author: Eldridge, Judge. Blackburn, Judge,

text:
    A98A1246.
    SPEIR v. KRIEGER.
    (509 SE2d 684)
   Eldridge, Judge.

This is an appeal from a Clayton County trial court’s order granting appellee/plaintiff Craig Krieger’s motion for summary judgment and denying appellant/defendant Thomas Lee Speir’s summary judgment motion. This case is one in a series of ongoing lawsuits filed by plaintiff Krieger against McFrugal Auto Rental, Inc. (“McFrugal Auto”) and its corporate officers.

McFrugal Auto is a closely held corporation whose operating officers and sole shareholders are appellant Thomas Speir and Donald Roveto, who is not a party to this appeal. Speir is registered with the Secretary of State as the Corporate Secretary and Agent for Service for McFrugal Auto; Roveto is registered as Chief Executive Officer (“CEO”).

In 1993, plaintiff was injured when the vehicle he was driving was hit by a car rented from McFrugal Auto. Thereafter, plaintiff learned that McFrugal Auto carried no liability insurance on its vehicles. Plaintiff filed suit against McFrugal Auto in the State Court of Fulton County based upon McFrugal Auto’s failure to carry third-party liability insurance, even though McFrugal sold such nonexistent insurance to its renters, and even though such insurance coverage was mandated under state law in order to protect third parties, such as plaintiff, in case of injury. A default judgment was entered against McFrugal Auto on December 18, 1995, and a hearing was held on damages. The Fulton County State Court awarded plaintiff $257,248, $250,000 of which was in punitive damages reflecting plaintiff’s claim of fraud in the sale of non-existent insurance. McFrugal Auto did not contest the award of such damages or the factual predicate that provided the foundation for the award.

However, on October 1, 1995, prior to the above judgment, McFrugal Auto’s CEO Donald Roveto sold the assets of McFrugal Auto, as well as the assets of a separate, closely held corporation, McFrugal Holding Company, Inc. (“McFrugal Holding”), to a new corporation formed for the purpose of acquiring the assets of McFrugal Auto and McFrugal Holding, McRent-A-Car, Inc. (“McRent”). This action rendered both McFrugal Auto and McFrugal Holding insolvent.

Plaintiff then filed a suit in equity against McFrugal Auto and McFrugal Holding (the “McFrugal Entities”) and McRent in the Superior Court of Fulton County, seeking to “pierce the corporate veil” between the corporations by demonstrating their fraudulent operation. In his complaint, plaintiff alleged that there existed a commingling of assets between the McFrugal Entities in order to avoid payment of debt (including plaintiff’s judgment), which pierced the corporate veils of the McFrugal Entities. Plaintiff voluntarily dismissed McRent from the suit, and on January 22, 1997, a judgment was entered finding against the McFrugal Entities as to their liability for the prior $257,248 state court judgment against McFrugal Auto. As to the issues raised in plaintiff’s complaint, the Fulton County Superior Court specifically found as a matter of fact and law that: “McFrugal [Holding] and McFrugal [Auto] were operated as one entity, commingled assets, and used corporate entities to perpetuate fraud and injustice upon Georgia consumers, of which the plaintiff was one. Plaintiff has, as a matter of law, pierced the corporate veil rendering said entities one entity, as alleged in Plaintiff’s complaint.” (Emphasis supplied.)

No challenge was made to the findings of the Fulton County Superior Court or the factual predicates in support thereof.

Plaintiff then filed the instant suit in equity in the Superior Court of Fulton County against appellant Thomas Speir and Donald Roveto, as sole corporate, operating officers of McFrugal Auto and McFrugal Holding. For jurisdictional reasons, the case was transferred to Clayton County. In his complaint, plaintiff sought to hold Speir and Roveto, as sole corporate, operating officers and shareholders of the McFrugal Entities, liable for the judgment against the McFrugal Entities, as reflected in the orders of the two Fulton County lawsuits. In addition, plaintiff amended his complaint, alleging that Speir’s and Roveto’s actions demonstrated a pattern of racketeering activity within the meaning of OCGA § 16-14-1 et seq., civil Racketeer Influenced & Corrupt Organizations (“RICO”) Act, and sought treble damages pursuant to OCGA § 16-14-6 (c).

Plaintiff filed a motion for summary judgment, as did Speir and Roveto. The trial court heard the matter on July 17, 1997. The Clayton County trial court, “[a]fter consideration of the arguments of counsel,” found no justiciable issue of material fact and granted summary judgment to plaintiff; the court denied the defendants’ summary judgment motion. In addition, the Clayton County trial court found “evidence of a specific pattern of racketeering activity, in that these defendants operated as an auto leasing company with many offices in the State, leasing vehicles to be operated upon the streets of and highways of this state without one dime’s worth of liability insurance, and as Judge Bonner said [in the Fulton Superior Court case], perpetrated ‘fraud and injustice upon Georgia consumers.’ ” Pursuant to OCGA § 16-14-6 (c), the trial court ordered that the damage award against the corporation be trebled to the amount of $771,744.

Roveto did not challenge the trial court’s order, and a final judgment was entered against him on January 30, 1998. Appellant Speir filed this appeal. Held:

At the outset we recognize that Speir, in his notice of appeal, specifically requested that “No transcripts are to be transmitted to the Court of Appeals.” This includes a transcript of the hearing on the summary judgment motions and all evidence introduced in relation thereto. This also includes the evidence and pleadings that formed the basis for the two Fulton County judgments.

It is a sound rule of appellate practice that the burden is always on the appellant in asserting error to show it affirmatively by the record. The brief cannot serve in the place of the record or the transcript for the purpose of demonstrating error or for supporting a claim of error. State v. O’Quinn, 192 Ga. App. 359, 360 (1) (384 SE2d 888) (1989). Further, “[e]very presumption of legality will be made in favor of a judgment by a court of competent jurisdiction[,] and it will be presumed that a judgment of a court of competent jurisdiction is supported by every fact essential to make such judgment valid and binding.” (Citations and punctuation omitted.) First Financial Ins. Co. v. Mathis, 214 Ga. App. 537, 539 (448 SE2d 87) (1994).

Thus, we will presume as factually and legally correct the Fulton County State Court order which awarded damages to plaintiff based upon plaintiffs claims that (1) McFrugal Auto failed to carry liability insurance in violation of state law, and (2) McFrugal Auto sold the non-existent liability insurance to its renters. We will presume as correct the Fulton County Superior Court’s factual determination that the McFrugal Entities “were operated as one entity, commingled assets, and used corporate entities to perpetuate fraud and injustice upon Georgia consumers, of which the plaintiff was one.” (Emphasis supplied.) We note that Speir did not challenge these findings or the evidence in support thereof.

Further, we will presume as correct the Fulton County Superior Court’s legal determination piercing the corporate veil between the McFrugal Entities because of fraudulent operation and commingling of assets by its operators thereby perpetrating fraud and injustice on the consumers of Georgia. Speir did not challenge the determination “piercing the corporate veil” or the evidence in support thereof.

Here, our review is strictly limited to the factual and legal issues legitimately raised through the Clayton County pleadings and the Clayton County Superior Court’s order as reflected in the record before us.

1. Speir contends that the Fulton County Superior Court order which “pierced the corporate veil” as to the McFrugal Entities simply held McFrugal Holding liable as the “parent company” of McFrugal Auto and did not establish liability as to the operators of the corporations. We disagree.

(a) There is no competent evidence in the record before this Court that McFrugal Holding is the “parent” corporation of McFrugal Auto. Moreover, Speir never attempted to allege a parent/subsidiary relationship in the trial court. In all pleadings, Speir referred to McFrugal Auto and McFrugal Holding as having individual corporate status. In the court below, Speir maintained that “the McFrugal companies were ‘operated as one entity,’ but the [Fulton Superior Court] Judgment did not remove the corporate status of any McFrugal entity.” Compare Fort & Turner Enterprises v. Scrocca, 195 Ga. App. 554 (394 SE2d 364) (1990). We will not consider this new factual contention regarding a parent/subsidiary relationship, which apparently was neither raised nor ruled upon in the court below.

(b) On October 1, 1995, Roveto, acting on behalf of Speir as the only other shareholder and corporate officer of McFrugal Auto, sold all of the assets of McFrugal Holding and McFrugal Auto to a third corporation, McRent, formed for the specific purpose of receiving the assets. This rendered both McFrugal Auto and McFrugal Holding insolvent. Thereafter, plaintiff filed the Fulton County Superior Court suit seeking to “pierce the corporate veil” as to McFrugal Auto and McFrugal Holding.

If, as Speir contends before this Court, the “purpose” of the Fulton Superior Court action was only to pierce the veil between McFrugal Auto and McFrugal Holding “in order to allow Plaintiff to recover from the [alleged] parent corporation,” i.e., McFrugal Holding, then the action was futile from the inception, since at the time the action was filed, plaintiff could recover from neither.

We have no record of the prior Fulton Superior Court case before us, save for the final order “piercing the corporate veil” because of the fraudulent operation of the McFrugal Entities in commingling assets and operating as “one entity” in order “to perpetrate fraud and injustice upon the consumers of Georgia.” However, in this State, “there is a presumption that a trial judge, acting as a public official, faithfully and lawfully performed the duties devolving upon [her,] and in the absence of [record evidence to the contrary], we will presume that the trial court fully complied with the law.” (Citations and punctuation omitted.) AAA Bonding Co. v. State of Ga., 192 Ga. App. 684, 685 (3) (386 SE2d 50) (1989). Thus, contrary to Speir’s contention, we will not find that the Fulton Superior Court judge entertained a meritless action, granted plaintiff ineffective relief, made findings of fact and conclusions of law that had no legal effect, and, while finding fraud in the operation of the McFrugal Entities, shielded the operators from liability due to the intricacy of their corporate shell game.

(c) “The concept of piercing the corporate veil is applied in Georgia to remedy injustices which arise where a party has over extended his privilege in the use of a corporate entity in order to defeat justice, [perpetrate] fraud or to evade contractual or tort responsibility.” (Citations and punctuation omitted.) Amason v. Whitehead, 186 Ga. App. 320, 321 (367 SE2d 107) (1988).

In this case, the Fulton County Superior Court determined that the abuse of the corporate form between the separate enterprises “pierced the corporate veil” between the corporations. This determination created liability on the part of Speir, who, along with Roveto, were the only stockholders and operators of both intermingled corporations and who abused the corporate form. The Fulton Superior Court’s holding did not create from McFrugal Auto and McFrugal Holding a new, single corporation. The improper commingling of two independent corporations so as to render them “one entity” does not create a separate corporation entirely liable for plaintiff’s damages and conveniently shielding the operating officers therefrom. J & J Materials v. Conyers Seafood Co., 214 Ga. App. 63 (446 SE2d 781) (1994); Brown v. Rentz, 212 Ga. App. 275 (441 SE2d 876) (1994); compare Mark Six Realty Assoc, v. Drake, 219 Ga. App. 57, 59 (463 SE2d 917) (1995). It does not follow that operating two separate corporations illegally creates one legal corporation.

Here, McFrugal Holding did not operate McFrugal Auto. Speir and Roveto operated both corporations, illegally commingling their assets in order to avoid creditors and forming new corporations to receive assets therefrom. “By whatever means the conclusion to disregard corporate entity is arrived at, when it is reached it merely means that under the facts of the case the person or corporation in control of the subservient corporation is held liable for the acts or omissions of the subservient corporation.” (Citation and punctuation omitted; emphasis supplied.) Williams Plaza v. Sedgefield Sportswear &c., 164 Ga. App. 720 (297 SE2d 342) (1982).

The Fulton County Superior Court order “piercing the corporate veil” of the McFrugal Entities due to the fraudulent operation of the corporations created liability on the part of the McFrugal Entities’ operating officers, of which Speir was one.

2. Speir contends that, even if the McFrugal Entities’ corporate officers can be held liable under the facts of this case, he was not a corporate officer, because he “officially resigned” from all McFrugal enterprises during a Board meeting in December 1994.

On a motion for summary judgment under OCGA § 9-11-56, the moving party may prevail by (1) presenting evidence which negates an essential element of the plaintiff’s claims, or (2) showing an absence of evidence to support the case as to any essential element. Caven v. Warehouse Home Furnishings Distrib., 209 Ga. App. 706 (434 SE2d 532) (1993). If the moving party discharges this burden, the nonmoving party cannot rest on its pleadings, but rather must point to specific evidence giving rise to a triable issue. OCGA § 9-11-56 (e).

Speir submitted an affidavit asserting that he had resigned from all McFrugal enterprises in December 1994 and, thus, should not be liable as a corporate officer for any judgment rendered against the McFrugal Entities.

Plaintiff, however, tendered certified copies of the corporate registry for McFrugal Auto and McFrugal Holding, which registry is filed with the Secretary of State and is required by law to be updated annually. See OCGA §§ 14-2-1622; 14-2-1420. Moreover, the failure to notify the Secretary of State within 60 days that a corporation’s registered agent has resigned subjects such corporation to administrative dissolution. OCGA § 14-2-1420 (4). The certified documents showed that, as of September 11, 1996, Speir was still registered as the corporate secretary and registered agent of McFrugal Auto.

Speir submitted no evidence in rebuttal thereto. In fact, before this Court Speir admits that his name was left on the registry. He asserts, however, that the failure to remove him from the corporate registry was due to the “negligence of the corporation,” because he had “received assurances” that his name would be removed.

Based upon the above, the trial court determined that there was no genuine issue of material fact as to Speir’s status as a corporate officer of the McFrugal Entities during all relevant periods. We agree.

A self-serving, conclusory affidavit not supported by fact or circumstances is insufficient to raise a genuine issue of material fact. Brooks v. Boykin, 194 Ga. App. 854, 856 (3) (392 SE2d 46) (1990). In light of the affirmative evidence of Speir’s continuous corporate involvement in McFrugal Auto, Speir could no longer rest on his pleadings, but was required to put forward some evidence, other than his self-serving affidavit, that made his status as a corporate officer of McFrugal Auto a disputed issue of fact. Lau’s Corp. v. Haskins, 261 Ga. 491 (405 SE2d 474) (1991). He did not. He did not tender a copy of his alleged notice of resignation; he did not submit an affidavit from any other corporate officer stating Speir’s name was inadvertently left on the corporate registry; he submitted nothing. Even viewing the evidence in a light most favorable to Speir, there was no error in the trial court’s finding.

3. Speir contends that he was not a “party” to the prior Fulton County litigations between plaintiff and the McFrugal Entities, and thus the prior judgments cannot be enforced against him. We disagree. Speir’s contention ignores the legal effect of the judgment “piercing the corporate veil,” a judgment that Speir did not contest.

“As a legal entity, a corporation is separate and distinct from its officers, stockholders, and agents. The legal advantage of incorporation being the limited liability of its stockholders. Thus, owners of corporations restrict personal liability by acting only as an agent of the corporation. However, using such expressions as ‘piercing the corporate veil,’ or ‘looking at the substance rather than at the form,’ or ‘disregarding the corporate fiction,’ the courts are constantly demonstrating a willingness to disregard the separateness of the entity of a corporation where such corporation has overextended its privileges in the use of the corporate entity to defeat justice, to perpetrate fraud, or to evade statutory, contractual or tort responsibility. Courts permit ‘piercing the corporate veil’ in situations where the parties involved have themselves disregarded the separateness of legal entities by a commingling and confusion of properties, records, control, etc. Under such circumstances, the court may disregard the corporate entity.” (Citations and punctuation omitted.) Casey v. Carrollton Ford Co., 152 Ga. App. 105, 106 (262 SE2d 255) (1979). “ ‘The interposition of corporate form has never been permitted to thwart the action of the law upon a wrong doer.’ ” Kaplan’s Nadler, Ga. Corporation Law, 1998 ed., § 3-14.

Here, Speir was one of only two stockholders of the McFrugal Entities and two operating officers of McFrugal Auto. The Fulton Superior Court judgment “pierced the corporate veil” in finding the corporate form was abused in the operation of the corporation, which ruling in effect negated the separate corporate existence. Such dissolution of the separate corporate entity exposed Speir’s identity of interest with McFrugal Auto and his liability as its operator. Miller v. Steelmaster Material Handling Corp., 223 Ga. App. 532, 535 (478 SE2d 601) (1996). Speir did not contest this judgment.

“A judgment of a court of competent jurisdiction shall be conclusive between the same parties and their privies as to all matters put in issue or which under the rules of law might have been put in issue in the cause wherein the judgment was rendered until the judgment is reversed or set aside.” (Emphasis supplied.) OCGA § 9-12-40. “[P]rivity connotes those who are in law so connected with a party to the judgment as to have such an identity of interest that the party to the judgment represented the same legal right.” (Citations and punctuation omitted.) Miller v. Steelmaster Material Handling Corp., supra at 535. “[T]he trend is becoming more and more pronounced that the jurisdiction of all the states, including Georgia, are breaking down the impregnability of this fiction of the separateness of the corporation and its members. More sympathetically and more frequently are the courts coming to realize the fallacy of this fiction so that the law of corporations is developing along the lines that a corporation cannot be considered without taking into account its lifeblood, its activities supplied by, interwoven with, and related to the individuals who constitute its members, shareholders and stockholders.” Kaplan’s Nadler, Ga. Corporation Law, 1998 ed., § 3-14.

We conclude that, by virtue of the piercing of the corporate veil, the corporate shield is gone. Consequently, Speir and McFrugal Auto are privies, and the prior judgment against one may be enforced against the other. This enumeration of error is meritless.

4. In his fourth enumeration of error, Speir contends that the trial court erred in finding him liable for the torts committed by the corporations, because there was no evidence in the record before the Clayton County trial court that he “directly participated, directed, or co-operated in the commission of any tort” while an officer of the McFrugal Entities. Cherry v. Ward, 204 Ga. App. 833, 834 (420 SE2d 763) (1992).

Speir’s argument ignores the fact that the analysis in Cherry applies only in those situations wherein the evidence is insufficient to pierce the corporate veil. Then, the liability of the corporate officers for a tort committed by the corporation is dependent upon separate evidence of direct participation in the tort. See Brown v. Rentz, supra at 276 (2). “[When a corporate officer] demonstrates] the inapplicability of the ‘piercing the corporate veil’ exception to the general rule of non-liability[,] . . . personal liability to appellees as the result of the Corporation’s operation . . . can only be for such tortious acts as he personally committed or specifically directed be done.” Smith v. Hawks, 182 Ga. App. 379, 385 (355 SE2d 669) (1987). Clearly, it is unnecessary to prove an officer’s participation in torts “committed by the corporation,” when the corporation has been found to be nonexistent. “The law intervenes when the separate personalities of the corporation and its owner no longer exist.” (Punctuation omitted.) Brown v. Rentz, supra at 276 (1).

5. Although Speir did not challenge the prior Fulton County State Court’s award of damages to plaintiff, in his fifth and sixth enumerations of error, Speir challenges the Clayton County trial court’s determination to treble plaintiff’s damage award based upon a violation of OCGA § 16-14-1 et seq., civil RICO. Speir contends that (a) there was no evidence of predicate acts as required by RICO; (b) there was no evidence of criminal acts as required by RICO; and (c) the $250,000 punitive damage award was not subject to trebling under RICO because punitive damages are capped at $250,000 under OCGA § 51-12-5.1 (g). We disagree with these contentions.

Summary judgment is proper when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. OCGA § 9-11-56 (c). A de novo standard of review applies to an appeal from a grant of summary judgment, and we view the evidence, and all reasonable conclusions and inferences drawn from it, in the light most favorable to the nonmovant. Rice v. Huff, 221 Ga. App. 592, 593 (472 SE2d 140) (1996).

(a) The predicate acts necessary to prove a pattern of racketeering activity as defined by OCGA § 16-14-3 (8) were proved as a matter of law through the Fulton County Superior Court’s conclusive, factual determination that the McFrugal Entities were operated in such a manner as “to perpetrate fraud and injustice upon Georgia consumers, of which the Plaintiff was one.” (Emphasis supplied.) We will presume the correctness of this finding and the sufficiency of the factual basis therefor. First Financial Ins. Co. v. Mathis, supra at 539. Thus, the commission of fraudulent acts against multiple consumers was proved as a matter of law, and the “predicate acts” requirement was satisfied. See Olukoya v. American Assn. of Cab Cos., 219 Ga. App. 508, 510 (465 SE2d 715) (1995).

(b) Further, the above Fulton County Superior Court factual determination as to the fraudulent acts perpetrated against Georgia consumers by the McFrugal Entities was grounded in an equitable analysis regarding liability for the damages already awarded plaintiff in the Fulton County State Court suit against McFrugal Auto. Thus, the two suits are factually interrelated.

In the state court suit, plaintiff was awarded damages based (1) upon his claim that McFrugal Auto rented its vehicles to Georgia consumers without purchasing third-party liability insurance as required by law, OCGA § 33-34-4; Jones v. Wortham, 201 Ga. App. 668 (411 SE2d 716) (1991); and (2) upon the sale of such non-existent insurance to its renters. We also presume the correctness of the state court’s order and the factual basis therefor. First Financial Ins. Co. v. Mathis, supra at 539.

Accordingly, the Clayton County trial court did not err in finding a RICO violation. While we have held that the illegal sale of insurance is not in and of itself a basis for a RICO action absent further evidence of fraud rising to the level of theft by deception, we find that the repeated sale to unsuspecting Georgia consumers of nonexistent insurance is the very essence of such fraud amounting to theft by deception. OCGA §§ 16-8-3 (b); 16-14-3 (9) (A) (ix); compare Avery v. Chrysler Motors Corp., 214 Ga. App. 602 (448 SE2d 737) (1994). This conduct on the part of McFrugal Auto is exactly the type of criminally fraudulent activity masquerading as “business” that RICO was designed to address. OCGA § 16-14-2 (a).

A violation of RICO was shown as a matter of law based upon the conclusive, factual determinations contained in the prior Fulton County suits. The trial court’s ruling was not error.

(c) Speir contends that even if the evidence demonstrates a violation of RICO, the $250,000 punitive damage award was not subject to be trebled under RICO because punitive damages are capped at a maximum of $250,000 pursuant to OCGA § 51-12-5.1 (g). This contention is without merit.

OCGA § 51-12-5.1 (f) states in pertinent part that “[i]n a tort case . . . if it is found that the defendant acted, or failed to act, with the specific intent to cause harm, . . . there shall be no limitation regarding the amount which may be awarded as punitive damages against an active tort-feasor.” Evidence sufficient to show a RICO violation necessarily also demonstrates the “intent to cause harm” that removes the cap to a punitive damage award. The conduct proscribed under RICO shows “an interrelated pattern of criminal activity motivated by or effect of which is [to derive] pecuniary gain.” OCGA § 16-14-2 (b). Herein, the facts demonstrated a pattern of racketeering activity under OCGA §§ 16-14-3 (9) (A) (ix) and 16-14-4 which amounted to intentional theft by deception through the fraudulent sale of non-existent insurance. Accordingly, the trial court did not err in applying RICO and trebling the amount of punitive damages awarded to the plaintiff.

In addition, the Fulton County Superior Court determined that the McFrugal Entities were operated with the intent to defraud the consumers of Georgia. A finding of specific “intent to cause harm” pursuant to OCGA § 51-12-5.1 (f) is inherent in the essential elements of such an intentional fraud. McDaniel v. Elliott, 269 Ga. 262 (497 SE2d 786) (1998). Since the punitive damage award herein was based upon an intentional fraud, the award was not subject to the $250,000 cap of OCGA § 51-12-5.1 (g). McDaniel v. Elliott, supra.

6. In his enumerations of error 7 and 8, Speir alleges that the trial court erred in denying his motion for summary judgment because the record contains no evidence that fraud was committed and no evidence that the McFrugal Entities failed to maintain proper insurance on its vehicles. However, it is not surprising that the record in this case contains no evidence as to these issues; the factual bases for these contentions were decided adversely to Speir in the prior Fulton County judgments, which judgments went unchallenged by Speir, and the records pertaining thereto were not made a part of the instant appeal. As per Division 1, supra, it was not error to deny Speir’s motion for summary judgment based upon issues that had already been decided in a court of competent jurisdiction.

7. Plaintiff’s motion to supplement the record on appeal pursuant to OCGA § 5-6-41 (f) was properly denied by the trial court. The evidence which plaintiff sought to add to the record was not admitted at trial. Nixon v. Rosenthal, 214 Ga. App. 446, 447 (448 SE2d 45) (1994).

Judgment affirmed.

McMurray, R J., and Senior Appellate Judge Harold R. Banke concur. Andrews, C. J., Johnson, P. J., and Smith, J., concur in judgment only. Blackburn, J., dissents.

Blackburn, Judge,

dissenting.

I must respectfully dissent from the majority as it allows a corporate officer to be held responsible for actions of a corporation without first requiring (1) that such officer be appropriately brought within the jurisdiction of the applicable court and (2) evidence that the officer took part in the commission of the corporation’s tort. See Brown v. Rentz, 212 Ga. App. 275 (441 SE2d 876) (1994); Cherry v. Ward, 204 Ga. App. 833 (420 SE2d 763) (1992). No matter how egregious the facts, a party must still be afforded notice and the opportunity to defend actions brought against them individually. No judgment may issue against those who were not parties to the action. See Hartley v. Shenandoah, Ltd., 170 Ga. App. 868, 869 (318 SE2d 508) (1984) (judgment obtained against corporate general partner in prior action not enforceable in subsequent action against other general partners not parties to prior suit); Wickliffe v. Wickliffe Co., 227 Ga. App. 432, 433-435 (1) (489 SE2d 153) (1997) (collateral estoppel not applicable and judgment in first action not enforceable against a non-party thereto in a subsequent action).

The corporate officer in question, Speir, was not a defendant or a party in any prior action where personal jurisdiction attached. In the instant case, the majority affirms Speir’s liability for a corporation’s actions solely on the basis that he was a corporate officer. Speir was not a party to the previous action in which the trial court pierced the corporate veil between the two corporations, McFrugal Holding Company, Inc. and McFrugal Auto Rental, Inc. In that action, the trial court determined only that the two corporations were operated as one entity. The trial court’s determination did not create personal liability of Speir as a corporate officer because he was not a party to the action. The present action was brought to hold the corporate officers personally responsible for the judgment already obtained against the corporations. However, no evidence has been presented as to Speir’s involvement with the actions of the corporations. Such evidence is necessary to hold Speir personally liable for the judgment obtained against the corporations.

Furthermore, the evidence supports a finding that Speir had resigned from his position as a corporate officer of the McFrugal companies in December 1994. Speir testified that he resigned by giving notice thereof at a board of directors meeting. Speir’s actions complied with OCGA § 14-2-843, which provides: “An officer may resign at any time by delivering notice to the corporation. A resignation is effective when the notice is delivered unless the notice specifies a later effective date. A copy of the notice of resignation . . . may be filed with the Secretary of State.” (Emphasis supplied.) Thus, a resignation may be effective whether or not notice of the resignation is filed with the Secretary of State. Following Speir’s resignation, in February 1995, his name was removed from corporate listings filed with the Secretary of State. Viewing all evidence and inferences therefrom in the light most favorable to Speir, he resigned from his position as a corporate officer of McFrugal as required by law prior to the acts upon which the suit against him are based.

The majority contends that the evidence shows that Speir was still an officer of McFrugal Auto, if not McFrugal Holding, as of September 11, 1996. The majority bases this contention on a letter from the Office of the Secretary of State to which McFrugal Auto’s corporate registration is attached. The letter, itself, is dated September 11, 1996; however, this reflects only the date on which the Secretary of State prepared the cover letter. The corporate registration form which was attached was dated February 21, 1994, months prior to Speir’s resignation. As such, these documents do not support the majority’s contention that Speir remained an officer of McFrugal Auto in 1996.

The majority apparently contends that Speir, despite the fact that he resigned from the McFrugal Entities in December 1994, still had some duty to file a change in the corporate registry, and, as a result of his failure to do so, he could still be treated as a corporate officer. The law does not support this argument. As discussed above, OCGA § 14-2-843 places no requirements on a resigning officer to give written notice to the Secretary of State. Furthermore, a corporate officer, once resigned, lacks authority to file a new corporate registry reflecting changes in leadership. Thus, Speir had no duty to notify the Secretary of State that he had resigned from the McFrugal Entities, and he had no authority to alter the corporate registry of McFrugal Auto, dated February 21, 1994, once he had resigned.

In addition, I cannot agree with the majority’s affirmance of the trial court’s ruling that punitive damages should be trebled. As the majority has reasoned in a prior case, “the purposes of treble damages and punitive damages are substantially the same.” Simpson Consulting v. Barclays Bank, 227 Ga. App. 648, 655 (4) (490 SE2d 184) (1997) (physical precedent only). Each penalty, then, is a similar form of punishment. Therefore, the trebling of punitive damages works to inappropriately heap punishment on punishment, and the result is not just punitive, but oppressive. Although it may be proper to add treble damages to punitive damages, it should not be proper to multiply one by the other. The latter is the result the majority espouses here, and I simply cannot condone such an excessive outcome.

Decided November 20, 1998.

Merry & Associates, Rebecca S. Merry, Eldridge Melton, for appellant.

S. Robert Hahn, Jr., for appellee.

Because the trial court erred in granting plaintiff’s motion for summary judgment, I respectfully dissent from the majority which affirms the trial court.

       Prior to September 9, 1995, Speir was listed as Corporate Secretary and Agent for Service for McFrugal Holding; his wife Eleanor Speir was listed as CEO. Thereafter, the Speirs’ names were removed from the registry, and Roveto was listed as CEO.

       Holding corporation: “A corporation that controls the voting power of other individual corporations for the purpose of united action.” Black’s Law Dictionary (5th ed.).

       Also, under the specific facts of this case, compare the legal precedent under workers’ compensation law where a judgment was not collected because “the employer [corporation] carried no ... insurance^ and] the employer [corporation] was insolvent. Had the employer’s agents [corporate officers] carried out their duties ... by procuring . . . insurance coverage, the award would have been collected. Under these limited circumstances, [plaintiff] may pursue a claim at law against the agent of the employer [corporate officer] for an amount equal to the award.” Samuel v. Baitcher, 247 Ga. 71, 73-74 (274 SE2d 327) (1981).

       None of the cases upon which Speir relies relates to a finding of privity between a corporation and its operating officer after the corporate veil had been pierced in the prior judgment sought to be enforced, thereby exposing the officer to liability. See Wickliffe v. Wickliffe Co., 227 Ga. App. 432, 433 (489 SE2d 153) (1997); Hartley v. Shenandoah, Ltd., 170 Ga. App. 868 (318 SE2d 508) (1984). See also Anderson Oil Co. v. Benton Oil Co., 246 Ga. 304 (271 SE2d 207) (1980) (prior judgment against corporation not enforceable against president thereof when fraud committed by the corporation).

        Olukoya v. American Assn. of Cab Cos., supra at 510.


source: Caselaw Access Project

author: McMurray, Presiding Judge.

license: Public Domain

text:
    A98A1364.
    SAGE TECHNOLOGY, INC. v. NATIONSBANK N.A. SOUTH.
    (509 SE2d 694)
   McMurray, Presiding Judge.

On July 8, 1996, NationsBank N.A. South (“NationsBank”) contracted to sell Sage Technology, Inc. (“Sage”) two parcels of realty for $1.8 million. The parties’ sales contract (“the Agreement”) called for the deal to close on or before August 1, 1996, “unless the parties mutually agree in writing upon another place, time, or date.” Paragraph 3.1 of the Agreement required Sage to make a $50,000 earnest money deposit with an escrow agent, which supplemented Sage’s earlier $50,000 earnest money deposit, no “later than 4:00 p.m. on July 8, 1996, [and provided NationsBank with] the option of terminating [the] Agreement if the Earnest Money [was] not delivered to the Escrow Agent within such time.” Paragraph 4.1 (b) of the Agreement gave Sage until July 12, 1996, to make objections to the realty’s title and provided NationsBank with “the right (without any obligation to do so) to cure or attempt to cure . . .” any of Sage’s title exceptions.

Sage made the $100,000 earnest money deposit in timely fashion and, in a letter dated July 12, 1996, listed 15 exceptions to the realty’s title — including the charge that “[rjecord title does not vest in [NationsBank] as to either Tract I or Tract II of the subject property.” NationsBank addressed each of these exceptions in a letter dated July 22, 1996, and informed Sage that it would endeavor to have the realty’s title transferred on or before closing according to the Agreement’s requirement that NationsBank provide Sage with title to the realty via a “Limited Warranty Deed.”

On July 29, 1996, Sage executed an amendment to the Agreement which deferred the closing until September 9, 1996, and required Sage to make an additional $25,000 earnest money deposit “on or before 4:00 p.m. on Wednesday July 31, 1996. . . .” Sage, however, did not make this deposit because (according to Sage’s corporate attorney) Sage discovered, after executing this amendment, that NationsBank had received and recorded an invalid deed to the realty from a subsidiary corporation of NationsBank’s corporate predecessor. NationsBank terminated the deal after Sage failed to make the additional earnest money deposit on July 31, 1996, and claimed Sage’s earlier $100,000 earnest money deposit under the Agreement’s default provision — Paragraph 8.2. This paragraph provides, “If [Sage] breaches this agreement, [NationsBank], as [its] sole remedy and relief hereunder, may terminate this Agreement and thereupon receive the Earnest Money as liquidated damages. . . .”

Sage sued NationsBank, alleging that the July 29, 1996 amendment was a unilateral promise which it rejected (by not depositing more earnest money) and that NationsBank breached the Agreement by not closing the deal on the August 1, 1996 closing date. Sage also alleged that NationsBank acted in bad faith, in breach of a fiduciary duty, during the transaction because NationsBank did not own the realty when it executed the Agreement, NationsBank misrepresented its ability to acquire good title to the realty and NationsBank was aware that it could not produce a “Limited Warranty Deed” to the realty by the time of closing on August 1,1996. Sage alleged that NationsBank fraudulently induced the July 29, 1996 amendment by concealing its inability to deliver good title to the realty and that Sage first learned about this treachery on July 30 and 31,1996, when its attorney discovered that NationsBank had recorded a defective deed during the Agreement’s executory period which purported to, but did not, convey NationsBank title to the realty.

NationsBank denied liability and filed a motion for summary judgment. This appeal followed entry of the trial court’s order granting NationsBank’s motion for summary judgment. Held:

1. Sage first contends the trial court erred in granting Nations-Bank’s motion for summary judgment based on the liquidated damages clause in Paragraph 8.2 of the Agreement because Paragraph 4.3 of the Agreement provides for return of the earnest money to Sage upon termination of the transaction. “However, this argument appears not to have been raised in the trial court and may not be considered for the first time on appeal. Noro-North Plaza &c. v. Rare Coins of Ga., 196 Ga. App. 443 (1) (395 SE2d 918) (1990).” Minor v. E. F. Hutton & Co., 200 Ga. App. 645, 646 (1) (409 SE2d 262). But assuming Sage had preserved this issue for appellate review, we find no contractual ambiguity between Paragraphs 8.2 and 4.3 of the Agreement which defeats Paragraph 8.2’s liquidated damages provision.

Paragraph 4.3 is in a section of the Agreement entitled, “CONDITIONS TO CLOSING.” This Section gives the parties options for terminating the deal for reasons other than default during the Agreement’s executory period — such as Sage’s right to terminate during a specified period upon discovery of an unacceptable fact or condition affecting or existing on the realty. Paragraph 8.3, on the other hand, is in a section entitled, “DEFAULT” which deals only with the parties’ respective remedies in case of default. These circumstances demonstrate that Paragraphs 8.2 and 4.3 are not conflicting. That is, while Paragraph 4.3 directs disposition of the earnest money in case of termination by either party as a matter of right, Paragraph 8.2 directs disposition of the earnest money in case of termination by reason of default. “ £[A] contract should be construed by examining the agreement in its entirety, and not merely by examining isolated clauses and provisions thereof. (Cits.)’ Duffett v.E&W Prop., 208 Ga. App. 484, 486 (2) (430 SE2d 858).” Richard Haney Ford, Inc. v. Ford Dealer Computer Svcs., 218 Ga. App. 315, 316 (1) (b) (461 SE2d 282).

We reject Sage’s assertion that its earnest money deposit should be returned because the July 29,1996 amendment made no provision for disposition of this money. The July 29, 1996 amendment modified the Agreement’s closing date, not the Agreement’s provisions regarding disposition of the earnest money in the event of default.

2. We also reject Sage’s contention that the July 29,1996 amendment was an unenforceable unilateral promise which was not supported by consideration. The July 29, 1996 amendment embraces NationsBank’s agreement to delay the closing until September 9, 1996, as well as Sage’s agreement to pay additional earnest money in exchange for this postponement. Such a mutual exchange of promises constitutes adequate consideration for a contract. Bank of Dade v. Reeves, 257 Ga. 51, 53 (3) (354 SE2d 131). The trial court properly rejected Sage’s arguments that “the dealings of the parties” should be admitted to explain the purpose of the July 29, 1996 amendment. Such parol evidence is inadmissible to vary the unambiguous terms of the July 29, 1996 amendment. Craig v. C & S Nat. Bank, 142 Ga. App. 474 (1), 475 (236 SE2d 166).

3. Sage asserts in its second enumeration of error that genuine issues of material fact remain as to whether “Nationsbank breached the Agreement by wrongfully terminating [the] Agreement.” This assertion is without merit. No matter what NationsBank did or did not do during the Agreement’s executory period, NationsBank’s ultimate obligation under the Agreement was to convey the realty at closing via a “Limited Warranty Deed.” It is undisputed that Nations-Bank did not fulfill this obligation because Sage breached the Agreement before the closing by failing to deposit additional earnest money as required by the July 29,1996 amendment. Under such circumstances, we agree that NationsBank was authorized in terminating the Agreement based on Sage’s breach of contract. Consequently, the trial court did not err in granting NationsBank’s summary judgment as to Sage’s breach of contract claim.

4. Sage claims in two enumerations of error that genuine issues of material fact remain as to its bad faith and fraudulent inducement claims. We do not agree.

It is undisputed that Sage (as evidenced by its July 12,1996 title exceptions letter) knew that NationsBank did not have title to the realty before executing the July 29, 1996 amendment. It is also undisputed that Sage knew or should have known, when it agreed to amend the Agreement on July 29, 1996, that NationsBank had no obligation under the Agreement to cure the realty’s title defects. Sage was, therefore, not justified in failing to comply with the July 29, 1996 amendment based on its alleged discovery that NationsBank did not have good title to the property or that NationsBank was concealing its inability to deliver good title to the realty at closing. “[0]ne cannot claim to be defrauded about a matter equally open to the observation of all parties, absent the existence of a special relationship or trust or confidence. [Conerly v. First Nat. Bank of Baldwin County, 209 Ga. App. 601, 603 (2) (434 SE2d 143)]. See Campbell v. C & S Nat. Bank, 202 Ga. App. 639, 640 (1) (415 SE2d 193) (1992) (express written terms in note will defeat defense of fraud in the procurement of a note based on purported oral misrepresentations by bank officer).” Fuller v. Greenville Banking Co., 230 Ga. App. 63, 64 (1) (495 SE2d 320). Since Sage points to no proof indicating that it had a special relationship of trust or confidence with NationsBank, the trial court did not err in granting NationsBank’s motion for summary judgment as to Sage’s bad faith and fraudulent inducement claims.

We have considered all of Sage’s assertions and find them to be without merit.

Judgment affirmed.

Blackburn and Eldridge, JJ., concur.

Decided November 20, 1998

Sabiston & Smith, Eric P. Sabiston, for appellant.

Alston & Bird, Lonnie T. Brown, Jr., Staci B. Abrams, for appel-

       Paragraph 4.3 pertinently provides: “If this Agreement is terminated pursuant to the right of either party to terminate this Agreement, the Earnest Money will be promptly refunded to [Sage] and neither party shall have any further obligations under this Agreement. . ..”

       Sage argues that this deadline was not enforceable because the July 29,1996 amendment did not have a “time is of the essence” clause. While the July 29,1996 amendment did not include such a clause, the Agreement did include a “time is of the essence” clause. Thus, since there is no indication that NationsBank waived this provision upon agreeing to extend the deal’s closing date, time remained of the essence during the transaction and Sage was bound by its promise to deposit additional earnest money by July 31,1996. See McCullough v. McCullough, 263 Ga. 794, 795 (1) (439 SE2d 486).


author: Pope, Presiding Judge.

text:
    A98A1395.
    PADILLA v. HINESVILLE HOUSING AUTHORITY.
    (509 SE2d 698)
   Pope, Presiding Judge.

Appellant Rosemary Padilla brought this action against appellee Hinesville Housing Authority seeking damages for injuries suffered when she fell on a stairway leading from her apartment. The trial court granted the housing authority’s motion for summary judgment, and Padilla appeals. We affirm.

“To prevail at summary judgment under OCGA § 9-11-56, the moving party must demonstrate that there is no genuine issue of material fact and that the undisputed facts, viewed in the light most favorable to the nonmoving party, warrant judgment as a matter of law. OCGA § 9-11-56 (c). A defendant may do this by showing the court that the documents, affidavits, depositions and other evidence in the record reveal that there is no evidence sufficient to create a jury issue on at least one essential element of plaintiff’s case. If there is no evidence sufficient to create a genuine issue as to any essential element of plaintiff’s claim, that claim tumbles like a house of cards.” (Emphasis in original.) Lau’s Corp. v. Haskins, 261 Ga. 491 (405 SE2d 474) (1991). On appeal from a grant of summary judgment, this Court conducts a de novo review of the record, construing the evidence and all inferences therefrom in favor of the non-moving party. Maddox v. Southern Engineering Co., 231 Ga. App. 802, 803 (500 SE2d 591) (1998); Lane v. Spragg, 224 Ga. App. 606 (481 SE2d 592) (1997).

The record, viewed in that light, shows that Padilla became a resident of Regency Apartments, an apartment complex owned by Hinesville Housing Authority, in July 1993. On the morning of December 14, 1995, Padilla left her apartment to take her son to the emergency room for his asthma condition. The stairs leading from Padilla’s apartment were constructed of concrete with a metal edging. The sun was coming up at the time Padilla left the apartment and her porch light was on, so she could plainly see the stairs. Upon reaching the second or third step from the bottom of the stairway, Padilla tripped and fell when the tip of her shoe caught in the metal edging which had separated from the concrete portion of the step. Prior to her fall, Padilla testified that she had successfully traversed the stairs in question five to six times per day for over two years without incident.

At the time of Padilla’s accident, the housing authority had received no maintenance requests or other reports from Padilla or anyone else regarding the metal stripping on the stairways leading from Padilla’s apartment. In fact, the housing authority had never received any complaints about the metal stripping on any of the stairs in the Regency Apartments complex. And Padilla herself could not recall ever communicating any concern to the housing authority staff regarding the condition of the metal stripping on the stairs in question.

Reina Chiclana, the property manager for the apartment complex, walks the apartment grounds every day as a part of her duties, and she never noticed anything unsafe about the condition of the stairs outside Padilla’s apartment. Moreover, in July 1995, approximately five months before Padilla’s accident, the United States Department of Housing & Urban Development (“HUD”) conducted an inspection of Regency Apartments. HUD made no mention of any problems with the stairs at the time of that inspection. The HUD inspection report indicated that no maintenance was required on the “walks, steps or guardrails” or the “stairs, walkways or community spaces” of the complex. Sometime after Padilla’s fall, Chiclana attended a seminar in Florida where she received training in performing property safety inspections. At the seminar, she learned that if a metal edging pulls away from the concrete portion of a step, it can create a safety hazard. After returning from the seminar, Chiclana went back to inspect the apartment steps and stated that she did not see any safety hazards. However, Padilla stated that she had observed maintenance personnel repairing the metal edge of the steps after her fall.

“[I]n order to recover for injuries sustained in a slip-and-fall action, an invitee must prove (1) that the defendant had actual or constructive knowledge of the hazard; and (2) that the plaintiff lacked knowledge of the hazard despite the exercise of ordinary care due to actions or conditions within the control of the owner/occupier.” Robinson v. Kroger Co., 268 Ga. 735, 748-749 (2) (b) (493 SE2d 403) (1997). In granting summary judgment to the housing authority, the trial court found as a matter of law that the housing authority lacked actual or constructive knowledge of the condition leading to Padilla’s fall.

While there is nothing in the record to indicate that the housing authority had actual notice of a problem with the stairs, Padilla contends that the court erred in granting summary judgment because factual issues remáin as to whether the housing authority conducted a reasonable inspection of the premises and thus whether the housing authority had constructive notice of the unsafe condition of the apartment steps. Specifically, Padilla argues that the fact that Chiclana learned at the seminar she attended after Padilla’s fall that metal edging pulling away from concrete steps may become a safety hazard creates a factual issue as to whether the housing authority had failed to reasonably inspect the steps prior to the fall.

Constructive knowledge may be inferred by showing that the property owner failed to exercise reasonable care in inspecting the premises and keeping them safe. A landlord is liable to invitees for injuries caused by a “failure to exercise ordinary care in keeping the premises and approaches safe.” OCGA § 51-3-1. However, a landlord’s liability is not absolute. “Ordinary care in the fulfillment of the landlord’s duty to keep the premises in repair does not embrace an affirmative duty to make such an inspection of the premises as will disclose the existence of any and all latent defects which may actually exist therein. This would be but to place upon the landlord an absolute duty to rent premises free from latent defects. It follows that a proper application of the landlord’s duty to the keep the premises in repair does not, under any theory, result in making the landlord liable for a latent defect in the premises, simply because it existed at the time of the lease.” (Citation and punctuation omitted.) Lonard v. Cooper & Sugrue Properties, 214 Ga. App. 862, 864 (449 SE2d 348) (1994). “[A]lthough ordinarily questions of negligence do not lend themselves to summary adjudication, nevertheless the classic rules of negligence still apply in this state. These rules impose liability only where the landlord has actual or constructive superior knowledge. To say otherwise would be to impose absolute liability upon landlords for all defective conditions which could have been repaired before the injury.” (Citation and punctuation omitted.) Harris v. Sloan, 199 Ga. App. 340, 341 (1) (405 SE2d 68) (1991).

The record in this case shows that no problem was readily discernible in the stairs during either the HUD inspection several months prior to Padilla’s fall or Chiclana’s regular walks through the property. And Padilla noticed no problems with the stairs even though she went up and down them several times a day. No one had ever complained to the housing authority about any problem with the metal edging of the stairs. Thus, the housing authority met its initial obligation of showing that there is an absence of evidence to support Padilla’s claim that a reasonable inspection would have discovered this defect in the stairs and thus no evidence of constructive knowledge.

To survive summary judgment, Padilla was obligated to “point to specific evidence giving rise to a triable issue.” Lau’s Corp. v. Has-kins, 261 Ga. at 491. Padilla relies upon Chiclana’s later attendance at the seminar to raise an inference that the housing authority’s prior inspections of the property were somehow lacking. While the seminar attendance indicates that Chiclana received training on the inspection of stairs and notification that a safety hazard may exist if the metal edging pulls away from stairs like those in the apartment complex, it does not in and of itself create a factual issue as to whether the housing authority was negligent in inspecting the property. Nothing in the record indicates that any inspection would have discovered a problem with the metal edging on the stairs, and there can be no inference that the housing authority was negligent simply because the problem was not detected. Certainly, the HUD inspection detected no problem with the steps several months before Padilla’s accident. Thus, there is no evidence of constructive knowledge on the part of the housing authority. Because no genuine issue of material fact exists as to the first element of Padilla’s claim, the trial court correctly granted summary judgment to the housing authority. See Lonard v. Cooper & Sugrue Properties, 214 Ga. App. at 865; Harris v. Sloan, 199 Ga. App. at 342.

Decided November 20, 1998.

Montlick & Associates, Alan Y. Saltzman, Killian & Boyd, Robert P. Killian, for appellant.

Oliver, Maner & Gray, Patrick T. O’Connor, David S. Gruskin, for appellee.

Judgment affirmed.

Beasley and Ruffin, JJ, concur.


text:
    A98A1439.
    THE STATE v. HALL.
    (509 SE2d 701)
   Pope, Presiding Judge.

The state appeals from the trial court’s grant of appellee Clifton Walter Hall’s motion to suppress marijuana and other evidence found during a vehicle search. We reverse.

In November 1997, the Gwinnett County Drug Task Force began surveillance of an individual who was believed to be a marijuana supplier. On November 7, 1997, the officers observed a black Honda at the suspected supplier’s home. The officers tailed the suspect’s car and the black Honda, which was following it, to several different locations until they split up and the black Honda proceeded to the interstate. The task force officers radioed for a uniformed police officer to follow the Honda and pull it over if the driver committed any traffic violations. Gwinnett County Police Officer Jim Price was in the area and responded to the radio call.

In response to the task force’s request, Price followed the Honda onto 1-85 and pulled the car over when he noticed it was speeding. Shawn Weeks, the Honda’s driver, consented to a search of the car, and in the course of the search a 17-pound block of marijuana was discovered.

The next day, November 8, officers from the task force were again staking out the suspect’s house when they saw a blue Ford Explorer with South Carolina tags parked there. The suspect left his home and was followed by the Ford Explorer, driven by appellee Hall. Task force officers followed the cars as they drove to several different locations and until they eventually split up, with Hall heading toward 1-85. Once again, the task force radioed for a uniformed police officer to follow the Ford Explorer and pull it over if the driver committed any traffic violations. Coincidentally, Price was again on duty and took the call.

Price trailed Hall’s car onto the interstate and paced his car behind Hall’s to clock its speed. Price determined that Hall was driving 78 mph in a 65-mph zone and that he was following the car in front of him too closely, so Price pulled him over. Price requested Hall’s license and proof of insurance and asked Hall where he was coming from. Hall responded with several conflicting versions of where he was staying in Atlanta and what his plans were. Price then returned to the police car to run Hall’s license through a computer check. He found no problems with the license and decided to write up a courtesy warning for speeding and following too closely. Officer Price returned to Hall, gave him his license and insurance, and explained that he was issuing only a courtesy warning. Price testified that the traffic stop was over at this point in time.

But as Hall turned to get back into his vehicle, Price asked him if he had a second and then mentioned the problems the police were having with “people running drugs and guns up and down the interstate system.” Price asked Hall if he was carrying any illegal substances. He said no. Price then asked Hall if he could search his car, but Hall did not consent to a search. Price told Hall that due to his failure to give clear answers regarding his plans in Atlanta, he had decided to call in a K-9 unit to search the area around Hall’s vehicle.

It took approximately 30-40 minutes for a K-9 unit to arrive on the scene after Price put in his call. In the meantime, one of the task force officers had also arrived. Both officers waited until the drug dog completed his search around the perimeter of the car and alerted on the rear of Hall’s vehicle before searching the car. They discovered a large brick-type block of marijuana, scales, and ledgers reflecting various monetary transactions. It is this evidence that Hall successfully moved to suppress.

“Although an officer may conduct a brief investigative stop of a vehicle [cit.], such a stop must be justified by ‘specific and articulable facts which, taken together with rational inferences from those facts, reasonably warrant that intrusion.’ Terry v. Ohio, 392 U. S. 1, 21 (88 SC 1868, 20 LE2d 889) (1968).” Vansant v. State, 264 Ga. 319, 320 (2) (443 SE2d 474) (1994). “The issue critical to a determination of the validity of the stop is whether the officer had a particularized and objective basis for suspecting the particular person stopped of criminal activity. Investigative stops of vehicles are analogous to Terry-stops, and are invalid if based upon only unparticularized suspicion or hunch. An investigatory stop must be justified by some objective manifestation that the person stopped is, or is about to be, engaged in criminal conduct. What is demanded of the police officer, as the agent of the state, is a founded suspicion, some necessary basis from which the court can determine that the detention was not arbitrary or harassing.” (Citations and punctuation omitted.) Painter v. State, 227 Ga. App. 875, 877 (490 SE2d 544) (1997).

Price had specific and articulable facts to make the initial traffic stop because Hall was exceeding the posted speed limit and was following the car in front too closely. The initial stop was thus proper even if the officer would not have made the stop absent the call from the drug task force. See State v. Kirbabas, 232 Ga. App. 474, 477 (502 SE2d 314) (1998) (“ ‘In other words, if the arresting officer witnessed the driver breaking even a relatively minor traffic law, a motion to suppress under the Fourth Amendment arguing that the stop was pretextual [would] fail.’ ”); Jackson v. State, 267 Ga. 130, 131 (5) (a) (475 SE2d 637) (1996).

However, Price needed a basis other than the traffic violation to proceed with a further investigation of Hall. “An officer must have reasonable suspicion of criminal conduct before conducting additional questioning and searching a vehicle once a normal traffic stop has ended and the officer has told [the] motorists they are free to go. To meet the reasonable suspicion standard, an officer’s investigation during a traffic stop must be justified by specific, articulable facts sufficient to give rise to a reasonable suspicion of criminal conduct. Although this suspicion need not meet the standard of probable cause, it must be more than mere caprice or a hunch or an inclination.” (Citations and punctuation omitted.) Parker v. State, 233 Ga. App. 616, 617-618 (1) (504 SE2d 774) (1998).

The trial court found that Price detained Hall because he failed to give straight answers regarding his plans and held that this was not enough to give Price a reasonable basis for further investigation. We find, however, that Hall’s inconsistent responses did give rise to an articulable suspicion justifying Price’s additional investigation. See Pitts v. State, 221 Ga. App. 309, 311 (2) (471 SE2d 270) (1996); Roundtree v. State, 213 Ga. App. 793, 794 (446 SE2d 204) (1994).

In Pitts v. State, this Court determined that an officer was justified in ordering a “free air” search by a drug dog during a traffic stop for failure to lower headlights in response to oncoming traffic, after the driver and his passenger gave conflicting accounts of their travel itinerary. 221 Ga. App. at 311 (2). We noted that the questions the officer asked “did not relate to a narcotics investigation. The deputy merely asked these suspects about their travel itinerary in a manner which was ‘not extensive or prolonged, and (was) not unconstitutionally intrusive when balanced against the widespread clear danger of drug peddling from Florida via the roads of this state. [Cit.]’ [Cit.]” Id.

In Roundtree v. State, this Court upheld a search by a drug dog in connection with a traffic stop for following too closely after the driver and her passenger gave conflicting information. 213 Ga. App. at 794. “Upon stopping the car, the officer’s suspicions of illegal activity were aroused by the inconsistencies in the explanations given by [the driver and passenger] concerning the ownership of the car and the duration of their trip to Florida, and [the driver’s] increasing nervousness. Under such circumstances, the officer’s suspicions were reasonable and justified the brief investigative stop that grew out of the lawful traffic stop.” Id.

Price’s questioning of Hall regarding his plans fell within the parameters of his investigation of the initial traffic stop and was not unconstitutionally intrusive in light of the problem of interstate drug traffic. Hall’s vague and conflicting responses to these questions gave Price a reasonable suspicion to conduct further investigation and to request a K-9 unit. Under these circumstances, it is clear that Price was acting on something more than a mere hunch and that the additional investigation was not arbitrary or harassing. Compare Parker v. State, 233 Ga. App. at 617-618 (finding search unlawful where officer testified that he asked for consent to search following a traffic stop “just for the hell of it”); Simmons v. State, 223 Ga. App. 781, 782 (2) (479 SE2d 123) (1996) (finding search unlawful where driver was merely nervous in responding to police questions, but did not give conflicting information); Smith v. State, 216 Ga. App. 453, 455 (2) (454 SE2d 635) (1995) (officer’s hunch that driver possessed narcotics did not justify probe beyond basis for original traffic stop).

Decided November 20, 1998

Daniel J. Porter, District Attorney, Ben L. Leutwyler III, Assistant District Attorney, for appellant.

Jeffrey R. Sliz, for appellee.

Moreover, the state produced uncontroverted evidence at the suppression hearing regarding the prior day’s incident where Price had been involved with the stop and search of the black Honda driven by Weeks, resulting in the discovery of 17 pounds of marijuana. Price testified at the suppression hearing that he knew when he stopped Hall that Hall had been to the same residence where Weeks had been the day before. While the trial court made no specific findings of fact regarding this earlier incident, this background information would only have served to bolster Price’s decision to order the K-9 unit. See Buffington v. State, 228 Ga. App. 810, 811 (492 SE2d 762) (1997) (‘‘‘[T]he existence of an articulable suspicion can be based on the collective knowledge of law enforcement officials’; a detaining officer is ‘entitled to rely on the information given him by a fellow officer in the formation of an articulable suspicion.’ [Cit.]”).

Judgment reversed.

Beasley and Ruffin, JJ, concur in judgment only.

       Price testified at the suppression hearing that it is the normal policy of the Gwinnett police not to stop a speeder going less than 80 mph in a 65-mph zone, and that under normal circumstances, he would not have stopped Hall for speeding. But relying upon the request of the task force officers and the fact that Hall was folio-wing the car in front of him too closely, he decided to pull Hall over.

       Price testified: “I asked [Hall] where he was coming from. He said he was staying in the area for the weekend. I asked him who he was staying with. He said his girlfriend. And then he said, no, I’m staying with some friends of his girlfriend. I asked him where they lived. He said he didn’t know. I asked him where his girlfriend was at the present time. And then he said, no, I’m waiting on her to come down from South Carolina. And then he said he was staying at the big Marriott. I asked him which Marriott. And he said, well not the one that’s about five miles back. He said the other one. And I said, there’s a bunch of Marriotts. I said, do you know which one? And he kept stuttering around. And he finally said, well, the Peachtree one. I said okay.
      “I asked him where he was going at the present time. He said to get something to eat. I asked him where he was going to get something to eat. He had his back to the exit. When I asked him the question, he turned around. He looked up towards the exit and said, well, I guess I’m going up here (indicating). At that point, I asked him to step to the rear of his car, out of his vehicle.”

       In both Pitts and Roundtree the air search occurred during the traffic stop. Although in this case the drug dog was called in after the traffic stop, this distinction does not alter the fact that Hall’s responses during the stop provided a sufficient basis for further investigation.


author: Eldridge, Judge.

text:
    A98A1517.
    NAWROCKI v. THE STATE.
    (510 SE2d 301)
   Eldridge, Judge.

Daniel P. Nawrocki appeals a Cherokee County jury’s verdict finding him guilty of driving with an unlawful alcohol concentration. OCGA § 40-6-391 (a) (4). He appeals and challenges the trial court’s denial of his motion to suppress the results of an intoxilyzer test.

Nawrocki was stopped by a Cherokee County Sheriff’s deputy for speeding on Bells Ferry Road. After approaching and speaking to Nawrocki, the officer detected an odor of alcohol and asked Nawrocki to submit to field sobriety tests. Nawrocki consented. After conducting several such tests, including an alco-sensor test, the deputy concluded that Nawrocki was a less safe driver and placed him under arrest for DUI. The officer read Nawrocki the implied consent notice, which included the advisement that Nawrocki had the right to an additional test of his breath, blood or urine by qualified personnel of his own choosing.

Nawrocki consented to taking the State-administered breath test. He was transported to the Sheriff’s office where a breath test was conducted showing a blood-alcohol concentration of .10. Thereafter, he was transported to the Cherokee County jail, which also had an intoxilyzer. En route thereto and, again, at the jail, Nawrocki requested a second, State-administered breath test. A second breath test was not conducted. Held:

1. Nawrocki contends that the implied consent notice, OCGA § 40-5-67.1 (b) (2), is unconstitutional because it does not inform a DUI suspect of his right against self-incrimination under Art. I, Sec. I, Par. XVI of the Constitution of the State of Georgia and under OCGA § 24-9-20 (a), which right is allegedly violated by requiring a DUI suspect to submit to a breath test. This issue has been decided adversely to Nawrocki.

“ ‘The use of a substance naturally excreted by the human body does not violate a defendant’s right against self-incrimination under the Georgia Constitution (Ga. Const. of 1983, Art. I, Sec. I, Par. XVI).’ Green v. State, 260 Ga. 625, 627 (2) (398 SE2d 360) [(1990)], citing and adopting with modification, Robinson v. State, 180 Ga. App. 43 (3) (348 SE2d 662) [(1986)]. Thus, although the Georgia Constitution provides more protection for its citizens against self-incrimination than does the United States Constitution, [Nawrocki] would have neither a claim of constitutional right nor a claim of privilege against self-incrimination from the evidentiary use of his [breath] (at least, when such sample is obtained by the State in a manner not constitutionally shocking to the conscience). See Robinson.” State v. Leviner, 213 Ga. App. 99, 101 (443 SE2d 688) (1994).

Further, contrary to Nawrocki’s contentions, a DUI suspect may be required to produce a breath sample under Georgia law. “Examining OCGA §§ 40-5-55, 40-5-67.1 and 40-6-392 in pari materia and so as to give proper effect to their purpose (Ga. Marble Co. v. Whitlock, 260 Ga. 350, 354 (1) (d) (392 SE2d 881) [(1990)]), we find that ‘Georgia law requires the person to submit to a test to determine if the person is under the influence of alcohol or other drugs.’ (Emphasis supplied.) OCGA § 40-5-67.1 (b) (1). Nevertheless, the legislature ‘has granted a driver the right to refuse to take a State-administered test,’ Keenan v. State, 263 Ga. 569, 571 (436 SE2d 475) [(1993)], subject to a legislative mandate ‘that evidence of the exercise of that right shall be admissible in the driver’s criminal trial. OCGA § 40-6-392 (d).’ Id.” State v. Leviner, supra at 101.

The trial court did not err in denying Nawrocki’s motion to suppress on these grounds.

2. Upon his affirmative request, Nawrocki should have been permitted to obtain a second, State-administered breath test, and we must reverse the trial court’s denial of the motion to suppress on this ground.

The trial court made a specific, factual finding that Nawrocki made a request for an additional State-administered test: “It’s not disputed that he [Nawrocki] inquired about taking an additional test, and as elicited by the State that inquiry was that he wanted an additional test. The evidence is that the only test that was requested was an additional State administered test.” Thereafter, the trial court denied Nawrocki’s motion to suppress, holding that “DUI defendants are not afforded the opportunity to demand an additional Intoxilizer 5000 test performed by the State under implied consent law. The purpose of this component is to provide independent analysis as a check against state misconduct or incompetence. This purpose is not served by requiring the same testing agent to repeat the test.”

While the trial court’s reasoning displays more than a little common sense with regard to the purpose for a second test, it remains that OCGA §§ 40-6-392 (a) (3) and 40-5-67.1 (b) (2) entitle a DUI suspect to have an “additional” test — not necessarily an independent test — of his “blood, breath, urine, or other bodily substances at [his] own expense and from qualified personnel of [his] own choosing.” OCGA § 40-5-67.1 (b) (2). Consequently, under the plain language of the statutes, a DUI defendant — at his own expense — may affirmatively choose to have the State’s qualified testing officer perform an additional breath test. Since, as a practical matter, State law enforcement agencies appear to be the primary locations at which breath test machines are readily available, a timely second breath test may be conducted on a law enforcement agency’s machine.

In fact, from the officer’s testimony in this case, it appears that a second, State-administered breath test performed by the original testing officer on a law enforcement machine is not uncommon: “a second request on a breath test is it’s so much easier, you don’t have to go anywhere. You give the breath sample right there. ... If a second breath sample is what he wanted, a second breath sample is what he would have got.”

Decided November 20, 1998

J. Guy Sharpe, Jr., for appellant.

G. Channing Ruskell, Solicitor, Barry W. Hixson, Assistant Solicitor, for appellee.

Thus, although as noted by the trial court, such choice may seem unwise in light of the apparent purpose for an additional test, there is nothing about the plain language of either OCGA § 40-6-392 (a) (3) or 40-5-67.1 (b) (2) which would preclude such choice. “[A] statute should be read according to its natural and most obvious import of the language without resorting to subtle and forced constructions for the purpose of either limiting or extending its operation.” Apollo Travel Svcs. v. Gwinnett County Bd. of Tax Assessors, 230 Ga. App. 790, 792 (498 SE2d 297) (1998).

Because of what it perceived as the “purpose” for the implied consent laws, the trial court incorrectly applied the plain language of those laws. Pursuant to his affirmative request for an additional breath test, to be conducted by a qualified officer on a law enforcement intoxilyzer, Nawrocki should have been given such additional test pursuant to the implied consent statutory provisions. “The requirement is that when the State seeks to prove the [DUI] violation by evidence of a chemical test, the State has the burden of demonstrating compliance with the statutory requirements.” (Citation and punctuation omitted.) State v. Causey, 215 Ga. App. 85, 86 (449 SE2d 639) (1994). Accordingly, the trial court erred in denying Nawrocki’s motion to suppress.

Judgment reversed.

McMurray, P. J., and Blackburn, J., concur.

       The reasonability of a DUI suspect’s affirmative request for additional testing and choices with regard thereto are subject to a trial court’s determination based upon the totality of the circumstances. See, e.g., State v. Buffington, 189 Ga. App. 800, 801-802 (377 SE2d 548) (1989).


author: Smith, Judge.

text:
    A98A1575.
    METROPOLITAN ATLANTA RAPID TRANSIT AUTHORITY v. GREEN INTERNATIONAL, INC. et al.
    (509 SE2d 674)
   Smith, Judge.

Green International, Inc. and Seaboard Surety Company brought this action against Metropolitan Atlanta Rapid Transit Authority (MARTA), seeking damages in the amount of approximately $3.4 million for cost overruns and additional work on the Kensington Transit Station construction project. Green and Seaboard alleged that MARTA’s plans and specifications were inadequate and defective and that MARTA did not correct the errors or administer the contract in a timely fashion, causing a significant increase in the costs of performance.

The case was tried before a jury, which returned a verdict in favor of Green and Seaboard for $2.8 million. The trial court denied MARTA’s motion for judgment notwithstanding the verdict or for new trial, and MARTA appeals, asserting that Green and Seaboard failed to prove damages proximately caused by contract deficiencies, that they failed to comply with contract conditions precedent to recovery, and that the trial court erred in admitting two exhibits and refusing to admit another. Finding no error, we affirm.

1. First, we consider MARTA’s contention that Green and Seaboard .failed to prove damages proximately caused by contract deficiencies. In reviewing a jury verdict after denial of a j.n.o.v. or motion for new trial, we follow well-established principles. “Where a jury returns a verdict and it has the approval of the trial judge, the same must be affirmed on appeal if there is any evidence to support it as the jurors are the sole and exclusive judges of the weight and credit given the evidence. The appellate court must construe the evidence with every inference and presumption in favor of upholding the verdict, and after judgment, the evidence must be construed to uphold the verdict even where the evidence is in conflict. As long as there is some evidence to support the verdict, the denial of defendant’s motion for directed verdict and new trial will not be disturbed.” (Citations and punctuation omitted.) John Crane, Inc. v. Wommack, 227 Ga. App. 538 (489 SE2d 527) (1997).

Construed in this manner, the evidence shows that MARTA originally engaged Stolte Construction Company to build the project after Stolte submitted a competitive bid based upon plans and specifications provided by MARTA. These plans and specifications were flawed, however, because the firm MARTA hired to coordinate the architectural and structural drawings did not complete its work. The manager of design review for MARTA characterized this firm’s performance as a “total disaster.” The plans and specifications contained major errors, inconsistencies, and design flaws; a Green project manager and an office engineer described the design problems as the worst they had ever seen. Stolte began discovering these problems during construction and repeatedly notified MARTA of a potential claim due to deficient plans and asked for assistance. MARTA did not adopt any of Stolte’s suggestions or respond to requests to address the problem. Green and Seaboard also presented evidence that MARTA did not prepare formal change orders in a timely fashion.

Stolte experienced “financial strain” as a result of the design deficiencies and MARTA’s failure to correct them; eventually Seaboard, the surety on the project, designated Green to complete the work. The problems with design discrepancies and errors did not improve after Green took over management of the project but continued “right through the end of the concrete work.”

The record is replete with evidence from many witnesses, who were personally involved in the management and supervision of the project, regarding the design deficiencies, MARTA’s delay in responding, and the resulting effect on the project. According to these witnesses, the state of the plans created a “design-as-you-go situation” requiring over 350 written requests for information and clarification, or “RFIs,” and over 1,000 new or revised drawings while the project was already underway. The witnesses testified that this piecemeal design scheme disrupted planning and coordination of the work, impaired efficiency, and caused additional costs, giving numerous specific examples. Green and Seaboard also presented expert witnesses who conducted a detailed evaluation of the claim, including review of all construction documents, interviews with Stolte and Green personnel, and scheduling and cost analysis. These experts analyzed the claim in terms of the plan deficiencies, the cause of loss of time and efficiency, and the value of that loss, allowing adjustments for more appropriate bid costs and expected or customary delays in similar work constructing other MARTA stations over a period of years.

MARTA contends that some of the corrective work performed by Green was compensated by change orders, that the change orders and RFIs contained waiver language, and that Green and Seaboard did not sufficiently distinguish between the claims remaining at trial and those already paid for and released. But evidence was presented that Green reserved its right to claim disruption and impact costs caused by the design deficiencies and distinguished between those reserved claims and those already compensated by change order.

Under OCGA § 13-6-2, “[d]amages recoverable for a breach of contract are such as arise naturally and according to the usual course of things from such breach and such as the parties contemplated, when the contract was made, as the probable result of its breach.” The trial court instructed the jury in the language of this Code section, proximate cause, damages as compensation for loss sustained as a result of defendant’s breaches, and proof of the amount of damages. MARTA did not except to these instructions, which are a correct general statement of Georgia law.

Expert testimony will support a finding of the amount of damages caused by a party. Sanders v. Robertson, 196 Ga. App. 739 (1) (397 SE2d 26) (1990) (in action against contractor and architect for negligent design and construction, expert testimony authorized jury to determine amount of damages “attributable or apportionable to” contractor). “The applicable law in Georgia is OCGA § 24-9-67, which provides: ‘the opinions of experts on any question of science, skill, trade or like questions shall always be admissible; and such opinions may be given on the facts as proved by other witnesses.’ Provided an expert witness is properly qualified in the field in which he offers testimony, and the facts relied upon are within the bounds of the evidence, whether there is sufficient knowledge upon which to base an opinion or whether it is based upon hearsay goes to the weight and credibility of the testimony, not its admissibility.” (Citations omitted.) Orkin Exterminating Co. v. McIntosh, 215 Ga. App. 587, 592-593 (4) (452 SE2d 159) (1994).

Green and Seaboard presented expert testimony calculating damages caused by the design deficiencies, setting out three different methods of calculation employed in the trade, and explaining which method produced the most accurate results in this case.

A very similar problem of damages analysis was presented in CRS Sirrine v. Dravo Corp., 219 Ga. App. 301 (464 SE2d 897) (1995), involving deficiencies in design documents prepared by the defendant that increased costs to the plaintiff construction contractor. We first remanded the trial court’s bench trial judgment for clarification because of an apparent conflict between the amount of damages the trial court found and the amount awarded. CRS Sirrine v. Dravo Corp., 213 Ga. App. 710, 720-721 (4) (445 SE2d 782) (1994).

On the second appeal, this Court considered and approved a revised judgment specifying the percentage of increased costs caused by the defendant and applying that percentage to various cost categories. CRS Sirrine, supra, 219 Ga. App. at 302, 303 (1). Our findings on the second appeal are equally applicable here. The defendant argued that reversal was required because the trier of fact found that the defendant did not cause all of plaintiffs’ damages, and therefore should have limited the award to only those damages which were shown to result solely from specific breaches on the part of defendant. This Court rejected this proposed approach, observing that it “would establish a standard which would be almost impossible to meet, resulting in nonliability for the defendant even when it is clear that the defendant caused a substantial portion of the loss.” Id. We reiterated the general approach to damages in Georgia, contrasting mere speculation with evidence that allows damages to be “estimated with reasonable certainty,” despite difficulty in fixing the exact amount. “Thus, if a plaintiff can show with reasonable certainty the total amount of damages and the degree to which those damages are attributable to defendant, that is sufficient to support an award. And that is exactly what happened in this case.” Id. The trial court did not err in denying MARTA’s motion for j.n.o.v. and new trial on the basis of failure to prove causation or damages.

2. (a) In its second enumeration of error, MARTA contends that Green’s and Seaboard’s claim is barred because Stolte failed to give timely notice of its claim under Article 39 of the general conditions to the project contract “within 15 days after the happening of the event or occurrence giving rise to the potential claim.” MARTA also contends that Stolte failed to submit its claim in a timely fashion as required by Article 40 of the general conditions.

Assuming without deciding that Stolte’s conduct was imputable to Green and Seaboard, this issue was for the jury. Some evidence was presented that Stolte notified MARTA approximately four months after the inception of the contract that a number of submittals had not been reviewed in a timely fashion, that this would “begin to affect the field operations and our schedule,” and that Stolte would “have no other choice” but to file delay claims. In April, Stolte again notified MARTA that it would hold MARTA responsible “for any delays to the project associated with the untimely answers to RFI’s.” While MARTA routinely responded to Stolte’s RFIs with language indicating that “the clarification given should be performed at no change in contract price or time,” Stolte by letter challenged this statement and noted that it was “not in accordance with the contract.”

In September 1990, Stolte sent MARTA another letter placing it on notice that a claim for damages arising from the contract documents would be forthcoming as soon as Stolte was able to provide “a detailed and accurate statement and calculation of the claim amount.” Stolte followed this letter with claim submittal documents which were updated periodically to reflect revision of the claim.

Article 39 requires only that the contractor set out “insofar as possible” the amount of the claim and its potential effects upon the schedule. MARTA does not identify the particular “event or occurrence giving rise to the potential claim” that it contends should have triggered a notice of potential claim at an earlier date. Nor did MARTA assert at the time that the notice of claim was untimely. Moreover, MARTA acknowledged the existence of “a potential claim for inefficiency of design” as early as February 1990.

Ordinarily, the question of reasonable notice is for the jury. See, e.g., Brackett v. Cartwright, 231 Ga. App. 536, 538 (2) (499 SE2d 905) (1998) (jury question whether notice of termination during default to lessee reasonable); Intl. Multifoods Corp. v. Nat. Egg Products, 202 Ga. App. 263, 266 (414 SE2d 253) (1991) (question whether notice reasonable under Uniform Commercial Code “is ordinarily a factual one”); Jones v. Cranman’s Sporting Goods, 142 Ga. App. 838, 840 (1) (a) (237 SE2d 402) (1977) (same). Under these circumstances, whether Stolte gave notice of a potential claim in a reasonable and timely manner and in accordance with the requirements of Article 39 of the general conditions was a question for the jury.

(b) MARTA also contends that Special Condition 32 of the contract, “Time of Completion,” bars any claim for compensation for delays to schedule. Green and Seaboard contend that they did not seek delay damages as such. But even assuming without deciding that this special condition applies, it also states: “No claims will be allowed for delays to the reduced time schedule nor will any compensation be paid for delays to schedules until times of completion stipulated below become affected.” (Emphasis supplied.) Green and Seaboard introduced evidence that all but one of the times enumerated in Special Condition 32 (A) through (N) were “affected” by delays. A witness for MARTA acknowledged that ten of the twelve dates were extended by change order. Under the “any evidence” rule, this at a minimum created a question for the jury as to whether the times of completion were “affected” within the meaning of Special Condition 32 and whether it applied.

3. MARTA contends the trial court erred in admitting two exhibits and excluding another.

(a) Plaintiffs’ Exhibit 269 originally consisted of a copy of the project drawings admitted as plaintiffs’ Exhibit 69, with 76 pages of narrative by a witness summarizing the various problems he identified on the job. MARTA objected to the exhibit on the ground that it constituted a continuing witness, and the trial court sustained the objection. Green and Seaboard then removed the narrative pages and tendered only the plans, which had certain parts highlighted in yellow ink; this modified form of the exhibit was admitted by the trial court over MARTA’s objection on the same ground.

“In Georgia the ‘continuing witness’ objection is based on the notion that written testimony is heard by the jury when read from the witness stand just as oral testimony is heard when given from the witness stand. But, it is unfair and places undue emphasis on written testimony for the writing to go out with the jury to be read again during deliberations, while oral testimony is received but once. [Cit.]” Tibbs v. Tibbs, 257 Ga. 370-371 (359 SE2d 674) (1987). This objection has been applied to evidence such as the affidavit in Tibbs, depositions, written dying declarations, written confessions, and other statements constituting “the equivalent of depositions. [Cits.]” Kenney v. State, 196 Ga. App. 776, 777 (2) (397 SE2d 131) (1990). But it does not apply to items of evidence such as drawings or other documents which are “demonstrative evidence that serve only to illustrate testimony given by the witnesses.” (Emphasis in original.) Gabbard v. State, 233 Ga. App. 122, 124 (3) (503 SE2d 347) (1998) (anatomical drawings used by child witnesses); Kenney, supra (photographic lineup card). The narrative statements .objected to by MARTA were removed from the exhibit, leaving only a copy of the project plans with certain portions outlined and shaded in yellow ink, but containing no written descriptions or indications as to the meaning of the shaded portions. Under these circumstances, the exhibit in its final form did not duplicate any oral testimony given by the witness and did not constitute written testimony or the equivalent of a deposition. The trial court therefore did not err in allowing it to go to the jury.

(b) MARTA also objects to the admission into evidence of plaintiffs’ Exhibit 309, which was a summary of Green and Seaboard’s claim, prepared by the witness who also prepared the claim submittal documents given to MARTA during the course of the project and discussed in Division 2 (a), above. All the claim submittal documents presented to MARTA at various times were admitted into evidence under specific limiting instructions, and this summary document was admitted in the same manner. In its charge to the jury, the trial court stated: “Some evidence in this case was admitted for what is called a limited purpose. Certain of the plaintiffs’ exhibits, specifically exhibits number 197-1, number 197-2, number 212, number 301, number 302 and 309, all of those plaintiffs’ exhibit numbers, those were admitted by the court for a limited purpose. These exhibits of the plaintiffs were not admitted to prove the truth of the matters asserted therein but solely for the purpose of proving some other element of the case. When an exhibit is admitted for a limited purpose, which these exhibits were, the legal effect is that you, the jury, may not use these exhibits as proof of the truth of their contents or substance.”

MARTA contends that it objected to the admission of Exhibit 309 and cites a single transcript reference to that effect in its statement of facts. But the actual history of the introduction and admission of this document, not revealed by MARTA, is far more complex and shows that MARTA first failed to interpose a timely objection to the trial court’s admission of this exhibit for a limited purpose and then acquiesced in its admission. Failure to make a specific objection at the time the evidence was offered resulted in a waiver of MARTA’s right to object on appeal. Ryans v. State, 226 Ga. App. 595, 597 (2) (487 SE2d 130) (1997). See also Ford Motor Co. v. Tippins, 225 Ga. App. 128, 130 (1) (483 SE2d 121) (1997).

At the time of MARTA’s objection, the trial court observed that the exhibit had already been admitted for a limited purpose. Counsel for MARTA immediately responded, “I stand corrected. That is consistent with my recollection, also,” and concluded his examination of the witness. Another lawyer for MARTA then rose to state that he did not believe he had agreed to the admission of Exhibit 309, but the trial court responded that it had been admitted for the limited purpose “to assist [the jury] in receiving and understanding the testimony of the witness and it is not admitted for the accuracy or the truthfulness of its contents or . . . its calculations.” Later during the trial, this lawyer again raised the issue and stated that he now agreed that the trial court had indeed already admitted the exhibit for a limited purpose; he requested that it be included in the general instruction to the jury regarding such exhibits. Our review of the record indicates that this statement is correct. The trial court did not err in admitting this exhibit under limiting instructions.

(c) Finally, MARTA asserts that the trial court erred in refusing to admit a handwritten document discovered in Green’s files on the ground that it was a business record. But the admission of a document as a business record requires that certain procedures be followed and an evidentiary showing made. “OCGA § 24-3-14, the Georgia Business Records Act, governs the admissibility of business records. Subsection (b) requires that a foundation be laid through the testimony of a witness ‘who is familiar with the method of keeping the records and who can testify thereto and to facts which show that the entry was made in the regular course of. . . business at the time of the event or within a reasonable time thereafter.’ [Cit.]” (Emphasis omitted.) Nalley Northside Chevrolet v. Herring, 215 Ga. App. 185, 186 (3) (450 SE2d 452) (1994). The document was unsigned, and MARTA acknowledged it was never able to locate anyone who could identify it. MARTA questioned Green’s witnesses repeatedly, but no one was able to identify the document or shed light on who had drafted it or why. MARTA, therefore, was unable “to produce the requisite foundation testimony of a witness who was familiar with the method of record keeping and who could testify to facts showing the entry was made in the regular course of business at the time of the event or within a reasonable time thereafter. [Cit.] The trial court properly excluded the evidence.” Hodson v. Mawson, 227 Ga. App. 490, 492 (3) (489 SE2d 855) (1997).

Judgment affirmed.

Johnson, P. J., and Senior Appellate Judge Harold R. Banke concur.

Decided November 20, 1998

Pursley, Howell, Lowery & Meeks, John R. Lowery, for appellant.

Smith, Currie & Hancock, Philip L. Fortune, James K. Bidgood, Jr., for appellees.

       MARTA, relying on cases from other jurisdictions, contends that Green and Seaboard proved damages by a means known as the “total cost method” or “modified total cost method.” MARTA contends both that this method is “universally disfavored” and that Green and Seaboard failed to meet the four-part test required by courts that recognize it. Several witnesses, including one of the experts who analyzed the claim, explicitly rejected MARTA’s assertion that the “total cost method” was used. But whether or not this method was used here, which Green and Seaboard deny, its use is irrelevant to the standard for proof of causation or proof of damages under Georgia law.

       We recognize, however, the distinction between documents prepared by a witness for demonstrative purposes at trial and those “ ‘documents which are themselves relevant and admissible as original documentary evidence in a case.’ [Cits.]” Hodson v. Mawson, 227 Ga. App. 490, 491 (2) (489 SE2d 855) (1997).