author: Branch, Judge.

text:
    A15A0555.
    AAA RESTORATION COMPANY, INC. v. PEEK.
    (775 S.E.2d 627)
   Branch, Judge.

AAA Restoration Company, Inc. (“AAA”), appeals from an order of the Henry County Superior Court denying AAA’s motion to stay the lawsuit brought against it by Florence Dianne Peek and to compel arbitration of Peek’s claims against AAA. AAA contends that the trial court erred in finding that a corporate misnomer as to the arbitral forum designated in the arbitration clause of the parties’ agreement meant that the arbitral forum was unavailable. AAA further argues that even if the parties’ designated arbitral forum is unavailable, the trial court misapplied our decision in Miller v. GGNSC Atlanta, 323 Ga. App. 114 (746 SE2d 680) (2013), to find that this unavailability rendered the arbitration clause void and unenforceable and that therefore the appointment of a substitute arbitrator pursuant to OCGA § 9-9-7 (b) was not required. For reasons explained more fully below, we agree that the trial court erred in finding the arbitration clause unenforceable and in refusing to appoint a substitute arbitrator. Accordingly, we reverse the trial court’s order and remand the case for entry of an order requiring the parties to arbitrate Peek’s claims against AAA and appointing a substitute arbitrator.

Because “[t]he question of whether a valid and enforceable arbitration agreement exists . . . represents a question of law,” we review de novo a trial court’s order granting or denying a motion to compel arbitration. Yates v. CACV of Colorado, 303 Ga. App. 425 (693 SE2d 629) (2010) (citation and footnote omitted).

The facts relevant to this appeal are undisputed. On July 16, 2013, a fire occurred at Peek’s residence in Newnan, resulting in the destruction of a significant portion of the home. Approximately three weeks later, Peek signed a written agreement (“the Agreement”) with AAA for the demolition of her fire-damaged residence and for the construction of a new home on the same lot. The Agreement contained an arbitration clause, initialed by both Peek and a representative of AAA, which provides:

All disputes arising from or related to this Agreement shall be resolved by binding arbitration in accordance with the Construction Arbitration Association (of Atlanta) according to their Commercial rules. The locale of any such arbitration shall be Atlanta, Fulton County, Georgia. The dispute shall be heard and decided by a single arbitrator selected pursuant to the applicable arbitration rules.

A dispute eventually arose between the parties and in March 2014, Peek filed suit against AAA asserting claims for rescission, fraud, negligent misrepresentation, violations of the Deceptive Trade Practices Toward the Elderly Act (OCGA § 10-1-850 et seq.), violations of the Fair Business Practices Act (OCGA § 10-1-390 et seq.), negligence, intentional infliction of emotional distress, and conversion. Peek also sought declaratory relief, attorney fees, and punitive damages. In its answer, AAA asserted that the trial court lacked jurisdiction, as the Agreement required the parties to arbitrate their dispute. AAA also filed a motion to dismiss for lack of jurisdiction together with a motion to stay the action and compel arbitration. In her response, Peek asserted that the arbitration clause was void and unenforceable because the designated arbitral forum, Construction Arbitration Association (of Atlanta), did not exist. AAA then filed a reply in which it claimed that it intended the Agreement to designate “Construction Arbitration Associates, Ltd.,” as the arbitrator. In support of this assertion, AAA submitted the affidavit of its assistant vice president, Michael McCune. McCune averred that “AAA has always understood the [Agreement’s arbitration clause] to mandate the arbitration of any disputes between the parties to be before Construction Arbitration Associates, Ltd.”; and that “it was the intent of AAA to resolve any disputes between AAA and Peek through Construction Arbitration Associates, Ltd., as that was the pattern and business practice of AAA.”

Following a hearing on the motion to compel arbitration, the trial court denied the same. At the request of AAA, and over the objection of Peek, the trial court certified its order for immediate review. This Court then granted AAA’s application for an interlocutory appeal.

1. AAA first argues that, as evidenced by the affidavit of AAA’s vice president, the arbitration clause simply misidentifies Construction Arbitration Associates, Ltd., as Construction Arbitration Association (of Atlanta). AAA further contends that this Court is free to correct the misnomer in the Agreement’s arbitration clause and require the parties to arbitrate before Construction Arbitration Associates, Ltd. We disagree.

In support of its argument, AAA relies on the rule that “a mere misnomer of a corporation in a written instrument, or in a law, or in a judicial proceeding is not material or vital in its consequences, if the identity of the corporation intended is clear or can be ascertained by proof.” Pinson v. Harts field Intl. Commerce Center, 191 Ga. App. 459, 461 (382 SE2d 136) (1989) (citation, punctuation and emphasis omitted). Applying this rule, we have held that a corporate misnomer in a deed to secure debt or a deed transferring title to real property will not invalidate the deed or otherwise taint the chain of title. See Darling Intl. v. Carter, 294 Ga. 455, 461 (1) (b), n. 3 (754 SE2d 347) (2014) (chain of title showing the grantor’s name as including the word “Southeast” rather than “Southeastern” did not mean that transfer of land from Southeastern Maintenance and Construction, Inc., was invalid); Deutsche Bank Nat. Trust Co. v. JP Morgan Chase Bank, N.A., 307 Ga. App. 307, 310 (1) (a) (704 SE2d 823) (2010) (“[i]t cannot be said that the mere placement of an additional space in the corporate name (i.e., ‘Indy Mac’versus ‘IndyMac’) made the identity of the corporation unclear” and thus “the misnomer did not render the Warranty Deed irregular on its face”). Similarly, where a corporation is a party to a contract, a corporate misnomer contained in the agreement will neither invalidate the contract, deprive the misnamed party of the ability to sue on the contract, nor protect the misnamed party from being sued for breach of the agreement. See Johnson v. Unified Residential Dev. Co., 285 Ga. App. 852, 858-859 (5) (648 SE2d 163) (2007) (use of the name “Unified Residential, Inc.,” in the contracts at issue, rather than “Unified Residential Dev. Co., Inc.,” constitutes “a mere misnomer that does not render [the agreements] unenforceable,” given that the “identity of the corporation was properly proved”); Atlanta Indoor Advertising Concepts v. World Class Fitness, 213 Ga. App. 295-296 (1) (444 SE2d 385) (1994) (corporate misnomer in contract did not bar corporation from suing on that contract); Pinson, 191 Ga. App. at 462 (fact that lease contained a misnomer as to corporate tenant did not relieve corporation of liability thereunder); Hawkins v. Turner, 166 Ga. App. 50, 51-52 (1) (303 SE2d 164) (1983) (fact that contract misidentified the corporation on whose behalf the agent executed the agreement did not render the agent personally liable on the contract as a matter of law).

Notably, in each of these cases, the corporate entity that had been misidentified was a party to the transaction which gave rise to the litigation, as well as being a party to the lawsuit itself. Thus, in each case the evidence was clear as to which corporate entity the parties to the transaction had intended to name in the contract or deed. And the evidence also showed that the misnomer had resulted from a mutual mistake of the parties to the underlying transaction — i.e., that despite the intent of both parties, the contract or deed had misnamed a corporate entity. Such evidence of the parties’ intent is not present in this case.

The corporate entity that was allegedly misidentified (Construction Arbitration Associates, Ltd.) was not a party to the underlying Agreement and is not a party to this dispute. Additionally, there is no evidence that Peek knew of Construction Arbitration Associates, Ltd., or intended to designate that entity, rather than Construction Arbitration Association (of Atlanta), as the parties’ arbitral forum. Thus, we cannot conclude that all parties to the transaction intended the arbitration clause to name Construction Arbitration Associates, Ltd., as the arbitral forum.

Put another way, the relief sought by AAA is not the correction of a corporate misnomer known to all parties to the Agreement. Instead, AAA is seeking reformation of the agreement to have the name “Construction Arbitration Associates, Ltd.” substituted for the name “Construction Arbitration Association (of Atlanta).” To be entitled to reformation of a contract based upon a mistake, however, the party seeking that reformation must show by “ ‘clear, unequivocal and decisive’ ” evidence that the mistake was mutual, rather than unilateral. See MAPEI Corp. v. Prosser, 328 Ga. App. 81, 85 (3) (761 SE2d 500) (2014), quoting Prince v. Friedman, 202 Ga. 136, 138 (1) (42 SE2d 434) (1947). See also Curry v. Curry, 267 Ga. 66, 67 (1) (473 SE2d 760) (1996) (a party may seek reformation of a written contract “ ‘where by mistake of the scrivener and by oversight of the parties, the writing does not embody or fully express the real contract of the parties. The cause of the defect is immaterial so long as the mistake is common to both parties to the transaction.’ ”) (footnotes omitted); OCGA § 23-2-31 (“[e]quity will not reform a written contract unless the mistake is shown to be the mistake of both parties”). Here, the evidence shows only that AAA, as the drafter of the Agreement, made a unilateral mistake when it named “Construction Arbitration Association (of Atlanta)” as the arbitral forum. Accordingly, we cannot reform the contract to reflect that the parties intended to designate Construction Arbitration Associates, Ltd., as the arbitral forum. As explained in Division 2, however, our inability to reform the arbitration clause does not render that clause invalid.

2. Given that the arbitral forum designated in the Agreement (Construction Arbitration Association (of Atlanta)) does not exist, the question is whether the failure of this forum means that the arbitration clause is impossible to perform and therefore unenforceable. AAA argues that the arbitration clause remains enforceable because the contract is governed by the Georgia Arbitration Code, OCGA § 9-9-1 et seq., and section 7 of that statute permits the trial court to appoint a substitute arbitrator. We agree.

The Georgia Arbitration Code (“GAC”) provides that the trial court “shall appoint one or more arbitrators” where the arbitration agreement “does not provide for a method of appointment” or where the method for appointing arbitrators set forth in the parties’ agreement either “fails” or “is not followed for any reason.” OCGA § 9-9-7 (b) (l)-(3). In Miller, 323 Ga. App. 114, we adopted the “integral term vs. ancillary logistical concern” test “for determining whether an arbitration agreement becomes unenforceable where the arbitral forum designated therein is unavailable for any reason” or whether the federal equivalent of OCGA § 9-9-7 “allows a court to name a substitute arbitrator.” Id. at 119-120 (2) (footnotes omitted). Although in Miller we were dealing with section 5 of the Federal Arbitration Act (“FAA”), ******9we find this same test should apply to cases governed by the GAC. Section 5 of the FAA is substantially similar to OCGA § 9-9-7, and as our Supreme Court has explained, “[bjecause our state arbitration code closely tracks federal arbitration law, we look to federal cases for guidance in construing our own statutes.” Brookfield Country Club v. St. James-Brookfield, LLC, 287 Ga. 408, 411-412 (1) (696 SE2d 663) (2010) (citation and punctuation omitted). Moreover, under Georgia law, arbitration is a matter of contract, and therefore an arbitration clause is subject to the ordinary rules of contract interpretation. South Point Retail Partners v. North American Properties Atlanta, 304 Ga. App. 419, 422 (1) (696 SE2d 136) (2010). The cardinal rule of contract construction is to ascertain the intent of the parties, as reflected in the language of the contract. Miller, 323 Ga. App. at 119-120 (2). Andas we explained in Miller, the “integral term vs. ancillary logistical concern” test “is consistent with Georgia contract law, in that it focuses on and requires a court to give effect to the intent of the contracting parties, as evidenced by the contract’s language.” Id. Accordingly, we find that the integral term vs. ancillary logistical concern test applies to arbitration agreements governed by the GAC.

Under this test, “where the language of the agreement reflects that the choice of arbitral forum ‘is an integral part of the agreement to arbitrate,’ then the agreement will be considered void if the forum is unavailable.” Miller, 323 Ga. App. at 119 (2), quoting Brown v. ITT Consumer Financial Corp., 211 F3d 1217, 1222 (II) (A) (3) (11th Cir. 2000). “If, on the other hand, the agreement shows that the selection of a particular forum was merely an ‘ancillary logistical concern,’ [OCGA § 9-9-7] will apply and a substitute arbitrator maybe named.” Miller, 323 Ga. App. at 119 (2). Thus, the question we must decide in this case is whether the arbitration clause reflects that the selection of Construction Arbitration Association (of Atlanta) as the arbitral forum was integral to the parties’ agreement to arbitrate. “In other words, does the language of the [arbitration [clause] indicate that the parties intended to arbitrate their claims only if [Construction Arbitration Association (of Atlanta)] was available to administer that arbitration?” Id. at 120 (2).

Both Peek and the trial court rely on our application of the integral term vs. ancillary logistical concern test in Miller to conclude that the designation of the arbitral forum was an integral part of the arbitration clause at issue in this case. Specifically, citing Miller, the trial court found that because the arbitration clause at issue provides that the parties “shall” arbitrate their disputes “in accordance with the Construction Arbitration Association (of Atlanta) according to their Commercial rules,” the parties “contracted to arbitrate only before Construction Arbitration Association (of Atlanta) — an entity that does not exist.” Thus, the trial court concluded that the appointment of a substitute arbitrator “ ‘would constitute a wholesale revision of the arbitration clause.’ ” (quoting Miller, 323 Ga. App. at 124 (2)). This reasoning gives far too broad a reading to Miller and fails to acknowledge the unique circumstances of that case — circumstances which do not exist here.

In Miller, we found that the selection of the arbitral forum (the National Arbitration Forum or “NAF”), was an integral term of the arbitration agreement for several reasons. First, the arbitration agreement provided “that any disputes between the parties ‘shall be resolved exclusively through binding arbitration’ conducted ‘in accordance with the National Arbitration Forum Code of Procedure, which is hereby incorporated into this Agreement.’’ 323 Ga. App. at 120 (2) (emphasis in original). The NAF Code of Procedure, in turn, provided that “only the NAF” could administer its Code, id., and that if the parties were unable to arbitrate before the NAF or pursuant to the NAF Code (which could be administered only by the NAF), “the parties [were] free to seek legal remedies — i.e., to file a traditional lawsuit.” Id. at 122 (2). We concluded that “[t]he Arbitration Agreement’s use of the mandatory ‘shall’ and the word ‘exclusively,’ together with its express incorporation” of rules releasing the parties from their obligation to arbitrate if the NAF was not available demonstrated “that the parties did not have a general agreement to arbitrate; rather, they contracted to arbitrate only before the NAF.” Id. at 120-121 (2) (emphasis supplied).

The circumstances in this case are markedly different from those in Miller. As an initial matter, the forum designated by the parties in Miller did, in fact, exist; it was unavailable because the NAF had “entered into a consent judgment under which [it] agreed that it would not administer, process, or in any manner participate in any consumer arbitration” after a certain date. Id. at 116 (punctuation and footnote omitted). In this case, however, the designated forum did not exist. This fact, together with the fact that neither party noticed the mistake when initialing the arbitration clause, serves as evidence that the choice of arbitrator was merely an ancillary logistical concern of the parties. In other words, these facts tend to show that the forum named in the arbitration clause was not integral to the agreement to arbitrate. See Inetianbor v. CashCall, Inc., 768 F3d 1346, 1350 (III) (A) (11th Cir. 2014) (“[t]o decide whether the forum selection clause is integral, we must consider how important the term was to one or both of the parties at the time they entered into the agreement”) (citation omitted).

Moreover, although the arbitration clause at issue does employ the mandatory term “shall,” unlike Miller, the parties here did not use the word “exclusively.” Thus, the parties gave no indication that they intended Construction Arbitration Association (of Atlanta) to be the only forum in which they would arbitrate their disputes. This lack of “exclusive intent,” taken together with the fact that Georgia law provides for the appointment of a substitute arbitrator where a designated forum is unavailable, further supports the conclusion that the selection of an arbitral forum was not integral to the parties’ agreement to arbitrate. See Brown, 211 F3d at 1222 (3) (selection of arbitral forum not an integral part of an arbitration clause which provided that any dispute between the parties “shall be resolved by binding arbitration under the Code of Procedure” of a forum that had become defunct by the time the dispute arose; thus, Section 5 of the FAA empowered the trial court to appoint a substitute arbitrator).

Decided July 14, 2015.

Giacoma, Schleicher, Roberts & Daughdrill, Brian E. Daughdrill, Matthew Momtahan, for appellant.

Glover & Davis, Peter A. Durham, for appellee.

Finally, and most importantly, the arbitration clause at issue did not incorporate, by reference or otherwise, any language indicating that if the designated arbitral forum was unavailable, the parties were not obligated to arbitrate their disputes but were instead free to seek traditional legal remedies. Given the circumstances of this case, including the nonexclusive language of the arbitration clause and the fact that it named a nonexistent forum, we find that the designation of the arbitral forum was merely an ancillary concern of the parties; it was not an integral part of the parties’ agreement to arbitrate any dispute that arose out of their Agreement. See Inetianbor, 768 F3d at 1350 (III) (A) (the designation of an arbitral forum is an integral part of an agreement to arbitrate only where it appears that the selection of this forum was “ ‘as important a consideration as the agreement to arbitrate itself’ ”), quoting In re Salomon Inc. Shareholders Derivative Litigation, 68 F3d 554, 561 (III) (2d Cir. 1995). Accordingly, the trial court erred in finding that the arbitration clause at issue in this case was unenforceable.

For the reasons explained herein, we find that the parties have a binding agreement to arbitrate their disputes. Because the designated arbitral forum is unavailable, the trial court shall on remand exercise its authority under OCGA § 9-9-7 (b) to appoint a substitute arbitrator. In so doing, the trial court shall honor those parts of the arbitration clause which require that the arbitration be conducted in “Atlanta, Fulton County, Georgia,” by a “single arbitrator.”

Judgment reversed and case remanded with direction.

Andrews, P. J., and Miller, J., concur.

       In support of its argument that this Court may correct AAA’s mistake in drafting the arbitration clause, AAA also relies on cases holding that a corporate misnomer in a complaint will not invalidate service of process, where service was in fact made on the real party-defendant. See Mathis v. BellSouth Telecommunications, 301 Ga. App. 881, 883 (690 SE2d 210) (2010); Miller v. U. S. Shelter Corp. of Delaware, 179 Ga. App. 469, 471-472 (2) (347 SE2d 251) (1986). We find these cases to be completely inapplicable to cases involving an alleged corporate misnomer in a contract, as their holdings rely on a party’s statutory right to amend his pleadings. See OCGA §§ 9-10-132; 9-11-15 (a).

       Section 5 of the PAA provides:
      If in the agreement provision be made for a method of naming or appointing an arbitrator or arbitrators or an umpire, such method shall be followed; but if no method be provided therein, or if a method be provided and any party thereto shall fail to avail himself of such method, or if for any other reason there shall be a lapse in the naming of an arbitrator or arbitrators or umpire, or in filling a vacancy, then upon the application of either party to the controversy the court shall designate and appoint an arbitrator or arbitrators or umpire, as the case may require, who shall act under the said agreement with the same force and effect as if he or they had been specifically named therein; and unless otherwise provided in the agreement the arbitration shall be by a single arbitrator.
      9 USC § 5.

       This quote is taken from that part of our opinion in Miller that addressed whether the clause in the arbitration agreement specifying the choice of arbitral forum could he severed from the remainder of the arbitration agreement.


source: Caselaw Access Project

author: Ray, Judge.

license: Public Domain

text:
    A15A0566.
    VIDAL v. LEAVELL.
    (775 S.E.2d 633)
   Ray, Judge.

Ashley Leavell filed a complaint against Officer Jose Vidal, Southern Restaurant Management, Inc. d/b/a International House of Pancakes, and Buckhead IHOP, Inc., alleging that Officer Vidal, an off-duty officer hired to provide security at an IHOP restaurant, used excessive force when arresting her. Officer Vidal filed this direct appeal pursuant to the collateral order doctrine seeking review of the trial court’s denial of his motion for summary judgment filed on official immunity grounds. For the following reasons, we reverse the denial of his summary judgment motion.

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. On appeal from the denial or grant of summary judgment, the appellate court is to conduct a de novo review of the evidence to determine whether there exists a genuine issue of material fact, and whether the undisputed facts, viewed in the light most favorable to the nonmoving party, warrant judgment as a matter of law.

(Punctuation and footnotes omitted.) Taylor v. Campbell, 320 Ga. App. 362 (739 SE2d 801) (2013).

The record shows that in the early morning hours of April 23, 2011, Leavell and a friend went to the Buckhead IHOP after having drinks at a bar. After being seated, Leavell noticed Officer Vidal approach a nearby booth and begin to speak to a group of young women seated there. Leavell stated in her affidavit that “I could not hear what was being said, but I saw the officer force himself into their booth and begin pushing two of the women into the wall with the full weight of his body as the women screamed hysterically.” Officer Vidal was engaged in an attempt to arrest the IHOP patrons in the booth. Leavell testified that she began to video the scene with her cell phone because she believed the officer was acting too aggressively. Officer Vidal instructed the women in the booth, and all those around him, to stop touching him. After another officer arrived and appeared to be engaged in stopping the officer from his interactions with the women, Leavell testified that she grabbed Officer Vidal’s shoulder “to get his attention so he would see that [she] was videoing him[,]” and Officer Vidal slapped her in the face. Video footage of the incident reveals that Leavell then violently swung at the officer several times before another officer grabbed her arm. As the other officer was holding her arm, Officer Vidal punched Leavell on the side of the head. Officer Vidal then “threw [Leavell] to the floor, dragged [her] to the front entrance, and handcuffed” her. Leavell was placed under arrest for obstruction and assault. An ambulance was called, and Leavell was evaluated at the hospital. After the incident, Leavell learned that other IHOP customers had videoed the incident and uploaded the videos to YouTube.com.

Leavell filed suit against Officer Vidal for, inter alia, battery, negligence and unconstitutional arrest using excessive force. Officer Vidal filed a motion for summary judgment alleging that the claims against him were barred by the doctrine of official immunity. Without making any findings of fact or conclusions of law, the trial court denied the motion.

Officer Vidal contends that no question of material fact exists as to whether his actions against Leavell were done with malice or with an intent to injure her and, thus, the trial court erred in denying his summary judgment motion on the grounds of official immunity. We agree.

The doctrine of official immunity, also known as qualified immunity, offers public officers and employees limited protection from suit in their personal capacity. Qualified immunity protects individual public agents from personal liability for discretionary actions taken within the scope of. their official authority, and done without wilfulness, malice, or corruption. Under Georgia law, a public officer or employee may be personally liable only for ministerial acts negligently performed or acts performed with malice or an intent to injure. The rationale for this immunity is to preserve the public employee’s independence of action without fear of lawsuits and to prevent a review of his or her judgment in hindsight.

(Citations omitted; emphasis supplied.) Williams v. Pauley, 331 Ga. App. 129, 130 (768 SE2d 546) (2015). Leavell does not dispute that Officer Vidal was engaged in a discretionary act when arresting her, but she argues that he acted with actual malice in striking her and forcibly arresting her. See Valades v. Uslu, 301 Ga. App. 885, 890 (2) (689 SE2d 338) (2009) (“arresting a person for conduct occurring in an officer’s presence is a discretionary act that will not give rise to personal liability unless the officer acted with actual malice or actual intent to cause injur/’) (punctuation and footnote omitted).

To prove that Officer Vidal acted with actual malice or an intent to injure, Leavell must show more than the officer’s ill will toward her. Rather, Leavell “must show that [Officer Vidal] acted with the deliberate intent to commit a wrongful act or with the deliberate intent to harm her.” (Citations omitted.) Anderson v. Cobb, 258 Ga. App. 159, 160 (2) (573 SE2d 417) (2002). Georgia courts have distinguished this actual malice from “implied malice, which ... had been defined to mean conduct exhibiting a reckless disregard for human life.” (Punctuation and footnote omitted.) Phillips v. Hanse, 281 Ga. 133, 135 (2) (637 SE2d 11) (2006).

Selvy v. Morrison, 292 Ga. App. 702 (665 SE2d 401) (2008), is instructive in determining what constitutes malice in the context of an arrest for the purposes of qualified immunity. In Selvy, the plaintiff alleged that she was brutally treated when she was arrested for disorderly conduct. The plaintiff alleged that police officers had come to her house to arrest her fiancé. After they had done so, she used profanity when demanding that they leave her house and locked the door behind them. The officers, also using profanity, decided to arrest her as well and threatened to break down her door if she refused to open it. When she opened the door, the officers grabbed her arm, twisted it behind her back and slammed her face into the wall. An officer kicked her legs out from under her, and in the process, kicked her ten-year-old son in the mouth. Id. at 702-704.

In affirming the trial court’s grant of summary judgment to the officers, this Court rejected Selvy’s claim that the officers acted with actual malice. We held:

In the context of official immunity, actual malice requires a deliberate intention to do wrong and denotes express malice or malice in fact. Actual malice does not include implied malice, or the reckless disregard for the rights and safety of others. A deliberate intention to do wrong such as to constitute the actual malice necessary to overcome official immunity must be the intent to cause the harm suffered by the plaintiffs. Likewise, the phrase “actual intent to cause injur/’ has been defined in a tort context to mean an actual intent to cause harm to the plaintiff, not merely an intent to do the act purportedly resulting in the claimed injury. This definition of intent contains aspects of malice, perhaps a wicked or evil motive.

(Punctuation and footnotes omitted.) Selvy, supra at 704-705. We concluded that “[ejvidence demonstrating frustration, irritation, and possibly even anger is not sufficient to penetrate official immunity, nor is proof of ill will, unless the ill will is combined with the intent to do something wrongful or illegal.” (Punctuation and footnotes omitted.) Id. at 706. Although the officers “may have shown poor judgment ... and reckless disregard for the rights and safety of others[,]” id. at 705, there was no evidence of actual malice when officers were at the plaintiff’s home to effectuate a valid arrest warrant for her fiancé, there was evidence to support her arrest for disorderly conduct, and because “the right to make an arrest necessarily carries with it the right to use some degree of physical coercion[.]” (Punctuation and footnotes omitted.) Id. at 706.

Similarly, in Tittle v. Corso, 256 Ga. App. 859, 860-862, 862-863 (1) (569 SE2d 873) (2002) (whole court), this Court held that an officer’s threats, use of profanity, and act of slamming a motorist against his vehicle were insufficient to establish actual malice. In Iblades, supra, this Court held that an officer did not exhibit actual malice when he, after arguing with plaintiffs during a traffic stop, pulled one plaintiff’s hair, lifted her up while handcuffed so as to cause soreness in her shoulder and pointed a weapon at her neck, or when the officer asked the other plaintiff if he wanted to die and kicked him in the knee because the officer’s actions showed an effort to restrain an uncertain situation rather than a deliberate intent to commit a wrongful act. Id. at 886-887, 892 (2).

“Police officers are often forced to make split-second judgments —in circumstances that are tense, uncertain, and rapidly evolving— about the amount of force that is necessary in a particular situation.” (Punctuation and footnote omitted.) Valades, supra at 891-892 (2). Accord Tittle, supra at 863 (1) (“The right to make an arrest or investigatory stop necessarily carries with it the right to use some degree of physical coercion or threat thereof to effect it”) (punctuation and footnote omitted). Although we do not condone the officer’s actions in this case, we do not find that the evidence creates a jury question concerning whether Officer Vidal exhibited actual malice toward Leavell. Leavell does not dispute that Officer Vidal was engaged in an attempt to arrest an IHOP patron who refused to leave the premises when Leavell came over to videotape the scene. Officer Vidal testified that Leavell’s arrest was based on simple assault and obstruction because she was “grabbing on” him while he was attempting to arrest another IHOP patron and because she swung at him several times. “Our task is not to decide, with the benefit of hindsight, what [Officer Vidal] should have done. We are concerned only with whether [his] behavior showed a deliberate intention to commit a wrongful act.” (Punctuation and footnote omitted.) Selvy, supra at 707. Because there was no evidence to support a finding of actual malice, the trial court erred in concluding that Officer Vidal was not entitled to official immunity and in denying Officer Vidal’s motion for summary judgment.

Decided July 14, 2015.

Robert N. Godfrey, Tamara N. Baines, LaShawn W. Terry, Veronica L. Hoffler, for appellant.

The Orlando Firm, Craig T. Jones, for appellee.

Judgment reversed.

Barnes, P. J., and McMillian, J., concur.

       Official immunity, like sovereign immunity, “is an entitlement not to stand trial rather than a mere defense to liability.” (Citation and punctuation omitted.) Taylor v. Campbell, 320 Ga. App. 362, 363, n. 3 (739 SE2d 801) (2013). Our appellate courts have
      held that an order denying such an immunity claim is appealable under the collateral order doctrine because the order conclusively determines the disputed question, resolves an important issue completely separate from the merits of the action, and is effectively unreviewable on appeal from a final judgment.
      (Citation and punctuation omitted.) Id. Leavell’s motion to dismiss on the grounds that this appeal did not fall under the collateral order doctrine is denied. See City of Atlanta v. Shavers, 326 Ga. App. 95, 97 (2) (a) (756 SE2d 204) (2014).

       Although Leavell and Vidal’s recitations of the events differ to a degree as to the characterization of Leavell’s first instance of touching the officer and her subsequent swings at him, this Court must rely upon facts as depicted by the videotape. See Scott v. Harris, 550 U. S. 372, 378-381 (HI) (A) (127 SCt 1769, 167 LE2d 686) (2007).


text:
    A15A0645.
    SAFARI et al. v. RES-MS BAYFRONT, LLC et al.
    (775 S.E.2d 637)
   Branch, Judge.

Two LLCs ■— RES-MS Bayfront, LLC, and RES-GA Bay Saint Louis, LLC — that had outstanding judgments against Michael and Donna Safari filed suit against the Safaris and two Safari related entities, seeking to set aside six allegedly fraudulent property transfers. The trial court granted summary judgment in favor of the LLCs and denied the defendants’ cross-motion. As a part of its decision, the trial court excluded Michael Safari’s testimony regarding the value of the properties on the ground that the defendants failed to timely identify him as an expert witness. Because we find that the trial court erred by excluding Safari’s testimony, we reverse.

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). We review a grant or denial of summary judgment de novo and construe the evidence in the light most favorable to the nonmovant. Home Builders Assn. of Savannah v. Chatham County, 276 Ga. 243, 245 (1) (577 SE2d 564) (2003).

The undisputed facts show that on September 5, 2013, based on a March 2006 promissory note and related guarantees, RES-MS obtained a judgment against the Safaris and others in an amount in excess of $3 million. And on December 23,2013, based on a November 2006 promissory note and related guarantees, RES-GA obtained a judgment against Michael Safari and others in an amount in excess of $11 million. Several months before these two judgments, RES-MS and RES-GA filed the present action seeking to set aside six property transfers by the Safaris alleged to be fraudulent under the terms of the Georgia Uniform Fraudulent Transfers Act, OCGA § 18-2-70 et seq. (the “Act”).

On September 26, 2013, the trial court entered a scheduling order providing that discovery would end January 15, 2014, and directing that the defendants identify expert witnesses by a certain date:

Disclosure of the names and opinions of the Defendant^’] (whether in the case-in-chief, in counterclaim, in cross-claim, or in rebuttal) expert witnesses, if any, must be made no later than December 16, 2013. The disclosure shall include the names, subject matters, substance of facts and opinions, and a summary of the grounds for each opinion with respect to which any expert is expected to testify at trial on issues to which the party bears the burden of proof.

The scheduling order did not demand the identification of any other witnesses. It appears from the record that the defendants did not identify any expert witnesses by the deadline.

Following discovery, the parties filed cross-motions for summary judgment, and on June 20, 2014, the trial court entered an order granting the plaintiffs’ motion and denying the Safaris’. In its order, the court addressed, among other things, the Safaris’ defense that the properties could not be considered “assets” subject to the Act because they were fully encumbered by debt and the Act only governs the transfer of assets to the extent they are not encumbered. See OCGA § 18-2-71 (2) (A) (assets do not include “[p]roperty to the extent it is encumbered by a valid lien.”) (emphasis supplied); 18-2-71 (16) (“ ‘[transfer’ means every mode... of disposing of or parting with an asset...”); Target Corp. v. Amerson, 326 Ga. App. 734,740 (1) (d), n. 22 (755 SE2d 333) (2014) (where the fair-market value of the property is less than the encumbrances on the property, the property is not considered an asset under the Act). The court then analyzed the value of the six properties and found that each had more value than its associated indebtedness and that therefore “the properties in question are ‘assets’ as that term is defined in the Act.” In addressing that question, however, the trial court excluded any testimony by Michael Safari as to the value of the six properties on the ground that the defendants had failed to identify him as an expert witness by the deadline given in the scheduling order. The court went on to find undisputed evidence to support the plaintiffs’ claim that the properties were fraudulently transferred. Accordingly, the trial court granted summary judgment in favor of RES-MS and RES-GAon their claims of fraudulent transfer of the six properties.

The appellants contend the trial court erred by excluding Safari’s testimony. We agree. Although trial courts have broad discretion to control discovery, the trial court’s decision to exclude Safari’s testimony was erroneous as a matter of law. Georgia law provides that nonexperts may testify as to value:

Direct testimony as to market value is in the nature of opinion evidence. A witness need not be an expert or dealer in an article or property to testify as to its value if he or she has had an opportunity to form a reasoned opinion.

OCGA § 24-7-701 (b). The Code section expressly provides that the witness “need not be an expert” to so testify. Id. Michael Safari therefore was authorized to testify as to the value of the six properties without being an expert. It follows that the trial court’s scheduling order requiring the defendants to identify expert witnesses by a certain date cannot be construed as requiring the defendants to identify Michael Safari as an expert witness. The trial court therefore erred as a matter of law by excluding Safari’s testimony for that reason. The case of Goodman v. Lipman, 197 Ga. App. 631, 632 (399 SE2d 255) (1990), cited by the LLCs, is not on point in that it concerned the question of whether an alleged expert was properly qualified. Further, in Goodman this Court reversed a trial court’s disqualification of an expert because the trial court based its decision on a ground not supported by law. Id.

The LLCs counter that even if the trial court so erred, the exclusion of the testimony is not reversible error. They argue that Safari’s testimony is conclusory and self-serving. We disagree. First, the trial court made no such finding. Second, Michael Safari tendered an affida vit and was deposed. In his deposition, he testified as to the value of the Ballybunion property based on tax appraisals and recent sales that he had seen. In his affidavit, he opined as to the fair market value of five of the properties at different relevant points in time based on a “thorough knowledge of sales in the area, having experience in buying and selling real estate, and reviewing the tax valuations for [the property].” Thus, Safari showed that he had an “opportunity to form a reasoned opinion” as required by OCGA § 24-7-701 (b). Cf. Maree v. ROMAR Joint Venture, 329 Ga. App. 282, 295 (6) (a) (763 SE2d 899) (2014) (witness’s testimony that she based her opinion as to value on “rental rates in the area, information from appraisals, and (her) knowledge of the commercial real estate market in the area,” was sufficient to show that she had an opportunity to form a correct opinion as to value, the standard under the law prior to the effective date of the new Evidence Code — July 1, 2013); In re Estate of Hubert, 325 Ga. App. 276, 286 (6) (750 SE2d 511) (2013) (testimony that witness “was familiar with the properties at issue, in which he had an ownership interest, and that he also was familiar with comparable properties, which he had considered in reaching his opinion” provided a sufficient foundation under former law).

Decided July 14, 2015.

Wagner, Johnston & Rosenthal, C. David Johnston, S. Bradley Shipe, for appellants.

Schulten, Ward & Turner, Kevin L. Ward, J. Zachary Zimmerman, for appellees.

Because the critical issue below concerned the value of the properties, and because evidence regarding that value was improperly excluded, we reverse the grant of summary judgment in favor of the LLCs.

Judgment reversed.

Andrews, P. J., and Miller, J., concur.

       The alleged fraudulent transfers involved the following properties: (1) 1811 Ballybunion Drive, Duluth, Georgia; (2) 1176-1182 Old Roswell Road, Alpharetta, Georgia; (3) 1168-1174 Old Roswell Road, Alpharetta, Georgia; (4) 6183 Ellis Street, Douglasville, Georgia; (5) 2150 Memorial Drive SE, Atlanta, Georgia; and (6) a Florida condominium.

       Former OCGA § 24-9-66 provided: “Direct testimony as to market value is in the nature of opinion evidence. One need not he an expert or dealer in the article in question hut may testify to its value if he has had an opportunity for forming a correct opinion.”


text:
    A15A0670.
    SMITH et al. v. WILLIAMS et al.
    (775 S.E.2d 639)
   Ray, Judge.

This case stems from the breakup of a law firm, Smith, Hall & Williams, LLR Luanne Bryant Smith and Luanne Bryant Smith, P.C. (collectively “Smith”) filed this direct appeal from three trial court orders entered in a suit between Smith and her onetime law partner, Jennifer E. Williams, and Jennifer E. Williams, LLC (collectively ‘Williams”). For the reasons that follow, we affirm in part and reverse in part.

The firm handled domestic, personal injury, and workers’ compensation cases, among others. In November 2012, Williams alleges that, without notice, Smith packed up her things, took case files, and left the office. After Smith left, Williams sued, seeking dissolution of the partnership and alleging breach of contract. She also moved for an injunction. The portion of their dispute that is before this Court turns primarily on issues related to a division of the fees earned from certain workers’ compensation cases where the clients elected to retain Smith as their counsel after Smith and Williams ceased practicing together. Williams seeks 50 percent of those fees.

1. Smith contends that the trial court erred in denying her motion to dismiss for lack of subject matter jurisdiction. The gravamen of Smith’s argument is that this case involves a dispute over attorney fees in workers’ compensation cases and that the State Board of Workers’ Compensation (the “Board”) has exclusive jurisdiction over such disputes. The trial court did not err.

We review a trial court’s ruling on a motion to dismiss de novo. Aetna Workers’ Comp Access v. Coliseum Med. Center, 322 Ga. App. 641, 644 (1) (746 SE2d 148) (2013). An examination of the nature, jurisdiction, and authority of the Board is instructive here.

The Board is a “creature of statute” with only the jurisdiction, power, and authority conferred upon it by the General Assembly. See OCGA § 34-9-40 (“The [B]oard shall have full authority, power, and the duty to promulgate policies, rules, and regulations for the administration of this chapter.”)____ The Board performs all the powers and duties relating to the enforcement of the Workers’ Compensation Act (the “Act”), and the Act shall be liberally construed only for the purpose of bringing employers and employees within the provisions of this chapter and to provide protection for both.

(Citations and footnote omitted; emphasis supplied.) Id. See also OCGA § 34-9-58.

The action between Smith and Williams is clearly not one between an employer and an employee within the Act’s provisions. However, this Court has recognized that the Board also has jurisdiction to resolve ancillary issues relating to an employee’s compensation rights under the Act. See Builders Ins. Group v. Ker-Wil Enterprises, 274 Ga. App. 522, 523-524 (2) (618 SE2d 160) (2005) (if a dispute is ancillary to an employee’s right, the Board has authority to act; when the rights of an employee in a pending claim are not at stake, the Board may disavow jurisdiction when, for example, the dispute is over an insurer’s duty to pay a particular share of an award but the award itself is not under attack).

The question here is whether Williams’ claims against Smith are ancillary to the determination of the rights of the employee-claimants since attorney fees are at issue, thus falling within the Board’s exclusive jurisdiction. While it is true that specific claimants are referenced in these cases, neither party points to any claimant

whose claim of benefits would be affected by [the] resolution of [Williams’] claim against [Smith], Accordingly, we do not find these allegations implicate the benefits to be paid to any individual injured employee, but instead allege a systemic failure within [the erstwhile law firm of Smith, Hall & Williams].

Aetna, supra at 645 (1).

It is true that OCGA § 34-9-108 (a) requires Board approval of attorney fees in excess of $100 and limits attorney fees to 25 percent of a claimant’s award. However, the statute by its own terms clearly deals with the Board’s protection of the rights of employee-claimants in relation to their attorneys rather than the rights of one attorney in relation to another attorney.

The State Board of [Workers’] Compensation has authority to examine and approve contracts between claimants and their counsel as to the amount of [attorney] fees but it has no authority, statutory or otherwise, to set the fees of the attorneys, or to examine and approve contracts between attorneys as to the division of their fees when associated to represent claimants.

(Citations omitted; emphasis supplied.) Feldman v. Edwards, 107 Ga.App. 397, 397 (1) (130 SE2d 350) (1963). The trial court did not err.

2. Smith argues that the trial court erred in denying her motion for partial summary judgment.

On appeal from the grant or denial of summary judgment, this Court applies a de novo standard of review. Summary judgment is proper when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. We must view the evidence, and all reasonable inferences drawn from it, in the light most favorable to the nonmovant. Woodcraft by MacDonald v. Ga. Cas. and Sur. Co., 293 Ga. 9, 10 (743 SE2d 373) (2013).

Smith alleges that Williams was notified, in writing and by September 19, 2013, at the latest, that claimants in the contested cases had terminated Williams’ services. She argues that because Williams failed to file attorney fee liens on these cases with the Board in accordance with State Board of Workers’ Compensation Rule 108 (e) (“Board Rule”), she has waived any claim for fees in the contested cases.

It is undisputed that Williams did not file attorney fee liens with the Board in the disputed cases. When an employee and his or her attorney terminate their contract as outlined below, Board Rule 108 (e) provides, in pertinent part:

An attorney of record who chooses to file a lien for services and/or expenses must do so by filing written notice of the contended value of such services and/or expenses with the Board ... within 20 days after (i) withdrawal from the case, or (ii) notice of termination of the contract in writing by the client. . . . Failure to perfect a lien in this manner will be considered a waiver of further attorneys’ fees.

The trial court, however, denied Smith’s motion for partial summary judgment, finding, in a narrowly tailored order, that “several cases settled prior to the ‘termination’letters sent by [Smith] and that said cases are assets and . . . are for a determination at a final trial.” (Emphasis supplied.)

Viewing the facts in the light most favorable to Williams as the nonmovant, the cases the trial court references were assets and as such may be subject to enforcement through the partnership agreement because there remains a material factual dispute as to when the partnership terminated. Smith argued that the partnership ended when she left the office November 24, 2012. Williams argued that the partnership was not terminated merely by Smith’s leaving the office, and there is evidence that the parties split fees even after the date that Smith alleges the partnership ended. There also is evidence that as of June 16, 2014, the partnership affairs had not been wound up. See OCGA § 14-8-30 (“On dissolution the partnership is not terminated, but continues until the winding up of the partnership affairs is completed”). As a result, and as determined by the trial court, in an action such as this that seeks to end a partnership, the determination of the value of assets and liabilities is properly reserved until the main determination of the case. Rogers v. McDonald, 224 Ga. 599,601 (1) (163 SE2d 719) (1968). See generally Jordan v. Moses, 291 Ga. 39, 41 (727 SE2d 460) (2012) (“Apartner may not dissolve a partnership to gain the benefits of the business for himself, unless he fully compensates his co-partner for his share of the prospective business opportunity”) (citation omitted).

Contrary to Smith’s argument, the trial court’s order by its own terms does not cover cases in which the contingency justifying the fee had yet to be earned, as the cases covered by the order were previously “settled,” so Smith’s reliance on The Eichholz Law Firm v. Tate Law Group, 310 Ga. App. 848, 850-853 (1) (714 SE2d 413) (2011) is misplaced. The trial court did not err.

3. Smith argues that the trial court erred in granting Williams’ motion to have Smith place additional attorney fees in trust because doing so modified a prior consent order for an interlocutory injunction that required each party to place 50 percent of attorney fees from contested cases in escrow.

The granting and continuing of injunctions shall always rest in the sound discretion of the judge, according to the circumstances of each case. The discretion of the trial judge is a discretion based on the law and the evidence before him. A petition to modify an interlocutory injunction cannot be granted in the absence of a meritorious showing that such modification should be made.

(Citations and punctuation omitted.) Kelley v. Kelley, 228 Ga. 639, 640 (187 SE2d 284) (1972). OCGA § 9-5-8 (granting and continuing injunctions rests in the sound discretion of the trial court and should not be used other than in clear and urgent cases).

The initial injunction required that 50 percent of attorney fees from specific listed cases be deposited in trust accounts and not disbursed except by written agreement of the parties and their lawyers, or by court order. Williams sought a modification to add in fees from two other cases, the Dishman case and the Keller case, which had settled and from which fees had been disbursed to Smith’s operating account prior to the initial injunction.

In the modification order appealed from, the trial court determined that Smith was “about to settle a large case” and should place “those funds in trust” to apply to “one-half of the fees,” specifically on the Dishman and Keller cases, within ten days of the entry of the order. Smith filed a motion for clarification, and the trial court entered a new order identifying the “large case” as the “Jose Hernandez” case, and requiring Smith to place $43,750 from that case in trust within ten days of the time Smith received the funds. The trial court specified that the $43,750 was the amount that Williams claimed she was entitled to from the settlement of the earlier Dishman and Keller cases. As Smith points out, Williams’ claim to half the fees in the Hernandez case already is protected by the original injunction. The clarification order would essentially have Smith deposit additional money from the Hernandez case, once it settles, in order to protect Williams as to the unrelated Dishman and Keller cases.

However, an exhibit attached to the motion for clarification is an e-mail from counsel for Hernandez’s employer stating that the employer “has elected not to settle the claim at this juncture.”

Based on the information before us, there is no way to know whether — or for what amount — the Hernandez case will settle. In the event that it does settle and, hypothetically, results in $50,000 in attorney fees rather than the larger amount the trial court apparently anticipates, Smith would be required to place half of that $50,000, or $25,000, in trust under the terms of the original injunction, and then to satisfy the clarification order, would have to place an additional $43,750 — more than the amount collected from the Hernandez case — in trust as well.

Atrial court may issue an interlocutory injunction to maintain the status quo until the final hearing if, by balancing the relative conveniences of the parties, it determines that they favor the party seeking the injunction. That is because an interlocutory injunction is a device to keep the parties in order to prevent one from hurting the other whilst their respective rights are under adjudication. There must be some vital necessity for the injunction so that one of the parties will not be damaged and left without adequate remedy.

(Citation omitted.) American Mgmt. Svcs. East v. Fort Benning Family Communities, 318 Ga. App. 827, 832-833 (3) (734 SE2d 833) (2012). Here, the modification does not “maintain the status quo,” and may put Smith at risk of injury. Further, there has been no showing that Williams would be left without an adequate remedy absent this modification. Id. Finding error, we therefore reverse the trial court’s clarification order modifying the injunction.

Decided July 14, 2015.

Ryan Law Firm, G. Robert Ryan, Jr., for appellants.

John D. Holt, for appellees.

Judgment affirmed in part and reversed in part.

Barnes, P. J., and McMillian, J., concur.

       The parties do not agree on the issue of when the partnership actually ended.

       Smith has not answered Williams’ complaint, but rather has entered a special appearance without submitting to the jurisdiction of the trial court.

       Williams sent a letter and attorney fee lien to opposing counsel in one case, however.

       The trial court’s order is, to a degree, philosophically analogous to a prejudgment attachment (OCGA §§ 18-3-1,18-3-9, 18-3-10); however, such prejudgment actions must meet certain requirements and offer certain safeguards not present here.


author: ELLINGTON, Presiding Judge. DILLARD, Judge,

text:
    A15A0792.
    RTT ASSOCIATES, INC. v. GEORGIA DEPARTMENT OF LABOR.
    (775 S.E.2d 644)
   ELLINGTON, Presiding Judge.

RTT Associates, Inc. brought this action in the Superior Court of Fulton County against the Georgia Department of Labor for breach of contract and breach of the implied covenants of good faith and fair dealing. After a hearing, the trial court determined that RTT failed to show that the State had waived sovereign immunity and granted the Department’s motion for summary judgment on that basis. RTT challenges that ruling on appeal, along with the denial of its motion for judgment on the pleadings. For the reasons explained below, we affirm the trial court’s denial of RTT’s motion for judgment on the pleadings and reverse the grant of summary judgment in the Department’s favor.

1. RTT contends that its claims constitute an action ex contractu for the breach of a written contract and, therefore, that the trial court erred in ruling that the State is entitled to sovereign immunity. It is undisputed that the parties entered into a written contract for RTT to develop a software program for the Department and that the Department refused to pay RTT the full contract price. In its complaint, RTT alleged, inter alia, that the Department breached the contract by refusing to compensate RTT for work performed under the contract and by purporting to terminate the contract for cause without giving RTT an opportunity to cure its default. In granting the Department’s motion for summary judgment on the basis of sovereign immunity, the trial court noted that the parties’ written contract provided that it would terminate on a specified date, which had passed. The trial court held that, as a result, RTT could only maintain an action for breach of that written contract by producing a written extension or amendment that contained all of the terms required to constitute a valid contract, including consideration for extending or amending the contract and the parties’ mutual assent to any such changes. The trial court determined that RTT had failed to establish any written extension or amendment and ruled that RTT’s claim was therefore not one for breach of a written contract for which the State had waived its sovereign immunity. RTT contends that, at a minimum, a material question of fact exists regarding whether the parties agreed to extend the written contract and that the trial court therefore erred in finding as a matter of law that the Department is immune from suit. We agree.

On the subject of sovereign immunity, the Georgia Constitution of 1983 provides that “sovereign immunity extends to the State and all of its departments and agencies [,]” except as otherwise provided in Art. I, Sec. II, Par. IX or unless the General Assembly in an Act “specifically provides that sovereign immunity is thereby waived and the extent of such waiver.” Ga. Const. 1983, Art. I, Sec. II, Par. IX (e). “[Sjovereign immunity of a State agency is not an affirmative defense, going to the merits of the case; instead it raises the issue of the trial court’s subject matter jurisdiction to try the case.” (Punctuation and footnotes omitted.) Dept. of Transp. v. Kovalcik, 328 Ga. App. 185, 189-190 (1) (b) (761 SE2d 584) (2014). “Jurisdiction [to afford the relief sought] either exists or does not exist without regard to the merits of the case.” (Citations and punctuation omitted.) Dept. of Transp. v. Dupree, 256 Ga. App. 668, 671 (1) (570 SE2d 1) (2002). Further, because “immunity from suit is a privilege that is subject to waiver by the State,” rather than “an affirmative defense that must be established by the party seeking its protection,” the claimant, as the party seeking to benefit from the waiver, has the burden of establishing the waiver. (Punctuation and footnotes omitted.) Tift County School Dist. v. Martinez, 331 Ga. App. 423, 425-426 (1) (771 SE2d 117) (2015).

When a court either has or lacks subject matter jurisdiction, regardless of any conflict in the facts that go to the merits of the case, the trial court should determine whether it has jurisdiction to afford the relief sought as a threshold issue at the outset. Dept. of Transp. v. Dupree, 256 Ga. App. at 671-672 (1). Sometimes, however, the determination of subject matter jurisdiction and waiver of sovereign immunity is so factually intertwined with determination of the merits of the case that the trial court may defer final determination of such issues until after the presentation of all the evidence at trial. Id. at 672 (1) (a).

We review de novo a trial court’s ruling on the issue of whether it lacks subject matter jurisdiction under the doctrine of sovereign immunity, which is a question of law, but factual findings by the trial court in support of its legal decision are sustained if there is evidence authorizing them. Dept. of Transp. v. Kovalcik, 328 Ga. App. at 186; Ga. Dept. of Corrections v. James, 312 Ga. App. 190, 193 (718 SE2d 55) (2011).

This case concerns the constitutional provision that the State’s defense of sovereign immunity is waived “as to any action ex contractu for the breach of any written contract[.]” Ga. Const. 1983, Art. I, Sec. II, Par. IX (c). As a result, “to overcome the Department’s assertion of sovereign immunity, [RTT] has the burden of showing that the contract sought to be enforced is in writing and contains all of the terms necessary to constitute a valid contract.” (Citations omitted.) Ga. Dept. of Community Health v. Data Inquiry, 313 Ga. App. 683, 685 (1) (722 SE2d 403) (2012).

The record shows the following undisputed facts. The Department hired RTT in March 2012 to develop software for the Department to use in implementing the Work Opportunity Tax Credit program. RTT and the Department entered into a written contract, State of Georgia State Entity Standard Contract Form, Contract No. GL12005-2717, which was signed on behalf of both parties. The contract provides for a maximum payment by the Department to RTT of $247,422.68 and specified a “Date of Completion” of June 30, 2012. The contract further provides that it “shall begin and end on the dates specified in the State Entity Standard Contract Form unless terminated earlier in accordance with the applicable terms and conditions.” The contract provides for immediate termination under certain circumstances, termination upon written notice under certain circumstances, and termination for cause in the case of certain defaults by RTT. In the event of a default by RTT, the contract requires the Department to give RTT written notice of the default and specify a time period in which it may remedy the default. The contract also provides that it “may be amended in writing from time to time by mutual consent of the parties.”

The work to be performed by RTT, and corresponding payment by the Department, was divided into four “Milestones.” On March 8,

2012, the Department submitted a partial payment of $82,474.23 to RTT. RTT failed to deliver fully functional WOTC software by June 30,2012, the “Date of Completion” specified in Contract No. GL120052717.

During the latter half of 2012 and continuing into early 2013, the Department continued to work with RTT in an effort to allow RTT to deliver the WOTC software. The Department received multiple editions of the WOTC software from RTT, tested each new edition of the software, and determined that it was not fully functional. In a letter to RTT dated April 3, 2013, the Department notified RTT that it was in breach and noncompliance of Contract No. GL12005-2717 and that the contract was thereby “terminated immediately.” In the letter, the Department stated that the contract had been “extended multiple times [after] June 30, 2012[,] to allow [RTT] to complete and deliver satisfactory WOTC Processing System to [the Department].” On the same date, in a letter to Evergreen National Indemnity Company, the Department notified the bond company that Contract No. GL120052717 had been “extended multiple times [after] June 30, 2012[,] to allow completion and delivery of a Contract compliant WOTC processing System to [the Department]” and that, as of the date of the letter, “the Contract terms have not been met by RTT.” In that letter, the Department notified the bond company of the costs it expected to incur to bring an alternative product on-line. According to a Department employee, RTT’s software was never fully functional and did not meet the requirements of the contract and, at a meeting on May 7, 2013, the Department informed RTT of that fact, that the Department had decided not to use RTT’s software, and that the contract was terminated.

On July 10, 2013, RTT filed its complaint for breach of contract and breach of the implied covenants of good faith and fair dealing. The Department asserted a counterclaim for breach of contract, alleging that RTT breached the contract by failing to complete and deliver the work required under Milestone 2, for which the Department had issued advance payment, and by failing to timely deliver fully functional software that met the terms of the contract.

In granting the Department’s motion for summary judgment, the trial court determined that RTT could only show that its claims constitute an action ex contractu for the breach of a written contract, and thereby satisfy its burden of proving a waiver of sovereign immunity, “hy establishing a written extension or amendment to the Contract” between the parties, Contract No. GL12005-2717, under which RTT agreed to deliver the WOTC software by June 30, 2012. The court found that RTT failed to do so and that, “[a]t best, the record evidences [the Department’s] willingness to not hold [RTT] to the delivery deadline contained in the written Contractf.]” On appeal, the Department defends the trial court’s analysis, arguing that the written contract expired by its terms on June 30, 2012; neither party was bound by the terms of the contract after that date; and any work RTT performed after that date was not under any written contract. As the Department would have it, RTT “must logically be proceeding under a theory of implied contract for the period after June 30, 2012, and therefore the waiver of sovereign immunity contained in OCGA § 50-21-1[] is inapplicable.” (emphasis supplied).

The Department’s position lacks merit. First, in some circumstances, certain obligations under a contract may survive the end of the contract. Nebo Ventures v. NovaPro Risk Solutions, 324 Ga. App. 836, 844 (4) (752 SE2d 18) (2013); McDevitt & Street Co. v. K-C Air Conditioning Svc., 203 Ga. App. 640, 643 (2) (418 SE2d 87) (1992). Therefore, even if the passing of the specified “date of completion” meant that the written contract had expired, it does not follow that neither party was bound by any of the terms of the contract after that date.

In addition, “a written contract may be modified by mutual consent of the parties, which need not be expressed in words, in writing or signed, but the parties must manifest their intent to modify the original contract.” Ryder Truck Lines v. Scott, 129 Ga. App. 871, 873-874 (4) (201 SE2d 672) (1973). See also Med. Doctor Assoc. v. Lab-Quip Co., 201 Ga. App. 880, 882 (1) (b) (412 SE2d 625) (1991) (accord); Dan Gurney Indus. v. Southeastern Wheels, 168 Ga. App. 504, 505 (1) (308 SE2d 637) (1983) (accord). Most pertinently, a provision that limits the time for performance may be waived, and “a subsequent offer to fulfill the contract and urging a compliance with the contract by the party of the other part, instead of treating the contract as at an end, amounts to a waiver.” (Citation and punctuation omitted.) Seay v. Malone, 219 Ga. 149, 151 (1) (132 SE2d 261) (1963). See also Bolton v. Barber, 233 Ga. 646, 648 (2) (212 SE2d 766) (1975) (“[I]f time is of the essence of a contract, it may be waived; and . . . subsequent conduct of the obligor may have that effect.”) (citations omitted).

Furthermore, a provision in a written contract that it may only be modified in writing may be waived, and waiver of such a written modification requirement may be established through the course of conduct of the parties. Handex of Florida v. Chatham County, 268 Ga. App. 285, 288 (1) (602 SE2d 660) (2004); Caribbean Lumber Co. v. Anderson, 205 Ga. App. 415, 417 (2), n. 1 (422 SE2d 267) (1992). Generally, whether there has been a mutual departure from the terms of a contract, with a resulting modification of a contract, is generally a question for the jury. Lynx Real Estate v. F. A. L. Investments, 312 Ga. App. 324, 327 (1) (718 SE2d 552) (2011); Handex of Florida v. Chatham County, 268 Ga. App. at 288; Norair Engineering Corp. v. Porter Trucking Co., 163 Ga. App. 780, 784 (295 SE2d 155) (1982).

In this case, the Department admits that it signed a legally valid, written contract, so the existence of a written contract vel non is not at issue. And the record contains some evidence, recounted above, that, through their course of conduct, the Department and RTT waived or extended the required date of completion and, likewise, waived the provision that the contract could be amended (only) in writing. The specific allegations of RTT’s complaint, viewed in context of the documents of record, show that RTT is seeking recovery under a written contract, as (allegedly) amended. The Department’s position that it did not intend to extend the time for RTT’s performance that was specified in the written contract at issue in this case, at most, points to a disputed issue of material fact, and the question whether there has been a mutual departure from the terms of the written contract is a question for the jury. We conclude that the trial court erred in ruling that RTT’s claims, as a matter of law, do not constitute an action ex contractu for breach of a written contract. Consequently, the trial court erred in granting the Department’s motion for summary judgment on the basis of sovereign immunity.

2. RTT contends that the record establishes as a matter of law that the Department failed to send RTT written notice of its default under the contract and an opportunity to cure the default and, therefore, that the Department did not satisfy the conditions precedent in the termination-for-cause provision of the contract. As a result, RTT contends, the trial court erred in denying its motion for judgment on the pleadings on its breach of contract claims.

On appeal, we review de novo the trial court’s decision on a motion for judgment on the pleadings, and we construe the pleadings in a light most favorable to the appellant, drawing all reasonable inferences in her favor. All well-pleaded material allegations of the opposing party’s pleading are to be taken as true, and all allegations of the moving party which have been denied are taken as false.

(Citation and punctuation omitted.) Poole v. In Home Health, 321 Ga. App. 674 (742 SE2d 492) (2013). ******8

Decided July 14, 2015

Batch & Bingham, Christopher S. Anulewicz, Joshua M. Moore, for appellant.

Samuel S. Olens, Attorney General, Elizabeth A. Harris, Assistant Attorney General, for appellee.

In this case, RTT alleged that the Department failed to send RTT written notice of its default under the contract and an opportunity to cure the default. In its answer, the Department denied these allegations. For purposes of a motion for judgment on the pleadings, therefore, RTT’s allegations are taken as false. Poole v. In Home Health, 321 Ga. App. at 674. Although, as RTT contends, the Department did not allege in its counterclaim that it had provided notice of default and an opportunity to cure, this is not the same as admitting the opposite proposition. The trial court did not err in denying RTT’s motion for judgment on the pleadings. Id.

Judgment affirmed in part and reversed in part.

McFadden, J., concurs. Dillard, J., concurs fully in Division 2, and concurs in judgment only as to Division 1.

DILLARD, Judge,

concurring specially.

I concur fully in Division 2 of the majority’s opinion. I concur in judgment only as to Division 1 because I do not agree with all that is said in that division of the majority opinion. Thus, the majority’s opinion in Division 1 decides only the issues presented in that division and may not be cited as binding precedent in future cases. See Court of Appeals Rule 33 (a).

       OCGA § 50-21-1 (a) restates this constitutional waiver of sovereign immunity and provides: “The defense of sovereign immunity is waived as to any action ex contractu for the breach of any written contractf.]”

       The Work Opportunity Tax Credit (“WOTC”) program, which the Department coordinates, provides employers with financial incentives, in the form of reduced federal income tax liability, when hiring workers from targeted groups.

       See footnote 1, supra.

       In the contract at issue in this case, for example, RTT agreed not to disseminate any confidential information it used in the course of performing the contract, an obligation that expressly survived termination of the contract, and the Department agreed not to reverse engineer RTT’s product or create derivative works based thereon, an obligation that inherently survived the delivery of the completed custom software.

       For this reason, Bd. of Regents of Univ. System of Ga. v. Barnes, 322 Ga. App. 47 (743 SE2d 609) (2013), cited by the trial court, is inapposite, as it concerns a case where there was no written contract in the form of a single document. 322 Ga. App. at 50 (2) (for purposes of a waiver of sovereign immunity under Ga. Const. 1983, Art. I, Sec. II, Par. IX (c), and OCGA § 50-21-1 (a), no written contract was established by an unauthenticated partial copy of the student code of conduct, which was not signed by either party, and a counseling center consent form, which was signed only by the plaintiff). See also Ga. Dept. of Community Health v. Data Inquiry, 313 Ga. App. at 686-687 (1) (b) (The claimant failed to show a waiver of sovereign immunity for its breach of contract claim where it failed to show that'anyone ever executed the proposed written agreement on behalf of the State or the department and failed to show that the department paid the retainer as required in the written contract.).

       This is consistent with the trial court’s acknowledgment that “the record evidences [the Department’s] willingness to not hold [RTT] to the delivery deadline contained in the written Contract^]”

       For example, the Department raises an issue regarding the authority of its employee to modify and extend the contract, saying, “one employee’s characterization of the contract as extended [past June 30, 2012,] and terminated in April 2013 does not make it so. . . . [T]he Department is not bound by the unauthorized acts of its employees.” Whether its employees had or lacked authority to modify the contract is a fact issue. See Caribbean Lumber Co. v. Anderson, 205 Ga. App. at 417-418 (2) (Because there were issues of material fact concerning the scope of an engineer’s actual and/or apparent authority to waive or change certain contractual provisions and, if he had authority to waive or change certain contractual provisions, which ones were waived by him, the trial court erred in granting the other party’s motion for summary judgment.).

       The Department contends that RTT failed to preserve its right to appeal from this interlocutory ruling by failing to obtain a certificate of immediate review and file an application for interlocutory review under OCGA § 5-6-34 (b). This argument is plainly unfounded. See OCGA §§ 5-6-34 (d) (Where a direct appeal is taken under any provision of OCGA § 5-6-34 (a), (b), or (c), “all judgments, rulings, or orders rendered in the case which are raised on appeal and which may affect the proceedings below shall be reviewed and determined by the appellate court, without regard to the appealability of the judgment, ruling, or order standing alone and without regard to whether the judgment, ruling, or order appealed from was final or was appealable by some other express provision of law contained in [OCGA § 5-6-34], or elsewhere.”); 9-11-56 (h) (“An order granting summary judgment on any issue or as to any party shall be subject to review by appeal.”); Sotter v. Stephens, 291 Ga. 79, 84 (727 SE2d 484) (2012) (“[W]hen a direct appeal is taken, any other judgments, rulings or orders rendered in the case and which may affect the proceedings below may be raised on appeal and reviewed and determined by the appellate court.”) (citation and punctuation omitted); Southeast Ceramics v. Klem, 246 Ga. 294, 295 (1) (271 SE2d 199) (1980) (“Although the appeal of a grant of a motion for summary judgment is not one of the appeals authorized by [OCGA § 5-6-34 (a)], it is a judgment from which direct appeal can be taken. [Therefore,] when a direct appeal is taken [from an order granting a motion for summary judgment], any other judgments, rulings or orders rendered in the case and which may affect the proceedings below may be raised on appeal and reviewed and determined by the appellate court.”); Headrick v. Stonepark of Dunwoody Unit Owners Assn., 331 Ga. App. 772, 774-775 (1) (a) (771 SE2d 382) (2015) (accord); Schoenbaum Ltd. Co. v. Lenox Pines, 262 Ga. App. 457, 458-459 (1) (a) (585 SE2d 643) (2003) (accord).


author: DOYLE, Presiding Judge.

text:
    A15A0574.
    CHENEY v. LAWSON.
    (773 S.E.2d 297)
   DOYLE, Presiding Judge.

Amanda Lawson filed a medical malpractice action against Dr. David Cheney after she experienced a serious infection and complications following breast augmentation surgery performed by Cheney. The jury found in favor of Lawson, awarding her $500,000. Cheney appeals, arguing that the trial court erred by (1) admitting a summary of Lawson’s medical bills; (2) denying Cheney’s motion for a mistrial and failing to admonish plaintiff’s counsel after counsel mentioned other claims against Cheney in violation of the trial court’s ruling excluding such evidence; and (3) failing to admonish plaintiff’s counsel for mentioning an apology letter from one of Lawson’s treating physicians. For the reasons that follow, we reverse.

Construed in favor of the verdict, the evidence shows that Lawson paid $3,450 for breast augmentation surgery, which Cheney performed with the assistance of his business partner. Lawson was not given general anesthesia, but was awake and alert during the painful three- to four-hour procedure. In the days following the procedure, Lawson experienced pain, swelling, and drainage from her breasts, and one of the implants began to protrude from the point of insertion. Lawson saw another doctor, Wallace Steve Anderson, who admitted her to the hospital for infection, and she was treated by multiple other doctors, including an infectious disease specialist. Lawson was eventually diagnosed with methicillin-resistant staphylococcus aureus (“MRSA”), and she ultimately had the implants removed.

Lawson filed suit against Cheney. At the conclusion of the trial, the jury found Cheney liable, awarding Lawson $500,000, and the trial court entered judgment. This appeal followed.

1. Cheney contends that the trial court erred by admitting a single-page summary of Lawson’s medical bills because the underlying bills were not admitted into evidence, and Lawson failed to lay the necessary foundation for their admission.

During the trial, plaintiff’s counsel asked Lawson whether she could identify the medical records contained in Exhibit 4, a compound exhibit consisting of Lawson’s medical bills from seven providers, “as [her] medical bills [sic] that [she] incurred as a result of — ?” Counsel was interrupted by the trial court to clear up confusion regarding the exhibit numbers, and Lawson never answered the question. Cheney objected to admission of Exhibit 4, and the trial court reserved ruling on the objection. Lawson then identified Exhibit 5, a single-page summary of her medical bills, which summary listed charges from the same seven providers, totaling $24,698.34. Lawson confirmed that the summary reflected “[her] medical bills from these same physicians and hospitals.” Cheney objected to the admission of Exhibit 5, arguing that there had been no testimony regarding most of the providers listed in the summary, and therefore, Lawson had failed to demonstrate that the bills were reasonably incurred as a result of Cheney’s actions. The trial court overruled the objection and admitted Exhibit 5.

“The decision to admit or exclude evidence is committed to the sound discretion of the trial court and will not be disturbed on appeal absent a clear abuse of discretion.” “Where a party sues for damages, [s]he has the burden of proof of showing the amount of loss in a manner in which the jury... can calculate the amount of the loss with a reasonable degree of certainty. An allowance for damages cannot be based on guesswork.” A patient suing for medical malpractice “shall be a competent witness to identify bills for expenses incurred in the treatment of the patient upon a showing . . . that the expenses were incurred in connection with the treatment of the injury, disease, or disability involved in the subject of litigation at trial. . . ,” Thus, if

medical bills include charges for treatment, drugs, and hospitalization for items other than those arising out of the cause of action, the plaintiff has the duty to segregate the irrelevant expenses [because she] has the burden of proof to show [her] losses in such manner as can permit calculation thereof with a reasonable degree of certainty.

In this case, there was no testimony that the charges listed in the summary were incurred as a result of the procedure performed by Cheney. And plaintiff’s counsel conceded during opening statements that although Lawson was “in very bad health” after the breast augmentation, “not everything is related to this surgery.” There was evidence that Lawson was diagnosed with a seizure disorder, and she was treated for hypertension and insomnia by one of the doctors who treated her for complications arising from the procedure. There was no evidence linking these conditions and diagnoses to the procedure performed by Cheney, nor is there evidence that charges from such treatments were excluded from the summary of medical bills. Thus, because Lawson failed to demonstrate sufficiently that she incurred all of the charges listed in the summary as a result of Cheney’s actions,* the trial court erred by admitting it.

Decided June 12, 2015 —

Reconsideration denied July 15, 2015 —

Coles Barton, Matthew S. Coles, Thomas M. Barton, Aaron P. M. Tady, for appellant.

Additionally, there is no merit to Lawson’s argument that admission of her medical bill summary was harmless because the verdict form was general. “Under the circumstances presented here, the opposite of this is true: [because] the jury found a general verdict for [Lawson] against [Cheney], the verdict cannot stand [because] this [C]ourt cannot determine whether the verdict was entered upon a proper basis.”

2. In light of our holding in Division 1, we decline to address Cheney’s remaining enumerations.

Judgment reversed.

Phipps, C. J., and Boggs, J., concur.

Savage & Turner, Brent J. Savage; The McCranie Law Firm, George F. McCranie IV, for appellee.

       See Hand v. South Ga. Urology Center, P.C., 332 Ga. App. 148 (769 SE2d 814) (2015).

       Lawson also named as defendants Southeast Laser & Plastic Surgery, Inc. (“SLPS”), and the owner of the business, Chavez-Yawn. Neither SLPS nor Chavez-Yawn participated in the trial, and the jury awarded Lawson $250,000 against each of them.

       The trial court ultimately excluded Exhibit 4.

       The medical hills are not a part of the appellate record. Exhibit 5, as it appears in the record, consists solely of the one-page summary.

       Although plaintiff’s counsel argued to the trial court that Lawson had testified that she incurred the hills as a result of her surgery, we find no such testimony in the record, and Lawson has not provided a citation to the record therefor in her brief on appeal.

       (Punctuation omitted.) Sellers v. Burrowes, 302 Ga. App. 667, 671 (2) (691 SE2d 607) (2010).

       (Punctuation omitted.) Lester v. S. J. Alexander, Inc., 127 Ga. App. 470, 471 (1) (193 SE2d 860) (1972).

       (Emphasis supplied.) OCGA§ 24-9-921 (a).

       (Punctuation omitted; emphasis supplied.) Daniel v. Parkins, 200 Ga. App. 710, 711-712 (4) (409 SE2d 233) (1991), quoting Lester, 127 Ga. App. at 470 (2).

       Compare Emory Healthcare v. Pardue, 328 Ga. App. 664, 673-674 (4) (760 SE2d 674) (2014) (affirming admission of edited medical bills because the “[pjlaintiff provided lay testimony that the edited bills admitted into evidence were related solely to the injury at issue in the present litigation”) (physical precedent only); Daniel, 200 Ga. App. at 712 (4) (“appellee’s own testimony that the edited medical bills represented expenses incurred in connection with the treatment of the back injury that he allegedly sustained in the collision was sufficient to authorize their admission into evidence”).

       Lawson has pointed to no testimony in the trial transcript regarding several of the providers listed in the bill summary, including Mercer Medicine, Medical Center of Central Georgia, and Douglas Internal Medicine. And although Cheney tendered Lawson’s medical records from these providers, as we have previously noted, the records were not admitted into evidence.

       See Hossain v. Nelson, 234 Ga. App. 792, 794 (4) (507 SE2d 243) (1998); Lester, 127 Ga. App. at 472 (1). See also Eberhart v. Morris Brown College, 181 Ga.App. 516, 518(1) (352 SE2d 832) (1987).

       (Punctuation omitted.) MARTA v. Mitchell, 289 Ga. App. 1, 4 (659 SE2d 605) (2007), quoting Troncalli v. Jones, 237 Ga. App. 10, 13 (1) (514 SE2d 478) (1999) and citing Lee v. Mercedes-Benz, USA, 276 Ga.App. 28, 30 (2) (622 SE2d 361) (2005); Wolff v. Middlebrooks, 256 Ga.App. 268, 271-272 (3) (568 SE2d 88) (2002); Ga. Power Co. v. Busbin, 242 Ga. 612, 616-617 (8) (250 SE2d 442) (1978). We note that during closing, Lawson’s counsel specifically requested an award that would include the $24,698 she owed in medical bills, and the trial court instructed the jury that any damage award to Lawson could include the cost of her medical treatment.