text:
    A93A1178, A93A1179.
    WAYNE COUNTY v. HERRIN et al.; and vice versa.
    (437 SE2d 793)
   Pope, Chief Judge.

Plaintiff Wayne County, acting by and through the Board of Commissioners of Wayne County (the “Board”), filed this action against its current sheriff, defendant David E. Herrin, and other named defendants who were employed by Herrin as deputy sheriffs when Herrin’s term as sheriff began on January 1, 1993. The Board contends that Herrin improperly terminated 17 prior employees of the sheriff’s office and hired the other named defendants in contravention of the county’s personnel system. The defendants filed a counterclaim alleging the Board was interfering with the operation of the sheriff’s office by refusing to pay for bonding the deputies hired by Herrin, refusing to pay for equipment and supplies for the operation of the sheriff’s office and refusing to pay the deputies hired by Herrin for their services in that capacity. After a hearing on the claims asserted by the parties, the trial court issued an order holding that the personnel system was properly adopted pursuant to OCGA § 36-1-21 but that Sheriff Herrin nonetheless acted within his authority in refusing to reappoint certain employees of the sheriff’s office in accordance with OCGA § 15-16-23. The trial court therefore enjoined the Board from failing to provide to the deputies appointed by Herrin “the pay, benefits, and other rights and privileges associated with their employment with the Wayne County Sheriff’s Office” and from failing to provide funds to the sheriff’s office that had been approved in the budget for the operation of that office. In Case No. A93A1178, the Board appeals from that order, and in Case No. A93A1179, the defendants cross-appeal.

The following facts are pertinent to both appeals: The Board adopted Wayne County’s current personnel system on December 6, 1988. On December 29, 1988, the same day he was sworn into office for his term beginning on January 1, 1989, the previous sheriff of Wayne County, James E. Warren, requested that the positions of chief deputy, secretary, chief detective, detective, deputy sheriff, sergeant, and detention officer be subject to and covered by the personnel system. On December 18, 1992, the Board adopted a resolution authorizing elected officials to bring their employees into the personnel system, and on December 28, 1992, Sheriff Warren, whose term was to expire on December 31,1992, renewed his request first made in December 1988 that the above-mentioned positions in the sheriff’s department be made a part of the personnel system. During December 1992, Sheriff-elect Herrin met with county personnel who explained the Wayne County personnel system to him and Herrin indicated during that meeting that he did not wish to be bound by the provisions concerning the employment of deputies. By letters dated January 1, 1993, the first day of his term of office, Sheriff Herrin informed 17 employees of the sheriff’s office that they were not being “reappointed ... to the office of Deputy Sheriff of Wayne County” and that “this termination is effective immediately.” On that same day, Sheriff Herrin appointed the remaining defendants to the office of deputy sheriff. The county has continued to pay the 17 employees who were dismissed or not reappointed by Herrin and has refused to pay those appointed by Herrin to the office of deputy sheriff.

1. Before addressing the issues raised in Case No. A93A1178, we first address arguments raised by defendants in their cross-appeal in Case No. A93A1179. Defendants argue the trial court erred in holding that the Wayne County personnel system was adopted in accordance with OCGA § 36-1-21 and that it is applicable to the sheriff’s office. A brief history of that Code section is helpful to our analysis. As the trial court correctly noted, the United States Supreme Court signaled the end of the practice of patronage dismissals for rank and file employees of elected officials in Elrod v. Burns, 427 U. S. 347 (96 SC 2673, 49 LE2d 547) (1976). In that case certain noncivil service employees of the Cook County, Illinois, Sheriff’s Office, who were Republicans, brought suit against the newly elected Democratic sheriff alleging they were dismissed in violation of the First and Fourteenth Amendments for the sole reason that they were not affiliated with or sponsored by the Democratic Party. Id. at. 350. The Court held “that the practice of patronage dismissals is unconstitutional under the First and Fourteenth Amendments” and patronage dismissals must be limited to policy making positions. Id. at 372-373. Accord Branti v. Finkel, 445 U. S. 507 (100 SC 1287, 63 LE2d 574) (1980) (holding the First and Fourteenth Amendments protect assistant public defenders from dismissal solely because of their political beliefs).

In light of the mandates contained in those cases and the growing utilization of civil service systems, the Georgia Constitution was amended in 1983 to provide that “[t]he General Assembly may by general law authorize the establishment by governing authorities of civil service systems covering county employees or covering county employees and employees of the elected county officers.” Ga. Const., Art. IX, Sec. I, Par. IV. In 1986, the General Assembly implemented that provision by enacting OCGA § 36-1-21, which provides in pertinent part:

“(a) The governing authority of any county is authorized to provide by ordinance or resolution for the creation of a civil service system for employees of the county, other than elected officials or persons appointed to positions for specified terms.

“(b) Subsequent to the creation of a civil service system, the county governing authority which created the system may provide by ordinance or resolution that positions of employment within departments subject to the jurisdiction of elected county officers . . . shall be subject to and covered by the civil service system upon the written application of the elected county officer . . . having the power of appointment, employment, or removal of employees of the officer. . . . Once positions . . . are made subject to the civil service system, such positions shall not be removed thereafter from the coverage of the civil service system.

“(c) A civil service system created pursuant to the authority of this Code section shall be administered in such manner and pursuant to such rules and regulations as may be provided for by resolution or ordinance of the county governing authority which created the system.”

Thus, in order to comply with the mandates of OCGA § 36-1-21, the governing authority of a county must first adopt by resolution or ordinance a civil service system. Defendants argue that because the current personnel system was adopted by motion rather than by resolution or ordinance, it is not in compliance with OCGA § 36-1-21. A similar argument was considered by our Supreme Court in Allen v. Wise, 204 Ga. 415 (50 SE2d 69) (1948). In that case it was argued that the Mayor of Savannah could only veto a resolution or ordinance and could not veto a “motion.” However, our Supreme Court looked to the effect of the motion and concluded it had the same effect as a resolution and should be treated as such. Id. at 418-419. The same analysis is applicable in the case at bar. The term “resolution” is defined as “a formal expression of the opinion or will of an official body or public assembly by vote. . . . The term is usually employed to denote the adoption of a motion, the subject-matter of which would not properly constitute a statute. . . .” Black’s Law Dictionary, p. 1310 (6th ed. 1990). Applying that definition to the facts of this case, we hold the motion creating the current personnel system was a resolution within the meaning of OCGA § 36-1-21. The parties do not cite and we are not aware of any authority requiring that resolutions of governing authorities be in a certain form. A review of the minutes of the Board’s meetings contained in the record reveals that it was the custom and practice of the Board to act by adopting motions.

With regard to the resolution dated December 18, 1992 that allowed elected county officials to bring positions of employment within their department into the personnel system, the trial court properly concluded that resolution complied with the dictates of OCGA § 36-1-21 (b). The resolution is in written form and recites that it is being adopted pursuant to OCGA § 36-1-21 (b). The trial court also correctly held Sheriff Warren’s second request dated December 28, 1992 was effective to bring the requested positions in the sheriff’s office under the personnel system. Although Sheriff Warren’s term was about to end at the time of the second request, he was a duly elected county officer and he made the requisite written application to have positions of employment in the sheriff’s office made subject to the personnel system. Thus, the Board and Sheriff Warren fully complied with all requirements set forth in OCGA § 36-1-21 (b) necessary to bring employees of the sheriff’s office within the personnel system.

Defendants also argue that certain amendments to the personnel system were not properly effected. Assuming arguendo the Board had to comply with the dictates of Art. IX, Sec. II, Par. I (b) (1) of the Georgia Constitution in order to properly amend the personnel system, failure to do so would at most invalidate any proposed amendment and the personnel system as it was first adopted would still be effective. Ga. Const., Art. IX, Sec. II, Par. I (g). As the personnel policy has always required cause for dismissals, the Board’s failure to properly amend the personnel system would not constitute reversible error in this case.

The record reveals that defendants’ argument that no resolution concerning this personnel policy was spread on the minutes of the Board’s meeting is erroneous. The minutes of the December 6, 1988 meeting contains the following paragraph: “Motion by Mr. O’Quinn, second by Mr. Denison to adopt the new personnel plan to be effective January 1, 1989. Mr. O’Quinn, Mr. Denison, Mr. Aspinwall, and Mr. Johnson voted yes. Mr. Lane voted no.” As we have held this motion had the effect of a resolution, this language is sufficient to spread information of the policy on the minutes of that meeting. The minutes of the December 18, 1992 meeting further reflect that the resolution required by OCGA § 36-1-21 (b) was adopted by motion.

We also reject defendants’ argument that the adoption of the personnel system by oral motion created an oral contract of employment with the county. Defendants’ reliance on our decision in Murray County v. Pickering, 42 Ga. App. 739 (157 SE 343) (1931) and the Eleventh Circuit Court of Appeals’ decision in Ogletree v. Chester, 682 F2d 1366 (11th Cir. 1982) as authority for that proposition is misplaced. At most the Board’s adoption of a personnel system effected positions of employment with Wayne County, the oral adoption of the motion did not create oral contracts of employment.

2. Defendants further argue on cross-appeal that the trial court erred in failing to hold that OCGA § 36-1-21 is unconstitutional. “The Supreme Court shall be a court of review and shall exercise exclusive appellate jurisdiction in . . . all cases in which the constitutionality of a law, ordinance, or constitutional provision has been drawn in question. . . .” Ga. Const., Art. VI, Sec. VI, Par. II. The appeals in this case were originally filed in this court, transferred by this court to the Supreme Court, and subsequently transferred back to this court. Since this court has no jurisdiction to consider a constitutional challenge to OCGA § 36-1-21, we must decline to address this argument raised by defendants. In re W. M. F., 180 Ga. App. 397 (349 SE2d 265) (1986).

3. We next address the Board’s contention in Case No. A93A1178 that the trial court erred in holding that the enactment of OCGA § 36-1-21 did not pro tanto repeal OCGA § 15-16-23. The Board argues that because these statutes are so repugnant to one another, the trial court’s purported reconciliation of the two was error. The pertinent language of OCGA § 36-1-21 is set forth in Division 1. OCGA § 15-16-23 provides in pertinent part that “[sjheriffs are authorized in their discretion to appoint one or more deputies.” As the parties correctly note, deeply embedded in our case law is the notion that the sheriff alone has the authority and power to appoint and fire deputies. “ ‘Deputy sheriffs and deputy jailors are employees of the sheriff, whom the sheriffs alone are entitled to appoint or discharge. Board of Commissioners of Richmond County v. Whittle, 180 Ga. 166 (178 SE 534) [(1935)]. They have no duties save alone duties of the sheriff, which as his deputy and his agent they are by law authorized to perform. . . . The sheriff, and not the county, is liable for the misconduct of his deputies. . . . The tenure in employment of a deputy jailor or deputy sheriff is dependent, not alone upon the will of the sheriff whose employee he is and who may discharge him when he chooses, but also upon the re-election of the sheriff. Thus it is impossible for deputies to calculate with any degree of certainty when their employment will terminate. . . . [D]eputies perform duties of the sheriff, which, ceases when the sheriff leaves office. . . .’ ” Employees Retirement System v. Lewis, 109 Ga. App. 476, 480-481 (136 SE2d 518) (1964). See also Drost v. Robinson, 194 Ga. 703, 710 (22 SE2d 475) (1942) (holding deputy sheriffs and jailers are employees of the sheriff only and the county is not liable for their misconduct).

In deciding whether OCGA §§ 15-16-23 and 36-1-21 can be reconciled, we are guided by decisions from other jurisdictions which have considered similar statutes in light of the mandate of Elrod v. Burns, supra. In Ison v. Zimmerman, 372 S2d 431 (Fla. 1979), the Florida Supreme Court refused to hold that a sheriff should have absolute control over his choice of deputies, reasoning that such a holding would contradict the spirit of the constitutional mandate establishing a civil service system and the legislative intent expressed in the statute allowing civil service systems to be created by special or local laws for deputies as officers. It is significant to note, however, that the Florida legislature specifically exempted the positions of the office of the sheriff, chief deputy, chief criminal deputy, and chief civil deputy from inclusion in a civil service system. Id. at 435. In Yarosh v. Becane, 406 NE2d 1355 (Ohio 1980), the Supreme Court of Ohio similarly held that the Ohio statute giving sheriffs power to hire and fire deputies is subject to the civil service rules contained in another chapter of the Ohio Code. Id. at 1358-1359. The Ohio legislature, however, also recognized that there are certain positions of employment in offices held by elected officials that should be exempt from any civil service system. Id. at 1359; see Ohio Rev. Code Ann. 124.11 (A) (9).

In New York several appellate decisions have dealt with similar issues and concluded that to the extent counties have assumed responsibility for or can be held liable for the tortious acts of deputies, the position of deputy may be placed in a civil service system. See Thoubboron v. New York State Dept. of Civil Svc., 552 NYS2d 1012 (Sup. Ct. 1990), aff’d 572 NYS2d 494 (N.Y. App. Div. 1991), aff’d 594 NE2d 927 (N.Y. 1992) and the cases cited therein.

We hold the trial court correctly concluded that OCGA §§ 15-16-23 and 36-1-21 can be read consistently and that the later enactment of OCGA § 36-1-21 did not repeal OCGA § 15-16-23 by implication. However, we cannot agree with the manner in which the trial court reconciled these statutes. The trial court found that only the positions are protected under the Wayne County personnel system, and the sheriff has the authority at the beginning of his term to appoint a person to fill the position and the person appointed receives the employment protection by the personnel system for the term of the sheriff. The trial court’s reconciliation of these statutes seeks to combine the merit and spoils (or political patronage) systems. However, civil service systems rest on the principles of a merit system rather than (not in addition to) a spoils system, and are designed to protect people rather than positions. Clark v. State Personnel Bd., 252 Ga. 548, 550 (2) (b) (314 SE2d 658) (1984); Cohilas v. Clayton County Bd. of Commrs., 206 Ga. App. 134, 137 (424 SE2d 651) (1992). The benefits of a civil service system are two-fold: Civil service laws protect (1) the employee by providing them with job security for dedicated service; and (2) the public by allowing local governments to render more efficient services to the public. 15 AmJur2d Civil Service, § 1.

We hold that once positions in a sheriff’s office have been made subject to a personnel or civil service system, a sheriff’s authority to appoint deputies pursuant to OCGA § 15-16-23 is limited to vacancies created by the removal of employees in the manner provided under the applicable personnel or civil service system or vacancies created when employees resign or retire. We do not lightly limit the ability of sheriffs to employ persons loyal to him for the position of deputy sheriff. As our Supreme Court observed in Warren v. Walton, 231 Ga. 495, 499-500 (202 SE2d 405) (1973) (quoting Foster v. Vickery, 202 Ga. 55, 60 (42 SE2d 117) (1947), “ ‘[t]he office of sheriff carries with it all of its common-law duties and powers, except as modified by statute. Elder v. Camp, 193 Ga. 320 (5) (18 SE2d 622) [(1942)]. Statutes in derogation of the common law must be strictly construed. (Cits.) Both under the rule of the common law and the statute law of force in this State, sheriffs are not restricted in their right to employ and discharge their deputies and employees, and any limitation or restriction which now applies to only one sheriff in this State must be strictly construed, and no powers or rights will be given to the reviewing or limiting authority except those definitely and positively granted by the General Assembly.’ ” However, the General Assembly has definitely and positively provided for the creation of county civil service systems and conferred on elected officials the ability to bring all employees in their office into the system. Our role is not to act as a policymaker for our legislature and we must presume that our legislature was aware of all potentially conflicting statutes and cases when it enacted OCGA § 36-1-21.

We note that this case highlights a problem associated with our legislature’s decision not to limit what positions within an elected official’s office could be brought within a civil service system. Cf. Ison, 372 S2d at 435 (noting Florida legislature exempted sheriff’s chief deputy, chief criminal deputy, and chief civil deputy from participation in civil service system); Yarosh, 406 NE2d at 1359 (noting that deputies or assistants who are in a fiduciary or administrative relationship with an elected official are not included in the state civil service system). OCGA § 36-1-21 currently allows all positions in an elected official’s office to be brought under a civil service system and further provides that once positions are subject to the system the “positions shall not be removed thereafter from the coverage of the civil service system.” It is probable that an elected official requesting that positions in his office be placed in a civil service system will request that all positions be placed under the civil service system, even policymaking positions, so that all employees who have served him well will be protected from political discharge if he is not reelected. Unless our legislature decides to narrow the scope of civil service systems to exclude policymaking positions, elected officials who take office after positions in that office have been brought under a civil service system will be forced to work within the system and discharge any covered employee only for good cause, such as insubordination or poor job performance. See Elrod, 427 U. S. at 366.

4. This court will not consider defendants’ contention that the trial court erred in failing to hold that OCGA §§ 15-16-23 and 15-16-24 preempt home rule legislation. Defendants do not show us and our review of the record does not reveal that this issue was brought to the attention of and considered by the trial court. It is well-settled that issues raised for the first time on appeal will not be considered. Kennedy v. Johnson, 205 Ga. App. 220, 222 (1) (421 SE2d 746) (1992).

5. Defendants posit that the trial court erred in failing to hold that “plaintiffs” should be estopped from denying that the employees of the sheriff’s office serve at the pleasure of the sheriff. Estoppel is an affirmative defense that must be set forth in a responsive pleading. OCGA § 9-11-8 (c). Estoppel was not affirmatively pled by the defendants and our review of the record does not reveal that this issue was raised below; therefore this issue will not be considered on appeal. Furthermore, defendants’ argument on appeal makes it clear that the “plaintiffs” that defendants wish to estop are the 17 individuals who were not reappointed or terminated from employment with the Wayne County Sheriff’s Office by Sheriff Herrin, who are not parties to this litigation.

6. We also reject defendants’ argument that Wayne County’s personnel system is void as against public policy to the extent it attempts to restrain the sheriff’s power to appoint and discharge his employees. In support of this argument defendants rely upon Hewatt v. Bonner, 142 Ga. App. 442 (236 SE2d 111) (1977), in which we held that an oral contract for employment for a specific term was unenforceable against a sheriff because “[a]s a public officer, a sheriff may not be hampered in the administration of his duties to the public by employee contracts.” Id. at 443. However, the most recent expression of public policy on this particular issue was expressed when the Georgia Constitution was amended to allow the General Assembly to authorize the establishment by county governing authorities of civil service systems that would cover county employees and employees of elected county officers. Ga. Const., Art. IX, Sec. I, Par. IV. Accordingly, we find this argument to be without merit.

7. We next consider whether the trial court erred in refusing to grant the injunctive relief sought by the Board ordering Sheriff Herrin to reinstate the 17 employees of the sheriff’s office whom he terminated without affording them due process rights in connection with their dismissal. We first note that a writ of mandamus rather than a writ of injunction is the proper remedy for the relief sought by the Board. McAfee v. Bd. of Firemasters of Atlanta, 186 Ga. 262 (197 SE 802) (1938) (holding writ of mandamus was the appropriate remedy to compel reinstatement of a fireman who was suspended in violation of the Civil Service Act). Although generally in Georgia no one in public employment has a right to such employment, Barnes v. Mendonsa, 110 Ga. App. 464, 465 (138 SE2d 914) (1964), the right to continued employment can arise when employment can only be terminated for cause. Brownlee v. Williams, 233 Ga. 548, 551 (212 SE2d 359) (1975). Section 10, paragraph G of the Wayne County Personnel Policies and Procedures provides that employees can be dismissed only for cause. Therefore, employees who are covered by that system, such as the 17 dismissed employees of the sheriff’s office, have a property interest in their employment. Pursuant to Section 11 of the policies and procedures, any covered employee who is dismissed is entitled to written notice concerning what conduct constitutes just cause for dismissal and to appeal his dismissal to a grievance committee. Brownlee, 233 Ga. at 551. Sheriff Herrin’s discharge of the 17 employees in violation of these provisions renders their dismissals illegal, void and null. See McAfee, 186 Ga. at 262. Accordingly, we find the trial court erred in failing to order Sheriff Herrin to reinstate the 17 dismissed employees.

8. It follows that if Sheriff Herrin improperly dismissed the 17 employees, his action in hiring the defendants to replace those employees is also improper. Therefore, we further hold that the trial court erred in ordering Wayne County to provide the employees hired by Sheriff Herrin as replacements for the employees who were illegally terminated with “all pay, benefits, and other rights and privileges associated with their employment with Wayne County.” To the extent these persons have provided services to Wayne County, they are entitled to reasonable compensation for their services. This case is remanded to the trial court for proceedings consistent with this decision.

Decided September 10, 1993

Reconsideration denied November 3, 1993

Leaphart & Johnson, J. Alvin Leaphart, James G. Johnson, for appellant.

Gary A. Bacon, for appellees.

Walker, Hulbert, Gray & Byrd, Charles W. Byrd, Malcolm J. Hall, Jim Chamberlin, amici curiae.

Judgment reversed with direction in Case No. A93A1178. Judgment affirmed in Case No. A93A1179.

Birdsong, P. J., and Andrews, J., concur.

       The personnel policy and procedures adopted to implement the personnel system state that one of the reasons the personnel system was implemented was to assure “that employees are protected against coercion for partisan political purposes and are prohibited from using their official authority for the purpose of interfering with or affecting the result of an election or a nomination for office.”

       Although the record does not reflect whether Warren requested that all positions in the sheriff’s office be placed under the personnel system, the parties argue in their briefs that all positions other than the sheriff are now part of that system.

       Even though all terminated employees held the title of deputy sheriff, they served various functions including secretary, detention officer, and clerk/typist.

       As is noted in the Handbook for Georgia County Commissioners, the better practice is for a governing authority to act by adopting written resolutions and ordinances, which are drafted in accordance with a standard form.

       As the Board, points out, OCGA § 15-16-23 is not the only arguably inconsistent statute. For example, OCGA § 15-6-59 gives clerks of the superior court similar powers to appoint deputies and for that reason is arguably in conflict with OCGA § 36-1-21.

       Although not presented in this appeal, another potential problem arises because the sheriff rather than the county is liable for the misconduct of deputies. Drost v. Robinson, 194 Ga. at 710; cf. Thoubboron v. Dept. of Civil Svc., supra.

       As we discussed above, the creation of a civil service system does not create a contract of employment, instead it imposes certain terms and conditions on existing employment positions.

       The Board is a proper party to seek a writ of mandamus ordering the sheriff to reinstate the improperly dismissed employees since under certain circumstances it may be held liable under 42 USC § 1983 for the acts of the sheriff in depriving sheriff office employees of their constitutional rights. See Johnson v. Ballard, 644 FSupp. 333 (N.D. Ga. 1986).


source: Caselaw Access Project

author: Johnson, Judge. Blackburn, Judge,

license: Public Domain

text:
    A93A1205.
    STEPTOE et al. v. AUTO-OWNERS INSURANCE COMPANY.
    (437 SE2d 626)
   Johnson, Judge.

In 1990, Brian Derek Steptoe, a minor, was injured in an automobile accident while riding as a passenger in a car insured by Auto-Owners Insurance Company. Brian Steptoe and his mother, Jalayne Steptoe, eventually settled their claims arising out of the accident with Auto-Owners; however, the settlement excluded personal injury protection (PIP) coverage. Auto-Owners subsequently failed to make timely payment for two medical bills for Brian Steptoe. In September 1991, the Steptoes brought suit seeking to recover those expenses as well as penalties and punitive damages pursuant to former OCGA § 33-34-6 for the late payment of no-fault benefits. Jalayne Steptoe also sought to recover punitive damages under OCGA § 51-12-5.1 for mental stress she allegedly suffered due to Auto-Owners’ bad faith failure to pay.

The trial court granted Auto-Owners’ motion to dismiss, relying on this court’s decision in Terry v. State Farm Mut. Auto. Ins. Co., 205 Ga. App. 224 (422 SE2d 212) (1992), holding that in the absence of a contractual term in the policy providing for bad faith damages, the October 1991 repeal of OCGA § 33-34-6 bars recovery of penalties and punitive damages for an insurer’s bad faith failure to pay under the No-Fault Act. The trial court also found Jalayne Steptoe could not maintain an action in tort against Auto-Owners because its duty to make payments was owed to Brian Steptoe and was of a contractual nature. The Steptoes appeal.

1. The Steptoes attack the trial court’s application of Terry to this case on a number of grounds, all of which we find to lack merit. They first contend this court’s decision in Terry is inconsistent with the general rule that laws that exist at the time of the making of a contract form a part of the contract. This rule, however, simply stands for the proposition that the contract must be construed in light of the laws which exist at the time it is made. See Dorsey v. Clements, 202 Ga. 820, 825 (44 SE2d 783) (1947).

The Steptoes also contend the decision in Terry, which established that a contract must specifically include the right to collect statutory penalties before that right can be vested by the contract, is erroneous. As this court noted in Terry, supra at 227, the privilege to seek penalties against insurers is not generally a bargained-for element of insurance contracts. Here, as in Terry, the insurance policy simply mentioned the No-Fault Act; it did not mention the insured’s ability to seek penalties and damages against the insurer. The court in Terry found that the “mere mention within a contract of an act which contains a statute authorizing penalties is not sufficient to secure the right to collect penalties by contract. . . . Any other interpretation of that language would be inconsistent with the aversion to forfeitures and penalties consistently recognized by the Georgia appellate courts.” Id. at 226.

The Steptoes next contend the trial court’s application of Terry to this case effectively impaired a contract in violation of the Georgia Constitution because their right to receive 25 percent of the medical bills owed and reasonable attorney fees under former OCGA § 33-34-6 became “vested” when Auto-Owners refused to pay within 30 days. However, this court addressed such constitutional concerns in Terry when it noted that the Supreme Court has recognized that “construing a statute so as to relieve against penalties and forfeitures does not violate the constitutional rights of the complaining party because a person has no vested rights to a forfeiture or penalty.” (Citation and punctuation omitted.) Terry, supra at 227; see also State Farm Mut. Auto. Ins. Co. v. Young, 207 Ga. App. 355 (427 SE2d 835) (1993).

Finally, the Steptoes contend this court’s decision in Terry to apply the repeal retroactively is erroneous because the legislature did not indicate that it intended for the repeal to so apply. This court addressed this argument on rehearing in Terry and found it to be without merit. See Terry, supra at 225, n. 1; see also State Farm Mut. Auto. Ins. Co. v. Sills, 208 Ga. App. 184 (430 SE2d 32) (1993); Khosravi v. Aetna Cas. &c. Co., 206 Ga. App. 481 (425 SE2d 905) (1992).

2. The Steptoes contend the trial court erred in refusing to consider the settlement release as evidence that their right to recover penalties was vested because that document was not included in the record before the court. The Steptoes argued to the trial court that Terry was distinguishable because their right to recover penalties and punitive damages was vested contractually by virtue of the release agreement they entered into with Auto-Owners which specifically excluded PIP coverage. We find the trial court correctly declined to consider the release because that document was not included in the record before it. See Judge v. Wellman, 198 Ga. App. 782, 783 (403 SE2d 76) (1991). We reject the Steptoes’ contention on appeal that the release did not need to be made a part of the record because the parties agreed that PIP coverage was excluded and the only issue was the meaning of that exclusion and whether it included a right to recover penalties for the insurer’s failure to pay. Aside from the fact that this argument was never addressed to the trial court, it is clear that a court cannot be asked to construe the meaning of terms in a contract without having the entire contract in the record before it.

3. The Steptoes allege the trial court erroneously dismissed Jalayne Steptoe’s claim on the ground she could maintain no action in tort because she had failed to show Auto-Owners owed her any duty. We agree with the trial court that the only duty owed by Auto-Owners was to make payment to Brian Steptoe under the insurance policy in question. “If there is no liability except that arising out of a breach of the express terms of the contract, the action must be in contract, and an action in tort cannot be maintained.” (Citation and punctuation omitted.) Wells v. New York Life Ins. Co., 195 Ga. App. 79 (392 SE2d 251) (1990). The Steptoes’ reliance on Atlanta Cas. Co. v. Jones, 247 Ga. 238 (275 SE2d 328) (1981), for the proposition that the duty to pay was owed to Jalayne Steptoe is misplaced. We also reject appellants’ contention that the complaint stated a claim for intentional infliction of emotional distress. See Bekele v. Ryals, 177 Ga. App. 445 (339 SE2d 655) (1986).

Judgment affirmed.

McMurray, P. J., concurs. Blackburn, J., concurs specially.

Blackburn, Judge,

concurring specially.

I reluctantly concur with the majority opinion’s conclusion that this case is controlled by Terry v. State Farm Mut. Auto. Ins. Co., 205 Ga. App. 224 (422 SE2d 212) (1992). Upon reflection on the effect of the repeal of the No-Fault Act on claims for statutory penalties, attorney fees, and punitive damages, I have reservations about the correctness of this court’s determinations in Terry and its progeny. See American Assn. of Cab Cos. v. Egeh, 205 Ga. App. 228 (9) (421 SE2d 741) (1992); Green v. State Farm Ins. Cos., 206 Ga. App. 478 (2) (426 SE2d 3) (1992); Khosravi v. Aetna Cas. &c. Co., 206 Ga. App. 481 (425 SE2d 905) (1992); and State Farm Mut. Auto. Ins. Co. v. Young, 207 Ga. App. 355 (427 SE2d 835) (1993). However, this court’s holding in Terry having become so well-established, I am constrained to follow it notwithstanding my reservations.

Decided October 21, 1993

Reconsideration denied November 3, 1993

Dodd & Kinsey, Jack E. Dodd, James B. Kinsey, for appellants.

Bonnie C. Oliver, for appellee.


author: Johnson, Judge. McMurray, Presiding Judge,

text:
    A93A1466.
    MARYLAND CASUALTY INSURANCE COMPANY v. GLOMSKI.
    (437 SE2d .616)
   Johnson, Judge.

Raymond Glomski was injured in a car accident while on business in Georgia. Glomski, whose employer was located in Illinois, was eligible for workers’ compensation in either Illinois or Georgia. Glomski filed his workers’ compensation claim in Illinois and received payments under Illinois law from Maryland Casualty Insurance Company, his employer’s workers’ compensation carrier. Glomski then filed a tort action in Georgia against various third parties seeking to recover damages for the injuries he sustained in the accident. Maryland Casualty filed a motion to intervene in the action. The trial court denied the motion. Maryland Casualty appeals, claiming that the trial court erred in denying its motion because it should be allowed to intervene as a matter of right in order to protect its right to be subrogated, as provided by the Illinois Workers’ Compensation Act, to any judgment Glomski recovers.

The issue before us is whether Illinois or Georgia law governs Maryland Casualty’s subrogation rights. In Murphy v. Sears Roebuck & Co., 209 Ga. App. 171 (1) (433 SE2d 325) (1993), this court addressed a conflict of laws question in a workers’ compensation case by relying on Howard v. Alfrey, 697 F2d 1006 (11th Cir. 1983). In Howard, the United States Court of Appeals for the Eleventh Circuit stated the general rule that “[a]s to third-party actions, if compensation has been paid in a foreign state and suit is brought against a third-party in the state of injury, the substantive rights of the employee, subrogated insurance carrier and the employer are ordinarily held governed by the laws of the foreign state.” (Citation and punctuation omitted.) Id. at 1009 (III). This majority rule, however, is not the rule in Georgia. After the decision in Howard, the Georgia Supreme Court answered the following certified question from the Eleventh Circuit Court of Appeals: “ ‘Under Georgia law, does the Illinois or Georgia workers’ compensation rule of law apply in fixing a defendant-product manufacturer’s right to seek contribution and indemnity by impleading the plaintiff’s employer when the injury occurred in Georgia, the employment relationship was localized in Illinois, and the plaintiff sought and received workers’ compensation benefits in Illinois even though she was available for such benefits in either state?’ ” Sargent Indus. v. Delta Air Lines, 251 Ga. 91, 93 (303 SE2d 108) (1983).

The Supreme Court answered that Georgia law applies and cited with approval the ruling in Wardell v. Richmond Screw Anchor Co., 133 Ga. App. 378 (210 SE2d 854) (1974), stating “that under the Georgia conflicts-of-laws rule in tort cases, the law of the place where the tort was committed is the law by which liability is to be determined, i.e., the lex loci delictis determines the substantive rights of the parties.” Sargent, supra at 94. “In language applicable to the instant case, the Sargent court acknowledged that the Wardell and Sargent cases dealt with different questions concerning workers’ compensation, but went on to find that when the underlying situation involves an employee who was injured in one state and qualifies for workers’ compensation benefits in that state but claimed and received benefits in another state, the law of the place of the tort applies. [Cit.]” (Emphasis supplied.) Swain v. D & R Transport Co., 735 FSupp. 425, 427 (2) (M.D. Ga. 1990). To the extent our holding in Murphy, that the compensation laws of the state where a worker elects recovery control the worker’s rights against third parties, conflicts with the decision of the Supreme Court in Sargent, it is overruled. Applying the conflict of laws rule set forth in Sargent to the instant case, we are compelled to find that the law of Georgia, the place of the alleged tort, governs Maryland Casualty’s subrogation rights even though Glomski has received workers’ compensation in Illinois. The Illinois Workers’ Compensation Act, upon which Maryland Casualty bases its claim to a right of subrogation, is inapplicable to the instant case.

“As originally enacted in 1920, the [Georgia] Workers’ Compensation Act did not subrogate the employer to any part of the employee’s claim against a third party. [Cit.] In 1922, the Act was amended to extend subrogation rights to the employer under certain circumstances. See former Code Ann. § 114-403; [cit.] However, in 1972, the employer’s subrogation rights were abolished by the repeal of former Code Ann. § 114-403. [Cit.] Further, it has been held that any subrogation claim which an insurer under the Georgia Workers’ Compensation Act may have against a third-party tortfeasor who has caused the death or disability of an employee arises solely by operation of statute. [Cit.]” K-Mart Apparel Corp. v. Temples, 260 Ga. 871, 873 (1) (401 SE2d 5) (1991); see also Sargent, supra at 93. The Georgia legislature has now enacted OCGA § 34-9-11.1, which again extends to the employer or its insurer the right to be subrogated to an employee’s claim against a third party to the extent it has paid workers’ compensation. OCGA § 34-9-11.1, however, did not become effective until after Glomski filed his tort action.

“Laws prescribe only for the future; they can not . . . , usually, have a retrospective operation, [cit.]; and the settled rule for the construction of statutes is not to give them a retrospective operation, unless their language imperatively requires it. [Cit.]” (Punctuation omitted.) Hart v. Owens-Illinois, 250 Ga. 397, 398 (297 SE2d 462) (1982). The language of OCGA § 34-9-11.1 does not imperatively require retrospective application of it. Because the statute provides a substantive, rather than procedural, change in the law, it should not be applied retroactively. Dan River, Inc. v. Carroll, 192 Ga. App. 537, 538 (2) (385 SE2d 686) (1989). Thus, at the time Glomski was injured, received workers’ compensation and filed his tort action, Maryland Casualty did not have a right of subrogation under Georgia law. The trial court therefore correctly denied Maryland Casualty’s motion to intervene as a matter of right under OCGA § 9-11-24 (a).

Judgment affirmed.

Pope, C. J., Birdsong, P. J., Beasley, P. J., Cooper, Andrews, Blackburn and Smith, JJ., concur. McMurray, P. J., dissents.

McMurray, Presiding Judge,

dissenting.

I respectfully dissent with regard to overruling Murphy v. Sears Roebuck & Co., 209 Ga. App. 171 (433 SE2d 325) as it is my view that Murphy is inapposite in the case sub judice.

In Murphy, the plaintiff was injured while working in Arizona and elected workers’ compensation benefits pursuant to Arizona law. The plaintiff in Murphy then filed a products liability action in Georgia more than a year after his injury and this Court affirmed the dismissal of the complaint based on an Arizona law divesting a worker of the right to sue a third-party tortfeasor more than a year after any such claims accrue. Specifically, Arizona law provides for automatic assignment of third-party claims to the compensation carrier in the event the worker does not pursue his remedy against the third-party tortfeasor within one year after the claim accrues. Id. at 172 (1), supra.

The obvious factual distinction between Murphy and the case sub judice is that Glomski was injured in Georgia and the plaintiff in Murphy was injured in Arizona. Under these circumstances and according to Georgia’s conflict of laws rule as enunciated in the majority opinion (i.e., “ ‘the lex loci delictis determines the substantive rights of the parties’ ”), this Court was correct in applying Arizona law in Murphy since the plaintiff’s claim in Murphy accrued in Arizona. More importantly, however, is the judicial distinction that the case sub judice involves a conflict of laws question between opposing Workers’ Compensation Acts and Murphy does not.

The case sub judice involves an employee eligible for workers’ compensation benefits in either Georgia or Illinois because the employee was injured in Georgia and the employer was based in Illinois. Glomski, the injured employee, elected compensation benefits pursuant to Illinois law, presenting the choice of law question of whether Maryland Casualty is subrogated to Glomski’s third-party claims as afforded under Illinois law or is excluded from subrogation as required by Georgia’s former Workers’ Compensation Act. Conversely, the plaintiff in Murphy did not have an election between opposing Workers’ Compensation Acts. He was injured while employed in Arizona and covered pursuant to the Arizona Workers’ Compensation Act. The only choice afforded the plaintiff in Murphy was to recover workers’ compensation and abide by the substantive restraints imposed by Arizona law or not. By electing to recover compensation benefits in Arizona and then filing a products liability suit in Georgia after automatic assignment (pursuant to Arizona law) of any such third party claim, the plaintiff in Murphy was simply attempting to avoid the substantive law he chose in Arizona. It was under these circumstances that this Court in Murphy cited the rule enunciated in Howard v. Alfrey, 697 F2d 1006 (11th Cir. 1983), i.e., “the compensation laws of the state where a worker elects recovery control the worker’s rights against third parties. 4 Larson, The Law of Workmen’s Compensation § 88.23.” Murphy v. Sears Roebuck & Co., 209 Ga. App. 171, 172 (1), supra.

Should this Court overrule Murphy, there would be a failure to recognize the “adjustment of rights [the] plaintiff [in Murphy] brought on himself by accepting compensation benefits in another state.” Id. at 172 (1), supra. It is my view that Murphy is not controlling in the case sub judice and should therefore be distinguished.

Decided October 14, 1993

Reconsideration denied November 3, 1993

Swift, Currie, McGhee & Hiers, Robert R. Potter, Jodi B. Ginsberg, for appellant.

James C. Carr, Jr., for appellee.

       In Murphy we concluded that an Arizona statute of limitation applied rather than Georgia law. That same conclusion would be reached under the conflict of laws rule set forth in Sargent because the place of the tort in Murphy was Arizona.

       We note that a dispute over whether a workers’ compensation insurer has the right to be subrogated to an employee’s tort action against third-parties sounds in tort rather than in contract. Swain, supra at 427-428 (2).

       Glomski filed his lawsuit on June 30, 1992; OCGA § 34-9-11.1 did not become effective until July 1, 1992.


author: Johnson, Judge.

text:
    A93A1533.
    GUTHERIE et al. v. FORD EQUIPMENT LEASING COMPANY.
    (437 SE2d 482)
   Johnson, Judge.

Ford Equipment Leasing Company sold a farm at a nonjudicial foreclosure held pursuant to a power of sale contained in a deed to secure debt executed by Thomas Gutherie for a loan made by Ford to Greensboro Lumber Company. The trial court confirmed the sale. In Gutherie v. Ford Equip. Leasing Co., 206 Ga. App. 258, 261 (1) (424 SE2d 889) (1992), this court reversed that confirmation, finding that the trial court improperly considered the “quick sale” value of the property and that there was no other evidence that the property was sold for at least its true market value. On remand, the trial court granted Ford’s motion to dismiss the confirmation proceeding and denied Greensboro’s motion for a resale of the property under OCGA § 44-14-161 (c). Gutherie and Greensboro appeal, contending that the trial court erred in dismissing the action and refusing to order a resale of the property.

The attempt of Gutherie and Greensboro to force Ford to pursue the confirmation proceeding is improper. “[Tjhere is no requirement that the foreclosing party initiate proceedings [under OCGA § 44-14-161] to have the sale confirmed. Confirmation is a proceeding which results only in the event the sale did not satisfy the underlying debt and a deficiency judgment against the debtor is to be sought. Thus, the public policy behind confirmation proceedings is not to impose an affirmative duty upon the foreclosing party to obtain the true market value of the property; it is to protect the debtor from an action to obtain a deficiency judgment when the property was sold for a sum less than its true market value. [Cit.]” (Emphasis in original.) Kennedy v. Gwinnett Commercial Bank, 155 Ga. App. 327, 329 (1) (270 SE2d 867) (1980); see also Turner v. Commonwealth Mortgage &c. Co., 207 Ga. App. 428, 429 (2) (428 SE2d 398) (1993). Ford voluntarily moved to dismiss the confirmation proceeding it initiated and is not seeking a deficiency judgment against Gutherie and Greensboro. Since Ford is under no duty to pursue a confirmation of the sale, the trial court did not err in granting Ford’s motion to dismiss the proceeding. Because the court properly dismissed the action, Gutherie and Greensboro have secured the full benefit of the confirmation statute and cannot use it to force a resale of the property. “If no confirmation is sought or, if sought, is not obtained, the debtor has secured the full benefit of the confirmation statute because his debt is, in effect, extinguished. ... In our opinion the debtor is entitled to no other form of affirmative relief under the confirmation statute.” (Citation omitted.) Id. at 330. The trial court’s order granting Ford’s motion to dismiss the confirmation proceeding and denying Greensboro’s motion for a resale was proper and consistent with our prior decision in this case. See Gutherie, 206 Ga. App. 258.

Decided October 20, 1993

Reconsideration denied November 3, 1993

Lightmas & Delk, Frank A. Lightmas, Jr., William F. Lozier, for appellants.

W. Dan Greer, for appellee.

Lambert & Roffman, E. R. Lambert, amicus curiae.

Judgment affirmed.

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


author: Smith, Judge.

text:
    A93A1231.
    BOWEN v. TUCKER FEDERAL SAVINGS & LOAN ASSOCIATION.
    (438 SE2d 121)
   Smith, Judge.

Tucker Federal Savings & Loan Association (“the bank”) brought suit against K. C. Bowen on ten promissory notes executed by Bowen in its favor. Bowen appeals from the trial court’s grant of summary judgment to the bank

The sole issue in this appeal is whether the lender may accelerate a debt and bring suit on a note when the default is not a failure to pay according to the terms of the note, but rather a breach of other terms of the security deed.

The record reveals that Bowen executed the notes in 1986. Each note was for the principal amount of $50,000, and all had identical terms. Contemporaneously with the execution of the notes, he executed ten security deeds, securing each note with a separate unit in a condominium complex he owned in Gwinnett County. In 1991, Bowen failed to pay state and county ad valorem taxes on the condominium properties. After informing Bowen of this failure, which Bowen did not cure, the bank advanced the funds to pay the taxes and notified Bowen that it was exercising its right, under the terms of the security deeds, to accelerate the balances of the notes. The bank then filed this action on the notes.

1. Paragraph 4 of the security deeds clearly requires the borrower to pay all taxes on the property securing the debt. Bowen does not dispute that his failure to pay the taxes on the properties was a breach of the terms of the security deeds. He contends, however, that the trial court erred in granting summary judgment to the bank because his failure to pay taxes was not an event of default under the terms of the notes, and a breach of the terms of the security deeds may be remedied only by foreclosure. We disagree and affirm.

The notes themselves show the parties contemplated that the terms of the security deeds would also govern the conditions prompting acceleration of the debt. In paragraph 12 of each note, Bowen acknowledged that “[i]n addition to the protections given to the Note Holder under this note, a . . . Deed to Secure Debt (the ‘Security Instrument’) with an Adjustable Rate rider, dated the same day as this Note, protects the Note Holder from possible losses which might result if I do not keep the promises which I made in this Note. That Security Instrument and Rider describe how and under what conditions I may be required to make immediate payment in full of all amounts I owe under this Note.” The security deeds further provide, in paragraph 19, that the bank at its option may accelerate the secured debts without further demand, upon a breach of any term of the security deeds. That paragraph also allows the bank, after acceleration, to “invoke the power of sale granted by Borrower and any other remedies permitted by applicable law.” (Emphasis supplied.)

It is established law in Georgia that although the holder of a note who is also the grantee of a security deed has the right to exercise the power of sale in the security deed upon default, he is not required to do so. He may sue on the note without instituting foreclosure proceedings. Jamison v. Button Gwinnett Savings Bank, 204 Ga. App. 341, 342 (1) (419 SE2d 91) (1992). Because the notes incorporate by reference the acceleration clause in the security deeds and a suit on the note is a “remed[y] permitted by applicable law” that the bank was authorized to use under the terms of the security deeds, the trial court correctly granted summary judgment in favor of the bank.

2. Independent of authority in the security deeds for the bank’s suit on the notes, another reason supports the trial court’s grant of summary judgment for the bank. The record shows that on a prior occasion, Bowen had been in default in payment of the notes. He was represented by counsel, who negotiated an agreement under which the default would be cured by paying the amounts due and executing an instrument captioned “Reinstatement Agreement.” Paragraph 3 of the Reinstatement Agreement provides in pertinent part as follows: “Borrower [Bowen] understands and acknowledges and agrees that upon any future default in the terms of the original notes, security deeds, or other loan agreements, Lender shall have all rights and remedies under the terms of same provided by Georgia Law, including, but not limited to, acceleration, suit upon the notes in a court of law or foreclosure of said properties.” This agreement was supported by consideration, and constitutes a valid modification and/or addition to the original instruments. See generally Aetna Cas. &c. Co. v. Valdosta Fed. &c. Assn., 175 Ga. App. 614, 617 (2) (333 SE2d 849) (1985). Its terms clearly authorize the bank’s suit on the notes.

Decided November 3, 1993.

Webb, Tanner & Powell, Anthony O. L. Powell, Ralph L. Taylor III, for appellant.

Walter C. Alford, for appellee.

Judgment affirmed.

Beasley, P. J., and Cooper, J., concur.


text:
    A93A1618.
    WEEMS v. MUNSON TRANSPORTATION, INC. et al.
    (437 SE2d 640)
   Johnson, Judge.

Charles Weems was allegedly injured in an automobile accident on October 1, 1990. On October 2, 1992, he filed this negligence action against the driver, Harold Rhea, and Rhea’s employer, Munson Transportation, Inc. Munson filed a motion for judgment on the pleadings, contending that the two-year statute of limitation had expired prior to the commencement of the action. The trial court granted Munson’s motion and dismissed the complaint with prejudice.

1. Weems argues that, pursuant to OCGA § 1-3-1 (d) (3), as amended, he had through Octobér 2, 1992, to file the action. We disagree. Prior to 1985, OCGA § 1-3-1 (d) (3) provided that the date on which the accident occurred would be counted in computing the period of limitation; thus, a personal injury action was barred if filed on the second anniversary of the injury. Davis v. Desa Intl, 209 Ga. App. 318 (433 SE2d 410) (1993). See, e.g., Loveless v. Grooms, 180 Ga. App. 424 (349 SE2d 281) (1986); Reese v. Henderson, 156 Ga. App. 809 (275 SE2d 664) (1980). However, in 1985 the Code section was amended so that the first, day would not be counted in computing the period of limitation. Therefore, an action filed on the second anniversary of the injury would be timely filed. See Hollingsworth v. Hubbard, 184 Ga. App. 121 (361 SE2d 12) (1987); Davis, supra. Because Weems’ complaint was filed the day after the second anniversary date, it was not timely filed and the action was barred by the statute of limitation. Compare Day v. Burnett, 199 Ga. App. 494, 495 (1) (405 SE2d 316) (1991) (property damage action timely filed on 12/5/88 for damage on 12/5/84); Gardner v. Hyster Co., 785 FSupp. 161, 163 (M.D. Ga. 1992) (interpreting Georgia law, court held statute of limitation for 6/12/89 injury ended on 6/12/91).

Decided November 3, 1993.

J. L. Jordan, for appellant.

Paul, Hastings, Janofsky & Walker, James H. Cox, for appellees.

2. Weems also contends that the court erred in granting Mun-son’s motion for judgment on the pleadings since he did not fail to state a claim upon which relief may be granted. This enumeration is without merit. Because Weems’ claim for relief was barred by the statute of limitation, Munson was clearly entitled to judgment. Therefore, judgment on the pleadings in favor of Munson was proper. See ALW Marketing Corp. v. McKinney, 205 Ga. App. 184, 186-187 (1) (421 SE2d 565) (1992).

Judgment affirmed.

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


text:
    A93A1525, A93A1527.
    PITTMAN et al. v. HARBIN CLINIC PROFESSIONAL ASSOCIATION; and vice versa. HARBIN CLINIC PROFESSIONAL ASSOCIATION v. NAGUSZEWSKI et al.; and vice versa.
    A93A1526, A93A1528.
    (437 SE2d 619)
   Smith, Judge.

Neurosurgeons Harris Pittman, Dennis Murphy, and Carl Herring, and neurologists Robert and William Naguszewski brought an action against their former employer, the Harbin Clinic Professional Association, seeking a declaration that the covenants in their respective employment contracts restricting them from competing with the clinic after leaving its employ were unenforceable. The clinic answered and counterclaimed, seeking to enjoin the doctors from establishing their new practices in the Rome, Georgia, area in violation of the covenants in their contracts. The trial court found the restrictive covenants in the contracts of Drs. Pittman and Murphy valid and enforceable, and those in the contracts of Dr. Herring and both Drs. Naguszewski void and unenforceable. In Case No. A93A1525, Drs. Pittman and Murphy appeal from the trial court’s order finding the covenants in their contracts valid and enforceable and enjoining them from practicing in the Rome area. In Case No. A93A1526, the Harbin Clinic appeals from the trial court’s order finding the covenants in the contracts of Dr. Herring and the Drs. Naguszewski void and unenforceable and refusing to enjoin the doctors from practicing in the Rome area. Case Nos. A93A1527 and A93A1528 are the cross-appeals filed by the appellees to each direct appeal. The cases have been consolidated for review in this opinion.

We note initially that these appeals were filed originally in the Supreme Court, which transferred them to this court. Although nominally involving injunctions, no substantive issues of equity are involved in these appeals. Resolution of the appeals turns instead on the question of the validity and enforceability of the contract provisions restricting competition, which is a question of law. See Roberts v. Tifton Med. Clinic, 206 Ga. App. 612 (426 SE2d 188) (1992).

The record reveals that the Harbin Clinic Professional Association employs approximately 50 doctors, including general practitioners and medical specialists. While employed at the clinic, Drs. Pittman and Murphy were shareholders in the professional association, while Dr. Herring and the Drs. Naguszewski were not. The employment contracts of Drs. Pittman and Murphy were those entered into only by physicians who had worked for the clinic for at least two years and had been invited to join the clinic permanently and purchase stock, which the association agreed to repurchase in the event of termination of the employment relationship.

All the plaintiff doctors were recruited to the clinic from outside the Rome area and none brought patients with them. Each left employment at the clinic through voluntary resignation, not through termination by the association. They resigned on various dates over a period of several months and began a new practice together in Rome. Their resignations left one physician in the neurosurgery department at the clinic.

In Georgia, it has long been the law that non-competition clauses in physicians’ employment contracts do not per se violate the state’s public policy. Like such clauses in other employment contracts, if they are sufficiently limited and are reasonable, considering the interest to be protected and the effects on both parties to the contract, they will be upheld. See Rash v. Toccoa Clinic Med. Assoc., 253 Ga. 322, 323-324 (1) (320 SE2d 170) (1984). In determining reasonableness, a three-part test is applied, examining duration, territorial coverage, and the scope of the prohibited activity, see W. R. Grace & Co. v. Mouyal, 262 Ga. 464, 465 (1) (422 SE2d 529) (1992), not as an arbitrary rule, but as “a helpful tool in examining the reasonableness of the particular factual setting to which it is applied.” Watson v. Waffle House, 253 Ga. 671, 673 (2) (324 SE2d 175) (1985).

1. In Case No. A93A1525, the covenants in issue prohibit Drs. Pittman and Murphy from “practicing medicine” within a 30-mile radius of the clinic’s location in Rome, Georgia, for a period of one year after leaving employment at the clinic. They also provide for waiver of this restriction, upon payment by the employee doctor of a sum certain, calculated in a method set forth in the contract. Applying the three-element test, the trial court found that all three elements of the restriction in the contracts of Drs. Pittman and Murphy were reasonable and that the restrictions were therefore enforceable. Drs. Pittman and Murphy contend this ruling was erroneous.

We affirm. The one-year limitation is patently reasonable. Limitations of one year and greater have been held to be reasonable. See, e.g., Rash, supra; Carroll v. Harris, 243 Ga. 34 (252 SE2d 461) (1979). We reject, as did the trial court, the argument made by Drs. Pittman and Murphy that the scope of the activity prohibited is overbroad because it encompasses such activities as telephonic communication from outside the prohibited area with patients or colleagues within it. Reading the covenants as a whole, it is clear that their plain meaning prohibits only the establishment of an office and hospital practice within the protected area. See Rash, supra at 326-327 (4); McMurray v. Bateman, 221 Ga. 240, 254-255 (3) (144 SE2d 345) (1965). As to geographical limitation, the contract itself sets forth the counties, both in Georgia and neighboring states, from which the clinic draws its patients. The trial court found that the counties listed are all within a 30-mile radius of the clinic location and that consequently, a covenant not to compete within a 30-mile radius is reasonable to protect the clinic.

In Rash, supra at 325-326 (2), the Supreme Court also examined the respective bargaining positions of the parties and whether the restrictive covenants in issue worked a mutual, rather than a unilateral, advantage. Consideration of these factors draws into sharp focus the differences between professional partnership agreements and employment contracts generally. It weighs in favor of the enforceability of restrictive covenants in the former, and against their enforceability in the latter. The trial court correctly considered and applied this portion of the Rash analysis. The contracts of Drs. Pittman and Murphy are denominated employment contracts. These doctors, however, were shareholders in the P.A., and when they executed the agreements, they not only committed themselves to the restrictions but also derived a benefit by exacting the same restrictions from the approximately 35 other physician shareholders who executed identical contracts. The covenants obviously provided mutual advantages. As in Roberts, supra at 615-616, because the bargaining power of Drs. Pittman and Murphy was equal to that of those with whom they contracted, the agreements are more usefully viewed as medical partnership agreements analogous to those in Rash than as traditional employment contracts. Roberts, supra at 616-617.

2. The other enumerations of error of Drs. Pittman and Murphy may be summarized by describing their broad contentions. The first of these includes several arguments founded on the basic premise that the phrase “otherwise reasonable,” as used in Rash, supra, established a fourth element in the test for reasonableness of a restrictive covenant in employment contracts. .

We agree with the trial court that this premise is untenable. The phrase refers to “the interests to be protected and the effects on both parties to the contract.” Rash, supra at 323 (1). Consequently, the arguments made by Drs. Pittman and Murphy based on the need for more neurosurgeons in the Rome area, the impact on third parties of enforcement of the covenants, and various other arguments, are without merit.

We likewise find no merit in the contention of Drs. Pittman and Murphy that because the protected geographical territory includes a portion of the State of Alabama and Alabama law prohibits non-competition clauses in physician employment contracts, the restrictions in issue are not “otherwise reasonable.” These are Georgia contracts, executed in Georgia by Georgia residents and covering the practice of medicine in Georgia, thereby distinguishing them from those in Nasco, Inc. v. Gimbert, 239 Ga. 675 (238 SE2d 368) (1977), cited by the doctors. The trial court correctly found that “the contracts at issue have as their very essence the practice of medicine physically located in Rome, Floyd County, Georgia. This Court concludes that Georgia was the state for performance of these contracts. [Cits.] The application of Georgia law renders the public policy and statutory law of Alabama irrelevant for the construction of these contracts. [Cits.]”

3. Drs. Pittman and Murphy also rely in several enumerations on their broad contention that the “richer record” in this case provides a basis for holding that these covenants are unenforceable despite the existence of previous Georgia case law, such as Rash, supra, to the contrary. We agree with the trial court that the issues raised in this appeal are controlled adversely to Drs. Pittman and Murphy by previously decided cases, and that even if the “richer record” emphasized by Drs. Pittman and Murphy exists, it does not demand a different result. Georgia case law, as well as that of other jurisdictions, has established that covenants such as the ones in issue do not conflict with medical ethical principles or Georgia law requiring informed consent or injure the public in general. See Rash, supra at 326 (restrictive covenant not void as against public policy because it limited patients’ choice of physician within geographical area). See also Shankman v. Coastal Psychiatric Assoc., 258 Ga. 294 (368 SE2d 753) (1988); Karlin v. Weinberg, 390 A2d 1161, 1168, n. 6 (N.J. 1978).

Decided October 19, 1993

Reconsideration denied November 4, 1993

Cook & Palmour, Bobby Lee Cook, Jr., Gambrell & Stolz, Irwin W. Stolz, Jr., Seaton D. Purdom, for Pittman and Naguszewski.

Brinson, Askew, Berry, Seigler, Richardson & Davis, C. King Askew, Mark M. J. Webb, for Harbin Clinic Professional Association.

4. In Case No. A93A1526, the clinic appeals from that portion of the trial court’s order finding that the restrictive covenants in the contracts of Dr. Herring and Drs. Naguszewski were void and unenforceable.

The restrictive covenants in the contracts of Dr. Herring and Drs. Naguszewski, who were not shareholders in the professional association, are identical to those in the contracts of the shareholder doctors except that the protected area lies within a 50-mile radius of the clinic, and the doctors may pay a smaller sum to secure the association’s waiver of the restriction.

Although the trial court found that a 50-mile radius protected area was not per se unreasonable, see McMurray, supra at 255 (4), it found that in this case it was unreasonable and unenforceable, based on two factors. First, the 50-mile area exceeds the territory of the clinic’s practice as described in the contract. Second, the 50-mile restriction was used only in the contracts of physicians who were not shareholders and whose bargaining position, therefore, was not equal to that of the clinic, necessitating stricter scrutiny of the restriction. Rash, supra. The record supports these findings.

We do not agree with the clinic that the trial court’s obvious slip of the tongue in referring to stricter scrutiny as strict construction renders the standard of review employed “fundamentally wrong.” It is clear from the authority cited by the trial court, as well as from its reasoning, that the correct standard was applied. Based on the same reasoning and authority, we affirm the trial court’s ruling that the covenants in the contracts of Dr. Herring and Drs. Naguszewski are void and unenforceable. See generally Osta v. Moran, 208 Ga. App. 544, 546-547 (2) (430 SE2d 837) (1993).

5. No additional enumerations of error or argument having been raised in the cross-appeals, Case Nos. A93A1527 and A93A1528 are hereby dismissed.

Judgment affirmed in Case Nos. A93A1525 and A93A1526. Appeals dismissed in Case Nos. A93A1527 and A93A1528.

Beasley, P. J., and Cooper, J., concur.


author: Andrews, Judge.

text:
    A93A1661.
    SPIVEY et al. v. CITY OF BAXLEY et al.
    (437 SE2d 623)
   Andrews, Judge.

Reverend and Mrs. Spivey appeal the trial court’s grant of summary judgment in this action arising out of injuries Mrs. Spivey claims to have sustained while attending an evening softball game at a field maintained by the Baxley-Appling County Recreation Board.

The complaint alleged that on May 24, 1990, the Spiveys were attending a church softball game at a recreational park which was owned, operated and maintained by defendants, the City of Baxley and the Baxley-Appling County Recreation Board. As the pastor’s spouse, Mrs. Spivey worked in many capacities associated with the church and was attending the softball game for the church on the evening of her injury. Mrs. Spivey stepped from a concrete slab, which covered a drainage area, stepped into a hole next to the slab, and fell and hurt herself. The Spiveys claimed that the injuries were caused by defendants’ maintenance of, and failure to correct, a dangerous condition on the property. The trial court’s order concluded that in order to allow water to enter the drain, there was a gap between one side of the slab and the ground.

Defendants moved for summary judgment, alleging that the Spiveys’ claims were barred by the Recreational Property Act, OCGA § 51-3-20 et seq., despite the existence of factual disputes regarding the length of the grass and the available lighting. They claimed that, as a matter of law, there was no basis for liability for Mrs. Spivey’s accident, which occurred as she stepped into the mouth of a storm drain.

Attached to the motion for summary judgment were two affidavits of Jeff Baxley, the director of the Baxley-Appling County Recreation Department, who swore that for many years preceding Mrs. Spivey’s accident, the storm drains at the ballfields were covered with metal grates, which grates had caused several accidents. He avowed that because of prior problems, the metal grates were replaced with the concrete covers in use at the time of Mrs. Spivey’s fall. He stated that he went to the area of Mrs. Spivey’s fall immediately after it and observed that there was no high grass, the area was well-lighted and that the step-off of the drain was in plain view.

Baxley stated that the softball game which Mrs. Spivey attended was open to the public at no charge. Baxley stated that both individual youths and the teams participating in the softball program were charged a fee which helped defray the cost of the equipment, official, facilities, lighting, and various officials involved in the game.

In response, the Spiveys submitted Reverend Spivey’s affidavit in which he stated that the hole in which his wife stepped was eight- and-one-half inches deep, was not open and obvious, and was not in plain view. He also stated that the grass obscured the hole and that the lighting was inadequate. Attached to his affidavit were photographs of the area.

In granting the motion for summary judgment, the trial court’s helpful order set forth many of the facts outlined above. Viewing the evidence in the light most favorable to the Spiveys, the court found that the gap was about eight inches and was obscured by grass. Nonetheless, the court concluded that summary judgment on the claim was proper.

OCGA § 51-3-20 provides that the purpose of the Recreational Property Act (RPA) is “to encourage owners of land to make land and water areas available to the public for recreational purposes by limiting the owners’ liability toward persons entering thereon for recreational purposes.” To that end, OCGA § 51-3-23 insulates owners and operators of recreational property made available for public use at no charge from liability for damages resulting from ordinary negligence. In their sole enumeration of error, the Spiveys claim that the trial court erred in granting summary judgment since the incident here fell outside the protection of the statute and they raise three specific arguments in this regard.

First, the Spiveys claim that appellees are liable under OCGA § 51-3-25 (1), which does not limit liability for any “willful or malicious failure to guard or warn against a dangerous condition, use, structure, or activity.” The Spiveys argue that the public authorities knew of the dangerous condition of the hole and yet chose not to warn of it. In addition to the hole itself, the Spiveys argue that the responsible authorities knew that the lighting was poor and that grass had grown up under the slab. Thus, they contend, the wilful and malicious exception applies.

We disagree. “A willful failure to guard or warn would require actual knowledge of the owner that its property is being used for recreational purposes; that a condition exists involving an unreasonable risk of death or serious bodily harm; that the condition is not apparent to those using the property; and that having this knowledge, the owner chooses not to guard or warn, in disregard of the possible consequences. This test excludes either constructive knowledge or a duty to inspect.” (Citation and punctuation omitted.) Quick v. Stone Mountain Memorial Assn., 204 Ga. App. 598, 599 (420 SE2d 36) (1992); compare North v. Toco Hills, 160 Ga. App. 116 (286 SE2d 346) (1981).

The evidence in this case showed that appellees knew that there was a concrete drainage cover on the property. There was evidence that the concrete drainage cover had replaced metal grates which had previously caused injuries. There was no evidence of any prior accidents which had been caused by the concrete covers, nor was there any evidence that the responsible authorities were aware of any danger associated with the concrete covers. “[W]e find no evidence to show that a condition involving an unreasonable risk of death or serious bodily harm existed . . . and no evidence demonstrating that appellee chose not to guard or warn in disregard of possible consequences. A wilful failure imports a conscious, knowing, voluntary, intentional failure, a purpose or willingness to make the omission, rather than a mere inadvertent, accidental, involuntary, inattentive, inert, or passive omission.” (Citations and punctuation omitted.) Quick, supra at 600; see generally McGruder v. Ga. Power Co., 126 Ga. App. 562 (1) (191 SE2d 305) (1972), rev’d on other grounds 229 Ga. 811 (194 SE2d 440) (1972); Ga. Marble Co. v. Warren, 183 Ga. App. 866 (360 SE2d 286) (1987); Edmondson v. Brooks County Bd. of Ed., 205 Ga. App. 662 (423 SE2d 413) (1992).

Secondly, the Spiveys contend that the fee charged for the softball team was a “charge” for the use of the premises and that therefore the RPA does not apply. The Spiveys argue that the fee which was required for participation in the church softball league constituted a “charge” and that whether the spectators were directly charged is irrelevant.

OCGA § 51-3-21 (1) defines “charge” for purposes of the Act: “[c]harge means the admission price or fee asked in return for invitation or permission to enter or go upon the land.” The “charge” referred to in the Act is what is imposed to obtain permission to enter the premises. The evidence showed that the fee for the softball league had no relation to permission to use the spectator seating area, which was open to the general public at no charge. Mrs. Spivey was not charged a fee to enter the premises on the evening in question. Furthermore, we do not accept the Spiveys’ argument that their contribution to the fees paid for the softball league, through their church contributions, constitutes a charge as contemplated by this section. See Majeske v. Jekyll Island State Park Auth., 209 Ga. App. 118 (433 SE2d 304) (1993); Hogue v. Stone Mountain Mem. Assn., 183 Ga. App. 378 (358 SE2d 852) (1987); see generally Cedeno v. Lockwood, 250 Ga. 799 (301 SE2d 265) (1983).

Finally, the Spiveys claim that Mrs. Spivey’s presence on the property was not for “recreational purposes” so as to fall within the Act. The Spiveys claim that the Act applies to individuals who are actually involved in the recreational activity for which the premises are utilized, not for people who are passive spectators.

OCGA § 51-3-21 (4) does not specifically address spectators at athletic events. Nonetheless, subsection (4) states “ ‘recreational purpose’ includes, but is not limited to, any of the following or any combination thereof: hunting, fishing, swimming, boating, camping, picnicking, hiking, pleasure driving, nature study, water skiing, winter sports, and viewing or enjoying historical, archeological, scenic, or scientific sites.”

Decided October 19, 1993

Reconsideration denied November 4, 1993

Hudson & Solomon, James D. Hudson, for appellants.

Newton, Smith, Durden, Kaufold & Rice, Wilson R. Smith, Jiles M. Barfield, Wilkes, Johnson, Smith & Knox, J. Alexander Johnson, for appellees.

We conclude that finding such spectators to be within the scope of the Act is not an unwarranted extension of its coverage, and an acceptance of the Spiveys’ argument would ignore the purposes of the Act. We conclude that the RPA applies to spectators at athletic events, when no admission charge is imposed. See generally Welch v. Douglas County, 199 Ga. App. 269 (1) (404 SE2d 450) (1991).

Judgment affirmed.

Pope, C. J., and Birdsong, P. J., concur.


author: Andrews, Judge. McMurray, Presiding Judge,

text:
    A93A1381.
    SPIVEY v. SAFEWAY INSURANCE COMPANY.
    (437 SE2d 641)
   Andrews, Judge.

Spivey and Stephens were involved in a one-car accident when the automobile in which both of them were riding swerved off the road into a power line pole on January 1, 1990. Spivey sued Stephens for damages resulting from the accident claiming Stephens negligently drove the car in which she was a passenger. Stephens answered claiming that Spivey was the negligent driver, and he was the passenger. The automobile at issue was insured by Safeway Insurance Company under a policy showing Spivey as the sole named insured. Safeway brought the subject declaratory judgment action against Spivey and Stephens seeking a declaration that it had no liability under the policy. Spivey moved for dismissal of the declaratory judgment action on grounds that there was no actual controversy sufficient to sustain the action. The trial court entered an order which denied the motion to dismiss, and, in effect, granted partial summary judgment, sua sponte, in favor of Safeway. The trial court ruled that regardless of whether Spivey or Stephens was the driver, Spivey was not entitled to recover under the policy for any bodily injuries or property damage she claims to have suffered as a result of the accident, and therefore Safeway had no obligation to defend Stephens, who was covered under the policy as the alleged permissive driver, against any such claims. The trial court further ruled that Safeway was obligated to defend Spivey against claims in the pending action apparently brought by Stephens against Spivey on the allegation that Spivey was the driver. Only Spivey appealed from the order of the trial court.

1. Although normally the interlocutory appeal procedures of OCGA § 5-6-34 (b) must be followed to take an appeal from the denial of a motion to dismiss, Spivey was entitled to a direct appeal in this case from what appears to be a final order addressing the issues raised in the petition for declaratory judgment, and granting summary judgment in favor of Safeway. Olympic Dev. Group v. American Druggists’ Ins. Co., 175 Ga. App. 425 (333 SE2d 622) (1985). Even though there was no summary judgment motion before the trial court, summary judgment may be granted, sua sponte, by the trial court to a non-moving party “provided the grant is proper in all other respects.” Howell Mill/Collier Assoc. v. Pennypacker’s, 194 Ga. App. 169, 170 (390 SE2d 257) (1990); Famble v. State Farm Ins. Co., 204 Ga. App. 332, 336 (419 SE2d 143) (1992). This means that in addition to ensuring the record supports such a judgment, the trial court must ensure that the party against whom summary judgment is rendered is given full and fair notice and opportunity to respond prior to entry of summary judgment. Id. at 336; OCGA § 9-11-56. The record does not reflect what steps, if any, were taken to provide Spivey with notice and an opportunity to respond, but since Spivey does not enumerate this as error on appeal, nor claim she was denied such notice and opportunity in the trial court, this issue has been waived. See Peppers v. Elder, 248 Ga. 136, 137 (281 SE2d 582) (1981); compare Smith v. Ticor Title Ins. Co. &c., 200 Ga. App. 534, 535 (408 SE2d 833) (1991); Smith v. Smith, 165 Ga. App. 532, 533 (301 SE2d 696) (1983).

2. There is no merit to Spivey’s claim that the trial court erroneously ruled that Safeway had no obligation to defend Spivey against any claim by Stephens. To the contrary, the trial court expressly ruled otherwise.

3. Spivey claims the trial court erred by ruling that she is precluded from recovering under her Safeway policy for any bodily injuries or property damages she suffered in the accident. Spivey was the sole named insured in the automobile liability policy at issue. She claims she was injured as a passenger, and is entitled under the policy to payment of damages caused by Stephens’ negligent operation of the car while he was driving with her permission. The policy provides that Safeway “will pay damages for bodily injury or property damages for which any covered person becomes legally responsible because of an auto accident.” Stephens was a “covered person” under the policy because he was driving with Spivey’s permission. The policy also excluded coverage “[f]or bodily injury, property damage or death sustained by any insured or any member of the family of an insured residing in the same household as the insured.”

The trial court concluded that this exclusion precluded Spivey, the named insured, from any recovery under the policy. Of course, enforcing the exclusion under these circumstances may leave Spivey without insurance coverage for her damages, and would leave Stephens, the permissive driver, exposed to potential tort liability for damages suffered by Spivey, unless Stephens was otherwise covered by his own liability insurance from which Spivey could be compensated for her damages. There is no claim that tort immunity exists between Spivey and Stephens. Spivey argues that at the time of the accident, minimum liability coverage was mandated by statute in Georgia, and therefore the exclusion at issue suspending such coverage was void as against public policy. “The Georgia Supreme Court has held that compulsory insurance statutes do not prohibit exclusions per se, and that each exclusion must be individually evaluated to determine if it is against public policy. Southern Guar. Ins. Co. v. Preferred Risk Mut. Ins. Co., 257 Ga. 355, 356 (359 SE2d 665) (1987) (upholding a family exclusion clause in an automobile liability policy).” Empire Fire &c. Ins. Co. v. Dobbins, 205 Ga. App. 700, 701 (423 SE2d 396) (1992). Where enforcement of the exclusion from coverage would leave an innocent injured victim unprotected, or would result in unfair exposure of an insured to unanticipated liability, then the exclusionary clause violates public policy. Stepho v. Allstate Ins. Co., 259 Ga. 475, 476 (383 SE2d 887) (1989); Southern Guar. Ins. Co., supra at 356.

The Supreme Court in Southern Guar. Ins. Co. enforced a policy provision, excluding coverage for damages suffered by the insured, who was injured while a passenger in the car insured under the policy. The exclusion enforced in that case left the injured insured without coverage under the policy at issue, and left the permissive driver of the car with no coverage under the insured’s policy, and exposed to potential tort liability unless the permissive driver was covered by her own separate liability insurance policy. In determining whether the exclusion violated public policy by leaving an innocent injured victim unprotected, or unfairly exposed an insured to unanticipated liability, the Supreme Court concluded under the first prong that the injured insured was not an innocent unprotected victim because as a named insured she was deemed to know the contents of the policy, which included knowledge of the exclusion. Id. at 356. Although it appears the permissive driver in Southern Guar. Ins. Co. was covered under her own separate automobile liability policy, in analyzing the second prong the Supreme Court did not conclude that the permissive driver was an insured under the policy who could claim unfair exposure to unanticipated liability if no such separate secondary coverage existed. Rather, the Court focused on insureds named in the policy. “[N] either the named insured nor any member of the household was exposed to additional liability because of the exclusion under the facts of the case. From the standpoint of the named insured, coverage of [the permissive driver] is important only insofar as [the named insured] might be exposed to liability as owner of the car for [the permissive driver’s] accident while driving [the named insured’s] car. It is clear that under the present facts [the named insured] will suffer no such exposure.” Id. at 356. Nothing in the Supreme Court’s opinion indicates that a person covered under the policy only as a permissive driver occupies the position of an insured under the policy who may be unfairly exposed to unanticipated liability. See Clabo v. Tennessee Farmers Mut. Ins. Co., 202 Ga. App. 110, 114-115 (413 SE2d 476) (1991) (Andrews, J., dissenting). Neither Southeastern Fidelity Ins. Co. v. Chaney, 259 Ga. 474 (381 SE2d 747) (1989) nor Stepho u. Allstate Ins. Co., supra, which found similar exclusions violated public policy, are contrary authority, since in both of those cases the drivers who would have been left exposed to liability were named insureds under the policies.

In the present case, although the exclusion would leave Spivey, the alleged injured victim, unprotected under the policy, she is the named insured presumed to know the contents of the policy, and does not occupy the status of an innocent victim. Southern Guar. Ins. Co., supra at 356. Although the exclusion leaves Stephens without coverage under the policy, and exposed to potential liability assuming he has no insurance coverage of his own, his claim to coverage solely on the basis of being a permissive driver does not qualify him as an insured under the policy unfairly exposed to unanticipated liability. To the extent Clabo, supra, holds otherwise, it is overruled. Moreover, there is no compelling reason in this case for any public policy concern that Stephens may be unfairly exposed to liability, since he did not raise this issue in his own behalf by appealing from the trial court’s order. Since enforcing the exclusion from coverage in this case would not leave an innocent victim unprotected, nor unfairly expose an insured to unanticipated liability, there was no error in the trial court’s ruling.

4. Spivey’s third enumeration of error is unclear. It appears to state an objection to the trial court’s ruling that since Spivey is not covered under the Safeway policy, Safeway is not obligated to defend a claim by Spivey against Stephens. We find no error.

5. Lastly, Spivey contends the trial court erred by failing to grant her motion to dismiss, which was made on the basis that there was no actual controversy sufficient to sustain a petition for declaratory judgment. This enumeration was not supported in appellant’s brief by citation of authority or argument and is deemed to have been abandoned. Court of Appeals Rule 15 (c) (2).

Judgment affirmed.

Birdsong, P. J., Beasley, P. J., Johnson and Smith, JJ., concur. Pope, C. J., McMurray, P. J., Cooper and Blackburn, JJ., dissent.

McMurray, Presiding Judge,

dissenting.

The majority opinion in this case brings before this court the same issues which were previously resolved by a divided court in Clabo v. Tennessee Farmers Mut. Ins. Co., 202 Ga. App. 110 (413 SE2d 476) (cert. denied by the Supreme Court of Georgia). I believe that the Clabo decision is correct, and that application of that decision in the case sub judice would require a partial reversal of the trial court’s judgment. Therefore, I respectfully dissent.

In the time since Clabo was decided half of the judges who joined in that majority opinion have left the court while the three dissenting judges remain. Thus, prior to consideration of this case, the Court is equally divided into three groups who have either previously supported one side or the other of this controversy, or have not spoken on this issue.

Distilled to the simplest possible explanation, Clabo involves an application of the overriding public policy of complete liability coverage in connection with motor vehicles for the protection of the public and insureds, and any exclusions broader than the tort immunity of this state are against public policy and will not be upheld. GEICO v. Dickey, 255 Ga. 661 (340 SE2d 595). Few exceptions to this preference for coverage have been identified. Clabo at 112.

Undoubtedly, the division of this court stems in large part from certain language in the decision of Southern Guar. Ins. Co. v. Preferred Risk Mut. Ins. Co., 257 Ga. 355 (359 SE2d 665), where the Supreme Court found that an exclusion clause did not offend public policy and should be upheld. However, the Supreme Court subsequently noted that that case involved “a peculiar set of facts under which neither the injured party nor the insured was left unprotected.” Stepho v. Allstate Ins. Co., 259 Ga. 475, 476 (1) (383 SE2d 887). In the words of the Stepho court: “We therefore concluded that the exclusion clause under those unusual circumstances did not offend public policy and should be upheld.” (Emphasis supplied.) Id. at 476.

Furthermore, in Stepho, the Supreme Court undertook to synthesize its decisions in Southern Guaranty and GEICO v. Dickey, 255 Ga. 661, supra. Inasmuch as Stepho attempted to highlight the “clear thread of consistency” which runs through Southern Guaranty and related cases, perhaps Southern Guaranty should be remembered more for the manner in which it is described in Stepho than for the exact words of the decision itself.

In my view, it is significant that in Stepho, the Supreme Court in distinguishing the related cases makes specific reference to the fact that the injured insured party in Southern Guaranty was protected because of the availability of insurance proceeds from the alleged tortfeasor’s policy. In the case sub judice, there is no indication as to whether the alleged tortfeasor is protected by any separate insurance policy. Thus, as in Clabo, I would hold that the exclusion at issue in the case sub judice is contrary to public policy to the extent that it will cause Stephens, an alleged tortfeasor and insured under the policy, to be unprotected up to the amount of mandatory liability coverage. In my view, the trial court erred in determining that Safeway had no obligation to defend Stephens since there was no evidence showing that Stephens was protected by any other insurance policy.

Decided November 4, 1993.

Williams & Henry, Phillip C. Henry, Arthur L. Myers, Jr., Richard A. Thane, Bannister & Black, Charles C. Black, for appellant.

Crim & Bassler, Nikolai Makarenko, Jr., Charles W. Lane, for appellee.

Under the particular facts and circumstances of the case sub judice, I cannot agree that the decision in Southeastern Fidelity Ins. Co. v. Chaney, 259 Ga. 474 (381 SE2d 747) can be distinguished from the case sub judice. In my view, the crux of that decision seems to be stated in Division 4 of that opinion predicated upon the GEICO decision and the test stated therein. That the alleged tortfeasor is a named insured on the policy in question is revealed in the account of the facts of that case, but the analysis makes no connection between that fact and the holding of the case. Southern Guaranty is mentioned only in connection with the synthesis contained in Stepho. Consequently, Southeastern Fidelity Ins. Co. v. Chaney, 259 Ga. 474, supra, which is one of the most recent Supreme Court decisions relevant to this controversy, reiterates the prominence of the test stated in GEICO and upon which Clabo is predicated, and should be recognized as controlling precedent in the case sub judice.

I am authorized to state that Chief Judge Pope, Judge Cooper and Judge Blackburn join in this dissent.


author: Birdsong, Presiding Judge.

text:
    A93A2000.
    MOORE v. FOOD ASSOCIATES, INC.
    (437 SE2d 832)
   Birdsong, Presiding Judge.

Florrie Moore appeals the grant of summary judgment to appellee Food Associates, Inc. d/b/a Kentucky Fried Chicken in this slip and fall case. Appellant Moore contends she slipped and fell on a wet floor outside of the toilet stall area of the ladies’ rest room in appellee’s restaurant. She contends her fall was caused by the accumulation of moisture because appellee mopped the rest room on the evening before and allowed the air conditioning system to remain on overnight. Appellee contends she was the first person to enter the rest room on the morning of the incident. She contends a policeman who examined the area after her fall discovered that the floor was damp because of moisture from the air conditioner.

Appellee/defendant contends the judgment of the trial court was correct, as appellee did not have superior knowledge of the allegedly hazardous condition in its restaurant rest rooms. Appellee’s assistant manager testified that she had inspected the rest room before the store opened at 10:30 a.m. and discovered no moisture on the floor outside the toilet stalls. Appellee also contends that a periodic inspection made no more than 15 minutes before appellant’s fall disclosed no moisture on the floor where appellant contends there was moisture. Held:

On a defendant’s motion for summary judgment, the evidence is construed in the respondent’s favor; the respondent is given the benefit of all doubts and all reasonable inferences therefrom are indulged in her favor. The burden is on the movant to show that no genuine issue of material fact exists and that it is entitled to summary judgment as a matter of law. Rivergate Corp. v. BCCP Enterprises, 198 Ga. App. 761, 762 (403 SE2d 65). Where the movant fails in that burden, the grant of summary judgment is error. 944, Inc. v. Ga. State Bank, 198 Ga. App. 893, 894 (403 SE2d 466). But where the movant carries this burden, the respondent may not rest on her pleadings but must put forth evidence showing actual issues for trial. Lau’s Corp. v. Haskins, 261 Ga. 491 (405 SE2d 474).

In support of its judgment, appellee contends the standard of review of a grant of summary judgment is whether there is any evidence to support it, and that the appellate court does not perform a de novo review of the evidence. Appellee’s contention is patently incorrect. It is well established that on appeal of a grant of summary judgment, the appellate court must determine whether the trial court erred in concluding that no genuine issue of material fact remains and that the party was entitled to judgment as a matter of law. See 944, Inc., supra. This requires a de novo review of-the evidence. A trial court’s conclusion that no genuine issue of material fact remains and that the party is entitled to judgment as a matter of law cannot be upheld merely on the basis that there was some evidence to support that conclusion, for there is no such thing as “any evidence” or “some evidence” that no genuine issues of material fact remain and that the party is entitled to judgment as a matter of law. Hoffman v. Atlanta Gas Light Co., 206 Ga. App. 727, 728-729 (426 SE2d 387).

To prevail in a suit for damages against a proprietor for injury caused by a defective or unsafe condition on premises, the plaintiff must show a defect of which the proprietor had superior knowledge; there is no liability for resulting injury where the invitee has as much knowledge as the proprietor does. Young v. YMCA &c., 204 Ga. App. 224, 225 (419 SE2d 97). It is not enough for the plaintiff to say that she did not see the dangerous condition and that the defendant must have known it was there. The customer must exercise ordinary care for her. own safety, and by the same degree of care, avoid the merchant’s negligence after it becomes apparent to her or in the exercise of ordinary care in discovering and avoiding those things that might cause hurt to her. Alterman Foods v. Ligon, 246 Ga. 620, 623 (272 SE2d 327). Appellant alleges that there was moisture in the rest room inside the toilet stalls, on the walls, and where she fell. Employees of appellee state that an inspection was made 15 minutes prior to appellant’s falling and no evidence of any moisture was seen. Plaintiff cites us to no evidence as to why she could not have seen or discovered any purported moisture on the floor. She says she did not see it, but she does not suggest the reason why. Her failure to see the moisture, which she says was on the floor, was caused as likely by her inattention as by any other cause. We cannot speculate when there is no evidence cited to us, and neither can the jury. The mere existence of a dangerous condition does not render the proprietor liable, for the proprietor is not a guarantor of the invitee’s safety. Alterman Foods, supra at 622. Appellant, having failed to cite to us any evidence that she exercised ordinary care for her own safety, must suffer the summary judgment against her.

Decided November 4, 1993.

Jones, Boykin & Associates, Harold J. Cronk, for appellant.

Painter, Ratterree & Bart, R.. Clay Ratterree, Catherine N. Clutter, for appellee.

Judgment affirmed.

Pope, C. J., and Andrews, J., concur.