corporate instrument is sufficient notwithstanding the omission of the corporate name over the signatures of the signers, if the corporation appears as the party to the instrument and the instrument is otherwise properly executed. Comment: This Standard is based upon prior Standard 9.2 as now amended by Georgia Laws 1992, Page 1180 [O.C.G.A. Section 14-5-7(a)], effective July 1, 1992.

9.2 Authority of Officer to Execute Instruments


When a corporate instrument is either (i) executed by a corporate officer, that person’s signature is attested by the secretary or assistant secretary (or other officer authorized to authenticate corporate records), and the corporate seal or a facsimile thereof is affixed, or (ii) executed by the president or vice president and that person’s signature is attested by the secretary or assistant secretary (or other officer authorized to authenticate corporate records), a title examiner may assume that the officer executing the document in fact holds the position indicated, that such person is authorized to execute the document, and that the officer’s signature is genuine.

Comment: Source — O.C.G.A. Section 14-2-151. See also O.C.G.A. Section 14-5-7, Clause (ii) above became effective July 1, 1992. The Examiner should bear in mind that the evidentiary presumption afforded by O.C.G.A. Sections 14-2-151 and 14-5-7 do not establish recording requirements. Recording is governed by O.C.G.A. Section 44-2-14, which requires, with respect to execution, a signature, attested by an officer as provided in O.C.G.A. 44-2-15, and attested by one other witness. Neither the presence of a corporate seal, nor the signature of an officer specified in O.C.G.A. Section 14-5-7, is required for recording.

9.3 Evidence of Corporate Authority


There exists a conclusive presumption of corporate authority to execute an instrument conveying an interest in real property when the documents executed by the president or vice president and attested by the secretary or an assistant secretary or the cashier or assistant cashier of the corporation. For other corporate instruments, the title examiner may assume that corporate authority exists if the document is either executed by a corporate officer, that person’s signature is attested by the secretary or assistant secretary ( or other officer authorized to authenticate corporate records), and the corporate seal or a facsimile thereof is affixed, or executed by the president or vice president and that person’s signature is attested by the secretary or assistant secretary (or other officer authorized to authenticate corporate records).

Comment: The first sentence is based upon O.C.G.A. Section 14-5-7 and the second sentence is based upon O.C.G.A. Section 14-2-151. Both of these Sections were effective July 1, 1992. Under prior law, a document executed by the president or vice president and attested by a secretary or assistant secretary required the presence of a corporate seal to create the presumption of authority. Note that O.C.G.A. Section 14-5-7 provides that a corporation may by proper resolution authorize the execution of instruments of conveyance by other officers of the corporation.

9.4 Corporate Existence


Where an instrument of a private corporation appears in the chain of title and has been of record for a period of at least seven years, and the instrument is executed in proper form, the examiner may assume that the corporation was legally in existence at the time the instrument took effect, and that the officers who executed such document were authorized to do so.

Comment: This is the same as former Standard 9.4. It appears that the seven-year measurement is based upon the period used in the Statute of Limitations for adverse possession under color of title or for an action for fraud or forgery in procuring title to land, although the Statute does not commence until the fraud is or should have been discovered. Jones v. Spindel, 239 Ga. 68, 235 S.E.2d 486 (1977).

9.5 Foreign Corporations


When an instrument of a corporation organized in and doing business in another state appears in the chain of title, an examiner need not inquire whether such corporation was authorized to do business in this State. Comment: The failure of a foreign corporation to obtain a certificate of authority does not impair the validity of its corporate acts. O.C.G.A. Section 14-2-1502(d).

9.6 Transfer or Satisfaction of a Security Deed by a Corporate Grantee


(a) A transfer of a security deed from a corporate grantee does not impair marketability if executed, without a corporate seal, by one corporate officer or by a person so authorized by corporate resolution and witnessed in the same manner as required for recording a deed.

Comment: This is based upon O.C.G.A. Section 14-5-7(b) which requires less formality for the execution of corporate transfers than does O.C.G.A. Section 14-5—7(a) for other corporate instruments. See Standards 9.2 and 9.3, supra.

(b) A satisfaction of a security deed by a corporate grantee does not impair marketability if executed, without a corporate seal, by one corporate officer or by a person so authorized by a corporate resolution in any of the three ways approved by Standard 14.7, infra. All approved methods for satisfaction, other than that of an entry on the face of the original security deed itself, must be witnessed in the same manner as required for recording a deed.

Comment: This is based upon O.C.G.A. Section 14-5-7(b).

9.7 Other Useful Provisions of the Georgia Business Corporation Code



In appropriate circumstances, the examiner should also take into consideration the following provisions of the Georgia Business Corporation Code:

(a) If the valid filing of an instrument with the Secretary of State is relevant to the examination, the examiner should take into consideration O.C.G.A. Section 14-2-127, which provides that a certified copy of a document filed with the Secretary of State is “prima-facie evidence that the original document has been filed with the Secretary of State.”

(b) If in an examination a question arises as to the authority of the directors of a corporation, the examiner should take into consideration, in addition to the presumptions provided by other Standards, O.C.G.A. Section 14-2-801, which provides that “no limitation upon the authority of the directors, whether contained in the articles of incorporation, bylaws, or an agreement among the shareholders, shall be effective against persons, other than shareholders and directors, who are without actual knowledge of the limitation.”

(c) If the authority of the chief executive officer of a corporation (or the president of the corporation if no person has been designated as chief executive officer) is relevant to the examination, the examiner should take into consideration, in addition to the other Standards, O.C.G.A. Section 14-2-841, which provides that such person “shall have authority to conduct all ordinary business on behalf of such corporation and may execute and deliver on behalf of a corporation any contract, conveyance, or similar document not requiring approval by the board of directors or shareholders as provided in this chapter.” Comment: This provision became effective on July 1, 1993, and changed existing Georgia case law holding that a president of a Georgia corporation had no such authority.

(d) If the effect on title of a merger of a corporation appearing in the title is relevant to the examination, the examiner should take into consideration O.C.G.A. Section 14-2-1106(a)(2), which provides that “when a merger takes effect: . . . (2) the title to all real estate and other property owned by each corporation party to the merger is vested in the surviving corporation without reversion or impairment.”

(e) If the validity of acts taken by a corporation that was dissolved by expiration of its period of duration or that was administratively dissolved, but that in either case subsequently was reinstated, is relevant to the examination, the examiner should take into consideration the effect of O.C.G.A. Sections 14-2-1409 and -1422, which provide, in general terms, that the reinstatement of such a corporation relates back to the date of dissolution or expiration and that the corporate existence continued without interruption.

(f) If the execution of deeds or other transfer instrument after the dissolution of a corporation is relevant to the examination or is a matter that the examiner must pass upon in connection with the execution of an instrument, the examiner should take into consideration O.C.G.A. Section 14-2-1408(c), which provides that “deeds or other transfer instruments requiring execution after the dissolution of a corporation may be signed by any two of the last officers or directors of the corporation” (without need of a corporate seal) “and shall operate to convey the interest of the corporation in the real estate or other property described.”

9.8 Alien Corporations



When an instrument of an alien corporation as defined in O.C.G.A. Section 16-143(1) appears in the chain of title, the examiner must require that proper certification be furnished that the corporation has complied fully with the requirements of O.C.G.A. Section 16-14-15(h) of the Georgia RICO Act which provides: “Each alien corporation that fails to file [with the Secretary of State] a report as required by subsection (c) of this Code section or fails to maintain a registered office and a registered agent as required by subsection (a) of this Code section shall not be entitled to own, purchase, or sell any real property and shall not be entitled to bring an action or defend in the courts of the state until such requirements have been complied with.” Comment: An “‘alien corporation’ means a corporation organized under laws other than the laws of the United States or the laws of any state of the United States.” (O.C.G.A. Section 16-14-3(1)).