Justia Georgia Supreme Court Opinion Summaries

Following a bench trial arising out of a joint venture contract between appellant Thomas Bagwell and appellees Bobby and Oretta Trammel, the trial court denied Bagwell's claim for specific performance of the contract but granted his claims for an equitable partition of real property jointly owned by the parties and dissolution of the joint venture. Bagwell challenged the trial court's final order on several grounds, but the Supreme Court found none sufficient to disturb the trial court's judgment. View "Bagel v. Trammel" on Justia Law

In "Vinings Bank v. Brasfield & Gorrie, LLC," (759 SE2d 886 (2014)), the Court of Appeals affirmed, among other rulings, the trial court’s determination that Vinings Bank was not entitled to summary judgment with regard to a counterclaim for conversion brought against the Bank by Brasfield & Gorrie, LLC ("B&G"). This case stemmed from a defaulted $1.4 million business loan. The bank made the loan to Wagner Enterprises, Inc., which used as collateral, a security interest in all of its accounts and accounts receivable, including Wagner's contract to provide drywall services for general contractor B&G. Wagner defaulted on the loan, and the Bank filed suit against B&G seeking to collect on Wagner's accounts receivable. B&G counterclaimed for conversion, and the parties filed cross-motions for summary judgment. The bank appealed the denial of its motion. The Supreme Court affirmed in part, reversed in part, and remanded. In affirming the trial court's judgment, the Court of Appeals did not consider whether B&G had any right to assert a counterclaim against the bank for conversion of funds due to Wagner's subcontractors. The Supreme Court found that B&G had no direct relationship with the Bank, B&G was not, itself, a subcontractor of Wagner entitled to any of Wagner's funds, B&G did not have direct contractual relationships with any of Wagner's subcontractors, and B&G had no fiduciary relationship with any of Wagner's subcontractors. Furthermore, there was no evidence that Wagner or Wagner's affected subcontractors assigned B&G any of their rights. "Therefore, even if we assume without deciding that funds in [Wagner's] account were held in a constructive trust for the benefit of [Wagner's] subcontractors, B&G is not the party to assert those rights and had no standing to do so." View "Vinings Bank v. Brasfield & Gorrie, LLC" on Justia Law

This appeal and cross-appeal involved a longstanding financial dispute between appellant and cross-appellee Jim Tafel, and appellee and cross-appellant Lion Antique Cars & Investments, Inc., involving two Ferrari race cars. In the main appeal, Tafel argued, among other things, that the trial court erred in declining to exercise its equitable powers to mark satisfied a judgment that Lion Antique had obtained against him. In the cross-appeal, Lion Antique argued the trial court erred in valuing the race cars for purposes of offsetting a part of the judgment that it had obtained against Tafel. Finding no reversible error, the Supreme Court affirmed. View "Tafel v. Lion Antique Cars & Investments, Inc." on Justia Law

Appellees Larry Garner, Sr. and Larry Garner, Jr. were minority shareholders in the Callaway Blue Springs Water Company (CBSW), a closely held corporation. The majority shareholder was Cason Callaway, Jr. In 2007, the Garners sued Callaway and his son and attorney-in-fact, Kenneth Callaway, for specific performance of an oral stock purchase agreement, alleging that the Callaways had reneged on an oral contract under which Cason Callaway, Jr. had agreed to purchase the Garners' 7,500 shares of CBSW stock. Following a bench trial, the trial court entered a detailed final order directing Callaway's estate to perform under the agreement by purchasing the stock at the agreed price of $160 per share, for a total purchase price of $1.2 million. The trial court also awarded prejudgment interest pursuant to OCGA 13-6-13 on the $1.2 million purchase price, running from the date of breach through the date of judgment. The Court of Appeals affirmed. The Supreme Court granted certiorari to determine whether OCGA 13-6-13 authorized the award of prejudgment interest on a judgment granting relief only in the form of specific performance. After review, the Court answer the question in the negative. Though the Court reversed the trial court to the extent it awarded prejudgment interest under OCGA 13-6-13, the Court remanded for a determination as to whether prejudgment interest may nonetheless be awarded in this case under OCGA 7-4-15. View "Estate of Cason Callaway, Jr. v. Garner" on Justia Law

The Eleventh Circuit Court of Appeals certified a question of law to the Georgia Supreme Court. The certified question arose out of a declaratory judgment action related to underinsured motorist (“UIM”) coverage under a commercial auto insurance policy issued by FCCI Insurance Co. (“FCCI”). The litigation was the result of a 2011 collision between a McLendon Enterprises, Inc. truck driven by McLendon employee Brooks Mitchell, with passengers Elijah Profit, III and Bobby Mitchell (“Bobby”), and an Evans County school bus driven by John Haartje. Profit, Bobby, and Mitchell claimed injuries as a result of the collision. In May 2013, Mitchell filed suit in state court against Haartje and the Evans County Board of Education to recover for his alleged damages. Mitchell served FCCI as McLendon's uninsured motorist (UM) carrier. At the time of the collision, the School District had an insurance policy with GSBA Risk Management Services, under whose policy, paid out the $1,000,000 liability limits for damages related to the collision. It settled with Profit and Bobby for $350,000 combined and agreed to pay Mitchell the remaining $650,000 in exchange for a limited liability release, thereby exhausting its $1,000,000 liability limits. Mitchell filed for UM benefits from FCCI. FCCI denied liability on the basis of the at-fault driver's statutory immunity. The question certified centered on whether an insured party could recover under an uninsured-motorist insurance policy providing that the insurer will pay sums “the insured is legally entitled to recover as compensatory damages from the owner or driver of an uninsured motor vehicle” despite the partial sovereign immunity of the tortfeasor. The Georgia Supreme Court answered the question in the affirmative. View "FCCI Insurance Co. v. McLendon Enterprises, Inc." on Justia Law

Piedmont Office Realty Trust, Inc. purchased two insurance policies: a primary policy issued by Liberty Surplus Insurance Company and an excess coverage policy issued by XL Specialty Insurance Company ("XL"). The excess policy provided that XL will only pay for a "loss" which Piedmont became "legally obligated to pay as a result of a securities claim." The policy also contains a "consent to settle" clause. In addition, the policy contains a "no action" clause which read: "No action shall be taken against the insurer unless, as a condition precedent thereto, there shall have been full compliance with all of the terms of this policy, and the amount of the insureds’ obligation to pay shall have been finally determined either by judgment against the insureds after actual trial, or by written agreement of the insureds, the claimant and the insurer." Piedmont was named as a defendant in a federal securities class action suit in which the plaintiffs sought damages exceeding $150 million. Relatively early in the litigation, Piedmont moved for summary judgment. The district court denied Piedmont’s motion. Thereafter, following years of discovery and litigation, Piedmont renewed its summary judgment motion. The district court granted the renewed motion and dismissed the class action suit. Plaintiffs appealed. While the plaintiffs’ appeal was pending, plaintiffs and Piedmont agreed to mediate plaintiffs’ claim. By that time, Piedmont had already exhausted its coverage limit under its primary policy and another $4 million of its excess policy simply by defending itself. Anticipating a settlement with plaintiffs, Piedmont sought XL’s consent to settle the claim for the remaining $6 million under the excess policy. XL agreed to contribute $1 million towards the settlement, but no more. Without further notice to XL and without obtaining XL’s consent, Piedmont agreed to settle the underlying lawsuit with plaintiffs for $4.9 million. The district court approved the settlement and Piedmont demanded XL provide coverage for the full settlement amount. XL refused. Piedmont filed suit against XL for breach of contract and bad faith failure to settle. XL moved to dismiss the complaint; the district court granted XL’s motion; and Piedmont appealed. The 11th Circuit certified three questions to the Georgia Supreme Court: (1) Under the facts of this case, was Piedmont "legally obligated to pay" the $4.9 million settlement amount, for purposes of qualifying for insurance coverage under the Excess Policy?; (2) In a case like this one, when an insurance contract contains a "consent-to-settle" clause that provides expressly that the insurer's consent "shall not be unreasonably withheld," can a court determine, as a matter of law, that an insured who seeks (but fails) to obtain the insurer's consent before settling is flatly barred from bringing suit for breach of contract or for bad-faith failure to settle?; and (3) In this case, under Georgia law, was Piedmont's complaint dismissed properly? The Georgia Supreme Court responded: absent XL’s consent to the settlement, under the terms of the policy, Piedmont could not sue XL for bad faith refusal to settle the underlying lawsuit in the absence of a judgment against Piedmont after an actual trial. It follows that the district court did not err in dismissing Piedmont’s complaint. View "Piedmont Realty Office Trust v. XL Specialty Insurance Co." on Justia Law

The owner of Mamilove, LLC, and its officers, sisters Michele and Lorraine Reymond sought rescission of a franchise agreement and damages for claims related to their negotiations for, and ultimate purchase of, a daycare franchise. The named defendants were the franchisor, Legacy Academy, Inc., and its officers, Frank and Melissa Turner (collectively “Legacy”). Ten years after they signed the franchise agreement at the heart of this dispute, the Reymonds alleged Legacy fraudulently induced them to sign the agreement by providing false information about the historical earnings of existing Legacy Academy franchisees. They sought to rescind the franchise agreement and recover damages for claims based on alleged fraud, negligent misrepresentation and violation of the Georgia Racketeer Influences and Corrupt Organizations Act (RICO). After a jury trial, the trial court denied Legacy's motion for a directed verdict as to all of the Reymonds' claims. The jury found in the Reymonds' favor, and awarded $750,000 in damages plus attorney fees. Legacy appealed, raising various challenges, including a challenge to the trial court's ruling on its motion for directed verdict. Upon review, the Supreme Court concluded the trial court erred in denying Legacy's motion for a directed verdict as to fraud, negligent misrepresentation and a violation of the RICO statute. The Court reversed the Court of Appeals who affirmed the trial court with regard to these claims, and remanded the case for further proceedings. View "Legacy Academy, Inc. v. Mamilove, LLC" on Justia Law

In this case, Subodh Raysoni raised consumer fraud claims under the Fair Business Practices Act of 1975 against Payless Auto Deals, LLC, alleging that Payless gave false assurances that a used minivan never had been in a collision or otherwise damaged - assurances upon which he relied - when he purchased the minivan from Payless. Contending that the terms of their written contract rendered any such reliance unreasonable as a matter of law, Payless moved for judgment on the pleadings. The trial court granted that motion, and the Court of Appeals affirmed. Payless relied on several provisions of the contract disclaiming warranties, but the Supreme Court held that its reliance was misplaced because these disclaimers were not absolute and unequivocal enough to warrant judgment on the pleadings: "We cannot say as a matter of law that the contractual disclaimers of warranties - which are, at least arguably, equivocal and limited - preclude any reasonable reliance in this case on a written Carfax report furnished by Payless. We do not mean to suggest that the provisions of the contract upon which Payless relies would not have been most reasonably understood by a customer just as Payless argues. On these pleadings, we cannot say as a matter of law that Raysoni will be unable to show that his reliance on representations that the minivan was undamaged and never had been in a wreck - particularly the written Carfax report - was reasonable." Judgment on the pleadings ought not have been awarded to Payless. The case was reversed and remanded for further proceedings. View "Raysoni v. Payless Auto Deals, LLC" on Justia Law

Velicia Carter was injured in an automobile collision with Jeova Oliviera. It was alleged that Oliviera was under the influence of alcohol at the time. Oliviera had an auto liability insurance policy with GEICO General Insurance Company with a $30,000 per person liability limit. Carter was insured by Progressive Mountain Insurance Company, including uninsured/underinsured motorist (UM) coverage of $25,000 per person. Carter sued Oliviera and served Progressive as her UM carrier, and entered into a settlement in which GEICO paid the $30,000 limit of Oliviera's policy, and Carter executed a limited liability release. It allocated $29,000 of GEICO's payment to punitive damages and $1,000 to compensatory damages. Progressive answered the suit as Carter's UM carrier and sought summary judgment on the UM claim, which the trial court granted, ruling that, by imposing the condition that $29,000 of the liability coverage limit be allocated to the payment of punitive damages, Carter failed to meet a prerequisite for recovery of the UM benefits. The Court of Appeals affirmed, finding that, by allocating a portion of the payment to punitive damages, rather than allocating all of the payment to compensatory damages, Carter failed to exhaust the limits of Oliviera's liability policy, and, therefore, forfeited the ability to make a claim on her UM policy. The Supreme Court granted a writ of certiorari to the Court of Appeals to determine if that Court properly applied the motor vehicle insurance limited liability release provision of OCGA 33-24-41.1. Finding that the Court of Appeals erred, the Supreme Court reversed that Court's judgment. View "Carter v. Progressive Mountain Ins." on Justia Law

The issue this case presented to the Supreme Court stemmed from litigation involving the dissolution of an anesthesiology practice. Plaintiffs Angel Cancel, M.D., Pravin Jain, M.D., Grace Duque-Dizon, M.D., and Monajna Sanjeev, M.D. were shareholders in the now-defunct Central Georgia Anesthesia Services, P.C. (CGAS), which was at one time the exclusive anesthesiology provider at a Macon hospital owned and operated by The Medical Center of Central Georgia, Inc. According to Plaintiffs' complaint, beginning in 2001, Plaintiffs Cancel and Jain discovered what they believed were billing irregularities within the practice, which they brought to the attention of their fellow shareholders and officials at The Medical Center over a period of time between 2001 and 2003. In 2003, The Medical Center announced its intention to restructure its anesthesiology department, after which CGAS shareholders voted to terminate CGAS' contract with The Medical Center. The Medical Center subsequently began recruitment of physicians for its restructured department and eventually selected several former CGAS physicians to join it. None of the four Plaintiffs were selected, and their affiliation with The Medical Center ended. The Medical Center had entered into an exclusive services contract with The Nexus Medical Group, LLC, which was comprised of the former CGAS physicians, and some non-CGAS physicians, who had been selected by The Medical Center for its restructured anesthesiology department. Alleging that the restructuring at The Medical Center and formation of Nexus were effectuated as part of a scheme to expel Plaintiffs from their practice in retaliation for bringing to light the billing issues, Plaintiffs filed suit seeking damages for breach of fiduciary duty, fraud, and other claims. Several years of discovery, and various motions for summary judgment were filed and hearings were held. In 2011, the trial court issued an order granting summary judgment to Defendants on all of Plaintiff Cancel's claims. Cancel appealed this order. Prior to the filing of Cancel's notice of appeal, the trial court issued a second order, denying Nexus' motion for summary judgment as to the remaining Plaintiffs. After the filing of the notice of appeal, the trial court issued the last of its summary judgment orders, denying the motions filed by the CGAS Defendants and The Medical Center Defendants as to the remaining Plaintiffs. Nexus and the CGAS Defendants filed a notice of cross-appeal, challenging the orders denying them summary judgment. A few days later, the Medical Center Defendants filed their own notice of cross-appeal. The Court of Appeals consolidated the appeal and cross-appeals and issued a single opinion in which it affirmed the grant of summary judgment against Cancel; reversed the denial of summary judgment against Nexus; and dismissed the cross-appeals of the CGAS Defendants and the Medical Center Defendants. Dismissal of the cross-appeals was premised on the Court of Appeals' conclusion that it had no jurisdiction to consider them because they sought to challenge orders issued after the filing of Cancel's notice of appeal. Upon review, the Supreme Court concluded that the appellate court had jurisdiction, and erred in holding otherwise. Accordingly, the case was reversed and remanded for further proceedings. View "Sewell v. Cancel" on Justia Law