author: Phipps, Judge.

text:
    A00A1123.
    LIGHTING GALLERIES, INC. v. DRUMMOND et al.
    (543 SE2d 419)
   Phipps, Judge.

Lighting Galleries, Inc. (LGI) filed an action for injunctive relief and damages against two of its former employees, Amanda Berryman Drummond and Brian Carlisle, and their new employer, Southern Lighting Gallery, Inc. (SLG). LGI appeals an order of the trial court denying motions to temporarily restrain Drummond, Car-lisle, and SLG from violating noncompete and nondisclosure covenants in Drummond’s and Carlisle’s employment agreements with LGI.

With respect to the covenant not to compete, we affirm the denial of the injunction against Carlisle because the covenant was overbroad as it applied to him. We reverse the denial of the injunction to enforce the covenant against Drummond and SLG because the covenant was not overbroad as to Drummond and the record shows that she had engaged in activities at SLG which violated the covenant. We affirm the denial of the injunction to enforce the nondisclosure provision because the record does not establish that Drummond or Carlisle disclosed or was threatening disclosure of any confidential information to SLG.

LGI consists of four operating divisions: (1) Augusta Lighting, which maintains a showroom in Augusta, Georgia; (2) American Light Source, which consists solely of mail order and telephone sales; (3) Lights Plus, which maintains a showroom in Lexington, South Carolina; and (4) Putzel’s Lighting, which maintains a showroom in Macon, Georgia.

Drummond worked as a salesperson for Augusta Lighting from September 17, 1996, to December 14, 1998, when she was terminated. Carlisle was hired by LGI to work in the Augusta Lighting warehouse on March 10, 1997. On September 4, 1997, he was transferred to American Light Source, where he worked as a mail order salesperson.

On November 29, 1997, Drummond and Carlisle were required to sign employment agreements which contained covenants against competition, disclosure of confidential information, and solicitation of customers. In early 1998, Carlisle was trained as a showroom sales consultant at Augusta Lighting and was transferred to the Lexington, South Carolina, showroom, where he worked as a salesman. On December 30, 1998, Carlisle resigned from employment with LGI and returned to Augusta.

SLG hired Drummond as a showroom manager on June 1, 1999. On June 18, it hired Carlisle in a sales capacity.

On September 16, LGI filed a complaint against Drummond, Carlisle, and SLG, seeking damages, expenses of litigation, and temporary and permanent injunctions against violation of the employment agreements. LGI also filed a motion for temporary injunction, asserting that Drummond and Carlisle had violated the noncompete, nondisclosure, and nonsolicitation clauses in the employment agreements.

The trial court granted the motion with respect to the nonsolicitation provision but denied it with respect to the noncompete and nondisclosure clauses. LGI appeals the denial of its motion to temporarily enjoin Drummond, Carlisle, and SLG from violating the noncompete and nondisclosure clauses.

The granting and continuing of injunctions shall always rest in the sound discretion of the judge, according to the circumstances of each case. This power shall be prudently and cautiously exercised and, except in clear and urgent cases, should not be resorted to.
“Covenants against competition which are contained in employment contracts are considered to be in partial restraint of trade and will be upheld only if they are strictly limited in time and territorial effect, and are otherwise reasonable considering the business interest of the employer sought to be protected and the effect on the employee.” [Cit.]

The employer has interests in protecting its investment in the development of the employee’s skills and craft and in preventing the employee from taking unfair advantage of customer relationships he developed while working for the employer. The employee has a right to earn a living without unreasonable restrictions.

Whether a restraint is reasonable is a question of law for determination by the court. The trial court’s findings of fact will not be set aside on appeal unless clearly erroneous.

1. The noncompetition covenant comprises the following provisions:

Employee’s Territory. Employee acknowledges and agrees with Employer that Employee’s activities in the execution of his/her duties will be conducted within the following counties in the State of Georgia: Columbia and Richmond, and Aiken county in the State of South Carolina.
Disqualified Employment in Employee’s Territory. During the time of Employee’s employment by Employer, and for a period of two (2) years thereafter, the Employee will not engage in employment as a residential lighting sales consultant in Employee’s designated territory on behalf of himself/herself or any competitor of Employer.

(a) As to Carlisle, there was evidence that the employment agreement may have been superseded by a subsequent agreement that he signed when he was transferred to the South Carolina showroom. But even if we assume that the agreement was not rescinded by a subsequent agreement, the noncompetition covenant was unreasonable as it applied to Carlisle. The covenant flatly banned him from working as a residential lighting sales consultant in the Augusta area for two years after he ceased working for LGI. But, because LGI had transferred him to Lexington, South Carolina, he had not worked in the Augusta area for approximately one year before'he left LGI. Given Carlisle’s long absence from the area, it was unreasonable to impose the full two-year restriction upon his employment there.

(b) However, as to Drummond and SLG, we find that the court abused its discretion in not granting an injunction to enforce the noncompete covenant. The court found that the covenant was over-broad and nonspecific and that there was no competent evidence that Drummond had worked elsewhere as a residential lighting sales consultant, as prohibited by the agreement.

In regard to its conclusion that the covenant was overbroad and nonspecific, the court determined that the prohibition against employment as a residential lighting sales consultant provided insufficient guidance as to what conduct was proscribed. It is true that

[a] non-competition covenant which prohibits an employee from working for a competitor in any capacity, that is, a covenant which fails to specify with particularity the activities which the employee is prohibited from performing, is too broad and indefinite to be enforceable.

However, the question is generally not determinable from merely looking at the face of the restrictive covenant. We must consider the particular factual context.* We find that this covenant was not over-broad in the scope of activity prohibited because it was “tailored to the job [Drummond] performed for [LGI].”

We find also that the record does not support the court’s determination that Drummond did not engage in prohibited activities at SLG. Drummond testified in her deposition that while at LGI, her duties as a residential lighting sales consultant included selling products on the showroom floor. While the record indicates that Drummond held a nonsales position of showroom manager at SLG, there is evidence that on several occasions she engaged in sales-related activities.

Robert Pentecost, the President of LGI, sent four mystery shoppers to the SLG showroom, in part to ascertain what activities Drummond and Carlisle were engaging in. The trial court found that the deposition testimony of the mystery shoppers merely established that “Drummond became involved in answering highly technical product information type questions that [the mystery shoppers] used to stump the initial sales person . . . and that Drummond became involved in entering information in the computer which was necessary to accomplish special orders.”

Although the record supports a finding that Drummond’s role sometimes was limited to providing insight on highly technical matters, it also shows that her aim was to assist in the making of sales. Moreover, according to the testimony of the mystery shoppers, she also engaged in activities such as helping them determine what products would best suit their needs, locating and procuring products from sources outside the store, and providing information regarding prices, discounts, and warranties. One shopper testified that Drummond offered her a ten percent discount if she would purchase items for her home remodeling project from SLG. Another testified that she was given the impression Drummond and another salesperson would “walk through” her home to help her determine what lighting fixture products were most suitable.

For these reasons, we find that as to Drummond and SLG the court incorrectly determined that an injunction to enforce the noncompete covenant was unwarranted.

2. The nondisclosure covenant comprises the following provisions:

Trade Secrets and Other Confidential Information. Employee hereby acknowledges that Employer’s business is the marketing and sale of residential lighting fixtures. Employee further acknowledges that Employer’s customer lists and marketing methods, and financial statements and records constitute confidential, proprietary information and trade secrets of Employer, the disclosure of which would cause irreparable harm to Employer.
Nondisclosure Covenant. During the time of Employee’s employment, and for a period of two (2) years thereafter, Employee covenants and agrees that he/she will not disclose to any competitor of Employer the confidential information and trade secrets belonging to Employer described [above]. . . . Employee further agrees that upon the termination of his/her employment, all records [,] lists or reports pertaining to or referencing any customer names or addresses, samples, operations and price structures or lists, including all copies, abstracts or summaries thereof, and all other property belonging to Employer shall be immediately returned by Employee to Employer.

LGI contends that Drummond and Carlisle violated the nondisclosure covenant by contacting several of its customers and one of its suppliers and by disclosing its pricing information to SLG. We find that the record fails to demonstrate that Drummond or Carlisle violated or was threatening violation of the nondisclosure covenant.

Decided December 1, 2000.

Jay M. Sawilowsky, for appellant.

Nimmons & Malchow, Leland M. Malchow, Kilpatrick Stockton, Robert P. Sentell III, Johnson, Wilkin & Williams, William J. Williams, Wendell E. Johnston, Jr., for appellees.

LGI’s claims that Drummond and Carlisle contacted customers and a supplier do not raise matters which would be covered by the nondisclosure provisions. LGI does not assert that these contacts were a result of Drummond or Carlisle disclosing confidential information to SLG.

Moreover, the record does not substantiate LGI’s claim that Drummond or Carlisle disclosed confidential pricing information to SLG. LGI points to a correlation in price markups employed by LGI and SLG. But the President of LGI conceded in his deposition that he had no evidence that Drummond and Carlisle had shared any confidential pricing information with SLG.

We find no error in the trial court’s denial of LGI’s motion for a temporary injunction to enforce the nondisclosure covenant.

Judgment affirmed in part and reversed in part.

Johnson, C. J., and Smith, P. J., concur.

       OCGA § 9-5-8.

       (Footnote omitted.) Nat. Teen-ager Co. v. Scarborough, 254 Ga. 467, 468-469 (330 SE2d 711) (1985).

        Brunswick Floors v. Guest, 234 Ga. App. 298, 299-300 (506 SE2d 670) (1998); W. R. Grace & Co. v. Mouyal, 262 Ga. 464, 465-466 (2) (422 SE2d 529) (1992).

       Id.

        Wright v. Power Indus. Consultants, 234 Ga. App. 833, 834 (1) (508 SE2d 191) (1998).

       OCGA § 9-11-52 (a); Merchant v. Mitchell, 241 Ga. App. 173, 174 (2) (525 SE2d 710) (1999).

       According to Carlisle and an administrative assistant for Robert Pentecost, the majority shareholder of LGI, Carlisle signed another employment agreement after he was transferred to South Carolina, and that agreement limited the restricted area to Richland and Lexington Counties in South Carolina. Pentecost denies this.

       See Orkin Exterminating Co. v. Walker, 251 Ga. 536, 538 (2) (a) (307 SE2d 914) (1983).

        Nat. Teen-ager Co., supra, 254 Ga. at 469.

       Id.

       Id.

        Ceramic & Metal Coatings Corp. v. Hizer, 242 Ga. App. 391, 394 (529 SE2d 160) (2000); compare Arnall Ins. Agency v. Arnall, 196 Ga. App. 414, 416-418 (1) (396 SE2d 257) (1990); Orkin, supra, 251 Ga. at 539 (2) (c).

        See American Software USA v. Moore, 264 Ga. 480, 484 (2) (448 SE2d 206) (1994); see also Cathcart Van &c. Co. v. City of Atlanta, 169 Ga. 791, 793 (151 SE 489) (1930) (court of equity should not exercise its extraordinary powers where there is no grave danger of impending injury).


source: Caselaw Access Project

author: Eldridge, Judge. Barnes, Judge,

license: Public Domain

text:
    A00A1370.
    McCARTER v. BANKERS TRUST COMPANY et al.
    (543 SE2d 755)
   Eldridge, Judge.

Jeannette McCarter appeals the trial court’s order granting summary judgment to Morris, Schneider & Prior, LLC (“the law firm”), in her action for wrongful foreclosure. This appeal concerns only the law firm and McCarter; her claims against the other defendants remain pending, and those defendants are not parties to this appeal. Bankers Trust Company of California, the lender on the deed to secure debt, after the foreclosure and sale of the property, set aside the sale and reinstated the loan with McCarter’s equity of redemption restored as well.

McCarter had repeatedly been late in her monthly payments on her deed to secure debt; Bankers Trust Company had the loan principal accelerated after the most current payment was more than a month due and gave timely notice of foreclosure of the deed to secure debt under the powers contained in the note and deed to secure debt. The law firm commenced the foreclosure notice by publication and sale procedure; however, Bankers Trust Company, without notice to the law firm, agreed with McCarter to reinstate her loan, despite it being in default, and failed to instruct the law firm to stop the foreclosure proceedings. The law firm completed the foreclosure and sale.

Despite having recovered her property without suit, McCarter sued Bankers Trust Company, Option One Mortgage Corporation, the mortgage servicer, and the law firm for wrongfully and intentionally foreclosing on her property and wrongfully and intentionally publishing false information about her.

The law firm, in response to plaintiff’s verified complaint, filed a verified answer and contended that, based on McCalla, Raymer &c. v. C.I.T. Financial Svcs., 235 Ga. App. 95 (508 SE2d 471) (1998), it was not a proper party to the action because it merely acted as an agent for the lender and servicer and was unaware that McCarter had been successful in having her loan reinstated from a default status. These contentions were supported by an affidavit from the law firm partner who handled the foreclosure.

McCarter responded that under OCGA § 10-6-85, the law firm was responsible for its torts even when acting as an agent and, further, that the statements in McCalla, Raymer on which the law firm and the trial court relied were dicta. The trial court granted summary judgment to the law firm. We agree that the statements at issue in McCalla, Raymer were dicta and limit such language, but we hold that the trial court was right for any reason and affirm.

1. We find that the statements in McCalla, Raymer, supra at 95, on which the law firm and trial court relied were not controlling precedent. Whether a law firm could be a proper defendant in a wrongful foreclosure action was not an issue in that appeal. Nevertheless, the statement that “the proper party to any claim for wrongful foreclosure is not McCalla, Raymer, which merely acted as counsel in the foreclosure; it is Lincoln, the foreclosing creditor and holder of the note and security deed on the property,” id. at 96, was correct under the facts of that case because the law firm was not a named party to the action, and the plaintiff made no allegations of tortious misconduct against the law firm or agent. However, this statement is limited to the facts of that case and is not a correct, broad statement of law generally.

McCarter contends that OCGA § 10-6-85 applies to the facts of this case, which statute reads as follows:

All agents, by an express undertaking to that effect, may render themselves individually liable. Every agent exceeding the scope of his authority shall be individually liable to the person with whom he deals; so, also, for his own tortious act, whether acting by command of his principal or not, he shall be responsible; for the negligence of his underservant, employed by him in behalf of his principal, he shall not be responsible.

See also Oglethorpe Realty Co. v. Hazzard, 172 Ga. App. 98, 99 (3) (321 SE2d 820) (1984).

McCarter, further, urges that Miller & Miller v. Wilson, 98 Ga. 567, 569 (25 SE 578) (1896); Graham v. Frazier, 82 Ga. App. 185, 195-196 (4) (60 SE2d 833) (1950); and Haas & Howell v. Godby, 33 Ga. App. 218, 222-223 (125 SE 897) (1925), control where the lawyer or other agent for a creditor erroneously levies or seizes personal property owned, not by the debtor, but by a third party and is liable for conversion and trover to the property owner. In Miller & Miller v. Wilson, supra at 569, the Supreme Court held:

[w]hoever meddles with another’s property, whether as principal or agent, does so at his peril, and it makes no difference that in doing so he acts in good faith, nor, in the case of an agent, that he delivers the property to his principal before receiving notice of the claim of the owner.

While such opinions are correct statements of abstract law regarding an action in conversion and trover, OCGA § 10-6-85 and the cited cases have no application to the facts and circumstances of this case.

First, these cited cases dealt with the seizing or delivering of personal property owned by another when the creditor, lawyer, or agent had no legal or equitable right to the property to satisfy a debt.

Second, under the facts of this case, Bankers Trust Company had legal title to the property under a deed to secure debt which was in default, thereby giving it a right to foreclose McCarter’s equity of redemption and acquiring complete title to the property. Third, the evidence does not show that there was any impropriety in the notice, advertisement, or sale at foreclosure under a deed to secure debt so as to constitute a wrongful foreclosure.

Finally, McCarter contends that the law firm “wrongfully and intentionally” foreclosed upon her property and published false information about her, i.e., that she was in default on the deed to secure debt, which she was at the time of publication; thus, McCarter placed in issue her title to the property with no right in the law firm to foreclose and the intent of the law firm to commit an intentional tort as an essential element of such causes of action.

2. “Under Georgia law, it is clear that a security deed which includes a power of sale is a contract and its provisions are controlling as to the rights of the parties thereto and their privies.” (Citations and punctuation omitted.) Gordon v. South Central Farm Credit, ACA, 213 Ga. App. 816, 817 (446 SE2d 514) (1994). Legal title passed to the lender from McCarter when the deed to secure debt was created, and the owner, McCarter, has a mere equity of redemption and right of possession of the realty until the secured debt has been satisfied in full. OCGA § 44-14-60; Rhodes v. Anchor Rode Condo. Homeowner’s Assn., 270 Ga. 139, 140 (1), (2) (508 SE2d 648) (1998); Connolly v. State, 199 Ga. App. 887, 889 (406 SE2d 222) (1991); Commercial Bank v. Stafford, 149 Ga. App. 736, 737-738 (256 SE2d 69) (1979); Dixon v. Bond, 18 Ga. App. 45, 47-48 (88 SE 825) (1916).

Thus, in this case, McCarter had no legal title to the property sold under the terms of the deed to secure debt, and there was a legal right to foreclose prior to opening the default. McCarter, in her complaint, admits that she was behind in her monthly payments and had violated the terms of the security deed, thereby authorizing sale of the property on the courthouse steps. OCGA § 44-14-160 et seq. Only through the indulgence of the lender was the deed to secure debt voluntarily reinstated for McCarter and the loan default allowed to be cured. Further, McCarter, in her complaint, admits that the foreclosure was legally conducted. In fact, after the foreclosure, the lender voluntarily had the foreclosure sale set aside because it had agreed to reinstate the deed to secure debt, and a mistake had been made by it in allowing the foreclosure to proceed.

The law firm breached no tort duties owed to McCarter, and it did not wrongfully foreclose the property. McCarter admits in judicio that the foreclosure was conducted according to the foreclosure statute, and a violation of the statute is necessary to constitute a wrongful foreclosure. See OCGA §§ 23-2-114; 44-14-160 et seq.; Calhoun First Nat. Bank v. Dickens, 264 Ga. 285, 286 (1) (443 SE2d 837) (1994); Sears Mtg. Corp. v. Leeds Bldg. Products, 219 Ga. App. 349, 351 (2) (464 SE2d 907) (1995); Tower Financial Svcs. v. Smith, 204 Ga. App. 910, 916 (2) (423 SE2d 257) (1992); Clark v. West, 196 Ga. App. 456, 457-458 (395 SE2d 884) (1990). Even if the lender on prior occasions accepted late monthly payments, then the failure prior to the commencement of foreclosure proceedings entitled the lender to proceed without giving notice to McCarter of strict compliance with the deed to secure debt. OCGA § 13-4-4; Lewis v. C & S Nat. Bank, 174 Ga. App. 847, 848 (1) (332 SE2d 11) (1985); see also Borden v. Pope Jeep-Eagle, 200 Ga. App. 176 (407 SE2d 128) (1997). McCarter admits that she had not paid the last month’s payment when foreclosure proceedings began, and the defendants had the right to foreclose. See Brown v. Freedman, 222 Ga. App. 213 (474 SE2d 73) (1996).

Further, where emotional damages are sought for an action for intentional wrongful foreclosure, such are recoverable as tort damages. Curl v. First Fed. Sav. &c. Assn. of Gainesville, 243 Ga. 842, 843-844 (2) (257 SE2d 264) (1979). However, such action for damages for emotional distress is treated as an action for intentional infliction of emotional distress, and the burden that plaintiff must meet is a stringent one in order to prevail. Clark v. West, supra at 458; see also Ingram v. JIK Realty Co., 199 Ga. App. 335, 336 (1) (404 SE2d 802) (1991). Thus, intentional conduct to cause harm is an essential element of such action. Clark v. West, supra at 458; Ingram v. JIK Realty Co., supra at 336. Where the defendant on summary judgment has shown an absence of intent to harm McCarter and has shown the foreclosure occurred from error, the burden shifted to McCarter to come forward with some evidence to create a jury issue, which she failed to do. See Clark v. West, supra at 458; Ingram v. JIK Realty Co., supra at 336.

McCarter failed to rebut defendants’ evidence showing that there was no tortious act in violation of the statute requiring good faith and fair dealing. Gordon v. South Central Farm Credit, supra at 817-818. Further, McCarter failed to rebut defendants’ evidence regarding the absence of severe emotional distress which is a necessary element of such action. See Ingram v. JIK Realty Co., supra at 338. The summary judgment is affirmed. See Lau’s Corp. v. Haskins, 261 Ga. 491, 495 (4) (405 SE2d 474) (1991).

Judgment affirmed.

Johnson, C. J., Pope, P. J., Andrews, P. J., Blackburn, P. J., Ruffin, Ellington, Phipps and Mikell, JJ., concur. Smith, P. J., Barnes and Miller, JJ., dissent.

Barnes, Judge,

dissenting.

Because I believe the trial court erred in granting summary judgment to Morris, Schneider & Prior, LLC, I respectfully dissent from the majority opinion.

1. I agree with the majority that the statements in McCalla, Raymer &c. v. C.I.T. Financial Svcs., 235 Ga. App. 95 (508 SE2d 471) (1998), relied on by the defendant are not controlling precedent. However, under general principles of agency law, an agent may be held individually liable for his own tortious acts. Oglethorpe Realty Co. v. Hazzard, 172 Ga. App. 98, 99 (3) (321 SE2d 820) (1984).

All agents, by an express undertaking to that effect, may render themselves individually liable. Every agent exceeding the scope of his authority shall be individually liable to the person with whom he deals; so, also, for his own tortious act, whether acting by command of his principal or not, he shall be responsible', for the negligence of his underservant, employed by him in behalf of his principal, he shall not be responsible.

(Emphasis supplied.) OCGA § 10-6-85. Further, in Miller & Miller v. Wilson, 98 Ga. 567, 569 (25 SE 578) (1896), our Supreme Court held that an attorney who merely acted as an agent to collect a debt and had no knowledge of the actual facts in the matter could still be sued. See also Haas & Howell v. Godby, 33 Ga. App. 218, 222-223 (125 SE 897) (1924). Further,

[w]hoever meddles with another’s property, whether as principal or agent, does so at his peril, and it makes no difference that in doing so he acts in good faith, nor in case of an agent, that he delivers the property to his principal before receiving notice of the claim of the owner. If an agent takes the property of another without his consent and delivers it to the principal, it is a conversion, and trover will lie for the recovery of the property or for damages, as the plaintiff may elect. An agent, who for and in behalf of his principal takes the property of another without the latter’s consent, is as to him guilty of a conversion, although being ignorant of the true owner’s title, the agent may have acted in perfect good faith; and such agent may be sued in trover for the property, even after his delivery of it to his principal. Also such an agent may be sued jointly with his principal for such conversion.

(Citations and punctuation omitted.) Graham v. Frazier, 82 Ga. App. 185, 195-196 (4) (60 SE2d 833) (1950).

The law firm is not absolved of liability merely because it acted as attorney for the lender and server, and, accordingly, the grant of summary judgment should be reversed.

2. Although the points raised by the majority in Division 2 ultimately may be correct, those issues were not asserted in the law firm’s motion for summary judgment. Consequently, McCarter was given no opportunity to address them, and, of course, the trial court never ruled on them.

Under this record, we should not rule on these issues. A plaintiff is not required

to respond to issues which are not raised in the motion for summary judgment or to present its entire case on all aliegations in the complaint — even on issues not raised in the defendants’ motion. Indeed, until appellees pierced the allegations of [McCarter’s] complaint on a particular issue, [she] was neither required to respond to the motion on that issue, nor required to produce evidence in support of [her] complaint on that issue. See also Bales v. Central Bank &c. Co., 204 Ga. App. 675, 676 (420 SE2d 358) [(1992)]: The issues that must be rebutted on motion for summary judgment are those raised by the motion. Consequently, [McCarter] was not required to present proof on all matters raised in [her] complaint until [the law firm] pierced [her] complaint on those issues.

Decided December 1, 2000.

Mark D. Welsh, for appellant.

Morris, Schneider & Prior, Larry W. Johnson, Brian S. Tatum, for appellees.

(Citation and punctuation omitted.) Hodge v. SADA Enterprises, 217 Ga. App. 688, 690 (1) (458 SE2d 876) (1995). Additionally,

due process requires that a party be given reasonable opportunity to contest a claim that there are no genuine issues of material fact. There having been no notice to [McCarter that this court] might consider the merits of the issue of [her claim], a holding that [she could not recover], tantamount to an award of summary judgment against [her], would deny [her] due process.

Coweta County v. Simmons, 269 Ga. 694 (507 SE2d 440) (1998). “Accordingly, we may not consider whether summary judgment would have been proper for any other reason. [Cit.]” Fedeli v. UAP/Ga. Ag. Chem., 237 Ga. App. 337, 339 (1) (514 SE2d 684) (1999).

For these reasons, I respectfully dissent to the majority opinion.

I am authorized to state that Presiding Judge Smith and Judge Miller join in this dissent.


author: Blackburn, Presiding Judge.

text:
    A00A1786.
    COSTRINI et al. v. HANSEN ARCHITECTS, P.C.
    (543 SE2d 760)
   Blackburn, Presiding Judge.

Anthony Costrini and others (collectively referred to as Costrini) appeal from the trial court’s grant of summary judgment to defendants Hansen Architects, P.C. and J. Paul Hansen (collectively referred to as Hansen) on claims for breach of contract, negligence, and fraud arising out of the construction of an office building. Costrini contends that the trial court erred by finding that the claim for breach of contract was time-barred and that Hansen’s alleged fraud did not toll the statute of limitation. For the reasons set forth below, we affirm.

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

Brown v. Ohio Cas. Ins. Co.

Viewed in this light, the record shows that Costrini hired Hansen to design and supervise improvements to an office building located in Savannah. In late 1988, Costrini complained to Hansen about water problems with the structure, but Hansen insisted that the problems were not attributable to him. In March 1994, Costrini hired an outside firm to examine Hansen’s work, and that firm concluded that the problems were attributable to Hansen. Then, on April 1, 1994, Costrini filed suit against Hansen alleging breach of contract, negligence, and fraud. Hansen filed a motion for summary judgment, contending that the claims were time-barred. The trial court granted the motion.

1. Costrini argues that the trial court erred by finding that his breach of contract claim was time-barred because it incorrectly applied the statute of limitation in OCGA § 9-3-30, which provides that “[a]ll actions for trespass upon or damage to realty shall be brought within four years after the right of action.” Costrini contends that this claim is governed by OCGA § 9-3-24, which provides: “All actions upon simple contracts in writing shall be brought within six years after the same become due and payable. However, this Code section shall not apply to actions for the breach of contracts for the sale of goods.” OCGA § 9-3-24. Although we agree that OCGA § 9-3-24 applies, we nonetheless conclude that the claim is time-barred.

The trial court mistakenly relied upon Kemp v. Bell-View, Inc. in concluding that the four-year limitation in OCGA § 9-3-30 applied because the breach of contract concerned damage to real property. In Kemp, the plaintiffs sued the manufacturer/seller of windows for property damage to their home. Ruling that a four-year limitation period applied to the claim, the court stated:

An action for damage to realty must be brought within four years after the right of action accrues. OCGA § 9-3-30. Whether count one is construed as a claim for breach of contract, breach of implied warranty, negligence, or strict liability, it is governed by a four-year limitation for filing suit. See OCGA § 11-2-725.

Kemp, supra. The property damage claim in Kemp was subject to a four-year limitation period even if it was actually a breach of contract claim because it related to the sale of goods under OCGA § 11-2-725. Thus, Kemp does not hold that breach of contract claims involving property damage are governed by OCGA § 9-3-30. Indeed, this court has recently ruled that “the four-year statute of limitation in OCGA § 9-3-30 applies only to tort actions for damage to property. Actions arising out of contract do not fall within OCGA § 9-3-30’s purview.” Mitchell v. Jones

Applying OCGA § 9-3-24, Costrini’s claim is time-barred because the construction was substantially completed more than six years before Costrini filed suit in April 1994. “The period of limitation on a construction contract commences on the date the work was substantially complete.” Fort Oglethorpe Assoc. II v. Hails Constr. Co. &c.; Space Leasing Assoc. v. Atlantic Bldg. Systems.

Hansen, the movant, produced a signed certificate of substantial completion as of December 14, 1987, and a certificate of occupancy for the building issued on December 16, 1987. Hansen identified and referenced the affidavit of substantial completion and the certificate of occupancy in his affidavit and attached them to it as exhibits.

Costrini argues that the date of substantial completion was much later, contending that he did not accept the building until April 1988 and that final payment on the building did not occur until December 1988. Thus, the contract did not become “due and payable” until that time. However, pretermitting whether the statute of limitation would run from that point if such facts were true, the record shows no competent evidence for this Court to consider in support of Costrini’s contention. Because Costrini failed to rebut Hansen’s evidence showing that the date of substantial completion was more than six years prior to the filing of this suit, the grant of summary judgment to Hansen was proper. “A grant of summary judgment must be affirmed if it is right for any reason.” (Punctuation omitted.) Nairon v. Land,.

2. Costrini also contends that the trial court erred by granting summary judgment to Hansen because the statute of limitation was tolled by Hansen’s fraud. Costrini argues that Hansen deterred him from bringing the suit because Hansen denied liability and told him that the water problems were not related to the design and sequence of construction of the building, but were caused by others. Costrini’s argument fails because Hansen’s actions do not constitute fraud within the meaning of OCGA § 9-3-96.

Section 9-3-96 provides: “If the defendant or those under whom he claims are guilty of a fraud by which the plaintiff has been debarred or deterred from bringing an action, the period of limitation shall run only from the time of the plaintiff’s discovery of the fraud.” However,

the fraud in question is not that which gives a cause of action, but that which conceals a cause of action. To constitute concealment of a cause of action so as to prevent the running of limitations, some trick or artifice must be employed to prevent inquiry or elude investigation, or to mislead and hinder the party who has the cause of action from obtaining information, and the acts relied on must be of an affirmative character and fraudulent.

(Punctuation omitted.) Turner v. Butler.

The record contains no evidence that Hansen affirmatively concealed any allegedly defective construction or that he hindered or prevented Costrini from discovering any alleged defect. See Mitchell v. Jones, supra. Indeed, in March 1994, almost six years after discovering the water problems, Costrini first hired an outside firm to examine Hansen’s work. Costrini was aware of the water problems and could have hired an outside firm earlier.

Decided December 1, 2000.

Thomas A. Nash, Jr., for appellants.

Lee, Black, Scheer & Hart, Christopher L. Rouse, for appellee.

Judgment affirmed.

Eldridge and Barnes, JJ, concur.

       Appellants are Anthony M. Costrini, J. Allen Meadows III, and David G. Smith, individually and d/b/a Costrini, Meadows & Smith Building Partnership.

        Brown v. Ohio Cas. Ins. Co., 239 Ga. App. 251 (519 SE2d 726) (1999).

        Kemp v. Bell-View, Inc., 179 Ga. App. 577-578 (1) (346 SE2d 923) (1986).

        Mitchell v. Jones, 247 Ga. App. 113, 114 (1) (541 SE2d 103) (2000).

        Fort Oglethorpe Assoc. II v. Hails Constr. Co. &c., 196 Ga. App. 663 (1) (396 SE2d 585) (1990).

        Space Leasing Assoc. v. Atlantic Bldg. Systems, 144 Ga. App. 320, 324 (2) (241 SE2d 438) (1977).

       Although Costrini attached certain documents to his affidavit, he did not reference them in his affidavit or otherwise authenticate them. See Davis v. First Healthcare Corp., 234 Ga. App. 744 (1) (507 SE2d 563) (1998).

        Nairon v. Land, 242 Ga. App. 259 (529 SE2d 390) (2000).

        Turner v. Butler, 245 Ga. App. 250, 252-253 (537 SE2d 703) (2000).


author: Miller, Judge.

text:
    A00A2210.
    MURRAY v. THE STATE.
    (543 SE2d 428)
   Miller, Judge.

Frederick Mashard Murray was indicted for murder and possession of a firearm during the commission of a crime, for the shooting death of Kevin Crumedy. After a bench trial, Murray was found guilty of voluntary manslaughter and the weapons charge. His motion for new trial was denied, and on appeal he enumerates only the general grounds.

Viewed in the light most favorable to the trial court’s adjudication of guilt, the evidence revealed the following: Murray’s girlfriend, Sharon Jones, was separated from her husband and had moved from Florida to Moultrie, Colquitt County, Georgia, to live with Murray. Jones testified that Murray was jealous of her friendship with the victim, a co-worker of hers, and that Murray had accosted the victim at work after discovering his telephone number in Jones’s coat. After work, Murray hit Jones in the mouth with his fist and threatened her with a gun if she ever disrespected him like that again. Murray also threatened Jones that he would shoot the victim if Murray saw him on the street.

The next morning, Murray told Jones she might as well quit her job because it was going to be her last day and started playing with a gun in front of her, suggesting that he would shoot her when she got home from work. At work, the victim helped Jones to leave town on a bus. Escorted by her estranged husband and a police officer, Jones returned to Moultrie several days later to retrieve her belongings when Murray showed up at their house. Murray told Jones not to be afraid of him, yet displayed to her what appeared to be a new or different gun. Jones finished packing without further incident and departed. On her way out of town, she stopped at the victim’s home. Murray drove up, walked over to where Jones, her husband, and the victim were standing, and greeted Jones and the victim. Murray queried whether the victim recalled “all that stuff you [were] saying over there at [work]? And [the victim] said, yeah, what’s up. . . . And [Murray] said, what? And he pulled out the gun and shot . . .” the victim once in the chest. Murray then told Jones to come with him and that he did it because he loved her and would do anything to keep her. Jones ran around the comer and never went back.

Decided December 1, 2000.

William R. Folsom, for appellant.

J. David Miller, District Attorney, Andrew W. Pope, Assistant District Attorney, for appellee.

Murray testified that the victim admitted having a sexual relationship with Jones and that Jones told Murray she was pregnant and returning to Florida. When Murray came across Jones at the victim’s apartment, the victim was “over her hugging on her.” As Murray asked Jones what was going on, the victim intervened, telling Jones “you don’t have to talk to that punk. . . .”

A person commits the offense of voluntary manslaughter when he causes the death of another human being “under circumstances which would otherwise be murder and if he acts solely as the result of a sudden, violent, and irresistible passion resulting from serious provocation sufficient to excite such passion in a reasonable person.”

Adulterous conduct can serve as sufficient provocation authorizing a charge on voluntary manslaughter under OCGA § 16-5-2 (a). And this rationale of sexual jealousy as provocation applies even though the parties to the relationship are not married to each other. It is for the trier of fact to determine whether the chain of circumstances and conduct were sufficient to engender irresistible passion. The evidence is sufficient under the standard of Jackson v. Virginia to authorize the trial court’s findings that Murray is guilty, beyond a reasonable doubt, of voluntary manslaughter and possession of a firearm during the commission of a crime.

Judgment affirmed.

Pope, P. J., and Mikell, J., concur.

       OCGA § 16-5-2 (a).

        Strickland v. State, 257 Ga. 230, 231-232 (2) (357 SE2d 85) (1987).

        Goforth v. State, 271 Ga. 700, 701 (1) (523 SE2d 868) (1999).

        Campbell v. State, 204 Ga. 399, 407 (1) (49 SE2d 867) (1948).

       443 U. S. 307 (99 SC 2781, 61 LE2d 560) (1979).

        McGuire v. State, 243 Ga. App. 899, 900 (1) (534 SE2d 549) (2000).


author: Andrews, Presiding Judge.

text:
    A00A1315.
    GENERAL MOTORS ACCEPTANCE CORPORATION v. JACKSON.
    (542 SE2d 538)
   Andrews, Presiding Judge.

General Motors Acceptance Corporation (GMAC) appeals from the trial court’s grant of summary judgment to T. Jerry Jackson, Commissioner of the Department of Revenue, in GMAC’s appeal to the superior court of the Department’s denial of its claim for a refund of sales and use taxes under OCGA § 48-8-45 (c).

In reviewing the Department’s administrative decision, the superior court determines whether there was any evidence to support the agency’s decision. Sawyer v. Reheis, 213 Ga. App. 727, 728-729 (1) (445 SE2d 837) (1994). Upon our review of the superior court’s actions, the evidence is construed in favor of the agency’s decision. Ga. Power Co. v. Ga. Public Svc. Comm., 196 Ga. App. 572, 580 (5) (396 SE2d 562) (1990). Both the superior court and this Court review conclusions of law de novo. OCGA § 50-13-19 (h); Municipal Elec. Auth. &c. v. Ga. Public Svc. Comm., 241 Ga. App. 237, 239 (1) (525 SE2d 399) (1999).

So viewed, the record shows that GMAC finances both General Motors dealers’ wholesale floor plans and retail purchases by consumers of automobiles from these dealers. The dealer acquires the cars from General Motors, and GMAC finances the acquisition by the dealer. Dealers are required to make monthly payments to GMAC of interest only. At the time the car is sold to a consumer, the dealer remits to GMAC the amount of the floor plan liability for the car.

On consumer purchases, GMAC and each dealer enter into the GMAC Retail Plan, a master contract which provides that GMAC may purchase contracts from the dealer at a discount rate. If GMAC approves the consumer’s credit, the dealer would sign the Installment Contract’s assignment provision, without recourse, so that GMAC would have no right to recover from the dealer if the consumer defaulted. The assignment clause provides: “Seller assigns its interest in this contract to General Motors Acceptance Corporation (GMAC) under the terms of the GMAC Retail Plan agreement.”

Upon GMAC’s approval of the customer’s credit and the resulting assignment to GMAC, the contract would be entered into GMAC’s records, and payment would be made by GMAC to the dealer consisting of the “amount financed” on the contract, including sales tax, plus either a flat fee or an amount representing the difference between the interest rate the dealer charged the consumer and GMAC’s “buy rate” at which the contract was purchased. The buy rate is generally lower than the rate paid by the retail customer and is where money is made on the deal. A flat fee is paid to the dealer if the rates are the same. Neither the assignment clause nor the GMAC Retail Plan makes any reference to sales taxes and their treatment after assignment.

Over years of doing business, GMAC has established a rate of default of three percent for its retail installment financing business based on contracts assigned by dealers. In order to provide for that, GMAC sets aside a certain percent of the finance charge as an anticipated loss reserve. For retail consumers with riskier credit, a larger loss reserve is set up. GMAC maintains accounts for each dealer to which the loss reserves are credited. As losses occur, they are deducted from the assigning dealer’s account by GMAC.

In the event of a default by a purchaser, GMAC attempts collection efforts by negotiating and eventually by repossessing and selling the vehicle. A defaulting purchaser is charged late charges in addition to other contract amounts. Even after a delinquent account has been charged off by GMAC, it is possible that additional amounts will be received from the purchaser through these efforts.

In August 1997, GMAC, for the first time, filed a claim for refund of sales taxes with the Department of Revenue. The claim sought a refund for the period from August 1, 1994 through October 31, 1996, for bad debts. GMAC computed the amount by multiplying the amount of its “uncollectible loan accounts” by a five percent tax rate. This claim was denied by the Department, and the superior court granted the Department summary judgment on the appeal.

1. GMAC’s first enumeration is that the trial court erred in concluding that it did not qualify as “any person” under OCGA § 48-8-45 (c).

That subsection provides that

[a]ny person reporting on the accrual basis of accounting shall be allowed a deduction for bad debts under rules and regulations of the commissioner on the same basis that bad debts are allowed as a deduction on state income tax returns. In the case of an assignee of credit card debt purchased directly from a dealer without recourse, the assignee reporting on the accrual basis of accounting or a credit card bank which extends such credit to customers under a private label credit card program shall be allowed a deduction for bad credit card debts under rules and regulations of the commissioner on the same basis that bad credit card debts are allowed as a deduction on state income tax returns.

(Emphasis supplied.)

The last sentence of this provision was added by Ga. L. 1998, p. 604, § 1.

This subsection, however, is not considered in a vacuum, but must be analyzed in the context of the entire Sales & Use Tax Act, including subsections (a) and (b) of OCGA § 48-8-45, and the Act’s history, keeping in mind that courts, when interpreting statutes, look diligently for the intent of the General Assembly. OCGA § 1-3-1 (a); Undercofler v. Capital Automobile Co., 111 Ga. App. 709, 716 (1) (143 SE2d 206) (1965).

The Sales & Use Tax Act was originally enacted to levy a privilege or license tax upon every person engaged in selling tangible personal property at retail, with the tax computed on gross sales of the retailer. Hawes v. Phillips, 122 Ga. App. 714, 716-717 (178 SE2d 759) (1970); Williams v. Gen. Finance Corp., 98 Ga. App. 31, 34 (1) (104 SE2d 649) (1958).

In 1960, the Act was amended to impose the tax primarily upon the purchaser. As now contained in OCGA § 48-8-30 (b) (1), the amendment provided that

[e]very purchaser of tangible personal property at retail in this state shall be liable for a tax on the purchase at the rate of 4 percent of the sales price of the purchase. The tax shall be paid by the purchaser to the retailer making the sale. . . . The retailer shall remit the tax to the commissioner ...[,] and, when received by the commissioner, the tax shall be a credit against the tax imposed on the retailer. Every person making a sale or sales of tangible personal property at retail in this state shall be a retailer and a dealer and shall be liable for a tax on the sale at the rate of 4 percent of the gross sale or gross sales, or the amount of taxes collected by him from his purchaser or purchasers, whichever is greater.

(Emphasis supplied.)

Thus, the tax imposed became a tax dual in nature, as both purchaser and retailer were liable for the tax and the tax was imposed upon each sale when the contract was executed. Grantham Transfer Co. v. Hawes, 225 Ga. 436, 442 (3) (d) (169 SE2d 290) (1969); Undercofler v. Eastern Air Lines, 221 Ga. 824, 834 (2) (147 SE2d 436) (1966); Hawes, supra, 122 Ga. App. at 717.

The retailer is required to register with the State and to report and remit the tax to the State on monthly returns. OCGA §§ 48-8-59 (a) (1); 48-8-30 (b) (1), (h); 48-8-32; 48-8-33; 48-8-49 (a).

OCGA § 48-8-45 (a) provides that the “person taxable” under the Act may report sales on either a cash or accrual basis of accounting. Once the basis is chosen, permission for a change must be obtained from the commissioner. OCGA § 48-8-45 (b) provides that persons reporting on a cash basis of accounting “shall include in each return all cash sales made during the period covered by the return and all collections made in any period on credit sales of prior periods and shall pay the tax on the sales at the time of filing the return” (Emphasis supplied.)

As reflected by the sample installment sales contracts contained in the record, all of those sales involved either trade-ins or cash down payments, or both. The total amount shown as a credit to the customers exceeded the sales tax shown due on these sample sales contracts. Therefore, it appears that the dealers would have remitted any sales tax owing to the Department the month of the sale.

It is also important, in considering whether GMAC is “any person” entitled to seek a deduction under the Act, to give great deference to the contemporaneous administrative construction given to the Act by the Department of Revenue and the legislature’s acquiescence in that construction. Undercofler v. Eastern Air Lines, supra at 831 (2); Ga. Public Svc. Comm. v. Sawnee Elec. &c. Corp., 242 Ga. App. 156, 159 (1) (529 SE2d 186) (2000). As reflected in Rule 560-12-1-.06, originally promulgated by the Department in 1965, and the affidavits of Commissioner Jackson, the Sales & Use Tax Act has been interpreted consistently as allowing a deduction only to a dealer and only under certain circumstances.

That the legislature has been aware of and acquiesced in this interpretation is reflected by the 1998 amendment to OCGA § 48-8-45 (c), by which assignees of credit card debt are allowed a deduction for bad credit card debts. Whether and to what extent deductions to a taxation plan are allowed is a matter of legislative grace, and only where there is expression of a clear provision providing for it will a deduction be allowed. New Colonial Ice Co. v. Helvering, 292 U. S. 435, 440 (2) (54 SC 788, 78 LE 1348) (1934); Fulton Bag &c. Mills v. Williams, 212 Ga. 783, 786 (2) (95 SE2d 848) (1956). Therefore, having provided for a bad debt deduction to assignees of bad credit card debt, the legislature has impliedly denied it to any others. Any change would be a matter for consideration by the legislature, not the courts.

Decided November 15, 2000

Reconsideration denied December 4, 2000

King & Spalding, Nolan C. Leake, L. Wayne Pressgrove, Jr., Felton E. Parrish, for appellant.

Thurhert E. Baker, Attorney General, Daniel M. Formhy, Deputy Attorney General, David A. Runnion, Warren R. Calvert, Senior Assistant Attorneys General, for appellee.

Parker, Hudson, Rainer & Dobbs, William J. Holley II, Charles W. Lyons, amici curiae.

Further, where one seeks the benefit of an exemption from taxation, any such exemption must be strictly construed and will not be found unless the terms under which it is claimed “ ‘clearly and distinctly show that such was the intention of the legislature.’ [Cits.]” Cherokee Brick &c. Co. v. Redwine, 209 Ga. 691, 693 (75 SE2d 550) (1953). See also Douglas County v. Anneewakee, Inc., 179 Ga. App. 270, 272 (1) (346 SE2d 368) (1986).

Therefore, we concur with the Department and the superior court that GMAC is not a person entitled to seek a deduction for bad debts under the Sales & Use Tax Act.

2. The remaining enumerations of error are rendered moot in light of our holding in Division 1.

Judgment affirmed.

Ruffin and Ellington, JJ, concur.

       A brief has also been filed on behalf of amici curiae Bank of America, N.A., Chrysler Financial Company, LLC, First Union National Bank, N.A., and SunTrust Bank, N.A.

       As set out below, the statutory tax rate is four percent and there is nothing contained in the record below to explain this discrepancy.

       While GMAC below contended it was entitled to a refund, as reflected by the trial court’s order, GMAC conceded during oral argument that, as provided by the statute, if it were entitled to anything, it would be a deduction, not a refund.

       That, under a previous commissioner, a refund was erroneously paid to SunTrust Bank is of no avail to GMAC. OCGA § 45-6-5; Ben Hill County Bd. of Ed. v. Davis, 270 Ga. 452, 453 (2) (510 SE2d 826) (1999).


author: POPE, Presiding Judge.

text:
    A00A1732.
    SCHREIBER COMPANY-SHURLINGTON PLAZA, (LP) v. NORSTAN APPAREL SHOPS OF N.Y., INC. et al.
    (541 SE2d 676)
   POPE, Presiding Judge.

In March 1995, Norstan Apparel Shops of N.Y., Inc. signed a lease to open a “Fashion Cents” store in the Shurlington Plaza in Macon, Georgia. Fashion Cents stores sell modestly priced ladies’ apparel throughout the country. The Shurlington Plaza lease, a standard form used by Norstan, contained a noncompetition provision prohibiting Norstan’s landlord from renting to other businesses selling comparable merchandise:

[D]uring the term of this Lease, and any renewal thereof, the Landlord, its successors, assigns, heirs and executors, hereby covenants that its successors, assigns, heirs, and executors shall not Lease, use, permit to be used, on leased [sic] on the Shopping Center premises any business operations primarily engaged in the sale of ladies popular priced apparel defined as a store where 50% or more of the merchandise is priced under $30.00.

Schreiber Company-Shurlington Plaza, (LP), a Pennsylvania limited partnership, purchased Shurlington Plaza in November 1995. Schreiber determined that Norstan’s form noncompetition language did not apply to the Shurlington Plaza lease because it was prefaced by language referencing negotiations for Norstan’s payment of a percentage rent, and the Shurlington Plaza lease provided that Norstan would pay only a minimum annual rent, with no percentage component. Accordingly, in September 1997, Schreiber signed a lease with CATO Corporation, which opened an “It’s Fashion” store in Shurlington Plaza the following month. The It’s Fashion stores sell predominantly budget-priced women’s apparel, as well as men’s and children’s clothing.

Within one week of the It’s Fashion store opening, Norstan wrote Schreiber stating that the CATO lease was in violation of the Norstan lease’s noncompetition clause. The letter also informed Schreiber that Norstan was exercising one of the remedies provided in the lease for such a violation and thus would begin paying one-half of the stated monthly rent as of November 1, 1997. After further communication, the parties were unable to resolve their differences, and Schreiber filed a declaratory judgment action seeking a determination of whether the noncompetition provision applied and whether the CATO lease violated the clause. Schreiber also sought to recover damages if Norstan was found to have breached the parties’ lease by paying one-half rent. Norstan filed a counterclaim seeking damages for Schreiber’s breach of the noncompetition provision. Norstan subsequently conceded liability to Schreiber for the amount of unpaid rent, and the matter proceeded to a jury trial on Norstan’s counterclaim. After Schreiber twice moved unsuccessfully for a directed verdict, the jury returned a verdict in Norstan’s favor in the amount of $146,000 in compensatory damages and $32,000 in litigation expenses.

Schreiber’s sole argument on appeal is that the evidence failed to support the jury’s damage award because Norstan presented evidence of lost profits only and did not provide evidence showing any decrease in the value of its leasehold. In support of this argument, Schreiber notes that the jury’s compensatory damage award of $146,000 corresponds almost exactly to Norstan’s evidence of the lost profits at the Shurlington Plaza store.

Both parties agree that the appropriate measure of damages for the breach of the noncompetition provision in the parties’ lease is the diminution in value of the leasehold following the breach:

The measure of damages recoverable for a lessor’s breach of a covenant not to rent other stipulated premises for a competing business is the difference in value between the plaintiffs’ leasehold with the covenant against competition unbroken and the same leasehold with the covenant broken.

(Citation and punctuation omitted.) Market Place Shopping Center v. Basic Business Alternatives, 227 Ga. App. 419, 420 (1) (489 SE2d 162) (1997). And while the value of the leasehold is not defined by the amount of rent paid or Norstan’s lost profits, such evidence is relevant to show damages flowing from the breach:

The value of said leasehold is not controlled by the stipulated rental therefor, nor the profits which the tenant could have realized from the operation of his business without the adjacent competing business. However, allegations and evidence of loss of profits are material to show the damage sustained by the lessee, in accordance with the rule herein stated.

(Citation and punctuation omitted.) Id. Thus, “while lost profits is evidence which may be presented in support of a claim for diminution of the value of the leasehold, and may be an element of damages, it is not the direct measure of damages in such a claim.” David Enterprises v. Kingston Atlanta Partners, 211 Ga. App. 108, 111 (2) (438 SE2d 90) (1993).

At trial, the president of Norstan Apparel Shops testified, based upon a comparison with the sales performance of other Fashion Cents stores in Georgia, that the Shurlington Plaza store had lost profits of $146,687. Schreiber does not contest Norstan’s method of calculating its lost profits or contend that the lost profits figure is speculative. Compare Market Place, 227 Ga. App. at 422-423 (2). Rather, it contends that this evidence was insufficient because Norstan made no effort to relate this figure to the diminution in the leasehold value.

But this evidence was not the only evidence of damages presented to the jury. Schreiber’s own expert testified regarding the leasehold value. The expert initially testified that Norstan’s leasehold had experienced no diminution in value and, in fact, had been enhanced in value after the It’s Fashion store moved into Shurlington Plaza. But on cross-examination, the expert admitted that as late as a week prior to trial his calculations had shown that the leasehold had diminished in value by $24,034. “Consequently, proof of lost leasehold value other than . . . lost profits was submitted, albeit from [Schreiber’s] own expert.” Market Place, 227 Ga. App. at 421 (1). And the jury “was authorized, as trier of fact, to believe portions of his testimony and disbelieve others. [Cit.]” Id. at 420-421.

Decided November 6, 2000

Reconsideration denied December 6, 2000

McGee & Oxford, James J. Brissette, for appellant.

Jones, Cork & Miller, W. Kerry Howell, Hall, Bloch, Garland & Meyer, J. Ellsworth Hall III, for appellees.

In addition, the jury heard evidence relating to the lease Schreiber executed with CATO Corporation. That lease also contained a noncompetition provision, although it necessarily allowed for the presence of the pre-existing Fashion Cents store. The CATO lease provided a fixed remedy in the event Schreiber breached that provision: CATO’s rent would be reduced by $22,000 per year and CATO would cease to pay an additional $3,560 in other charges under the lease, for a total of $25,560 per year. Thus, the jury could have concluded that Schreiber had agreed that this was a reasonable value for the breach of the CATO noncompetition provision. And it was authorized to compare this value to Norstan’s noncompetition provision, which allowed for no competing stores in Shurlington Plaza. .

Therefore, we conclude that the jury had sufficient evidence upon which to base its verdict. And while the verdict was comparable to Norstan’s lost profits figure, the jury was entitled to consider lost profits in calculating the diminution in leasehold value:

Evidence of loss of profits is admissible and pleadings in support thereof proper in order that the jury may properly estimate the value of the leasehold estate before and after the covenant is broken. Therefore, a recovery for loss of profits occasioned by a breach of contract where properly pleaded and proved may be indirectly had.

(Citations and punctuation omitted.) David Enterprises, 211 Ga. App. at 111 (2).

Judgment affirmed.

Miller and Mikell, JJ, concur.

       Norstan Apparel Shops, Inc., a separate corporate entity, was also named as a defendant in this action. Norstan Apparel Shops, Inc. guaranteed the obligations of Norstan Apparel Shops of N.Y., Inc. under the Shurlington Plaza lease. For ease of reference, we will refer to both Norstan entities collectively as “Norstan.”


author: Mikell, Judge.

text:
    A00A2144.
    STEVEDORING SERVICES OF AMERICA et al. v. COLLINS.
    (542 SE2d 134)
   Mikell, Judge.

This appeal concerns a claim for workers’ compensation benefits. Milton Hendrix was killed in an accident on September 6, 1997, while working as a longshoreman for Stevedoring Services of America. His mother, Georgia Collins, filed a claim with the Georgia State Board of Workers’ Compensation (“the Board”) seeking to recover partial dependency benefits. An administrative law judge (“ALJ”) denied her claim, and the appellate division of the Board adopted the decision. Collins appealed to the Superior Court of Glynn County, which remanded the case to the Board for entry of a decision articulating the evidentiary standard applied to certain findings of fact. Hendrix’s employer, Stevedoring Services of America, and its insurer, Employer’s Insurance of Wausau, (“appellants”) filed an application for discretionary appeal of the superior court’s order remanding the case, which we granted. We conclude that the superior court erred and reverse.

At the hearing on Collins’s claim for benefits, Carolyn Evans testified that she and Hendrix began living together in 1981 and had a daughter, Maleeka Evans, on November 17, 1982. Counsel for Hendrix’s employer presented an affidavit executed by Evans identifying Maleeka as a dependent of Hendrix, and Evans testified that Maleeka was currently receiving Social Security benefits as a result of the death of her father. The ALJ admitted into evidence the results of a paternity test concluding a 99.96 percent probability that Hendrix was Maleeka’s biological father. Two lifelong acquaintances of Hendrix testified that Hendrix acknowledged Maleeka as his daughter and conducted himself as the child’s father.

Evans testified that she was married to another man, Jack Evans, prior to her involvement with Hendrix; however, the Evanses separated in 1980, two years before Maleeka was born. Carolyn Evans did not obtain a divorce from her husband until 1998, after Hendrix’s death.

Following the hearing, the ALJ denied Collins benefits because Hendrix was survived by a primary dependent. The appellate division adopted the ALJ’s decision; however, the superior court remanded the case. This appeal followed.

1. First, the appellants contend that the superior court erred in holding that the ALJ improperly failed to specify the applicable standard of proof in his determination that Maleeka Evans is the biological daughter of Hendrix and, therefore, a primary dependent.

The appropriate standard of review to be applied to issues of fact on writ of certiorari to the superior court is whether the decision below was supported by any evidence. On appeal to this Court, our duty is not to review whether the record supports the superior court’s decision but whether the record supports the initial decision of the local governing body or administrative agency.

OCGA § 34-9-265 provides for compensation of the dependents of an employee who died in an accident in the course of his employment. If the decedent had at least one primary dependent, partial dependents cannot recover benefits. A child under the age of 18 is presumed to be wholly dependent and, therefore, a primary dependent. In this case, the ALJ determined that Maleeka Evans was Hendrix’s daughter and primary dependent.

On certiorari, the superior court reasoned that the fact that Maleeka Evans was born while her mother was still married to a man other than Hendrix raised a strong presumption of legitimacy. Thus, the superior court held that the ALJ was required to determine by clear and convincing evidence that Hendrix was the child’s father.

It is true that only clear and convincing evidence will rebut the presumption of legitimacy when a child is born in wedlock; however, remand is unnecessary in the case sub judice. We find no indication in the record that the ALJ failed to apply the proper standard in his factual determination. Furthermore, we conclude that clear and convincing evidence supports the ALJ’s determination that Maleeka is Hendrix’s biological child.

Collins argues that the ALJ erred in admitting the results of a paternity test, because the report did not meet the requirements of OCGA § 34-9-102 (e) (2). Specifically, Collins emphasizes that the report was not signed by a treating physician, and that no physician or other medical provider testified regarding the issue of paternity.

In order to qualify for admission under OCGA § 34-9-102 (e) (2), a medical report must be signed by a “duly qualified medical practitioner.” The paternity report at issue is signed; however, the signature is illegible, so it is unclear which one of the four persons listed below the signature line signed it. The persons listed include a physician and three laboratory directors designated as Ph.D.s. An individual holding a Ph.D. is not a “medical practitioner” as defined by OCGA § 43-34-20 (3). Therefore, because the evidence does not show that a physician signed the report, the ALJ erred in admitting it under OCGA § 34-9-102 (e) (2).

Decided November 7, 2000

Reconsideration denied December 6, 2000

Shari S. Miltiades, for appellants.

Walter D. Adams, for appellee.

However, such error was harmless, given the independent evidence supporting a finding that Maleeka is the biological daughter of Hendrix. First, there was evidence to rebut the presumption that Maleeka is the daughter of Evans’s former husband, based on the fact that “[a] prerequisite to the strong presumption of legitimacy is that a possibility of access exists.” Carolyn Evans testified that she and Jack Evans separated in 1980, and she swore in an affidavit that their relationship lasted only five months. Evans further testified that she had been living with Hendrix in what she regarded as a common law marriage since 1981. Maleeka was born on November 17, 1982. Clear and convincing evidence demonstrated that Evans and her former husband had no relationship during the time when Maleeka was conceived in 1982. Thus, the ALJ could conclude that the presumption of legitimacy had been rebutted.

Furthermore Evans and two lifelong acquaintances of Hendrix testified that he was Maleeka’s father. The evidence shows that Evans and Hendrix were living together when Maleeka was conceived, and that Hendrix acknowledged Maleeka as his daughter.

Accordingly, we conclude that clear and convincing evidence supports the ALJ’s determination that Maleeka is Hendrix’s biological child and, therefore, his primary dependent.

2. Our holding in Division 1 renders the appellants’ second enumeration of error moot.

Judgment reversed.

Pope, P. J., and Miller, J., concur.

       (Citation omitted.) City of Atlanta Govt. v. Smith, 228 Ga. App. 864, 865 (1) (493 SE2d 51) (1997).

       OCGA § 34-9-13 (d).

       OCGA § 34-9-13 (a) (1), (b) (2) (A).

       OCGA § 19-7-20 (b); In re White, 254 Ga. 678, 679 (1) (333 SE2d 588) (1985).

       (Punctuation omitted.) Rainwater v. State, 210 Ga. App. 594, 596 (5) (436 SE2d 772) (1993).

       See id.


text:
    A00A2071.
    NEILL v. THE STATE.
    (543 SE2d 436)
   Mikell, Judge.

Kevin Glenn Neill appeals his felony conviction for trafficking in methamphetamine. On appeal, Neill argues that the trial court erred by admitting a hotel registration card and Neill’s custodial statements into evidence. Neill also challenges the sufficiency of the evidence. We affirm.

As recognized in cases such as Shabazz v. State, on appeal from a criminal conviction, the evidence is viewed in a light most favorable to the verdict. We do not weigh the evidence or determine witness credibility but only determine whether the evidence is sufficient under the standard of Jackson v. Virginia. The jury’s verdict will be upheld as long as there is some competent evidence, even though contradicted, to support each fact necessary to make out the state’s case.

Viewed in the light most favorable to the verdict, the evidence shows that at approximately 2:00 p.m. on September 17, 1998, Clayton County Sheriff’s Office narcotics agent David Noe and Special Agent Jay Mortenson of the Drug Enforcement Administration followed a suspected drug dealer to a gas station on Old National High■'way. While they observed the suspect, Neill entered the suspect’s car for a brief meeting before going into the store at the gas station. After Neill exited the store, Noe and Mortenson approached him.

Noe asked Neill how he knew the suspect. Neill said he worked with him, but could not remember his name. While Neill was looking through his wallet for identification, Noe asked Neill about a Sumner Suites Hotel card key he saw in Neill’s wallet. Neill said he stayed there the previous night but had since checked out. Noe then asked Neill for permission to search him and his vehicle. Neill consented and signed a waiver and consent to search form. No drugs were found during either search. After completing the searches, Noe asked Neill for his hotel room number from the previous night. Neill said he could not remember, but thought it might have been 203 or 303. Noe then offered to return the room key to the hotel.

Noe and Mortenson released Neill and went directly to the Sumner Suites Hotel, where Noe asked the assistant managér the names of the guests in rooms 203 and 303. When the records showed that Neill had not occupied either room, Noe asked the assistant manager to go through all of the receipts. On the receipt for room 103, Noe noticed an address in Franklin, Georgia, which was where Neill resided. The room was registered under a different name, but the tag number and the description of the vehicle registered to the room matched Neill’s vehicle. Noe and Mortenson then went to room 103.

As they approached the room, a woman approached it as well. After the officers identified themselves and asked to search the room, the woman signed a consent to search form. The officers found what they suspected to be methamphetamine in the drawer of the nightstand, in the tissue dispenser, and in the coffee maker.

Within days, Neill was arrested. After Mortenson read Neill his Miranda rights, Neill told him he paid $15,000 for the drugs and that he intended to sell them. Neill also gave him a phone number for his supplier.

1. On appeal, Neill contends that the state did not lay the proper foundation for the admission of the hotel registration card into evidence as a business record. In support of his contention, Neill relies on the testimony of Chioke Jenkins, a hotel employee, that he was not the custodian of the hotel registration records and did not direct or control the method by which the cards were kept. Neill’s contention lacks merit.

“The business records exception does not require that the person laying the foundation for the admission of business records be the custodian of the records.” Instead, it requires that the record offered to prove an act or transaction be made in the regular course of business and that it is the regular course of business to make the record at the time of the act or transaction.

Jenkins testified that when guests check in, they write their names, addresses, and car information on the hotel registration card and sign the bottom of the card. Additionally, Jenkins testified that it was part of the regular course of business to make the records and they were made in the regular course of business. In light of Jenkins’ testimony, we find that the card was properly admitted.

2. In Neill’s second enumeration of error, he argues that the trial court erred in finding that his statements were freely given and voluntary. Neill contends that his confession to Mortenson was based on the “hope of benefit” that he would not be prosecuted in federal court.

“The standard for determining the admissibility of confessions is the preponderance of evidence. To determine whether the state has proven that a confession was made voluntarily, the trial court must consider the totality of the circumstances.”

During the trial, Mortenson testified that his purpose in interviewing Neill was to determine Neill’s source of supply. When he conducts these types of interviews, Mortenson stated that he always tries to explain the difference between federal and state prison time. During Neill’s interview, he explained this difference. However, he did not promise Neill that he would not pursue a federal prosecution based on anything Neill said.

At the Jackson-Denno hearing, Mortenson testified that he told Neill that he (Mortenson) would decide whether the case “went state or federal.” Mortenson also testified that it was his pattern to disclose this fact. In fact, he told the woman who consented to the search of the hotel room the same thing even though he did not actually interview her. At trial, when asked to explain what defense counsel called an “inconsistency,” Mortenson explained that he did say it was his decision but only to the extent that he had the discretion to decide whether to take the case to the federal prosecutor, who would then decide whether to prosecute it under federal law. Mortenson asked the federal prosecutor to prosecute the case, but he declined to do so.

“Existence of conflicting evidence at a Jackson-Denno hearing as to whether and why a given promise occurred does not automatically cause the trial court’s findings to be clearly erroneous that the confession was freely and voluntarily given.” Furthermore, “[f] actual and credibility determinations pertaining to voluntariness made by a trial judge after a suppression hearing must be accepted by appellate courts unless such determinations are clearly erroneous.”* We find that Mortenson’s pattern of explaining the distinction between state and federal time as well as the extent of his discretion does not equate to a hope of benefit.

Neill’s argument that his statement was not voluntary because he was confused at the time he gave it also fails. Neill contends that Mortenson refused his request for sugar until after he made a statement at the police station, even though Mortenson knew that Neill was hypoglycemic and would become confused without sugar. During the trial, however, there was no evidence that Mortenson withheld sugar from Neill to induce him to give a statement. On the contrary, the evidence was that Neill was responsive and followed Mortenson’s conversation quite well during the interview. Accordingly, in light of the evidence, we affirm the trial court’s finding that Neill’s statement was voluntary.

Decided December 6, 2000

Lee Sexton, for appellant.

Robert E. Keller, District Attorney, Staci L. Guest, Assistant District Attorney, for appellee.

3. In Neill’s third enumeration of error, he challenges the sufficiency of the evidence. Any person in possession of 28 grams or more of methamphetamine commits the felony offense of trafficking in methamphetamine. Neill was in possession of more than 448 grams of methamphetamine. Accordingly, we find that the evidence in this case was sufficient to support the trier of fact’s finding that Neill was guilty beyond a reasonable doubt. Thus, this enumeration is without merit.

Judgment affirmed.

Pope, P. J., and Miller, J., concur.

       229 Ga. App. 465 (1) (494 SE2d 257) (1997).

       443 U. S. 307 (99 SC 2781, 61 LE2d 560) (1979).

        Brown v. State, 237 Ga. App. 761, 762 (516 SE2d 810) (1999).

       The crime lab confirmed that the substance was methamphetamine.

        McBride v. State, 213 Ga. App. 857, 859 (6) (446 SE2d 193) (1994).

       OCGA § 24-3-14 (b).

       We also note that Jenkins specifically remembered Neill because Neill paid to stay another night in a room that was registered under a different name.

       (Citation omitted.) Lee v. State, 270 Ga. 798, 800 (2) (514 SE2d 1) (1999).

        Jackson v. Denno, 378 U. S. 368 (84 SC 1774, 12 LE2d 908) (1964).

        Godson v. State, 197 Ga. App. 315, 316 (1) (398 SE2d 409) (1990).

       (Citation omitted.) Green v. State, 154 Ga. App. 295, 296 (1) (A) (267 SE2d 898) (1980).

       OCGA § 16-13-31 (e).

        Jackson v. Virginia, supra.


text:
    A00A2215.
    CULLERS v. THE STATE.
    (543 SE2d 763)
   Mikell, Judge.

On May 3, 2000, Michael J. Cullers pled guilty but mentally ill to two counts of aggravated assault and one count of obstruction of an officer. In his sole enumeration of error, Cullers contends that his plea was not freely and voluntarily given.

When a defendant challenges the validity of a guilty plea, the State may meet its burden of demonstrating the plea was intelligently and voluntarily entered by two means, (1) showing on the record of the guilty plea hearing that the defendant was cognizant of all of the rights he was waiving and the possible consequences of his plea; or (2) fillting] a silent record by use of extrinsic evidence that affirmatively shows that the guilty plea was knowing and voluntary.

“The most reliable method of perfecting the record is to conduct an inquiry into the defendant’s understanding of the nature and consequences of his plea.”

In this case, the trial judge thoroughly inquired into Cullers’ understanding of the rights he waived by entering a guilty plea. He informed Cullers of his right to a jury trial, the presumption of his innocence, and his right to confront his accusers and to subpoena witnesses to testify on his behalf. The trial judge explained to Cullers that he had a right to testify in his own behalf and that if he chose not to testify, it would not be held against him in any way. In each instance, Cullers indicated that he understood his rights. When asked if he had been threatened or promised leniency in exchange for his guilty plea, Cullers replied that he had not.

It is readily apparent from the record that Cullers was made cognizant of the rights he waived by pleading guilty. Though the record does not show whether he was cognizant of the sentencing consequences of his plea, this lapse does not render his plea invalid. “There is no constitutional requirement that a defendant be advised of the length of his sentence before a court accepts his guilty plea.”

Cullers argues that his plea should be reversed because he entered it solely based upon his counsel’s advice. We note that Cullers does not attempt to recant his admission, made during the plea hearing, that he committed the offenses. “A person cannot avoid the legal consequences of his acts even if based on good faith reliance on the advice of counsel. ... A defendant’s subjective hopes and unfulfilled desires, not induced by the court or state, are not good grounds for attacking the resulting plea and sentence.” When Cullers was asked his plea as to each count charged against him, he responded that he was agreeing with his counsel. The trial judge then asked Cullers if he understood the charges, clarified Cullers’ plea, and asked Cullers if his plea was correct. Cullers did not, at any time, indicate that the plea was incorrect. Accordingly, we find that Cullers’ plea was voluntary.

We next look to OCGA § 17-7-131 (b) (2) to determine whether the trial court erred in accepting the plea. According to OCGA § 17-7-131 (b) (2), a plea of guilty but mentally ill cannot be accepted until the defendant has been examined by a licensed psychiatrist or psychologist, the court has examined the report and held a hearing on the defendant’s mental condition, and the court is satisfied that the defendant was mentally ill at the time of the offense. In Barber v. State, this Court held that the procedural requirements of OCGA § 17-7-131 (b) (2) were fulfilled when the defendant’s plea was taken and a factual basis for the plea was established. In that case, defense counsel obtained an independent psychiatric report and read the defendant’s psychiatric history into the record for the sentencing court’s consideration at the plea hearing.

Decided December 6, 2000.

John W. Sherrer, Jr., for appellant.

Patrick J. McDonough, District Attorney, Richard E. Thomas, Assistant District Attorney, for appellee.

In this case, two psychological evaluations were conducted. The court ordered the first evaluation, and defense counsel requested the second evaluation. The findings from both, which were consistent, were read into the record for the court’s consideration at the plea hearing. Thus, we conclude, as we did in Barber, that the requirements of OCGA § 17-7-131 (b) (2) were satisfied.

Cullers’ final argument is that his plea should be reversed because he was in the Veterans’ Hospital in Alabama on the date charged on the indictment, May 12, 1999. “The general rule is that when the exact date of the commission of the crime is not a material allegation of the indictment, the commission of the offense may be proved to have occurred any time within the statute of limitations.” In this case, Cullers did not deny the incident. Instead, he informed the court that it happened on May 9, 1999. Thus, the error in the indictment does not warrant the reversal of Cullers’ plea. Accordingly, we affirm.

Judgment affirmed.

Pope, P. J., and Miller, J., concur.

       The record reveals that Cullers pointed a gun at two people, then refused to come out of his house when asked to do so by a police officer. For each of the aggravated assault counts, the trial court sentenced Cullers to ten years to run concurrently, with the first year to be served in confinement and the remaining nine years on probation. Cullers received a sentence of twelve months for the obstruction count, to ran concurrent with the two aggravated assault counts.

       (Citation and punctuation omitted.) Morgan v. State, 191 Ga. App. 367, 368 (1) (381 SE2d 583) (1989).

        Clowers v. Sikes, 272 Ga. 463, 464 (532 SE2d 98) (2000).

        Waye v. State, 239 Ga. 871, 876 (2) (238 SE2d 923) (1977).

       (Citations omitted.) Smith v. State, 174 Ga. App. 238, 241 (329 SE2d 507) (1985).

       240 Ga. App. 156 (522 SE2d 528) (1999).

       Id. at 157 (2).

       (Citation and punctuation omitted.) Knight v. State, 210 Ga. App. 63, 65 (2) (435 SE2d 276) (1993).