This appeal arises from the bench trial of a counterclaim for a declaratory judgment brought by LIB Properties, Ltd. against the plaintiff/defendant-in-counterclaim, Macedonia Baptist Church of Atlanta MBCA, by which LIB sought a declaration that a loan note and a security deed were valid and enforceable against MBCA. MBCA appeals from the trial court’s grant of declaratory judgment in favor of LIB, and for the following reasons, we reverse. Acting through church members, MBCA, an unincorporated association, brought suit on March 30, 2007, against LIB, Macedonia Baptist Church of Atlanta, Inc. MBCA, Inc., and Scottie L. Cousins and Alan Moon both church members. The suit claimed that, without authority of the church membership, Cousins and Moon incorporated MBCA, Inc. as a non-profit corporation in January 2007, and that Cousins attempted to name himself as pastor of the church and take control of church property from the existing pastor, Daniel Dickson. The suit also alleged that Cousins signed documents on March 7, 2007, as president of MBCA, Inc. by which the corporation obtained a loan from LIB in the amount of $202,500, and gave LIB a note in that amount and a security deed over vacant real property owned by the church. The suit sought various damages along with injunctive relief preventing LIB from foreclosing against MBCA on the note and security deed or otherwise encumbering church property. LIB answered and filed a counterclaim against MBCA seeking a declaratory judgment validating the note and the security deed.1
Without objection from any party, the trial court held a bench trial on LIB’s counterclaim for declaratory judgment, and at the conclusion of the trial entered a judgment in favor of LIB against MBCA declaring the validity of the note and the security deed. The trial court considered the following evidence. The church was originally incorporated as a non-profit corporation in January 2001 under the name Macedonia Baptist Church of Atlanta, Inc. In July 2001, this original corporation was deeded title to the real property, including vacant land, owned by the previously unincorporated church. The vacant real property deeded to the original corporation in July 2001 was the same vacant real property described in the 2007 security deed given by MBCA, Inc. to LIB. The vacant real property deeded to the original corporation in July 2001 was held subject to a mortgage note and security deed given by the original corporation in October 2001 to Capital City Bank & Trust Company Capital City. In January 2007, the church pastor, Dickson, asked Cousins, who worked for the church and was also a mortgage broker, to look for a new mortgage loan for the church. In doing so, Dickson authorized Cousins to receive church financial records and to obtain loan offers. In January 2007, Cousins approached LIB for a loan and represented that he was acting on behalf of the church as the church pastor and as the president of the non-profit corporation, MBCA, Inc., which he incorporated in January 2007. The record shows that, because of failure to pay fees, the original corporation was administratively dissolved by the Secretary of State in 2005. The original corporation remained administratively dissolved in January 2007 when Cousins incorporated MBCA, Inc. as a new non-profit corporation using the same corporate name as the administratively dissolved corporation. When MBCA, Inc. entered into the loan transaction with LIB on March 7, 2007, and gave the note and security deed to LIB, the original corporation was still administratively dissolved. There is no evidence that the original corporation or MBCA, which filed the present suit as an unincorporated association, authorized or had prior knowledge of the loan transaction with LIB. Shortly after learning about the LIB loan transaction, MBCA filed the present suit on March 30, 2007. Although the original corporation remained administratively dissolved when the present suit was filed, it eventually paid the necessary fees and, prior to the bench trial, was reinstated by the Secretary of State with its original corporate name, Macedonia Baptist Church of Atlanta, Inc. We hereafter refer to the administratively dissolved and reinstated original corporation incorporated in January 2001 as Original MBCA, Inc.; we refer to the new corporation using the same name incorporated by Cousins in January 2007 as New MBCA, Inc.; and we refer to the unincorporated association which brought the present suit as MBCA Association.
