author: Banke, Presiding Judge.

text:
    A89A1840.
    ABRAHAMSEN v. McDONALD’S CORPORATION.
    (389 SE2d 386)
   Banke, Presiding Judge.

Abrahamsen brought the present action against McDonald’s Corporation seeking to recover approximately $300,000 in damages, plus expenses of litigation, based on the latter’s alleged breach of a series of construction contracts. The trial court granted McDonald’s motion for summary judgment, while denying a motion by Abrahamsen for partial summary judgment. This appeal followed.

Abrahamsen is a shareholder and officer of TBK Builders, Inc. (referred to hereafter as TBK), a general contracting firm which, prior to 1986, performed construction work on various McDonald’s restaurants in the southeastern United States. TBK ceased doing business in February of 1987 and subsequently assigned the present cause of action to Abrahamsen. Abrahamsen seeks damages for 12 separate construction projects which he alleges were wrongfully terminated by McDonald’s.

Pursuant to each of the three form contracts contained in the record, TBK was required to advance payment to its subcontractors and suppliers and to submit sworn certification of such payment prior to seeking reimbursement for these expenditures from McDonald’s in the form of progress payments. McDonald’s was authorized under the provisions of the contracts to terminate TBK’s employment for violation of its obligations and to finish the work by whatever method it might deem expedient. The contracts further provided: “In such case, [TBK] shall not be entitled to receive any payment in excess of reimbursement for his direct expenses ...[;] however, [TBK] shall remain liable to [McDonald’s] for all damages incurred as a result of the breach.”

Abrahamsen acknowledges in his brief that, “[f]rom the very first McDonald’s project, TBK had never been able to pay its subcontractors and material suppliers without first being paid by McDonald’s for the work” and that it had certified all its requests for progress payments “knowing that such certifications were false.” Abrahamsen contends, however, that “McDonald’s acquiesced to this deception and continued to make progress payments to TBK on this basis.” McDonald’s, on the other hand, contends that it had no knowledge of the deception and continued to rely upon TBK’s sworn certifications until December 21,1986, when it was informed by TBK’s president that TBK had exhausted its working capital and was unable to pay its existing debts to its subcontractors and materialmen. Upon receipt of that notice, McDonald’s ceased making payments to TBK, an action which Abrahamsen contends made it impossible for TBK to fulfill its obligations under the uncompleted contracts.

During the first week of January of 1987, McDonald’s conducted an audit of TBK’s books and records, including the unpaid invoices of its subcontractors and materialmen on McDonald’s projects. In a letter dated January 26, 1987, it notified TBK that $210,681.26 in claims by subcontractors and materialmen remained outstanding on McDonald’s projects and instructed the company to settle these claims within five days. Having received no response as of that date, McDonald’s thereupon made or committed itself to making payments to TBK’s subcontractors and materialmen totalling $201,486.67; and it subsequently gave written notification to TBK of the termination of each of the contracts at issue. Held:

1. While the appellant apparently does not dispute that TBK was obligated by the terms of the written contracts to pay its subcontractors and materialmen before receiving progress payments from McDonald’s, he asserts that several of the subject projects (without specifying which) were being performed under parol agreements which did not include the payment and certification conditions contained in the written contracts. We are cited, however, to no evidentiary support for this position. Rather, the record reveals without dispute that both parties intended that these conditions would be applicable to each of the 12 projects involved in the present litigation.

2. We further reject as unsupported by competent evidence the appellant’s assertion that McDonald’s accepted TBK’s falsified certifications, knowing they were false. The only evidence offered by the appellant in support of this contention consists of an averment to that effect contained in the affidavit of TBK’s president. However, no factual basis for this averment was contained in the affidavit, and “[i]t is axiomatic that ‘conclusory allegations by way of an affidavit . . . will not be sufficient to avoid summary judgment.’ [Cit.]” Collins v. West American Ins. Co., 186 Ga. App. 851, 852 (368 SE2d 772) (1988). Thus, the affidavit was insufficient to create a material issue of fact with respect to McDonald’s knowledge of TBK’s deceptive practices. Accord Parlato v. MARTA, 165 Ga. App. 758 (1) (302 SE2d 613) (1983).

3. The appellant contends that factual questions remain as to whether McDonald’s refusal to make further payments to TBK upon learning of its failure and inability to pay its subcontractors and materialmen made it impossible for TBK to perform under the contract. However, assuming that such factual questions do exist, they are not material to the issue of McDonald’s rights and obligations under the contracts. McDonald’s was specifically authorized to consider the contracts terminated if TBK “should fail to make prompt payment to subcontractors or materialmen, for material or labor,” and it is undisputed that McDonald’s did not cease making payments to TBK until after having been notified of the latter’s failure in this regard.

4. The appellant contends that the trial court erred in refusing to grant his motion for summary judgment on his claim for $28,764 in lost profits for McDonald’s alleged breach of a written contract for the construction of a restaurant on Holcomb Bridge Road in North Fulton County, Georgia. This contention is without merit. The parties entered into this contract on December 12, 1986, nine days before TBK disclosed its financial difficulties to McDonald’s. Since McDonald’s was authorized to terminate that contract upon TBK’s violation of any contractual provision, including its inability to pay for materials and labor, the trial court was authorized to conclude as a matter of law that McDonald’s had no liability on this claim.

Decided December 1, 1989

Rehearing denied December 13, 1989.

Donald E. Loveless, for appellant.

Craig K. Pendergrast, John G. Parker, for appellee.

5. The appellant’s remaining enumeration of error is rendered moot by the foregoing.

6. McDonald’s asks that a penalty be imposed against Abraham-sen for bringing a frivolous appeal. “Being unable to discern any reasonable ground upon which the appellant! ] might have anticipated the reversal of the trial court’s judgment, we assess a $500 penalty against the appellant[ ] pursuant to Rule 26 (b) of this court for pursuing a frivolous appeal.” Hulstzman v. State Farm Fire &c. Co., 188 Ga. App. 12, 13 (372 SE2d 9) (1988). The trial court is hereby directed to enter judgment in such amount upon return of the remittitur in the case.

Judgment affirmed with damages.

Sognier and Pope, JJ., concur.


source: Caselaw Access Project

author: Deen, Presiding Judge.

license: Public Domain

text:
    A89A2044.
    VANHOUTEN v. THE STATE.
    (389 SE2d 534)
   Deen, Presiding Judge.

Donald Vanhouten appeals from his conviction of driving under the influence of alcohol.

The evidence showed that on September 25, 1986, the defendant was found slumped over the steering wheel of his car, which had struck a utility pole. The investigating officer noticed that he suffered facial injuries, which were consistent with striking one’s face on the steering wheel. The officer also noticed an odor of alcohol about the defendant. Vanhouten told the officer that he had run off the road to avoid hitting a deer. After Vanhouten was transported to the hospital, the officer investigated the accident and interviewed a woman who had witnessed it. She testified at trial and stated that she saw only one person in the vehicle and that after striking the pole the driver attempted to leave the scene. Further investigation by the officer revealed no deer tracks at the accident scene, that the car had travelled 126 feet on the shoulder of the southbound lane before it crossed the centerline broadside, and that it ran along a ditch for some distance before striking the pole. There was no evidence that the car’s brakes were applied.

The officer went to the emergency room, where the defendant was being treated for his facial lacerations. He arrested Vanhouten for driving under the influence and read him his implied consent rights. Vanhouten refused to take any test that would determine his blood alcohol level. A second officer, who arrived to assist the arresting officer and put the defendant in a patrol car because he had become very foul-mouthed and belligerent, testified that he knew the defendant personally and detected an odor of alcohol about him, and that, based on his personal knowledge of the defendant, he was not behaving normally and appeared to be extremely intoxicated. In order to get the defendant out of the hospital and into the patrol car, the officers had to hook their arms in his, pick him up, and escort him out the door. It was only after his arrest that appellant claimed someone else was driving his car.

1. Appellant first contends that the court erred in denying his motion for a directed verdict of acquittal because the State presented no evidence that the accusation was filed within two years after the date of the offense alleged therein.

The accusation in question does not show a filing date on the space provided for the clerk of the superior court to make this notation. The trial court heard testimony on this issue from the deputy clerk at a pre-trial motion hearing. The clerk testified that an error had been made, that the accusation did not have evidence of filing on its face; but it had in fact been filed as evidenced by the docket number assigned to it and that it had been filed at the November 1986 term. This information appears on the face of the accusation. In November of 1987 a motion for a speedy trial was heard on the case, the case was on the trial calendar, and a notice of appeal on the ruling on the motion shows the docket number.

It is the duty of the clerk of the superior court to see that accusations presented to him by the District Attorney for filing are properly filed in his office. The clerk is also required to maintain a criminal docket which contains a summary record of all accusations filed in his office. See OCGA § 15-6-61. As this case was entered on the criminal docket and the date of this entry was proven to the satisfaction of the trial court, we find no error in denying the motion for a directed verdict on this issue.

2. It was not error for the trial court to refuse to admit the transcript of the testimony of a deceased witness given prior to trial at an administrative hearing before the Department of Public Safety. The hearing was conducted at the defendant’s request.

The issue at the administrative hearing, which was conducted by the Georgia State Patrol, was whether appellant had violated OCGA § 40-5-55 (c) and (d), the implied consent law. The arresting officer appeared as a witness, and no one from the District Attorney’s office appeared on behalf of the State. Indeed, there is testimony from the District Attorney that his office was never notified of the hearing.

OCGA § 24-3-10 permits the introduction of testimony of a deceased witness at a former trial, “which was given under oath on a former trial upon substantially the same issue and between substantially the same parties.” Applying this rule, we find that while the State was a party to the evidentiary hearing in that it was conducted by the Georgia State Patrol, the issue was whether Vanhouten’s driver’s license should be revoked for failure to comply with the implied consent law. Vanhouten offered two witnesses to testify that they had seen him in the presence of another man who was driving his car about one hour before the accident occurred. One of the witnesses died prior to trial.

“[T]he purpose for requiring that the former testimony had been received in a proceeding having substantially the same issue and parties is to ensure that the party against whom the testimony is now offered had an opportunity adequately to cross-examine the witness at the previous proceeding. [Cits.]” Prater v. State, 148 Ga. App. 831, 836 (253 SE2d 223) (1979). This rule does not demand that all the issues or parties be the same but requires only that the issue on which the testimony was offered in the first suit be the same as the issue upon which it is offered in the second. Id.

At the administrative hearing there was prima facie evidence offered that appellant had refused to take any type of test to determine his blood alcohol level. He exercised his right to a hearing on this issue and presented a witness who testified that about one hour before the accident he saw the defendant sitting on the passenger side of his car and that the driver was a third party.

The arresting officer testified that Vanhouten claimed that another person was driving his car only after he was arrested. As the issue in the hearing was solely to determine certain facts concerning the defendant’s refusal to take a chemical test under the implied consent law, which would determine whether his driver’s license would be suspended for six months, the issue was not the same as that for which he was tried. Even assuming that under the rule set forth in Prater, supra, that the issue and even the parties could be considered to be the same, the State did not have the right of cross-examination, which is crucial to the admission of this evidence. The State was not represented at the hearing, and the District Attorney’s office received no notice of it.

3. The general grounds are without merit. From the evidence adduced at trial, we find that a rational trier of fact could find the defendant guilty beyond a reasonable doubt. Jackson v. Virginia, 443 U. S. 307 (99 SC 2781, 61 LE2d 560) (1979).

Decided December 1, 1989

Rehearing denied December 13, 1989

Virgil L. Brown & Associates, Virgil L. Brown, Bentley C. Adams III, for appellant.

W. Fletcher Sams, District Attorney, J. David Fowler, Assistant District Attorney, for appellee.

4. Appellant finally contends that the trial court erred in overruling his motion for a mistrial because the trial judge made improper comments on the evidence to the jury when giving the court’s charge about the accusation having been filed by the District Attorney’s office. The court gave the standard jury charge on the filing of an accusation. We find no error, as this issue was not raised at any point during the trial except in the motion for a directed verdict, which referred to the pre-trial hearing. The court had determined at the pre-trial motion hearing that there was evidence that the case had been docketed and permitted the issue to be joined for trial. The jury was therefore authorized to use the face of the accusation to find that the case had been brought within the statute of limitation. There is no merit in this enumeration.

Judgment affirmed.

Birdsong and Benham, JJ., concur.


text:
    A89A2181.
    WOOD BROTHERS CONSTRUCTION COMPANY, v. SIMONS-EASTERN COMPANY et al.
    (389 SE2d 382)
   Deen, Presiding Judge.

In January 1984 the appellant contractor entered a construction contract with the Georgia State Financing & Investment Commission (GSFIC) to build a wood energy system plant at Central State Hospital. GSFIC earlier had contracted for Simons-Eastern Company to design and supervise the construction of the project. Various change orders and delays caused the construction not to be completed until approximately 6 months past the scheduled date.

There was extensive correspondence between the appellant and GSFIC about the delays and damages. In June 1985 the appellant notified GSFIC of its intent to file a claim for damages caused by all the delays. In early July 1985, GSFIC requested specific information from the appellant regarding any claim for delay damages. On July 30, 1985, the appellant submitted the required statutory affidavit for final payment, qualified by its reservation of its right to file a claim for delay damages and to recover payment for completion of grassing, but GSFIC responded that final payment could not be made until the appellant furnished an unqualified statutory affidavit. GSFIC also indicated that regarding any claim for delay damages, the appellant needed to submit a notice of specific claims. When the appellant did so, GSFIC then informed the appellant that a statement of claim was required under the construction contract.

On October 14, 1985, however, the appellant submitted a request for payment of the $73,308.49 remaining due under the contract. This letter noted GSFIC’s previous refusal to make final payment anyway. On October 30, 1985, GSFIC issued a check for the specified amount, which was delivered to the appellant by the appellant’s surety on the project. Because the appellant’s president was in a meeting at the time and was unable to look at the check, he instructed the surety agent to give the check to the appellant’s bookkeeper, who endorsed and deposited the check. The check provided that it represented “final payment except for the sum of $2000.00 withheld for completion of grassing.” A letter accompanying the check also indicated that the check was tendered in satisfaction of all debts existing under the contract. In December 1985 GSFIC denied the appellant’s subsequent claim for delay damages, asserting that final payment had already been made.

When the appellant was eventually sued by a subcontractor, the appellant commenced this third-party action against GSFIC and Simons-Eastern. The trial court denied Simons-Eastern’s motion for summary judgment on the appellant’s claim for Simons-Eastern’s failure to provide accurate plans, drawings, and specifications for the project, but granted summary judgment for Simons-Eastern on the appellant’s claim for negligent supervision of the construction. The trial court also granted summary judgment for GSFIC, on the basis that accord and satisfaction resulted upon the appellant’s negotiation of GSFIC’s check tendered as final payment. This appeal followed. Held:

1. OCGA § 51-1-11 (a) provides that “no privity is necessary to support a tort action; but, if the tort results from the violation of a duty which is itself the consequence of a contract, the right of action is confined to the parties and those in privity to that contract, except in cases where the party would have a right of action for the injury done independently of the contract. . . .” The appellant’s claim against Simons-Eastern for negligent supervision of the construction arises out of the contract between GSFIC and Simons-Eastern, and is defeated by the lack of privity between the appellant and SimonsEastern. This court and the Supreme Court have recognized an exception to the privity requirement in cases of negligent misrepresentation by a professional, reasonably relied upon by a foreseeable person or class of persons. See Rhodes-Haverty Partnership v. Robert & Co. Assoc., 163 Ga. App. 310 (293 SE2d 876) (1982), aff’d 250 Ga. 680 (300 SE2d 503) (1983). However, as noted by the court in Gulf Contracting v. Bibb County, 795 F2d 980 (11th Cir. 1986), no similar exception has been carved out for a professional’s alleged negligent failure to supervise a project. The trial court properly granted summary judgment for Simons-Eastern on this claim.

Decided December 1, 1989

Rehearing denied December 13, 1989

Edwin V. Gartin, R. Keith Prater, J. Littleton Glover, Jr., for appellants.

Greenfield, Ellis & Bost, John W. Greenfield, John A. Thomson, Jr., Tillman, McTier, Coleman & Talley, John T. McTier, Michael J. Bowers, Attorney General, H. Perry Michael, Executive Assistant Attorney General, Harrison W. Kohler, Roland F. Matson, Senior Assistant Attorneys General, for appellees.

2. The appellant contends that the trial court erred in granting summary judgment for GSFIC on the basis of accord and satisfaction. OCGA § 13-4-103 (b) provides that “[acceptance by a creditor of a check, draft, or money order marked ‘payment in full’ or with language of equivalent condition, in an amount less than the total indebtedness, shall not constitute an accord and satisfaction unless: (1) A bona fide dispute or controversy exists as to the amount due; or (2) Such payment is made pursuant to an independent agreement between the creditor and debtor that such payment shall satisfy the debt.” See Lewis v. Alfred L. Simpson & Co., 183 Ga. App. 166 (358 SE2d 262) (1987).

There is no question in the instant case that a bona fide dispute existed as to the amount the appellant was due altogether, and that GSFIC tendered the check as full satisfaction of all claims asserted by the appellant. The appellant’s acceptance and deposit of the check made upon condition carried with it the acceptance of the condition, and thus worked an accord and satisfaction. Anderson v. Shelby Mut. Ins. Co., 237 Ga. 687, 689 (229 SE2d 462) (1976). The circumstances of the appellant’s endorsement and deposit of the check did not create an issue of fact as to whether there was an understanding that the payment represented full payment of the debt. Cf. Clark Equip. Credit Corp. v. Refrigerated Transport Co., 148 Ga. App. 405 (251 SE2d 321) (1978).

Judgment affirmed.

Birdsong and Benham, JJ., concur.


text:
    A89A2201.
    BEARD v. THE STATE.
    (389 SE2d 384)
   Deen, Presiding Judge.

Donna Sue Beard appeals from her conviction of driving under the influence of alcohol.

1. The trial court did not err in denying Beard’s motion for a new trial based on an assertion that the State failed to prove venue beyond a reasonable doubt.

Venue, like every other material allegation in the indictment, must be proved beyond a reasonable doubt. Where venue is not established any ensuing judgment is invalid, but the reversal of a conviction for failure to prove venue does not act as a bar to retrial in a court where venue is proper and proven. Hernandez v. State, 182 Ga. App. 797 (357 SE2d 131) (1987). Where there is no conflicting evidence, only slight evidence is required to prove venue. The jury determines venue, and its decision will not be set aside if it is supported by any evidence. Jones v. State, 245 Ga. 592, 596 (266 SE2d 201) (1980).

Sgt. Carsten testified that he was employed by the DeKalb County Police Department and assigned to the north precinct at 4453 Ashford-Dunwoody Road, which is located across the street from Perimeter Mall and one block south of Park Place shopping center. He observed Beard run a red light at the intersection of Perimeter Center West and Ashford-Dunwoody Road and saw her vehicle weaving in the roadway as she drove on Perimeter Center West and then onto Perimeter Center Place, where she was stopped. A second officer arrived at the scene and testified that he was a patrolman assigned to the northern district of DeKalb County and his assignment included the Perimeter Mall area. As there was no evidence that the DeKalb County police officers were acting outside the scope of their authority, the State is entitled to an inference that they were acting within the scope of their authority. Hunter v. State, 191 Ga. App. 219, 220 (381 SE2d 525) (1989). We therefore find that there was sufficient proof of venue in DeKalb County to support the jury’s finding.

2. The trial court did not err in refusing to give appellant’s requested charge on circumstantial evidence.

“ ‘An instruction on circumstantial evidence is required only when the case is totally dependent upon circumstantial evidence.’ ” Arnett v. State, 245 Ga. 470, 474 (265 SE2d 771) (1980); DePalma v. State, 228 Ga. 272 (185 SE2d 53) (1971). In the instant case there was direct evidence of appellant’s impaired driving ability (crossing several lanes of traffic without signaling, making a left turn on a red light, as well as appellant’s admission that she had consumed two glasses of wine), and this charge was not mandated. McKeown v. State, 187 Ga. App. 685, 687 (371 SE2d 243) (1988).

Judgment affirmed.

Birdsong and Benham, JJ., concur.

Decided December 1, 1989

Rehearing denied December 13, 1989.

Timothy T. Herring, for appellant.

Ralph T. Bowden, Jr., Solicitor, N. Jackson Cotney, Jr., Andrew T. Rogers, Assistant Solicitors, for appellee.


text:
    A89A2228.
    SOUTHERN ENGINEERING COMPANY v. CENTRAL GEORGIA ELECTRIC MEMBERSHIP CORPORATION et al.
    (389 SE2d 380)
   Deen, Presiding Judge.

Mr. & Mrs. Kneip, not parties to the instant appeal, were injured when a truck owned by Gordon Mobile Home Carriers (also not a party to this appeal) and operated by one of its employees swerved into the path of their automobile in order to avoid striking a utility pole that had fallen into Gordon’s own traffic lane. The Kneips brought a negligence action against the driver and owner; the latter filed a third-party complaint against the pole’s owner, appellee Central of Georgia Electric Membership Corporation (Central), which in turn filed suit against the firm responsible for inspecting the poles, appellant Southern Engineering Company (Southern). The Kneips subsequently named Southern and Central as additional parties defendant, again charging negligence. Neither the Kneips nor Central filed with their respective complaints an affidavit, pursuant to OCGA § 9-11-9.1 (a), setting forth specific acts which constituted professional malpractice on Southern’s part.

In its answer Southern raised the defense of failure to file the affidavits required by the cited Code section and moved to dismiss on this ground. The Kneips, Gordon and its insurer, and Central argued that § 9-11-9.1 (a) is applicable only to medical malpractice actions; that engineering is not recognized as a profession under Georgia law; and that the employee responsible for actually inspecting the poles was not an engineer or a professional of any kind. They further contended that the cited section does not apply to third-party actions and that, moreover, since the defense was not raised until after the statute of limitation had expired for the voluntary dismissal and subsequent renewal of the action, a substantial injustice would be perpetrated if they were not allowed a reasonable time to file amended complaints with affidavits attached. The trial court denied the motion to dismiss, and Southern filed an interlocutory appeal which this court granted. Held:

1. We first address the applicability of OCGA § 9-11-9.1 to the engineering profession and to a third-party defendant. In Housing Auth. of Savannah v. Greene, 259 Ga. 435 (383 SE2d 867) (1989), the Supreme Court, reading the statutory language literally, held that OCGA § 9-11-9.1 applies to a malpractice claim against a member of any profession recognized as such under Georgia law. See OCGA §§ 43-4-1; 14-7-2 (2). In Greene the court held at p. 436: “[P]ersons performing architectural and engineering services are performing professional services, and the law imposes upon such persons the duty to exercise a reasonable degree of skill and care, as determined by the degree of skill and care ordinarily employed by their respective professions under similar conditions and like surrounding circumstances.” See Precision Planning v. Wall, 193 Ga. App. 331 (387 SE2d 610) (1989) (concurring opinion). See also Barr v. Johnson, 189 Ga. App. 136 (375 SE2d 51) (1988), cert. denied 259 Ga. _ (1989).

2. Greene further held, at 437, that the statute is applicable to a third-party complaint, as well as otherwise. Therefore, the statute is applicable to a defendant in the posture of Southern Engineering.

3. We next consider whether the statute can be invoked, as here, by an engineering firm named as a party defendant, as distinguished from an individual so named. This issue was not expressly addressed by the Supreme Court on certiorari. OCGA § 14-7-4 (b) provides that “[a] professional corporation shall engage in the practice of a profession only through its officers, employees, and agents who are duly licensed or otherwise legally authorized to practice the profession in this state.” In the instant case, as in Greene, the fourth-party defendant was not organized as a professional corporation. The holding of this court in Housing Auth. of Savannah v. Gilpin &c. Architects, 191 Ga. App. 400 (381 SE2d 550), on that particular issue applies by analogy to the instant case: “We reject appellant’s argument that the third-party complaint cannot be considered a claim for professional malpractice because it was brought against an entity which is not organized as a professional corporation. By law, a corporation may not be registered to practice architecture but may practice only through registered individuals. OCGA § 43-4-10 (c). Thus . . . the fact that appellee is not a professional corporation as defined by OCGA § 14-7-1 et seq. does not mean it is incapable of committing and being liable for professional malpractice by and through its individual agents.” Gilpin at 401, supra. In the instant case, therefore, the statute was properly invoked.

4. Having established that the statutory requirement does apply to Southern Engineering, and that the affidavits of expert witnesses should have been filed with the complaint, we turn to the allegation that plaintiff’s failure to file such affidavits is a non-amendable defect. In St. Joseph’s Hosp. v. Nease, 189 Ga. App. 239 (375 SE2d 241) (1988), aff’d 259 Ga. 153 (377 SE2d 847) (1989), this court noted at 240 that the Supreme Court had held that a defendant in a malpractice action “had waived the defect created by the plaintiffs’ failure to file the required affidavit contemporaneously with their complaint by waiting until after the statute of limitation had run on the claim to assert the defect.” Moreover, the court, relying on Glaser v. Meck, 258 Ga. 468 (369 SE2d 912) (1988), held that, since the plaintiff had been precluded from voluntarily dismissing the complaint and filing a renewal action, dismissal by the court would be contrary to the principle set forth in OCGA § 9-11-8 (f) that “(a)ll pleadings shall be so construed as to do substantial justice.” Id. at 241.

Decided November 30, 1989

Rehearings denied December 11 and December 13, 1989

Webb, Carlock, Copeland, Semler & Stair, Kent T. Stair, R. Michael Ethridge, for appellant.

Jesse Copelan, Jr., C. Robert Melton, David G. Kopp, Nall, Miller, Owens, Hocutt & Howard, Robert B. Hocutt, for appellees.

In Meck the defendant did not raise the defense of failure to file the required affidavit in his responsive pleading as required by OCGA § 9-11-12 (b), but waited three months and then raised this defense in an amended pleading. By that time the statute of limitation had run. In the instant case, in contrast, Southern raised the defense in its initial pleading, filed August 23, 1988 (18 days after expiration of the statute), in compliance with OCGA § 9-11-12 (b). That Southern was not served until a few days before August 5, 1988, when the statute expired, is the fault not of Southern, but of the plaintiffs.

Thus distinguished on a significant factual point, Meek cannot be relied on by appellees to support the argument that an amended complaint should be allowed because the statute of limitation had run by the time the defense of § 9-11-9.1 was raised. The trial court erred in denying Southern’s motion to dismiss the action for plaintiffs’ noncompliance with the affidavit requirement of the statute.

Judgment reversed.

Birdsong and Benham, JJ., concur.


author: Benham, Judge. Deen, Presiding Judge,

text:
    A89A0836.
    GUNTER v. TULLOT.
    (389 SE2d 338)
   Benham, Judge.

Appellant and appellee were involved in a motor vehicle collision in which both parties sustained injuries. Appellee filed suit against appellant, and a jury found in favor of appellee, awarding her $32,000. Appellant brings this appeal, contending the trial court erred by allowing harmful and prejudicial closing argument by appellee’s attorney to go unchecked.

Inasmuch as the parties did not arrange for the takedown of the closing arguments, the record does not contain a transcript of the offending remarks or the objection made thereto. Although we do not have a transcript or a supplement thereto (see OCGA § 5-6-41 (c)), the trial court made a finding of fact concerning the issue at the hearing on the motion for new trial. The trial court recalled that appellee’s attorney had stated in his closing argument that “[appellant] was out there drunk on the street.” While the trial court’s finding presents to this court the offending remark, the record is still devoid of appellant’s objection to the statement. “When allegedly improper argument is made to the jury, opposing counsel must object at trial or otherwise invoke a ruling of the trial court. Failure so to object constitutes waiver. [Cits.]” Verde v. Granary Enterprises, 178 Ga. App. 773 (5) (345 SE2d 56) (1986). Since “[t]he burden is on the party asserting error to show it affirmatively .by the record [cit.]” (Ragan v. Smith, 188 Ga. App. 770 (2) (374 SE2d 559) (1988) (emphasis supplied)), and the record contains no such showing, we must presume the trial court took the proper action. See Smith v. Manley, 96 Ga. App. 158, 161 (99 SE2d 534) (1957). See also Wright v. Wright, 170 Ga. App. 652 (3) (317 SE2d 888) (1984).

Judgment affirmed.

Birdsong, J., concurs. Deen, P. J., concurs specially.

Deen, Presiding Judge,

concurring specially.

Where improper closing argument is asserted on appeal, “[i]n the face of a silent record, there is a presumption that the court did in fact take proper action, and this court will invoke the presumption that the trial court did its duty and properly instructed the jury.” Wright v. Wright, 170 Ga. App. 652, 655 (317 SE2d 888) (1984). Contrary to the majority opinion, however, the instant case does not involve a silent record.

Although closing argument was not taken down, the transcribed hearing on the motion for new trial certainly provides the allegedly objectionable argument, the fact and nature of the appellant’s objection, and the trial court’s ruling on the objection. Specifically, as recounted on the record by the trial court itself, the argument objected to consisted of the appellee’s counsel’s statement that the appellant was “drunk on the street.” Both parties acknowledge that the appellant objected on the basis that the statement argued facts not in evidence, and the trial court ruled that he could not comment on the evidence. The trial court tacitly agreed with the recollection of the opposing counsel, when he discussed the incident and intimated that in hindsight he would have rebuked plaintiff’s counsel and instructed the jury accordingly. The majority opinion’s invocation of the presumption of proper action is thus inappropriate. I note also that the majority opinion misplaces its reliance upon Verde v. Granary Enterprises, 178 Ga. App. 773 (5) (345 SE2d 56) (1986), where review of the record (which apparently included the closing argument) revealed that the appellant had not objected to the closing argument.

Decided October 30, 1989

Rehearing denied December 14, 1989

Kessler & Parks, Michael A. Kessler, for appellant.

Lawrence J. Hogan, Allen H. Harris, Ronald L. Hilley, for appellee.

Nevertheless, I agree with the affirmance of the trial court. “Although [the appellant’s] counsel made known his objection to the argument and the grounds therefor prior to the court’s ruling thereon, he failed to specify what form of relief he desired in seeking the ruling, hence failed to invoke a reviewable ruling.” Seaboard &c. R. Co. v. Wallace, 227 Ga. 363, 365 (180 SE2d 743) (1971).


author: Beasley, Judge.

text:
    A89A0840, A89A0841.
    TRAVEL AGENCY GROUP, INC. et al. v. HENDERSON MILL TRAVEL, INC. et al.; and vice versa.
    (389 SE2d 511)
   Beasley, Judge.

Appellees Robyn and Edward Uzialko, the owners and sole stockholders of appellee Henderson Mill Travel, Inc. (HMT), a travel agency, negotiated with appellant Pelletier to sell him the accounts and certain assets of their business. Pelletier drafted a purchase agreement for the acquisition, which was rejected by appellees, and a new draft was prepared by their attorney.

Negotiations continued for the next few weeks and various changes were agreed to. The closing of the sale occurred on October 12, 1984, with the execution of agreements, notes, guaranties and covenants. Pelletier and his travel agency, Travel Agency Group, Inc. (TAG), paid $25,000 in cash at closing plus a note to HMT for an additional $35,000 at 10 percent interest payable on January 5, 1985. Pelletier signed as guarantor of TAG’S obligations.

The purchase agreement also provided that following the closing sellers would “transfer and assign the A.T.C. license” to buyers in accordance with the terms and provisions of Paragraph 4. These licenses were issued by the Air Traffic Conference (ATC) to travel agencies as a means to implement standardized and uniform rules and regulations governing the purchase of airline tickets and the payment of the agencies’ commissions. Pursuant to the ATC Manual, all licensed agencies are required to secure their obligations to ATC for the sale of cash tickets, usually by means of a surety bond maintained by the owner of the agency.

At the time of closing, HMT maintained such a bond through Robyn Uzialko. HMT’s license could not be transferred except upon formal approval by ATC, and the surety bond had to remain in effect until ATC approved the transfer of the license. If these or other material obligations imposed by the ATC Manual were violated or breached by a licensed agency, ATC could direct that the agency’s charge plates and ticket stock be removed. Without these a travel agency could neither issue tickets nor receive commissions.

On December 31, 1984, ATC was dissolved and replaced by the Airlines Regulation Commission (ARC), which was operated and regulated in a virtually identical manner. In connection with this changeover, ARC required all ATC licensed travel agencies to execute a transfer card, which would automatically include these agencies as ARC licensees.

Paragraph 4 of the purchase agreement provided: “4. Ownership of A.T.C. and I.A.T.A. Licenses: Purchaser acknowledges that the A.T.C. and I.A.T.A. licenses (the ‘Licenses’) currently utilized by Seller are the property of and registered in the name of Uzialko. For a period of 120 days following the Closing Date, Seller and Uzialko agree to permit Purchaser to operate the Business utilizing the Licenses in the usual and ordinary course of business; provided, however, that Purchaser shall use its best efforts to apply and qualify with the grantors of the Licenses for the transfer of such Licenses to Purchaser as soon as possible following the Closing Date. All expenses borne in connection with such transfer shall be the responsibility of Purchaser but Seller and Uzialko agree to reasonably cooperate in connection with such transfer and assignment. So long as Purchaser operates under such Licenses, Seller, Uzialko and their representatives shall have full access to the books and records of Purchaser in connection with its operation of the Business and use of such Licenses. Such Licenses shall be used only in the usual and ordinary course of business consistent with past business practices of Seller in the operation of the Business. Purchaser shall be responsible and liable for all accounts payable, expenses, losses, damages and monies owed in connection with the operation of the Business under the Licenses after the Closing Date and shall make payment thereof on a timely basis. In the event such Licenses are not transferred to Purchaser within such 120 day period, then Purchaser shall terminate any use of the Licenses upon the expiration of such 120 day period and shall not operate the Business until such time as Purchaser is issued new licenses by the A.T.C. and I.A.T.A. as sufficient and necessary for the continued operation of the Business. Purchaser acknowledges that under the terms of the Licenses, the Licenses may be terminated at any time by the grantors thereof following the Closing and prior to such grantors’ making written consent of the transfer of such Licenses to Purchaser by Uzialko, the Purchaser assumes the full risk of such termination hereunder, except that any loss of, or failure to obtain, said Licenses resulting from the bad faith conduct of Seller or Uzialko shall be deemed a breach of this Agreement for which Seller and Uzialko agree to indemnify and hold Purchaser harmless for all losses and damages resulting therefrom.” (Emphasis supplied.)

Appellants operated the business for the months of October, November and December. Preliminary steps for transfer of the license and security bond were undertaken, but the trial testimony as to what each of the parties did was contradictory. In any event, by letter dated December 4, 1984, the surety company notified HMT and ATC that the bond would be cancelled effective January 15, 1985.

As of January 5, 1985, the date appellants were due to pay the final $35,000 of the purchase price, no transfer of the license had been effected and the surety bond had not been reinstated. At that time, the buyers asserted that the sellers had breached the terms of the purchase agreement by cancelling the surety bond and failing to cooperate in executing the ATC/ARC transfer papers. Sellers demanded payment of the note plus interest, and buyers agreed to pay once the transfer documents were signed and the surety bond was reinstated. Because this did not occur, the bond expired on January 15 and ARC caused HMT’s charge plates and ticket stock to be removed, resulting in a significant negative impact on buyers’ business.

Buyers sought a declaratory judgment as to their rights and liabilities in regard to payment of the $35,000 note, maintenance of the surety bond, and execution of the ATC/ARC transfer papers. They also sought damages for breach of contract and sellers’ allegedly fraudulent alteration of the list of assets of the travel agency to be conveyed. Sellers counterclaimed to recover principal, interest and attorney fees under the note, plus incidental damages involving accounts receivable and payable.

After discovery proceedings and the partial grant of two motions to compel, the case was tried for four days. At the close of plaintiff-buyers’ case the trial court directed a verdict against them on their fraud claim. The jury found for appellees-sellers in the principal amount of the note and interest prior to the date of maturity; it awarded costs and attorney fees pursuant to OCGA § 13-6-11 to appellees’ trial attorney, but not to the firm representing them during the purchase negotiations. Appellants moved for judgment notwithstanding the verdict, or in the alternative for new trial, which was denied. The main appeal (A89A0840) is from the denial of appellants’ motion. The cross-appeal (A89A0841) is brought by appellees from the judgment entered on the jury verdict.

TAG and Pelletier contend that the verdict was a compromise and therefore illegal; that the refusal of the trial court to charge the jury as requested on ambiguity was so erroneous and prejudicial as to require a new trial; that there was no evidence to support the award of attorney fees; that the trial court erred in directing a verdict on their claim of fraud; and that appellees had waived any right to object to production of certain documents sought in discovery by their failure to file timely answers and objections. The cross-appeal protests the inadequacy of the awards of interest and attorney fees.

1. The trial court was correct to refuse plaintiff-purchasers Request to Charge No. 5, which read:

“I charge you that where the terms of a written contract are ambiguous or uncertain, the meaning of those terms must be determined most strongly against the drafter or maker of the contract. In this case, the contracts as issued were prepared by or on behalf of the Defendants and you must construe the terms of those contracts most strongly against the Defendants Henderson Mill Travel, Inc., Edward Uzialko and Robyn Uzialko.” The authority given for this charge is the case of Polk v. Slaton, 54 Ga. App. 328 (187 SE 846) (1936).

First, this charge was not adjusted to the evidence. The particular contract provision at issue here, Paragraph 4, was included in part by seller HMT’s attorney when he drafted a substitute contract for the one originally submitted by purchaser Pelletier, who was an attorney and acting as such in his own behalf. Then the last sentence regarding bad faith indemnification was added at Pelletier’s insistence.

Pelletier even testified, in his cross-examination by sellers’ attorney: “that provision had been negotiated between Mr. Aronin (sellers’ then attorney) and I over a considerable period of time with a clear understanding that that’s what that said. We had two lawyers who sat down with the same thought — . . . .”

Thus the principle of law contained in the submitted charge was inappropriate. Where the legal principle is correct but its recitation is not tailored by the requester to fit the evidence, its rejection by the trial court is not error. Leverett v. Flint Fuel, 183 Ga. App. 75, 80 (4) (357 SE2d 882) (1987), citing Roberson v. Hart, 148 Ga. App. 343, 345 (251 SE2d 173) (1978). The evidence did not conclusively establish as fact that Paragraph 4 was drafted by defendants, so the requested charge was “not precise and apt.” Ga. Power Co. v. Hinson, 179 Ga. App. 263, 269 (6b) (346 SE2d 73) (1986).

In the second place, applying the rules of contract construction, there is no ambiguity in Paragraph 4 which needed jury resolution, insofar as what was at issue was concerned.

“[I]t does not follow from the fact that there are two possible interpretations of a contract that the matter automatically becomes a question for the jury. [Cits.]” Davidson v. Baier Corp., 151 Ga. App. 314 (1) (259 SE2d 707) (1979). “ ‘(W)here no dispute of fact is involved, the construction of a plain and definite contract, if needed, is a matter of law for the court; a contract is not ambiguous even though difficult to construe, unless and until an application of the pertinent rules of interpretation leaves it uncertain as to which of two or more possible meanings represents the true intention of the parties. [Cit.]’ [Cit.]” Taylor v. Career Concepts, 184 Ga. App. 551, 553 (2) (362 SE2d 128) (1987). Thus, the mere fact that the parties here insist that as a matter of law Paragraph 4 either did or did not impose certain obligations on the appellees does not alone create a jury issue.

“If the language of the document was clear and unambiguous, then the trial court was correct in its construction as to its meaning as a matter of law. However, all agreements ‘should be determined according to the usual rules for the construction of contracts. [Cit.] The cardinal rule in construing contracts is to ascertain the intention of the parties. [Cits.]” Crawford v. Crawford, 158 Ga. App. 187, 188 (279 SE2d 486) (1981). Accord Olympic Constr. v. Drywall Interiors, 180 Ga. App. 142 (1) (348 SE2d 688) (1986); Heyman v. Fin. Properties Developers, 175 Ga. App. 146 (332 SE2d 893) (1985). “ ‘There are three steps in the process of contract construction. The trial court must first decide whether the contract language is ambiguous; if it is ambiguous, the trial court must then apply the applicable rules of construction (OCGA § 13-2-2); if after doing so the trial court determines that an ambiguity still remains, the jury must then resolve the ambiguity. [Cit.]’ [Cit.]” Cincinnati Ins. Co. v. Page, 188 Ga. App. 876, 878 (374 SE2d 768) (1988). “ ‘The first requirement of the law relative to contracts is that there must be a meeting of the minds of the parties, and mutuality (cits.), and in order for the contract to be valid the agreement must ordinarily be expressed plainly and explicitly enough to show what the parties agreed upon. (Cits.)’ ” Demer v. Capital City Cable, 190 Ga. App. 40, 43 (378 SE2d 162) (1989). “ ‘Ambiguity in a contract may be defined “as duplicity, indistinctness, an uncertainty of meaning or expression.” [Cits.]’ ” Taylor v. Estes, 85 Ga. App. 716, 718 (1) (70 SE2d 82) (1952).

What did need jury resolution was whether the parties performed their obligations under this provision, taken in context. The much-focused-on factual dispute concerning this paragraph in the contract was two-fold. First was whether the loss of the licenses before the expiration of 120 days was the result of “bad faith conduct” of HMT and particularly Robyn Uzialko, either in not cooperating in the purchaser’s efforts to have the licenses transferred to it, or in cancelling the surety bond required by the grantors of the licenses before the end of the 120-day period. Her testimony was that she did all within her control to effect the transfer, that it was actually within her best interest to do so, and that she cancelled the bond because she had been told by purchaser’s representative it was all right to do so. Purchaser contradicted this evidence.

The other primary dispute concerning this paragraph was whether the Purchaser used its “best efforts” to effect the transfer promptly after the closing and within the 120-day period. Here again, the evidence was in dispute.

The paragraph explicitly and clearly stated that it was purchaser’s responsibility to obtain the transfer and that the seller and Uzialko would “reasonably cooperate” to achieve this. Such is the law even without an express provision, as good faith performance is implicit in every contract. Crooks v. Chapman Co., 124 Ga. App. 718, 719 (3) (185 SE2d 787) (1971). Paragraph 4 did not need a minute description of every step to be taken by each party and the timing thereof to accomplish the clearly intended objective, in order to avoid factual ambiguity.

In sum, what was in dispute was not the meaning of Paragraph 4 but rather its application to the parties’ actions after they agreed to it.

Thirdly, the court amply charged the jury on the principles of contract law and breach and gave several rules of construction “to aid the jury” in its construction of the contract: 1) “. . . the surrounding circumstances of a transaction are always proper subjects of proof to aid the jury in the construction of a contract”; 2) “. . . evidence of known and established usage or custom can be admissible to aid in the construction of a contract”; 3) “. . . both attorneys have suggested and talked about during the closing argument that there is a term concerning bad faith conduct that is contained in the contract. Once again, I am not suggesting to you anything about the terms of the contract or how you should construe the contract, but I think it is appropriate for you to understand, under the law what the term ‘bad faith’ means. ...”

2. The trial court properly directed a verdict against appellants on their fraud claim, which alleged that appellees’ attorney made a false representation to Pelletier at closing which “induced” him to initial, but not to read, a document listing the tangible or physical assets to be included in the sale. Pelletier is an attorney and an experienced businessman and there was no indication that the relationship during negotiations was anything other than an arms-length business undertaking. “One who can read, must read. [Cit.]” Lovelace v. Figure Salon, 179 Ga. App. 51, 52 (1) 53 (345 SE2d 139) (1986). “Misrepresentations are not actionable unless the hearer was justified in relying upon them in the exercise of common prudence and diligence. [Cit.] ‘(I)n the absence of special circumstances one must exercise ordinary diligence in making an independent verification of contractual terms and representations, failure to do which will bar an action based on fraud.’ [Cit.]” Casgar v. C & S Nat. Bank, 188 Ga. App. 234, 235 (1) (372 SE2d 815) (1988).

Decided November 22, 1989

Rehearing denied December 14, 1989

Alston & Bird, Peter Q. Bassett, Elizabeth A. Gilley, for appellants.

Read, Huddleston & Medori, Eugene A. Medori, Jr., for appellees.

3. Appellants also complain of the trial court’s refusal to order certain documents to be produced during pretrial discovery. It appears that some or all of these documents have been “missing” since they were sent by courier from the offices of appellants’ attorneys to Ed Uzialko after having been in their possession for approximately four weeks. Appellants have not identified which of these documents is material to their case, and the trial court entered two orders in connection with production of any documents, correspondence or memoranda related to Robyn Uzialko’s applying for the license and renewing the bond. The court also conducted an in-camera inspection of certain other documents. “Trial courts have broad discretionary powers under the discovery provisions of the Civil Practice Act and appellate courts have consistently refused to interfere with the exercise of a trial court’s discretion except in cases of clear abuse. [Cit.]” Opatut v. Guest Pond Club, 188 Ga. App. 478, 482 (9) (373 SE2d 372) (1988). There is no abuse evident here.

4. We have reviewed the remaining enumerations in the appeal and cross-appeal and find no basis for reversal.

Judgments affirmed.

Carley, C. J., and McMurray, P. J., concur.


author: Pope, Judge.

text:
    A89A1369.
    A89A1370.
    LEHIGH PRESS, INC. et al. v. NATIONAL BANK OF GEORGIA. ANATAR INVESTMENTS, INC. v. NATIONAL BANK OF GEORGIA.
    (389 SE2d 376)
   Pope, Judge.

This appeal involves the claims of three parties (National Bank of Georgia, hereinafter referred to as “NBG”; The Lehigh Press, Inc., hereinafter referred to as “Lehigh”; and Anatar Investments, Inc., hereinafter referred to as “Anatar”) to certain funds which have been paid into the registry of the Fulton County Superior Court.

The underlying facts are not in dispute. The entities named above each assert their rights to the funds because of various debts owing to them by Cable Coupon Associates, (“CCA”) a Georgia Limited partnership, Cable Coupon Network, Inc. (“CCN”) the general partner of CCA or Cable Ventures, Inc. (CVI), an affiliated corporation. From 1981 to 1983, CCA/CCN conducted an advertising service known as the Cable Cash Coupon Program. CCA/CCN had contracts with, inter alia, Bristol-Myers Products and Coca-Cola, USA, Inc., pursuant to which these companies agreed to participate in this program. It is the funds of these companies which have been paid into the registry of the trial court which are the subject of the present controversy.

In December 1981, Anatar, a venture capitalist, loaned CCA $225,000. In order to secure this debt, CCA and Anatar entered into a security agreement giving Anatar an interest in certain property of CCA. In January 1982 Anatar filed a UCC financing statement which purported to cover “All personal property, equipment and fixtures of whatever kind and description now owned by debtor or hereafter acquired.”

Thereafter, NBG loaned $250,000 to CCA, CCN and CVI. This loan or “line of credit” was evidenced by a “Master Note” dated May 25, 1982. According to the deposition of Howard Mendel, Comptroller of CCN and a limited partner in CCA, CCA’s agreement with NBG was such that it could borrow from NBG an amount equal to 80 percent of CCA’s eligible receivables up to $250,000. As security for the loan, CCA & CCN executed a security agreement in favor of NBG, giving it a secured interest in, inter alia, all receivables of the parties. On June 15, 1982, NBG filed a UCC financing statement which covered “All accounts and contract rights of [CCA].” By letter dated June 21, 1982, Anatar agreed to “[subordinate] its interest in . . . [all accounts and accounts receivable] up to the amount of $250,000. relative to [CCA] to . . . [NBG].” On July 15,1982, Anatar filed a UCC-1 statement evidencing the subordination agreement with CCA and NBG.

In September of 1982, Lehigh entered into an agreement with CCN whereby it agreed to manufacture and distribute coupon booklets for CCN. Lehigh sought assurance that it would be paid for the work done and the parties originally entered into an escrow agreement the terms of which are not pertinent here. However, the escrow agreement was eventually terminated and the parties sought another means to provide security to Lehigh. According to the Mendel deposition this situation was discussed with Lance Reising, an officer of NBG, and it was agreed that receivables over and above $250,000 could be used to secure Lehigh’s interest. Specifically, it was agreed that the Bristol-Myers and Coke accounts could be used for this purpose. Thereafter Mendel marked those accounts as “pledged” on the Receivables Aging Document, a document which was provided to NBG and which reflected the amount of receivables CCA/CCN had available to provide to NBG as security for credit extended to it.

CCA/CCN subsequently defaulted on its payment to Anatar, NBG and Lehigh. NBG brought suit against CCA, CCN, CVI, Bristol-Myers, Lehigh and Anatar asserting its right to the funds owing under the Bristol-Myers contract. Bristol-Myers filed a motion for judgment in the nature of interpleader. This motion was granted by the trial court and the funds remaining to be paid under the Bristol-Myers contract were paid into the registry of the court. Subsequently, pursuant to a consent agreement, Coke also paid the monies it owed under its contract into the registry of the court.

NBG filed a motion for summary judgment. Lehigh and Anatar responded to the motion and Lehigh filed a cross-motion. The trial court granted NBG’s motion for summary judgment as to both parties and denied Lehigh’s motion for summary judgment. Both Anatar and Lehigh have filed notices of appeal, which we have consolidated for review.

Case No. A89A1370

1. Anatar contends that it agreed to subordinate its interest in the accounts receivable of CCA only for the first $250,000 loaned and since that amount was repaid, its subordination was not valid as to amounts subsequently loaned pursuant to the line of credit established by CCA with NBG. In this regard, the subordination agreement provides that “Anatar Investments hereby subordinates its interest ... up to the amount of $250,000.00,” and not, as Anatar contends, the initial $250,000 loaned under the line of credit.

Moreover, even if the subordination agreement did not secure the subsequent amounts loaned by NBG, we find that Anatar failed to perfect its security interest in the accounts receivable of CCA/CCN because it failed to include them in the collateral listed in its financing statement. As stated hereinabove, Anatar’s financing statement, as well as its security agreement with CCA included “equipment” and “fixtures” but not accounts. See OCGA §§ 11-9-109 and 11-9-313, respectively. The question then is whether accounts or accounts receivable are encompassed by the phrase “all personal property,” which is also used in the financing statement. OCGA § 11-9-402 (1) provides that “[a] financing statement is sufficient if it . . . contains a statement indicating the types, or describing the items, of collateral.” (Emphasis supplied.) Although the description given in the financing statement, need not be specific, it must “reasonably identify] what is described.” OCGA § 11-9-110. We find that the phrase “all personal property” “fails to indicate the types or describe the items of collateral in which a security interest was taken. . . . [The] failure to identify account as a type of collateral intended to be covered by the financing statement does not place third parties on notice that a security interest was taken in accounts receivable.” Healthcorp v. Southeastern Emergency Healthcare, 85 Bankr. 170, 172 (Bankr. N.D. Ga. 1988). See also In the Matter of Fuqua, 330 FSupp. 1050, 1052 (D. Kan. 1971), 461 F2d 1186 (10th Cir. 1972).

Anatar urges, however, that NBG also failed to perfect its security interest in the accounts because the contracts of Bristol and Coke were with CCN not CCA and CCA was listed as the debtor on the financing statement filed by NBG. Firstly, the contracts show that the Bristol and Coke accounts were “accepted” on behalf of CCA. Moreover, even if the debtor should have been listed as CCN, not CCA, the trial court correctly concluded that this minor error in naming the debtor was not seriously misleading. “In [this case] subsequent creditors would be searching the indexes for a business debtor and a business was actually listed as the debtor. Also in [this case] the first [two names] of the business debtor [were] accurately listed so the inaccuracy did not result in a different indexing. . . . Inconsistencies in the remainder of the business entity listed would at least leave a prudent investor on notice that the business listed was the business debtor in question.” Citizens Bank v. Ansley, 467 FSupp. 51, 54 (M.D. Ga. 1979). Thus we affirm the trial court’s order insofar as it granted summary judgment to NBG against Anatar Investments, Inc.

Case No. A89A1369

2. Lehigh argues that, contrary to the findings of the trial court it and not NBG was entitled to the funds paid into the registry of the court because the evidence shows that NBG agreed to subordinate its interest in the Bristol and Coke accounts in favor of Lehigh. The security agreement between NBG and CCA/CCN provides, in pertinent part that “[CCA] will not sell, transfer, lease, abandon, or otherwise dispose of . . . the collateral . . . except with the prior written consent of [NBG].” (Emphasis supplied.) The only “writing” here between CCA and NBG evidencing the “subordination” was the notation placed on the Receivables Aging Document showing the accounts in question as “pledged.” Lehigh argues that NBG’s failure to object to the document bearing this notation constituted an acceptance by NBG of the subordination agreement. As to this issue, NBG argues that the security agreement also provides that “no forebearance or indulgence shall operate as a waiver. . . .” Lehigh argues, however, that an anti-waiver provision such as the one at issue in this case can itself be waived, and that the question of waiver under these circumstances is for the jury to decide. See, e.g., Smith v. Gen. Fin. Corp., 243 Ga. 500 (255 SE2d 14) (1979); Integrated &c. Systems v. NEC Home Electronics, 174 Ga. App. 197, 202 (329 SE2d 554) (1985).

Decided November 29, 1989

Rehearing denied December 14, 1989

Hicks, Maloof & Campbell, Bruce M. Edenfield, Virginia B. Peterson, for appellants (case no. A89A1369).

Richard Freeman III, Gary G. Agnew, for appellant (case no. A89A1370).

Hurt, Richardson, Garner, Todd & Cadenhead, David W. Cranshaw, Glass, McCullough, Sherrill & Harrold, Robert S. Jones, for appellee.

Assuming arguendo that a jury question does exist as to the issue of waiver, we find the trial court’s order granting summary judgment should nevertheless be upheld, because, as the trial court found, Le-high also failed to perfect its security interest in the accounts. OCGA § 11-9-302 provides, in pertinent part, that “[a] financing statement must be filed to perfect all security interest except . . . (e) [a]n assignment of accounts which does not alone or in conjunction with other assignments to the same assignee transfer a significant part of the outstanding accounts of the assignor.” Here it is undisputed that the Coke and Bristol accounts accounted for 57 percent of CCA’s accounts. Consequently, this constituted a significant portion of the accounts of the debtor and Lehigh, having failed to perfect its security interest in the accounts, cannot now assert priority over NBG’s properly perfected security interest. See Park Ave. Bank v. Bassford, 232 Ga. 216, 218 (205 SE2d 861) (1974).

In sum, we find several bases for upholding the decision of the trial court as to each entity involved here. Consequently, the trial court’s order granting summary judgment to NBG and denying Le-high’s motion for summary judgment is also affirmed.

Judgments affirmed.

Banke, P. J., and Sognier, J., concur.


author: Benham, Judge.

text:
    A89A1471.
    ROBINSON-HUMPHREY COMPANY, INC. v. WILLIAMS.
    (389 SE2d 345)
   Benham, Judge.

We granted appellant’s application for interlocutory review of the trial court’s denial of appellant’s motion to compel arbitration of the lawsuit appellee filed against appellant.

Appellee, after receiving a settlement of a workers’ compensation claim, signed a document entitled “Trust Agreement” in July 1983 whereby appellant would act as trustee of the settlement funds deposited with appellant to be held in appellee’s name. Appellant’s agent signed the document after deleting the references to appellant as “Trustee” and replacing them with the title “Administrator,” and changing the references to appellee as “trustor” to “trustee.” Six days later, appellee signed a “Customer Agreement” in which, in consideration of appellant’s acceptance of his account and agreement to act as his broker, appellee agreed, among other things, that “[u]nless unenforceable due to federal or state law, any controversy arising out of or relating to [appellee’s] accounts, to transactions with you for me or to this agreement or the breach thereof, shall be settled by arbitration. . . .” In July 1988, appellee filed suit against appellant, contending that appellant, by orally accepting and agreeing to the unaltered trust agreement, fraudulently induced appellee to believe it would act as trustee of his funds and that appellee had been damaged by this alleged fraudulent inducement in that the income from the trust was less than that promised and the corpus of the trust had been invaded. Appellee sought in his complaint to rescind the trust agreement and have the corpus and the interest it would have earned under the original trust agreement paid to him. Appellee also alleged in his complaint that appellant committed fraud by making intentional misrepresentations and misappropriating the trust by altering the trust agreement and by taking unauthorized control of the trust principal. Appellant was also alleged to have committed fraud by misrepresenting the nature of the arbitration language contained in the customer agreement, thereby inducing appellee to sign the agreement. Appellee sought damages for appellant’s alleged breach of the trust agreement appellee signed.

“Although Georgia’s policy does not favor ‘all issues’ arbitration clauses, that policy must yield where it conflicts with federal policy as set forth in the Federal Arbitration Act, 9 USCA § 2. [Cits.] The federal statute provides, in pertinent part, as follows: ‘A written provision in . . .a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction . . . shall be valid, irrevocable, and enforceable, save upon such grounds as exist in law or in equity for the revocation of any contract.’ 9 USCA § 2.” Merrill Lynch &c. v. Wilbanks, 162 Ga. App. 154 (290 SE2d 122) (1982). Our initial inquiry is whether the agreements which form the basis of appellee’s lawsuit are contracts evidencing a transaction involving commerce. After reviewing them, we conclude that the trust agreement, whereby appellant allegedly agreed to act as trustee of appellee’s funds, does not evidence a transaction involving commerce. Therefore, 9 USCA § 2 and the arbitration clause contained in the “Customer Agreement” do not require arbitration of the allegations concerning the trust agreement. However, the “Customer Agreement” concerned transactions involving the purchase and sale of securities on national exchanges and therefore involved commerce within the meaning of the Federal Arbitration Act. Paine, Webber &c. v. McNeal, 143 Ga. App. 579 (239 SE2d 401) (1977). Appellee’s allegations based upon the “Customer Agreement” concern fraudulent inducement to enter into the “Customer Agreement” and misrepresentation of the nature of the arbitration clause. Appellee’s claim of fraud in the inducement involves the “Customer Agreement” generally, and appellee did not allege that he had been fraudulently induced to enter into the arbitration clause. The language of the arbitration clause is broad enough to encompass appellee’s claim that the execution of the agreement containing the arbitration clause was procured by fraud, and since that contract involves commerce within the meaning of the Federal Arbitration Act, the allegations concerning the “Customer Agreement” are matters for arbitration. See Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U. S. 395, 406 (87 SC 1801, 18 LE2d 1270) (1967). The trial court erred in failing to compel arbitration of that portion of the proceedings involving the “Customer Agreement.”

Decided November 8, 1989

Rehearing denied December 14, 1989

Peterson, Young, Self & Asselin, David C. Jensen, Joseph M. Ward, for appellant.

Brent J. Savage, Robert B. Turner, Kutak, Rock & Campbell, Jo Lanier Meeks, for appellee.

Judgment affirmed in part and reversed in part.

Deen, P. J., and Birdsong, J., concur.


author: Birdsong, Judge.

text:
    A89A2012.
    GREEN v. THE STATE.
    (389 SE2d 358)
   Birdsong, Judge.

Appellant, Jimmy Davis Green, appeals his conviction and sentence of kidnapping with bodily harm.

Sue S., age 14, was outside her home playing with her baton. It was about 9:00 p.m. and dark. She was grabbed by a tall individual whom she positively identified in court as the appellant. Appellant yanked her, told her to “shut up,” and said he had a gun. He appeared to be reaching for the gun. She was scared.

Sue S. screamed, and appellant said to “shut up” and threatened to kill her. She told appellant she was too young to die, but appellant kept telling her to “shut up” or he would kill her and stuck a knife to her throat. Although she saw the knife, she never saw a gun. When appellant pulled her, he placed the knife against her wrist. Sue S. sustained a small cut on her wrist from the knife, leaving a scar.

At one point, Sue S. threw her baton at appellant and tried to escape. Appellant dragged her between backyards towards a street. Appellant pushed and dragged her by the neck through some bushes. The second time, Sue S. attempted to escape, appellant “pulled [her] shirt, and then he got [her] and . . . stabbed [her]” with the point of the knife. The wound bled just a little bit; it was not a serious wound.

Appellant forced her into an area between a fence and a garage, and told her to take her pants down. A porch light was turned on and off and appellant told Sue S. to move. As they were moving, appellant got down on his knee, as if putting something in his shoe. Sue S. ran screaming toward two approaching people and yelled that appellant was going to kill her. She was taken inside a home and the police were called.

Sue S. affirmatively testified that she had been forced to go with appellant. She believed that he was going to rape and kill her. Although not wounded seriously, she was taken to the hospital and given a tetanus shot.

Luke Ousley was in his home when he heard some screaming. He went outside and saw a man and woman; the woman started to run, she was screaming and “shook up real bad.” He chased the fleeing man, lost sight of him, and then saw a man near a hedge bush and a house. It appeared to be the same man whom he had been chasing. He again pursued, and after a while saw the man lie down between some bushes. He approached the man and told him to “stay right there.” The man stood up; he had a knife in his hand. Appellant moved toward Ousley who hit him believing that appellant was “fixing to cut [him] or something.” Appellant fell backwards and remained on the ground until the police came. Ousley made a positive in-court identification of appellant.

Henry (Charles) Hendrix, who assisted Luke Ousley, identified appellant as the man who was lying on the ground; he witnessed appellant’s subsequent arrest. After appellant’s arrest an open knife was found on the ground approximately where appellant was lying when arrested.

Appellant denied the offenses. He testified, that while walking, he was assaulted by a male in a racially provoked incident. Appellánt pulled his knife to protect himself. He was hit in the back with a stick, and observed several other men in the area. He denied knowingly cutting the girl, but admits he could have cut her as she was at the scene and hit him on the head with her baton. Appellant further admitted to grabbing the girl and threatening that he would harm her unless the men left him alone. Appellant then fled and next remembers being in jail. Appellant admitted that it was his knife that had been placed in evidence. Held:

1. Review of the transcript in a light most favorable to the jury’s verdict reveals ample evidence from which any rational trier of fact could have found beyond a reasonable doubt that appellant was guilty of kidnapping with bodily harm. Jackson v. Virginia, 443 U. S. 307 (99 SC 2781, 61 LE2d 560); Baggett v. State, 257 Ga. 735 (2) (363 SE2d 257).

For purposes of construing OCGA § 16-5-40 (b), “bodily injury is a term of common usage requiring no legal definition,” Smith v. State, 236 Ga. 5 (5) (222 SE2d 357). Thus, “bodily injury” is accomplished, within the meaning of this statute, by inflicting any physical injury upon the victim’s body however slight.

Moreover, we are satisfied that evidence of record exists from which rational factfinders could conclude beyond a reasonable doubt that the victim was both held against her will and asported, as required by law to be found. In this regard, the distance that a victim is carried is not material; any carrying away is sufficient. McGinnis v. State, 183 Ga. App. 17 (1) (358 SE2d 269); see generally Waters v. State, 248 Ga. 355 (9) (283 SE2d 238), cert. den. 463 U. S. 1213 (103 SC 3551, 77 LE2d 1398); Williams v. State, 178 Ga. App. 581 (12) (344 SE2d 247) (asportation however slight suffices); Brown v. State, 132 Ga. App. 399 (2) (208 SE2d 183).

2. Appellant asserts that it constituted cruel and unusual punishment to sentence him to life imprisonment based upon the facts as proven herein.

In Albert v. State, 180 Ga. App. 779 (10) (350 SE2d 490), we stated “[appellant’s argument that OCGA § 16-5-40 (b) violates the Eighth Amendment prohibition against cruel and unusual punishment because it provides for a life sentence in the event there is any bodily injury, regardless of the severity of the injury, is . . . not persuasive.” (Emphasis supplied.) We adhere to this ruling, and find appellant’s enumeration of error to be without merit.

“Courts should not substitute their judgments as to the appropriateness of criminal penalties for those lawfully expressed by the General Assembly. It is only when criminal sanctions fail constitutional standards that the judiciary may concern itself with the substance of sanctions.” Means v. State, 255 Ga. 537 (1) (340 SE2d 612). This enumeration is without merit.

3. Appellant asserts that the trial court erred in requiring him to proceed to trial with only one month to prepare his defense and without giving him adequate time to hire counsel of his choice.

“A motion for continuance is addressed to the sound discretion of the trial court. Absent a showing that it has been abused, that discretion will not be controlled. [Cit.] ‘There is no fixed rule as to the number of days that should, of right, be allowed counsel in a criminal case to prepare the case for trial, but the trial judge, in the exercise of his discretion to grant or refuse a continuance, has to consider the facts and circumstances of each case to determine what the ends of justice require. A statement by counsel for the defendant that he has not had sufficient time to investigate and prepare the defense is a mere conclusion. Questions of this nature must of necessity be entrusted to the discretion of the trial judge.’ ” Hill v. State, 161 Ga. App. 346 (1) (287 SE2d 779).

The trial record reveals no express claim by counsel that he was not prepared to adequately defend his client. In fact, the entire record reflects that counsel performed more than adequately at both the pretrial and post-trial stages. At trial, appellant’s counsel asserted that appellant “has requested that [counsel] be relieved. ... He has requested some time to obtain some private funds to hire an attorney of his own choice. Because of that, it obviously makes it difficult to defend [appellant].” (Emphasis supplied.) At no point did appellant or his counsel assert that appellant’s services actually had been terminated by appellant, and in fact we note that the same counsel is aptly handling appellant’s appeal. Further, the appellant made no express showing as to where he expected to obtain funds, when such funds might be obtained, or that he had contacted any attorney other than his appointed trial defense counsel.

We find that the trial judge did not abuse his discretion in denying appellant’s motion for continuance. Compare Bennett v. State, 186 Ga. App. 832 (1) (368 SE2d 789); Hill v. State, supra, and Pope v. State, 140 Ga. App. 643 (2) (231 SE2d 549).

Judgment affirmed.

Deen, P. J., and Benham, J., concur.

On Motion for Rehearing.

Appellant asserts that this court has erroneously construed or misapplied the principles of proportional analysis found in Solem v. Helm, 463 U. S. 277 (103 SC 3001, 77 LE2d 637). Appellant in essence asserts that the injuries to the victim were so slight that “any victim to a kidnapping would have received no less of a trauma.” We disagree. Moreover, pretermitting any question of the authority of this court to determine the constitutionality of a sentence is the express authority of this court to take those measures necessary and appropriate to protect our judgment (Art. VI, Sec. I, Par. IV, Ga. Const, of 1983). In doing so we are constrained to observe that the circumstances attendant upon this particular offense clearly justify the punishment imposed. Specifically, we note inter alia the following operative facts: the age of the victim, the nature and purpose of the attack, the use of a weapon in the perpetration of the crime, the actual stabbing — albeit slightly — of the young victim, the repeated and obvious serious threats to kill her if she failed to submit to appellant’s nefarious criminal designs, and the state of fear instilled in the youthful female victim.

Decided November 20, 1989

Rehearing denied December 14, 1989

Don E. Snow, for appellant.

W. Fletcher Sams, District Attorney, Anne Cobb, Assistant District Attorney, for appellee.


text:
    A89A0856.
    ROBERTS et al. v. PORTER, DAVIS, SAUNDERS & CHURCHILL et al.
    (389 SE2d 361)
   Beasley, Judge.

Mr. and Mrs. Roberts appeal from a judgment based on stipulated facts presented to the Fulton Superior Court. Although the parties refer to the judgment as having resulted from the court’s consideration of their motions for summary judgment/directed verdict, the court entered judgment pursuant to OCGA § 9-11-52.

The Robertses sold their farm to Sweetwater Farms, Inc., on August 4, 1983. The closing attorney was Joseph Churchill, a partner in Porter, Davis, Saunders, & Churchill.

The Robertses had work performed on a barn on the property. Their contract was with Jimmie Dale Beck d/b/a Custom Farms Building Company. He had been paid in full by the Robertses, but had not in turn paid his subcontractor, North Brothers. He has since filed bankruptcy. North Brothers filed their lien pursuant to OCGA § 44-14-320 et seq. on February 10, 1983. The Robertses contend that the work performed by North Brothers was not satisfactory. On July 29, Mr. Roberts filed a property bond, approved by the clerk, to release the lien.

As a part of the closing, Sweetwater and the Robertses agreed that a portion of the purchase price due to the Robertses in an amount equal to the lien, $5,471.12, plus another $1,000, would be put into escrow with Porter. The closing statement reflected the “Lien to North Bros. Co.” as a miscellaneous item. No written escrow agreement is in the record, but it was stipulated that the $1,000 was to be held until such time as the Robertses could deliver an executed quitclaim deed and that the $5,471.12 was escrowed because of the lien and it would “be used to pay off the debt [to North Brothers] if found to be owing by defendants.” (Emphasis supplied.) The Robertses were the defendants in the Cobb litigation.

On October 21, Sweetwater Farms, represented by Porter, sued the Robertses in Cobb Superior Court, contending that the Robertses had failed to remove the lien, breaching the Sales Contract and entitling Sweetwater to the escrow fund; an order directing the Robertses to provide the quitclaim deed was sought.

The Robertses counterclaimed, contending that the quitclaim deed had been provided and that the lien had been bonded off the property, thereby entitling them to the escrow funds because of Sweetwater’s breach of the contract represented by the Closing Statement containing the escrow agreement.

On October 18, 1985, the Cobb court entered its order after trial. The court found that both Sweetwater and the Robertses agreed for the money to be placed in escrow; that the Robertses disputed the North bill; and that, at the closing, Sweetwater was aware of this dispute.

The Cobb order found that the disputed amount had been paid to North Brothers on August 26, 1983, by delivery of a Porter trust account check in the amount of $5,338 paid to Kutak, Rock & Huie, attorneys for North Brothers. Neither Sweetwater nor its agent Tucker “paid anything to North Brothers out of personal funds, and, therefore, completely fails to prove it’s (sic) contentions in Count One .... The Court further finds that there is insufficient evidence before the Court to decide the disputed North Brothers bill, which was the basis for the lien and the escrow deposit, inasmuch as nothing has been presented from which the Court could make a determination of the value of the work done, if any. Further, a necessary party, the escrow agent, has not been joined by either party, nor filed an inter-pleader in this action. Judgment for the [Robertses] as to Counts One and Two of [Sweetwater’s] petition [based on breach of the Sales Contract]. Judgment for [Sweetwater] on the [Robertses’] failure to prove their counterclaim [based on breach of the escrow contract by Sweetwater].”

This ruling was not appealed, but on December 30, 1985, the Robertses filed their Fulton complaint against Porter, alleging that Porter paid North Brothers without their permission and failed to obtain an assignment of the lien claim making the lien unenforceable and entitling them to the proceeds.

In its answer, filed in February 1986, Porter admitted holding the fund; that the funds had not been delivered to the Robertses; that North Brothers had been paid but denied the necessity of the Robertses’ consent for such a payment; and admitted that the lien claim of North Brothers was no longer an encumbrance on the property.

Thereafter, in March 1987, Porter amended its answer, adding the defenses of res judicata and collateral estoppel and adding its claim for costs and attorney fees, which claim was not available, as OCGA § 9-15-14 did not apply. Vogtle v. Coleman, 259 Ga. 115, 116 (2) (376 SE2d 861) (1989).

The Fulton court held that it was bound by the Cobb order because of privity between Porter and Sweetwater. It further found the Robertses’ argument concerning the lien to be “inappropriate and moot. That issue was litigated in the Cobb County action and disposed of therein.”

1. “ ‘OCGA § 9-12-40 provides that “A judgment of a court of competent jurisdiction shall be conclusive between the same parties and their privies as to all matters put in issue or which under the rules of law might have been put in issue in the cause wherein the judgment was rendered until the judgment is reversed or set aside.” OCGA § 9-12-42 provides that “[f]or a former judgment to be a bar to a subsequent action, the merits of the case must have been adjudicated.” These code sections together set out the basic principles of res judicata in Georgia. For res judicata to act as a bar of a subsequent action, the original and subsequent action must bear certain identical characteristics. The two actions must be between identical parties or their privies, and the cause of action in each suit must be identical. Collateral estoppel, like res judicata, requires identity of parties or privity. However, unlike res judicata, collateral estoppel does not require identity of the claim but only precludes readjudication of an issue already adjudicated between the parties or their privies in a prior action. (Cit.)’ Norris v. Atlanta &c. R. Co., 254 Ga. 684-685 (333 SE2d 835) (1985). ‘Further, the doctrine of res judicata will bar an action “even if some new factual allegations have been made. . . .” (Cits.)’ Williams v. Summit Psychiatric Centers, 185 Ga. App. 264, 267-268 (6) (363 SE2d 794) (1987).” City of Macon v. Pasco Bldg. Systems, 191 Ga. App. 48, 50 (380 SE2d 718) (1989).

The present litigation is between the seller in a real estate transaction and the escrow agent for both seller and buyer. The prior litigation was between seller and buyer, in which the buyer was represented by the escrow agent acting as attorney. There being a difference in parties, it must be determined if Porter was “in privity” with Sweetwater for purposes of res judicata and collateral estoppel.

One serving as an escrow agent is governed by certain principles. .“[I]n a situation such as this, the escrow agent is properly classified as the agent of both parties, rather than as a subagent of only one of the parties with a fiduciary relationship owed solely to that party.” Fickling & Walker Co. v. Giddens Constr. Co., 258 Ga. 891, 895 (1) (376 SE2d 655) (1989). There is in such a situation a contract and privity between the grantor and grantee, and the third party is by mutual agreement constituted escrow agent of both. Fickling, supra at 896.

The escrow agent’s rights and duties are as described by law and by the escrow agreement. Marathon U. S. Realties v. Kalb, 244 Ga. 390, 392 (260 SE2d 85) (1979). The agent’s purpose is only to fulfill the terms of that agreement. “Title [of the escrowed property] remains in the depositor who surrenders his property to the third party, until all conditions of the escrow are accomplished or it is abandoned and he or another receives the property from the depository. [Cit.]” Collins v. Norton, 136 Ga. App. 105 (1) (220 SE2d 279) (1975).

Thus, the escrow agent has no right to the property which he holds but is bound only to treat the property as required by the escrow agreement and the law.

“Of course, parties include privies, usually defined as all persons who are represented by parties and claim under them, the term privity denoting a mutual or successive relationship to the same rights of property [cits.], but not different rights in the same property. [Cits.].” (Emphasis supplied.) Cincinnati &c. R. Co. v. Hilley, 118 Ga. App. 293, 294 (1) (163 SE2d 438) (1968); Smith v. Wood, 115 Ga. App. 265, 268 (4) (154 SE2d 646) (1967).

Laying aside the issue of Porter’s allegiance to both seller and buyer, it is clear from the foregoing that Porter was not in privity with Sweetwater for purposes of res judicata and collateral estoppel. See A. R. Hudson Realty v. Hood, 151 Ga. App. 778, 779 (1) (262 SE2d 189) (1979), overruled on other grounds, Merrill Lynch &c. v. Zimmerman, 248 Ga. 580 (285 SE2d 181) (1981).

2. There is a further impediment to the res judicata/collateral estoppel claim, that of proof. In order to prove res judicata or collateral estoppel, a litigant must introduce those portions of the prior proceeding, duly certified, which are necessary to prove the defense. Boozer v. Higdon, 252 Ga. 276, 277 (313 SE2d 100) (1984). Only the Order of the Cobb court, but not the Complaint and Answer, is certified. Secondly, they do not reveal which issues involved in the present suit, if any, were definitely decided by that court, another requirement. OCGA § 24-7-20; Glen Oak, Inc. v. Henderson, 258 Ga. 455, 456 (1a) (369 SE2d 736) (1988).

The grant of judgment to Porter was error.

3. The next question is whether judgment should have been entered in favor of the Robertses. All agree that the quitclaim deeds for which the $1,000 was escrowed have been delivered, fulfilling this condition of the escrow and entitling the Robertses to judgment on that item. The remainder of the money was escrowed for the sole purpose of satisfying the lien of North Brothers if the Robertses were found to owe the money.

Decided November 20, 1989

Rehearing denied December 15, 1989.

Bannister & Black, Charles C. Black, for appellants.

Churchill & Ferguson, Glenn A. Delk, for appellees.

The lien was filed on February 10,1983, pursuant to the Mechanics & Materialman’s Lien Statute, OCGA § 44-14-360 et seq. The filing of a lien by an unpaid subcontractor, as occurred here, does not mean the lien will automatically ripen into foreclosure of the real property. The lien statutes are strictly construed and strict compliance with them is required. Allied Elec. Contractors v. Kern & Co., 184 Ga. App. 747, 748 (362 SE2d 452) (1987). The contract under which the work was performed must have been substantially complied with and the lien must be filed within three months of completion of the work and in compliance with the statute. OCGA § 44-14-361.1 (a) (1) & (2). Since the prime contractor had filed bankruptcy, North Brothers could have perfected its lien by foreclosing against the property “if filed within 12 months from the time the lien becomes due.” OCGA § 44-14-361.1 (a) (4).

Before such a suit was filed, Mr. Roberts posted a property bond on July 29, 1983, pursuant to OCGA § 44-14-364. The effect of such a bond is to serve as a replacement for the lien. North v. Waffle House, 177 Ga. App. 162, 163 (1) (338 SE2d 750) (1985); Stonepecker, Inc. v. Shepherd Constr. Co., 188 Ga. App. 513 (373 SE2d 295) (1988). After such a bond is filed, “it is still incumbent upon the lien claimant who brings suit against the principal and surety on the bond to prove entitlement to the underlying lien. [Cit.]” North, supra.

After the bond was filed and the lien thereby released, Sweet-water chose for reasons of its own to voluntarily pay North the amount claimed due, the cause of action against the property having been extinguished. Having done so, Sweetwater made it legally impossible for a determination to be made that the Robertses owed any money to North Brothers. The only mechanism for doing so would have been during suit on the bond, but unnecessary payment by Sweetwater obviated that.

Therefore, the Robertses were entitled to the funds which had been paid to them for the property by Sweetwater and placed in escrow by them with Porter for this contingency which is now legally impossible.

Judgment reversed.

Carley, C. J., and McMurray, P. J., concur.