text:
    A11A1185, A11A1186.
    AN v. ACTIVE PEST CONTROL SOUTH, INC.; and vice versa.
    (720 SE2d 222)
   Blackwell, Judge.

When Jo Ya An discovered that her home had been damaged extensively by termites, she sued Active Pest Control South, Inc. for professional negligence and breach of contract. A couple of years earlier, Active had agreed to monitor and treat the home for termites and to repair any damages that termites thereafter caused to the home. An does not dispute that the home sustained some termite damage before Active entered into this contract, and An also does not dispute that Active is not responsible for repairing damages that termites caused to the home before the date of the contract. So, everyone agrees that, if An is to prevail on her claims against Active, she must prove that the home sustained additional termite damage after the date of the contract and the extent of this additional damage. See Orkin Exterminating Co. v. Durden, 189 Ga. App. 479, 481-482 (1) (376 SE2d 376) (1988).

Active moved below for summary judgment, claiming that An cannot prove these things. In the course of discovery, An identified experts that would, she said, offer proof of these things in the form of opinion testimony, but Active said that the opinions of these experts are unreliable, and it moved to exclude their opinions under OCGA § 24-9-67.1. The court below heard all of these motions, but it granted the motion for summary judgment without ruling on the motions to exclude the opinions of the experts.

An appeals from the entry of summary judgment, and Active cross-appeals from an earlier order of the court below that struck two notices of nonparty fault that Active had filed under OCGA § 51-12-33, although Active concedes that, if it is entitled to summary judgment, the issues presented in its cross-appeal are moot. On the appeal from the award of summary judgment, we conclude that, if the opinions of her experts are admissible, An may be able to prove that the home sustained additional termite damage after the date of the contract and the extent of that additional damage. Whether the opinions of the experts are admissible, however, is something that must be determined in the first instance by the court below, exercising its discretion under OCGA § 24-9-67.1. Accordingly, we vacate the award of summary judgment and remand for the court below to decide whether the opinions of the experts are admissible and then to reconsider the motion for summary judgment. Because it remains to be seen whether Active is entitled to summary judgment, it is unnecessary at this time for us to decide the issues presented in the cross-appeal, and we dismiss the cross-appeal without prejudice to Active raising those issues again in a later appeal.

Case No. A11A1185

The standard for summary judgment is settled and familiar. “Summary judgment is warranted when any material fact is undisputed, as shown by the pleadings and record evidence, and this fact entitles the moving party to judgment as a matter of law.” Strength v. Lovett, 311 Ga. App. 35, 39 (2) (714 SE2d 723) (2011); see also Cowart v. Widener, 287 Ga. 622, 623 (1) (a) (697 SE2d 779) (2010). So, as we have explained before, “to prevail on a motion for summary judgment, the moving party must show that there is no genuine dispute as to a specific material fact and that this specific fact is enough, regardless of any other facts in the case, to entitle the moving party to judgment as a matter of law.” Strength, 311 Ga. App. at 39 (2).

When a defendant moves for summary judgment as to an element of the case for which the plaintiff. . . will bear the burden of proof at trial. . . the defendant may show that he is entitled to summary judgment either by affirmatively disproving that element of the case or by pointing to an absence of evidence in the record by which the plaintiff might carry the burden to prove that element.

Id.; see also Lau’s Corp. v. Haskins, 261 Ga. 491, 491 (405 SE2d 474) (1991). We review an award of summary judgment de novo, viewing the evidence in the record, as well as all inferences that might reasonably be drawn from that evidence, in the light most favorable to the nonmoving party. Cowart, 287 Ga. at 624 (1) (a).

So viewed, the record shows that a Roswell homeowner discovered a termite infestation in his home, and in January 2004, he hired Active to treat this infestation. When Active personnel inspected the home at that time, they found evidence of termite damage in the exterior wall of the dining room, a bathroom, the foyer, and the laundry room. Active personnel noted no other termite damage, although their inspection report disclaimed any responsibility to discover “hidden damage [that] is concealed, obstructed, or inaccessible to [Active personnel].” Active and the homeowner entered into a contract on January 13, 2004, by which Active agreed to provide “control of [s]ubterranean termites on the premises,” not only by treating the termite infestation active at that time, but also by monitoring the home thereafter and making “treatments to the premises to remedy any new infestation after the [initial] control period.” Active also promised to “make such repairs to the premises and contents to remedy any new damage caused by subterranean termites.” This contract was assignable to any subsequent owner of the home.

In August 2006, the homeowner sold the home to An. Around the time of the sale, Active personnel inspected the home again and prepared an “Official Georgia Wood Infestation Inspection Report,” which Active issued on the day before the sale closed and apparently was provided to An at or around the time of closing. According to this report, the 2006 inspection by Active personnel did not reveal any visible evidence of an active termite infestation. The report notes the earlier infestation, however, and includes an “inspection graph,” which indicates existing termite damage in the baseboard of the master bedroom, den, and garage, as well as in the baseboard and ceiling of a room identified as “Room 1.” Like the 2004 inspection report, the 2006 report disclaims any responsibility for “hidden damage [that] is concealed, obstructed or inaccessible to [Active personnel].” At closing, the homeowner assigned his contract with Active to An.

Soon after closing, An and her family set out to renovate the home, and as they removed wallpaper, they discovered additional termite damage. An contacted a home inspector, who examined the home in late August 2006 and found, in his words, “massive” termite damage. An later contacted the Georgia Department of Agriculture, and in December 2006, its inspectors found active termite infestations in the kitchen, foyer, master bedroom, bathroom, bathroom closet, den, and a secondary bathroom.

When Active failed to remedy the damages to the home, An sued, alleging that Active breached its contract and was negligent in its inspections and treatments of the home. In the course of discovery, An identified four potential expert witnesses, including Dr. Maxcy E Nolan III, an entomologist, and Raymond W Chulick, a general contractor with some expertise in estimating the costs of residential construction and repair. Nolan opined at his deposition that “at least 75 percent of the damage [to An’s home] was [done] after 2004,” and in an affidavit, he identified certain areas of the home that, he said, had seen active termite infestations since 2004 and had been damaged since January 2004. Chulick said at his deposition that repairing the termite damage would cost about $37,000, nearly $5,000 of which is attributable to damage caused by termites before Active contracted to treat the home. Active contends that these opinions are unreliable and, therefore, inadmissible, and Active filed motions under OCGA § 24-9-67.1 to exclude these opinions. At the same time, Active also filed a motion for summary judgment, in which it argued, among other things, that An would be unable at trial to prove that termites caused any damage to the home after Active contracted to treat it and the extent of that damage. The court below heard argument on all of these motions. Then, without ruling on the admissibility of the expert opinions, the court granted the motion for summary judgment, concluding that An “failed to present evidence that the damage caused to the property was proximately caused by [Active’s] negligence.” The parties understand, as do we, the court below to have meant that it found no evidence in the record by which An might prove that termites caused damage to the home after Active contracted to treat it.

As we said earlier, An does not dispute that Active is only responsible for damage caused by termites after January 13, 2004, when Active contracted to treat the home for termites, and she is right not to dispute it. After all, to the extent Active is liable under its contract for damage to the home, its liability is expressly limited by the terms of the contract to “any new damage caused by [s]ubterranean termites,” and damage caused by termites before the date of the contract is not “new damage.” Likewise, it is a settled principle of tort law that one “can be held financially responsible only for that damage proximately caused by its negligence,” Durden, 189 Ga. App. at 481 (1), and damage that preexisted the initial inspection and treatment of the home could not possibly be caused by anything Active did or failed to do. An also does not dispute that the home sustained some termite damage before Active contracted to treat it, and that fact appears clearly enough in the record. The question, then, is whether An has come forward with some evidence from which a jury might properly conclude that termites caused additional damage to the home after Active contracted to treat it and, if so, whether An has some admissible evidence of the extent of such damage. See American Pest Control v. Pritchett, 201 Ga. App. 808, 809 (2) (412 SE2d 590) (1991) (general measure of damages for injury to improved property is cost of restoration to the condition immediately prior to injury); Durden, 189 Ga. App. at 482 (1) (“[w]hile appellee proved the total cost of repairs necessary to her home due to the damage done by termites . . . , she did not isolate the cost of those damages that occurred due to appellant’s negligence”). To the extent that the opinions of her experts are admissible, we think An has come forward with such evidence.

When we review an award of summary judgment, we take the record as we find it, and the record now before us includes the opinions of several potential experts, including Nolan and Chulick. It is true, of course, that a court should consider only admissible evidence in connection with a motion for summary judgment, see Nyankojo v. North Star Capital Acquisition, 298 Ga. App. 6, 7 (679 SE2d 57) (2009), and Active argues on appeal, as it did below, that the opinions of these experts are inadmissible, raising some fair questions about the reliability of the opinions. Active asks, for instance, how Nolan can opine about the extent of damage done after Active contracted to treat the home when he did not perform the kinds of tests that, Active contends, are necessary to reliably determine the extent of damage done at any time, and Active asks how Nolan can make reliable findings about the damage done before January 2004 based on an inspection report that expressly disclaims any obligation to find hidden or latent damage. Perhaps An has good answers to these questions, or perhaps she does not, but the question for this Court is whether we ought to pass upon the admissibility of these expert opinions when the court below did not.

In some cases, we suppose, the admissibility or inadmissibility of evidence offered in support of, or in opposition to, a motion for summary judgment is so obvious that we properly can decide on appeal whether that evidence should have been considered, even without the court below having addressed it. But we must be cautious about deciding questions of admissibility — including questions of the admissibility of expert opinions — upon which a trial court has not ruled. After all, questions of admissibility generally are committed to the sound discretion of the trial courts, see Jones v. Forest Lake Village Homeowners Assn., 304 Ga. App. 495, 501 (2) (696 SE2d 453) (2010), and questions of the admissibility of expert opinions under OCGA § 24-9-67.1 are no different. See Mason v. Home Depot USA, Inc., 283 Ga. 271, 279 (5) (658 SE2d 603) (2008); see also Butler v. Union Carbide Corp., 310 Ga. App. 21, 25 (1) (712 SE2d 537) (2011). Whether an expert opinion ought to be admitted under OCGA § 24-9-67.1 is a question that is especially fit for resolution by a trial court because it requires a consideration of the facts and data upon which the opinion is based, whether the opinion is a product of “reliable principles and methods,” and whether the opinion was reached by a reliable application of those principles and methods to the facts of the case. See OCGA § 24-9-67.1 (b). All these things may require fact finding, and trial judges are better suited to find facts than appellate judges. Perhaps for these reasons, the appellate courts consistently have said that it is the trial judge that is to act as a gatekeeper and assess the reliability of proposed expert testimony. See Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U. S. 579, 589 (II) (B) (113 SC 2786, 125 LE2d 469) (1993) (“[T]he trial judge must ensure that any and all scientific testimony or evidence admitted is not only relevant, but reliable.”); see also Kumho Tire Co. v. Carmichael, 526 U. S. 137, 147 (II) (A) (119 SC 1167, 143 LE2d 238) (1999) (“In Daubert, this Court held that Federal Rule of Evidence 702 imposes a special obligation upon a trial judge to ‘ensure that any and all scientific testimony ... is not only relevant, but reliable.’ ”); General Electric Co. v. Joiner, 522 U. S. 136, 142 (II) (118 SC 512, 139 LE2d 508) (1997) (affirming “the ‘gatekeeper’ role of the trial judge in screening [expert opinion] evidence”); Condra v. Atlanta Orthopaedic Group, 285 Ga. 667, 671 (1) (681 SE2d 152) (2009) (“Under the Daubert line of cases, the trial judge acts as the gatekeeper in determining the admissibility of expert opinion . . . ,”).

So, although Active makes a number of fair points about the reliability of the expert opinions on which An relies, they are points more appropriately directed, we think, to the question of admissibility under OCGA § 24-9-67.1 and, therefore, to the court below. Active asserted challenges below to the admissibility of these opinions, but those challenges are not now before us because the court below never passed upon them, and we will not attempt to resolve them for the first time on appeal. Instead, we will consider only whether the record as we now find it — including the opinions of the experts — is enough to get An past summary judgment.

We think it is. Having reviewed the reports, affidavits, and depositions of these experts, especially those of Nolan and Chulick, we conclude that, if their opinions are admissible, they would permit a jury to find that the home was damaged by termites after January 13, 2004 and to assess the extent of that damage. Nolan has opined, for instance, about the extent to which the damage to the home was inflicted after January 13, 2004, and he has identified certain areas of the home in which, he believes, termites caused damage after January 2004, and Chulick has opined about the costs of repairing this damage. These opinions would, if admitted, afford sufficient grounds for a jury to find that An has been injured and to put a value on her injuries, the very elements of proof that, the court below found, An cannot establish at trial. So, if the opinions of the experts are admissible, summary judgment is not warranted.

Because Active properly raised questions about the admissibility of these opinions by filing motions under OCGA § 24-9-67.1, which the court below never decided, and because the questions of admissibility are, at least to some extent, dispositive of the question of summary judgment, we think that the court below should have addressed the questions of admissibility before deciding the question of summary judgment in this case. Accordingly, we vacate the award of summary judgment and remand for the court below to resolve the pending motions to exclude the opinions of Nolan and Chulick under OCGA § 24-9-67.1 and then to reconsider the motion for summary judgment. Compare McCall v. Henry Medical Center, 250 Ga. App. 679, 685 (2) (551 SE2d 739) (2001) (vacating award of summary judgment and remanding for resolution of pending motion to compel discovery, where motion to compel concerned discovery of evidence that might be dispositive of motion for summary judgment) with Tuck v. Marriott Corp., 187 Ga. App. 567, 569 (2) (370 SE2d 795) (1988) (“Although the grant of summary judgment while a motion to compel discovery is pending is generally not condoned, where, as here, the disallowed discovery would add nothing of substance to the party’s claim, reversal is not required.”).

Decided November 15, 2011

Reconsideration denied December 1, 2011.

Richard S. Alembik, Willis L. Miller TV, for appellant.

Case No. A11A1186

Active cross-appeals from an order striking two notices of nonparty fault that Active filed pursuant to OCGA § 51-12-33. In its briefs, Active concedes that, if it is entitled to summary judgment, the propriety of striking these notices is a moot issue. Whether Active is entitled to summary judgment is still an open question, one for the court below to address on remand, and the issues presented in the cross-appeal may well turn out to be moot. Consequently, it is unnecessary for us to pass upon these issues at this time, and we dismiss the cross-appeal without prejudice to Active raising these issues again in any subsequent appeals. See generally Bibbins v. State, 280 Ga. 283, 284-285 (627 SE2d 29) (2006) (“Georgia appellate courts are not authorized to render advisory opinions as to potential error.”) (citations omitted); see also Southern Business Machines of Savannah v. Norwest Financial Leasing, 194 Ga. App. 253, 260 (II) (390 SE2d 402) (1990).

Judgment vacated and case remanded with direction in Case No. A11A1185. Appeal dismissed without prejudice in Case No. A11A1186.

Barnes, P. J., and Adams, J., concur.

Scrudder, Bass, Quillian, Horlock, Taylor & Lazarus, Matthew P. Lazarus, Jason D. Hergenroether, for appellee.

       An appeals in Case No. A11A1185, and Active cross-appeals in Case No. A11A1186.

       An also identified another entomologist and another construction expert as potential expert witnesses.

       Active filed motions to exclude all of the opinions offered by Chulick, to exclude the opinion of Nolan about the extent to which the home sustained damage after Active contracted to treat the home, to exclude several other opinions offered by Nolan, and to exclude some opinions offered by the other two potential expert witnesses. When the court below later convened a hearing on these motions, An announced that she did not oppose the motion to preclude her other construction expert — not Chulick — from offering certain opinions about necessary repairs to the home, and An conceded that Nolan would not be asked at trial to give any opinions about necessary repairs. These concessions have no bearing on our disposition of this appeal.

       The reference to “negligence” in the order awarding summary judgment to Active is somewhat confusing, inasmuch as a claim for breach of contract requires no showing of negligence. But we think we understand what the court below meant, and the parties share our understanding.

       We look to Daubert and its progeny in construing OCGA § 24-9-67.1. See OCGA § 24-9-67.1 (f); Mason, 283 Ga. at 279 (5).

       We do not mean to suggest that these opinions are, in fact, unreliable, only that Active raises legitimate questions about the reliability of the opinions, questions to which An may well have good answers. That is for the court below to decide, and it is something about which we offer no opinion.

       Active does not contend that the opinions offered by Nolan are not sufficiently specific because he does not go through the home board by board and opine about when each board was damaged. We do not, therefore, address the question of specificity.

       We do not decide whether summary judgment would be appropriate if some or all of the expert opinions were excluded. The record now before us includes expert opinions that have not been excluded, and as we have said, we take the record as we find it. We offer no opinion about whether summary judgment might be warranted on some hypothetical record not now before us.

       We do not decide today that a trial court always must resolve a motion to exclude expert testimony under OCGA § 24-9-67.1 before it can decide a motion for summary judgment. After all, OCGA § 24-9-67.1 itself identifies no specific time by which a court must decide a motion to exclude expert testimony, except that it must decide any such motion “no later than the final pretrial conference contemplated under Code Section 9-11-16.” OCGA § 24-9-67.1 (d); see also Ford Motor Co. v. Gibson, 283 Ga. 398, 404 (5) (659 SE2d 346) (2008) (noting that “the time period within which the trial court was required to hold a hearing and rule on the [OCGA § 24-9-67.1] motion had already passed”) (emphasis supplied). But when the admissibility of an expert opinion has been challenged, and the admissibility of that opinion may be dispositive of a motion for summary judgment, as it may be here, it does not serve judicial economy to decide the motion for summary judgment without passing upon the admissibility of the expert opinion. In some other case, the question of summary judgment may not depend on the admissibility of expert opinions, and it may be perfectly sensible in such a case to defer ruling on a motion under OCGA § 24-9-67.1.

       Before the court below reconsiders summary judgment, it also should decide any other timely challenges to the admissibility of evidence that are material to the motion for summary judgment.


source: Caselaw Access Project

author: Mikell, Judge.

license: Public Domain

text:
    A11A1496.
    FUNDUS AMERICA (ATLANTA) LIMITED PARTNERSHIP v. RHOC CONSOLIDATION, LLC et al.
    (720 SE2d 176)
   Mikell, Judge.

Commercial landlord, Fundus America (Atlanta) Limited Partnership (“Fundus”), sued tenants, RHOC Consolidation LLC (“RHOC”) and its parent company Marriott International, Inc. (“Marriott”) (collectively “appellees”), for a writ of possession, breach of contract, and attorney fees, arising from the assignment of a lease for a hotel in downtown Atlanta. Appellees filed counterclaims for a declaratory judgment that appellees were not in violation of the lease, breach of lease, negligent misrepresentation and attorney fees. Both parties moved for summary judgment after discovery. Following a hearing, the trial court granted the motions in favor of appellees, and Fundus appeals. Finding no error, we affirm.

Summary judgment is proper “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” A defendant may establish entitlement to summary judgment either by “presenting evidence negating an essential element of the plaintiffs claims or establishing from the record an absence of evidence to support [those] claims.” If the defendant establishes those requirements, the plaintiff must point to specific evidence giving rise to a triable issue. When reviewing the grant or denial of a motion for summary judgment, we conduct a de novo review of the law and the evidence, and we view the evidence in the light most favorable to the nonmovant. “When a question of law is at issue ... we owe no deference to the trial court’s ruling and apply the ‘plain legal error’ standard of review.”

So viewed, the evidence shows that Fundus is the owner of a hotel property located in downtown Atlanta (the “Hotel”)- After acquiring the property in 1990, Fundus completed a multi-million dollar renovation of the Hotel. In October 1990, Fundus leased the Hotel to Penta Hotels Georgia, Inc. (“Penta”), pursuant to a lease with a 20-year term (the “Lease”). Penta had multiple obligations under the Lease, including that it use the Hotel solely as a “first class hotel,” keep the Hotel in good repair, pay for all capital improvements and repairs needed, keep the Hotel in compliance with all government regulations, and not commit waste. The management and operations of the Hotel switched hands several times until Penta engaged Renaissance to manage the Hotel. Marriott acquired the Renaissance brand in 1997, and operated the Hotel under that brand until 2005. In 2005, Penta’s obligations under the Lease were assigned to Marriott’s wholly-owned subsidiary, RHOC. In connection with this assignment, Marriott executed an Unconditional Guaranty of Payment and Performance (the “Marriott Guaranty”) and Fundus executed an estoppel certificate (the “Estoppel Certificate”) asserting that the Lease had not been breached by prior tenants.

Less than two years after the assignment, the parties began to negotiate for an early termination of the Lease. During these negotiations, Fundus commissioned an inspection of the Hotel by Herbert Mascha and Michael Regner (“M&R Report”) to determine the condition of the Hotel. The M&R Report identified $35 million worth of repairs, improvements and renovations needed to bring the Hotel up to the status of a “first class hotel,” as required by the Lease. Fundus sent a Notice of Default under the Lease to Marriott based on the M&R Report outlining the alleged breaches, and Marriott rejected these findings. Fundus then terminated the Lease, demanded that Marriott vacate the Hotel, and filed this lawsuit. The trial court granted summary judgment in favor of appellees, holding that Fundus’s claims were barred by the execution of the estoppel certificate and that the term “first class hotel” was unenforceable as a matter of law.

1. Fundus argues that the trial court erred in granting summary judgment to appellees on the theory that Fundus’s breach of contract claims against appellees were foreclosed by the execution of the estoppel certificate. Finding no error, we affirm.

The contract memorializing the assignment is comprised of several contemporaneous documents signed by Fundus and appellees, including a Consent to Assignment, the Assignment and Assumption of Lease, the Marriott Guaranty, and the Estoppel Certificate. The Consent to Assignment contains an integration clause, which provides:

This Consent, the Marriott Guaranty, the Estoppel Certificates and exhibits hereto constitutes [sic] the entire agreement of the parties concerning the transactions contemplated by this Consent. All prior understandings and agreements among the parties are merged into this Consent, which alone fully and completely expresses their understanding.

In the Marriott Guaranty, Marriott replaced Penta as the guarantor of the lessee’s performance under the Lease. Marriott guaranteed “the full and prompt performance of any and all obligations of Assignor and Assignee to Lessor under the Lease” and agreed that its liability extended to “all Obligations of either Assignor or Assignee, as ‘Lessee’ under the Lease, whether such Obligations arose to [sic], on or after, the Effective Date hereof.”

In exchange for the Guaranty, Marriott asked Fundus to execute an Estoppel Certificate assuring that there was no breach or default of the Lease at the time of assignment. Paragraph 2 of the Estoppel Certificate provides the following:

Landlord has not delivered or received any notices of a breach or a default under the Lease, and to the best knowledge of Landlord, there is no breach or default by Tenant or Landlord under the Lease, nor has any fact, act, event or omission occurred which, with the giving of notice or lapse of time, or both, would constitute a breach or default thereunder. Landlord, and to the best knowledge of Landlord, Tenant, have performed all their obligations under the Lease.

(a) Fundus argues that estoppels are disfavored under Georgia law, and that appellees are required to prove the elements of equitable estoppel, including proof of some concealment or false representation, in order to prevail on a motion for summary judgment. None of the cases relied upon by Fundus, however, involves a written estoppel certificate in which a party expressly agreed to be estopped. Georgia law recognizes, “on grounds of public policy and good faith,” that the execution of an estoppel certificate can create an estoppel effect against future claims for damages. In Virginia Highland Assoc. v. Allen, this Court reversed the trial court’s failure to enforce an estoppel certificate because “[a]dmissions which have been acted on by others, are conclusive against the party making them, in all cases, between him and the person whose conduct he has thus influenced.” Similarly, this Court in Office Depot v. The District at Howell Mill held that Office Depot was precluded from claiming a breach of its lease by the terms of an estoppel certificate it executed at the time the District sold a majority interest in a commercial shopping center to ELPF Howell, LLC, and upon which ELPF Howell, LLC reasonably relied. Neither of these cases included evidence of concealment or false representation.

Accordingly, it follows that a party can agree to be estopped under circumstances that might not otherwise constitute an estoppel under common law, as Fundus has in this case by executing the Consent to Assignment, which incorporated the Estoppel Certificate as part of its contractual terms.

(b) Fundus argues that the Estoppel Certificate does not preclude its claims because appellees were in a better position to know that the Lease had been breached at the time of assignment, and so they could not reasonably rely upon it.

Fundus is a Georgia limited partnership, but almost all of Fundus’s limited partners and decision-making representatives reside in Europe. Fundus argues that it had limited knowledge of the Hotel’s condition through infrequent visits to the Hotel from Europe and from the annual reports provided by its asset manager, Prudential Real Estate Investors, and that Marriott, who was currently providing the Hotel’s management services, was in a better position to know the condition of the Hotel. However, Marriott does not dispute that it had knowledge of the Hotel’s condition at the time of assignment. Instead, Marriott argues that it was that very knowledge that led them to insist upon the Estoppel Certificate before it would assume any liability for the Lease. Marriott’s representative testified that “[w]e were being asked to step into a tenant position, we simply would not do it, period, without getting an estoppel certificate that said the lease was in full force . . . [and] there were no outstanding breaches.”

Although it is a general rule of law that an estoppel cannot result “where both parties have equal knowledge or equal means of knowing the truth[,]” parties can contract around “this rule of law, so as to prevent lack of knowledge of a fact from avoiding. . . estoppel.” By executing the Estoppel Certificate and the Consent to Assignment, which specifically provided that appellees “shall have the right to rely on the certifications and representations of Lessor [Fundus] set forth in the Lessor’s Lease Estoppel Certificate,” Fundus contracted around this common law element of estoppel. Accordingly, appellees are not required to show that they did not have equal knowledge or means to obtain knowledge about the Hotel’s condition.

Further, in evaluating whether the Estoppel Certificate can preclude Fundus’s claims, we are persuaded by the holding of the Appellate Court of Illinois that “[a] party who executes an estoppel certificate should not be allowed to raise claims of which it knew or should have known at the time the certificate was executed” and that “[a] party who executes an estoppel certificate that there are no defaults is under a duty to inquire and determine, insofar as reasonably possible, what claims exist.” Accordingly, Fundus had a duty to make reasonable inquiries into the state of the Hotel prior to executing the Estoppel Certificate and cannot evade such responsibility by qualifying its representation as merely being its “best knowledge.” Fundus did not meet this obligation. Fundus admits that it did not conduct an inspection of the Hotel in anticipation of the Lease assignment. Its knowledge of the Hotel’s condition was based upon the annual reports prepared by Prudential, which “contained only a limited section of general updates on Marriott’s capital projects at the Hotel and the limited information that Prudential received from its yearly ‘walkthrough’ of the property with Marriott’s employees.” Prudential’s annual visit to the Hotel was “not a physical inspection of the property,” and Prudential “never” conducted such an inspection. An estoppel certificate can be enforceable even if the party signing it did so negligently. Because the law charged Fundus with the knowledge that a reasonable inspection would have uncovered, any dispute over the quality of Fundus’s inspections does not give rise to an issue of material fact. Fundus expressly agreed in the assignment contract that appellees “shall have the right to rely” on the Estoppel Certificate, and Fundus cannot avoid that commitment by arguing circumstances that would otherwise give rise to an equitable estoppel.

(c) Fundus contends that the trial court erred in granting summary judgment to appellees because the representations it made in the Estoppel Certificate were “limited and qualified,” and thus appellees’ reliance upon these admissions was unreasonable.

In support of this argument, Fundus notes that it refused to sign a draft of the Estoppel Certificate containing proposed Paragraph 6, which stated that Fundus was satisfied with improvements made to the Hotel and that the property complied with operating requirements contained in the Lease. Fundus argues that its refusal to sign an assignment with this language is sufficient evidence to put appellees on notice that they might be liable for some existing contractual breaches. However, this argument ignores the contract’s integration clause, which provides that the Consent to Assignment (and all its exhibits, including the Estoppel Certificate) “constitutes the entire agreement of the parties” and that “ [a]ll prior understandings and agreements among the parties concerning these matters are merged into this Consent.” When a contract is unambiguous, intentions not expressed by writing cannot add to or take away from the written instrument and cannot be shown by parol evidence. Accordingly, this Court cannot consider parol evidence to add to, take from, contradict or vary the assignment contract containing the terms of the Estoppel Certifícate.

Decided October 26, 2011

Reconsideration denied December 1, 2011

Lease. Fulton State Court. Before Judge Levenson, pro hac vice.

Alston & Bird, John C. Weitnauer, William C. Massey, Candace N. Smith, Meaghan G. Boyd, RobbinsFreed, Richard L. Robbins, Alexa R. Ross, Jason Alloy, for appellant.

Bondurant, Mixson & Elmore, Michael B. Terry, Timothy S. Rigsbee, Ronan P. Doherty, for appellees.

(d) Based upon the above, we find that although Fundus’s claims arising from alleged breaches of the Lease that arose prior to the June 22, 2005 assignment are barred by the Estoppel Certificate, claims for breach of the Lease that arose after June 22, 2005 are not barred by the Estoppel Certificate. However, Fundus pointed to no evidence of a post-assignment breach. The trial court concluded the motion for summary judgment hearing by specifically inviting Fun-dus to identify evidence of any breach that might survive the legal rulings now on appeal, but Fundus failed to do so.

2. Many of Fundus’s claims arose from an alleged breach of the Lease requirement that appellees maintain the Hotel as a “first class hotel. ’ ’ Fundus contends that the trial court erred in holding that the phrase “first class hotel” is not an enforceable contract term. Since, however, as we held in Division 1, Fundus’s claims for breach of the Lease are precluded by the Estoppel Certificate, this issue has been rendered moot.

Judgment affirmed.

Smith, P. J., and Dillard, J., concur.

       OCGA § 9-11-56 (c); Kaplan v. City of Sandy Springs, 286 Ga. 559, 560 (1) (690 SE2d 395) (2010).

       (Citation omitted.) Oglethorpe Dev. Group v. Coleman, 271 Ga. 173, 173 (1) (516 SE2d 531) (1999).

        Lau’s Corp. v. Haskins, 261 Ga. 491 (405 SE2d 474) (1991).

        Clayton County Bd. of Tax Assessors v. City of Atlanta, 286 Ga. App. 193, 194 (648 SE2d 701) (2007).

       (Citation and punctuation omitted.) Id.

       Then operating under the name “HPI Georgia, Inc.”

       An estoppel certificate is
      [a] signed statement by a party . .. certifying for another’s benefit that certain facts are correct, such as that a lease exists, that there are no defaults, and that rent is paid to a certain date. A party’s delivery of this statement estops that party from later claiming a different state of facts.
      Black’s Law Dictionary 572 (7th Ed. 1999).

       Georgia law provides that “multiple documents may be considered together as a single contract as long as all the necessary terms are contained in signed contemporaneous writings.” (Citation and punctuation omitted.) Bd. of Regents &c. of Ga. v. Tyson, 261 Ga. 368, 369 (1) (404 SE2d 557) (1991). OCGA § 24-6-3 (a).

       The party claiming the benefit of an equitable estoppel must prove that it is “free from fraud in the transaction, must have acted in good faith, and must have exercised reasonable diligence” and that the party against whom the estoppel is sought acted in a manner amounting to fraudulent representation or concealment. (Citation omitted.) Collins v. Grafton, Inc., 263 Ga. 441, 443 (2) (435 SE2d 37) (1993). Accord Harbor Co. v. Copelan, 256 Ga. App. 79, 80 (1) (567 SE2d 723) (2002), disapproved on other grounds by Shearin v. Wayne Davis & Co., P.C., 281 Ga. 385, 387, n. 5 (637 SE2d 679) (2006).

       (Citation and punctuation omitted.) Virginia Highland Assoc. v. Allen, 174 Ga. App. 706, 709 (2) (330 SE2d 892) (1985).

       Id.

       Id.

       (Citation and punctuation omitted; emphasis in original.) Id. at 708 (2).

       309 Ga. App. 525 (710 SE2d 685) (2011).

       Id. at 527-529 (1).

       (Citation and punctuation omitted.) Collins, supra at 443 (2).

       (Citation omitted.) Sovereign Camp &c. v. Heflin, 188 Ga. 234, 235 (1) (3 SE2d 559) (1939).

        K’s Merchandise Mart v. Northgate Ltd. Partnership, 359 Ill. App. 3d 1137, 1144 (II) (B) (835 NE2d 965) (2005).

       Id.

       As stated above, the Estoppel Certificate states:
      Landlord has not delivered or received any notices of a breach or a default under the Lease, and to the best knowledge of Landlord, there is no breach or default by Tenant or Landlord under the Lease. . . . Landlord and, to the best knowledge of Landlord, Tenant, have performed all of their obligations under the Lease.
      (Emphasis supplied.)

        Virginia Highland Assoc., supra at 709 (2) (“If appellees . . . are not estopped by the unqualified certificate they signed, even if they did so negligently, no prospective landlord would ever be able to rely upon the express declarations given to his predecessor in title by purported tenants in possession”).

        Gray v. Dental One Assoc., 269 Ga. App. 888, 890 (605 SE2d 366) (2004). Accord Watson v. Zurich-American Ins. Co., 221 Ga. App. 4, 5-6 (1) (470 SE2d 684) (1996).

       Id. at 6.

       See Locke’s Graphic &c. v. Citicorp Vendor Finance, 285 Ga. App. 826, 828 (2) (a) (648 SE2d 156) (2007).


author: BARNES, Presiding Judge. BLACKWELL, Judge,

text:
    A11A0855.
    AMERICAN MANAGEMENT SERVICES EAST, LLC et al. v. FORT BENNING FAMILY COMMUNITIES, LLC et al.
    (720 SE2d 377)
   BARNES, Presiding Judge.

Appellees Fort Benning Family Communities, LLC (“FBFC”) and Fort Belvoir Residential Communities, LLC (“BRC”) are owners of military housing projects at Fort Benning, Georgia and Fort Belvoir, Virginia. On May 20, 2010, they filed a complaint in Muscogee County Superior Court seeking a declaratory judgment that their property management agreements with appellant American Management Services East LLC (“AMSE”), their property manager, automatically terminated for cause because of AMSE’s misconduct. They also alleged breach of fiduciary duty, fraud, conspiracy to commit fraud, and unjust enrichment, and sought an accounting. The parent company, American Management Services LLC d/b/a Pinnacle (“AMS”), was also named in the action.

AMSE and AMS answered and filed a counterclaim alleging, among other things, breach of the management agreement by FBFC and BRC. They also filed a general motion to dismiss the action, and a motion to dismiss the declaratory judgment claim related to termination of the Fort Belvoir management agreement under the doctrine of forum non conveniens, because the facility is located in Virginia.

While the motions were pending, AMS and AMSE, along with Pinnacle Belvoir, LLC and Clark Pinnacle Belvoir, LLC filed suit in the Circuit Court of Fairfax, Virginia against Clark Realty Capital, LLC, Clark Belvoir, LLC, Lawrence C. Nussdorf, Douglas Sandor, and W Cleveland Johnson seeking a declaratory judgment to enforce certain rights related to the management agreement at the Fort Belvoir facility. They also alleged other claims, including abuse of process, breach of fiduciary agreement, and civil conspiracy. FBFC and BRC thereafter filed a motion in the Muscogee County Superior Court to enjoin AMS and AMSE from pursuing the Virginia action, which the trial court granted. The trial court also denied the motion of AMS and AMSE to dismiss the declaratory judgment claim for forum non conveniens. It is from that order that AMS and AMSE appeal.

“Generally, the granting of an injunction rests in the sound discretion of the trial judge and should not be resorted to except in clear and urgent cases. . . . The moving party has the burden of establishing the right to such relief.” Robinson v. The Landings Assn., 264 Ga. 24, 25 (440 SE2d 198) (1994). The grant of the injunction “will not be interfered with by this Court in the absence of a manifest abuse of discretion. [Cit.]” Cherokee County v. City of Holly Springs, 284 Ga. 298, 301 (2) (667 SE2d 78) (2008).

The facts pertinent to the appeal show that AMS, a property management firm which also conducts business as Pinnacle, and Clark Realty, a national general building contractor, entered into a joint venture known as “Clark Pinnacle,” to bid on military housing privatization projects. Clark Pinnacle won four bids to establish private military housing facilities, including projects at Fort Benning and Fort Belvoir. Clark Pinnacle created limited liability companies (“Clark Pinnacle LLCs”) to manage each project, which were 70 percent owned by Clark and 30 percent owned by Pinnacle. It formed Clark Pinnacle Belvoir, LLC to operate the Fort Belvoir facility and Clark Pinnacle Benning, LLC to operate the Fort Benning facility. In addition, each LLC had a Clark manager and Pinnacle manager, whose duties were defined by the LLC’s operating agreement.

Clark Pinnacle Benning LLC and the United States Army thereafter entered into a limited liability company operating agreement to form FBFC whose purpose was to develop and operate the Fort Benning location. Likewise, BRC was formed under a similar agreement between Clark Pinnacle Belvoir, LLC and the Army to develop and operate the Fort Belvoir facility. FBFC and BRC entered into property management agreements with AMSE for the Fort Benning and Fort Belvoir facilities.

In granting the motion to enjoin AMS and AMSE (“appellants”) from pursuing the Virginia action, the trial court first found it had jurisdiction over them because they had already subjected themselves to the trial court’s jurisdiction by answering and filing a counterclaim in the underlying action. The trial court then found it had jurisdiction over the other two Virginia plaintiffs, Pinnacle Belvoir, LLC and Clark Pinnacle Belvoir, LLC, pursuant to OCGA § 9-11-65 (d) because of their relationship with AMS and AMSE.

The trial court further found that even though the “Georgia plaintiffs” — FBFC and BRC — were not named in the Virginia action, they had standing to enjoin the Virginia action because “any decision made by the Virginia court would restrain the ability of the Georgia Plaintiffs to seek an independent remedy before the Superior Court in Muscogee County, Georgia.” It also found that the “same issues, facts, and same parties lie before both the Circuit Court of Fairfax County, Virginia, and the Superior Court of Musco-gee County, Georgia.” Finally, the trial court determined that

[w]ithout an injunction, both this Court and the court in Virginia would be in a position to make legal and factual determinations as to the enforcement of the Belvoir [property management agreement] as well as to the rights of the parties and their behavior at both Fort Benning and Fort Belvoir, creating the possibility of conflicting opinions in different forums.

1. Appellants first argue that the trial court did not have jurisdiction to enter the injunction because FBFC and BRC were not parties to the Virginia action and therefore lacked standing to request the injunction. They also argue that the trial court could not exercise personal jurisdiction over the enjoined Virginia parties who were not involved in the Georgia action. We do not agree with appellants’ jurisdictional argument, although we agree that, under these circumstances, the trial court had no personal jurisdiction over the two entities who were not parties to this case.

(a) To have standing to seek an interlocutory injunction, a party must have a legally protected interest that will be affected by the action sought to be enjoined. Ga. Power Co. v. Allied Chemical Corp., 233 Ga. 558, 560-561 (1) (212 SE2d 628) (1975). Thus, in Georgia, in seeking injunctive relief a plaintiff must show that he is in great danger of suffering an imminent injury for which he does not have an adequate and complete remedy at law. See Hobbs v. Peavy, 210 Ga. 671, 673 (4) (82 SE2d 224) (1954).

The appellants argue that because FBFC and BRC are not parties to the Virginia action, they have no vested interest in the case’s outcome, and any judgment rendered in Virginia will not have a preclusive effect against them. They cite American Med. Security v. Parker, 279 Ga. 201 (612 SE2d 261) (2005) as authority. However, Parker holds that there is no standing where “rights and remedies” are not affected by the foreign action. In Parker, because the Alabama court found that the insureds were not part of the Alabama class, our Supreme Court held that as nonclass members whose rights and remedies were not affected by the Alabama settlement, the insureds had no standing to challenge that settlement on an individual basis. American Med. Security v. Parker, 279 Ga. at 204 (2). It did not hold, as appellants maintain, that they were excluded only because they were nonparties, but rather held that as a nonclass member of the lawsuit their rights and remedies were not affected by the Alabama settlement. To put it more colloquially, they had no dog in the fight.

Here, the Virginia plaintiffs sought, among other things, a declaration in that action to amend the Belvoir property management agreement which was signed by BRC, and is the centerpiece of the Georgia litigation, and a declaration that the Georgia plaintiffs have abused the process by pursuing the Georgia litigation. Both claims directly affect the pending litigation in Georgia. Further, because they are not parties to the Virginia action, a décision by the Virginia court could not only affect FBFC and BRC’s rights and remedies in Georgia, but could also prevent them as nonparties from having any remedy in the Virginia action, essentially preventing them from having any recourse, whatsoever anywhere.

Thus, the trial court did not err in finding that FBFC and BRC had standing to seek the injunction because they demonstrated that they stood to suffer imminent and irreparable harm as a result of appellants’ actions in the Virginia action.

(b) AMS and AMSE also contend that the trial court could not exercise personal jurisdiction over Pinnacle Belvoir and Clark Pinnacle Belvoir. Georgia courts have the authority under their inherent equitable powers to order any party over whom the court has personal jurisdiction to act or refrain from acting in regard to litigation being conducted in another state. Sanders v. Yates, 215 Ga. 218, 219 (109 SE2d 739) (1959) (court of equity may act in personam and direct parties by injunction to proceed no further in foreign state lawsuit).

Per the language of the injunction, the trial court enjoined “Pinnacle from proceeding directly and through the entities that it controls, including AMS, AMSE, and Pinnacle Belvoir, with its lawsuit in the Circuit Court of Fairfax County, Virginia, until further order of this Court.” The trial court found that it had jurisdiction over Pinnacle Belvoir, LLC and Clark Pinnacle Belvoir, LLC, the additional Virginia plaintiffs, pursuant to OCGA § 9-11-65 (d) because of their relationship with AMS and AMSE. The trial court found that “Pinnacle Belvoir is an affiliate of AMS. [BRC] entered into the Belvoir [property management agreement] with AMSE, an affiliate of AMS. Pinnacle controls and AMS CEO Stan Harrelson manages both of the other Virginia Plaintiffs, Pinnacle Belvoir and Clark Pinnacle Belvoir.”

The appellants argue that the statute does not grant a trial court personal jurisdiction over a party’s affiliates, but only identifies parties bound by a properly issued injunction. They argue that a trial court cannot extend an injunction to cover a nonparty either directly or indirectly without a finding that the nonparty fits into one of the categories listed in OCGA § 9-11-65 (d), which provides that an injunction “is binding only upon the parties to the action, their, officers, agents, servants, employees, and attorneys, and upon those persons in active concert or participation with them who receive notice of the order by personal service or otherwise.”

First, the statute does not require an express finding by a trial court that a nonparty falls within a particular category listed in OCGA § 9-11-65 (d). Second, the trial court found that the two Virginia plaintiffs who were not parties to the Georgia suit were controlled by Virginia plaintiffs — the appellants — who are parties to the Georgia suit.

The trial court, therefore did not err in finding that its injunction binds Pinnacle Belvoir and Clark Pinnacle Belvoir. Extending the injunction to bind these two entities as “officers, agents, servants, employees . . . attorneys, and . . . persons in active concert and participation with them,” does not literally extend actual personal jurisdiction over them so as to make them parties to the Georgia action. It simply prohibits the appellants from proceeding for their own gain indirectly through these entities in the Virginia court.

2. Appellants argue that even if the injunction is jurisdictionally sound, the trial court abused its discretion in granting it. They assert that abuse of discretion is evident where “a trial court awards injunctive relief without any evidence to support such judgment and contrary to the law and equity.”

The power of a court of equity to restrain a person within its jurisdiction from prosecuting a suit in a court of a foreign State rests upon the basis that the person whom it is sought to enjoin is under the jurisdiction of the court and can be prevented from doing an inequitable thing. When both parties to an action in a foreign State are domiciled in this State, a court of equity in this State can in personam direct the parties, by injunction, to proceed no further in such State. Such power is not to be exercised capriciously, . . . but it is necessary that the complainant show that the action has for its purpose or necessary effect the obtaining of an inequitable or unconscionable advantage over the complainant. When such power is used, it acts only against the person of the resident plaintiff in the foreign suit, and not against the court itself, and should be exercised where not to exercise the power would be incompatible with equity and good conscience. The consideration in granting an injunction should overbalance the right of the party to bring his action in another State having jurisdiction of the parties and cause of action.

(Citations omitted.) Atlantic Coast Line R. Co. v. Pope, 209 Ga. 187, 188-189 (1) (71 SE2d 243) (1952), rev’d on other grounds, Pope v. Atlantic Coast Line R. Co., 345 U. S. 379 (73 SC 749, 97 LE 1094) (1953). See Sanders v. Yates, 215 Ga. at 218 (injunctive relief proper where shown that purpose, or necessary effect, of enjoined action in foreign jurisdiction was to obtain unconscionable or inequitable advantage to which plaintiff would not be entitled in domicile of parties).

Appellants argue that the action in Georgia relates to whether AMS, AMSE, FBFC, and BRC performed their respective obligations under the property management agreements, and relate solely to the parties’ conduct under the agreement. They assert that the Virginia claim is materially different, as it deals with the breach of operating and joint venture projects involving the Virginia defendants, and not the property management agreements. However, eight of the nine counts in the Virginia action either directly challenge the validity of the Georgia action, are based on the premise that the agreement or duty was breached by their pursuit of the Georgia action, or involved the Belvoir property management agreement, which is at issue in the Georgia action.

In Tenn. Farmers Mut. Ins. Co. v. Wheeler, 170 Ga. App. 380, 382 (2) (317 SE2d 269) (1984), an insurer’s answer pled defenses in tort and contract against the driver and the insureds in a wrongful death action in Georgia, and the insurer then filed a declaratory judgment action in Tennessee on the policy coverage issues. We held:

Had the trial court not restrained appellant from proceeding with its declaratory judgment action in Tennessee, the trial court would have ceded its earlier acquired jurisdiction to the Tennessee courts . . . , and the trial court’s determination as to the coverage issues would have amounted to no more than an advisory opinion. A double burden would have been cast upon appellees and the possibility of conflicting opinions in the two forums allowed. We hold, therefore, that just as a trial court will not permit a party to initiate a new petition for declaratory judgment when a proceeding invoking the same issues is already pending in another forum, a trial court is authorized to grant injunctive relief to prevent a party under its jurisdiction from proceeding with such declaratory action in another forum when a declaratory proceeding in which the same issues may be raised is already pending in the trial court.

Id.

The dissent maintains that the trial court abused its discretion in granting the injunction because the record does not sustain the trial court’s factual findings regarding all of the issues in each lawsuit. We have held, however, that

[t]his Court can only control the discretion of the Judge of the Superior Court where it has been manifestly abused. The law places the granting or refusal of an injunction in his, not our discretion. Though we may differ from him as to the soundness of its exercise in any given case, we may not interfere unless the facts show manifest abuse of it.

Davis v. Weaver, 46 Ga. 626, 629 (1872). Moreover,

in determining whether or not there has been an abuse of discretion ... a conflict in evidence upon the hearing, which would authorize the judge to either grant or deny the injunction, must be a conflict in the evidence on material issues in the case. Where the plaintiff shows grounds for the grant of an injunction and shows that unless injunction is granted he will suffer irreparable injury, and there is conflict in some immaterial issues made in the case, it is error to refuse an interlocutory injunction to restrain the defendant.

(Citations and punctuation omitted; emphasis supplied.) Jones v. Lanier Dev. Co., 188 Ga. 141, 145-146 (2 SE2d 923) (1939).

Although the dissent takes great care in contrasting and distinguishing the claims in the Virginia complaint from those in the Georgia complaint, it is evident that many of the Virginia claims, including abuse of process, breach of the joint venture agreement, breach of fiduciary duties, and breach of the Belvoir Management Agreement, either directly overlap or indirectly impact the Georgia action. Contrary to the dissent’s assertion that the trial court merely found that the “same issues” lie before both courts, the trial court made explicit factual findings about the Virginia claims and their impact on the claims in the Georgia action.

Thus, as the evidence supported the trial court’s award of injunctive relief, there was no abuse of the trial court’s discretion in so ordering.

3. There is no merit to the appellants’ argument that the trial court disregarded important principles of comity and state in issuing the injunction. In this case, there has been no ruling by the Virginia court, nor does the injunction usurp the Virginia Court’s authority.

Judgment affirmed.

Miller, P. J., Phipps, P. J., Ellington and Adams, JJ., concur. Doyle and Blackwell, JJ., dissent.

BLACKWELL, Judge,

dissenting.

Based on a finding that this case and the Virginia lawsuit present “[t]he same issues,” the court below enjoined Pinnacle from continuing to prosecute any aspect of the Virginia lawsuit. That, I think, was an abuse of discretion because, although the two lawsuits may present some of the same issues, not all the issues are the same, and the court below, apparently not appreciating the distinct issues presented in the Virginia lawsuit, failed to consider whether its injunction ought to sweep less broadly and whether Pinnacle ought to be permitted to continue to prosecute at least some of its claims in Virginia. Accordingly, I would vacate the injunction entered below and remand for reconsideration of the motion for an interlocutory injunction. Because the majority does not do so, I respectfully dissent.

The facts are complicated, but I will try to explain them as simply as I can. Several years ago, Clark Realty Capital, LLC, a construction firm, and Pinnacle, a property management firm, joined together to bid for the opportunity to maintain and manage military housing units at several installations across the country, and their joint venture won the opportunity to do so at, among other installations, Fort Benning, Georgia and Fort Belvoir, Virginia. To maintain and manage the housing units at Fort Belvoir, Clark Belvoir, LLC, an affiliate of Clark Realty, and Pinnacle Belvoir, LLC, an affiliate of Pinnacle, formed Clark Pinnacle Belvoir, LLC, in which Clark Belvoir has a 70 percent ownership interest and Pinnacle Belvoir has a 30 percent ownership interest. Clark Pinnacle Belvoir and the Army, in turn, formed Fort Belvoir Residential Communities, LLC, in which Clark Pinnacle Belvoir has a 51 percent ownership interest. Fort Belvoir Residential Communities owns the housing units at Fort Belvoir that Clark Realty and Pinnacle won the right to maintain and manage. In many respects, Pinnacle says, Clark Realty effectively controls Fort Belvoir Residential Communities, inasmuch as Clark Realty is the manager of Clark Pinnacle Belvoir, which, in turn, is the managing member of Fort Belvoir Residential Communities. But with respect to any adjustment of a property management agreement to which Fort Belvoir Residential Communities is a party, Pinnacle Belvoir has effective control of Fort Belvoir Residential Communities, Pinnacle claims, because under the operating agreement for Clark Pinnacle Belvoir, both Clark Realty and Pinnacle Belvoir must vote on any such adjustment, and if there is a tie, Pinnacle Belvoir has the right to break the tie. Similar entities apparently were formed for the maintenance and management of housing units at Fort Benning, including Fort Benning Family Communities, LLC, which owns the housing units there.

Fort Belvoir Residential Communities and Fort Benning Family Communities each entered into a property management agreement with Pinnacle, by which Pinnacle would provide property management services at the two installations. Each property management agreement provides, among other things, that the agreement terminates upon the occurrence of any “theft, fraud, or other knowing or intentional misconduct by [Pinnacle] or its employees or agents.” Clark Realty later came to believe that Pinnacle and certain Pinnacle employees were engaged in fraud at both installations, and both Fort Benning Family Communities and Fort Belvoir Residential Communities filed this lawsuit against Pinnacle, seeking a declaratory judgment that their property management agreements were terminated, as well as damages for breach of fiduciary duty, fraud, and unjust enrichment.

After this lawsuit was filed, Pinnacle Belvoir invoked its rights under the operating agreement for Clark Pinnacle Belvoir and proposed an adjustment to the property management agreement between Fort Belvoir Residential Communities and Pinnacle. Not surprisingly, the proposed adjustment would amend the property management agreement to give Pinnacle an opportunity to cure any “theft, fraud, or other knowing or intentional misconduct” prior to termination of the property management agreement. Clark Realty apparently refused to vote on the proposal, thereby depriving, Pinnacle says, Pinnacle Belvoir of the opportunity to break the tie and force an amendment of the property management agreement.

Pinnacle and Pinnacle Belvoir then filed a lawsuit in Virginia against Clark Realty and Clark Belvoir, in which they seek a declaratory judgment as to the rights of Pinnacle Belvoir under the operating agreement of Clark Pinnacle Belvoir to inspect its books and records and to propose and require a vote on the adjustment of the property management agreement for the housing units at Fort Belvoir. They also seek a declaratory judgment that, unless and until the Georgia court rules otherwise, the property management agreement at Fort Belvoir remains in effect. Finally, they allege that Clark Realty and its affiliates and officers are engaged in a scheme to deprive Pinnacle of its interest in the joint venture nationally, including by causing Fort Benning Family Communities and Fort Belvoir Residential Communities to file the lawsuit in Georgia, which, Pinnacle and Pinnacle Belvoir claim, is without merit and concerns matters so inconsequential or trivial that Fort Belvoir Residential Communities ought not pursue such a lawsuit in any event. Based on these allegations, Pinnacle and Pinnacle Belvoir seek damages from Clark Realty and its affiliates and officers.

Fort Benning Family Communities and Fort Belvoir Residential Communities moved the court below to enjoin Pinnacle from pursuing the Virginia litigation, and the court granted the motion. In its order, the court below found that “[t]he same issues, facts, and same parties lie before both the Circuit Court of Fairfax County, Virginia, and the Superior Court of Muscogee County, Georgia,” explaining, among other things, that “Count II of the Virginia complaint seeks to amend the [Fort] Belvoir [property management agreement].” Based on these findings, the court below enjoined Pinnacle from “proceeding . . . with its lawsuit in the Circuit Court of Fairfax County, Virginia.” There is no indication that the court considered any distinct issues raised in Virginia or whether a more limited injunction would be in order.

Whether to grant an interlocutory injunction is committed to the discretion of the trial court, but if, in the exercise of that discretion, a trial court relies upon a finding of fact that the record cannot sustain or misapplies the law, it abuses its discretion. See Mathis v. BellSouth Telecommunications, 301 Ga. App. 881, 881 (690 SE2d 210) (2010) (decision is an abuse of discretion if it is “unsupported by any evidence of record or where [the] ruling misstates or misapplies the relevant law”); see also Glisson v. Global Security Svcs., 287 Ga. App. 640, 640 (653 SE2d 85) (2007) (an abuse of discretion occurs “if a trial judge awards injunctive relief ‘without any evidence to support such judgment and contrary to the law and equity’ ”) (citation omitted); Allen v. Hub Cap Heaven, Inc., 225 Ga. App. 533, 534 (484 SE2d 259) (1997). Here, the record does not sustain the findings about the nature of the issues presented in the Virginia case on which the court based its injunction, and for that reason, the court abused its discretion, and we must vacate the injunction and remand for further proceedings.

The court below found that the “[s]ame issues” are presented in both lawsuits, but from the record, it is apparent, I think, that not all the same issues are presented in each lawsuit, even if some common issues appear in both. The Virginia lawsuit seeks, for instance, a declaration of the right of Pinnacle Belvoir to inspect the books and records of Clark Pinnacle Belvoir. Whether Pinnacle Belvoir has a right to inspect those books and records, as far as I can see, has nothing to do with whether Pinnacle has breached any property management agreement and does not depend at all on the resolution of any issue presented in the Georgia case. Likewise, the court below misconstrued the claim in Virginia concerning the right of Pinnacle Belvoir under the Clark Pinnacle Belvoir operating agreement to propose and have a vote on an adjustment of the property management agreement for Fort Belvoir. The court, as noted above, characterized this claim as one “to amend” the property .management agreement. But the Virginia complaint does not ask the Virginia court to order any changes to the property management agreement, and it instead asks the Virginia court only to declare whether Clark Realty can be required to vote on the proposal to amend the property management agreement and whether Pinnacle Belvoir has the right to break a tie. The issues raised by these claims are issues that concern the corporate governance of Clark Pinnacle Belvoir, and those are issues that are not before the Georgia court.

It is true, of course, that the assertion of these claims in Virginia may be motivated by the Georgia litigation, but I wonder if that ought to matter. If Pinnacle Belvoir has the rights that it claims under the operating agreement for Clark Pinnacle Belvoir, for instance, I am not certain that Pinnacle Belvoir properly can be divested of those rights simply because it has certain motives for exercising them. If motives matter, it is only because the operating agreement for Clark Pinnacle Belvoir or the law applicable to that operating agreement says so, but the operating agreement is not something that is before the Georgia court. And in any event, the court below did not even consider these questions because it apparently failed to appreciate that some of the issues presented in the two cases are not, in fact, the same.

It also is true that, if Pinnacle is permitted to proceed with these claims in Virginia, the Virginia court might award relief to Pinnacle that has some implications for the Georgia case, but it is not apparent that this possibility makes a difference. Fort Benning Family Communities and Fort Belvoir Residential Communities argued below that the demand to inspect the books and records of Clark Pinnacle Belvoir is simply an attempt to obtain discovery for the Georgia lawsuit by means other than those authorized by the Civil Practice Act, but so what if it is? Parties obtain discovery by other legal means — interviewing independent witnesses, searching their own records, searching public records, and asking others to voluntarily make records and information available — in all kinds of litigation. If Pinnacle Belvoir, in fact, has an unconditional right under the operating agreement of Clark Pinnacle Belvoir to inspect the books and records of that entity, I am not sure that it should be divested of that right simply because the books and records might be used in other litigation.

If the Virginia court declares that Pinnacle Belvoir has the right to require Clark Realty to vote on any change in the property management agreement at Fort Belvoir and has the right to break any tie, it might, of course, result in Pinnacle Belvoir actually effecting such a change, which might then affect the outcome of the Georgia litigation. But we regularly see cases in which the outcome is driven by business decisions that the parties or their affiliates made after the filing of the cases, decisions that they had every right to make, notwithstanding the pendency of litigation. And if Pinnacle Belvoir, in fact, has the right it claims with respect to a change in the property management agreement, that may be unfortunate for Clark Realty and its affiliates, but that is the operating agreement into which they entered. I am not confident that the existence of litigation that does not concern the operating agreement affords a basis for an injunction that may effectively strip Pinnacle Belvoir of its rights under the operating agreement.

“[T]he pendency of a suit in one State . . . furnishes no cause to stay or abate a new suit brought in a court of another State,” even when the suits involve the same parties and causes of action, Ambursen Hydraulic Constr. Co. v. Northern Contracting Co., 140 Ga. 1, 6 (78 SE 340) (1913), unless it appears that the party to be enjoined is attempting to do “an inequitable thing.” Id. at 7. If Pinnacle Belvoir has the rights that it claims under the operating agreement for Clark Pinnacle Belvoir, I am not sure that it is inequitable for Pinnacle Belvoir to seek to vindicate those rights just because some related entities are involved in related litigation in Georgia or because it might be motivated by the Georgia litigation. And whether Pinnacle Belvoir has the rights it claims is a question that concerns the corporate governance of Clark Pinnacle Belvoir, a company organized under the laws of Virginia and apparently having its principal place of business in Virginia. The principle of comity, I think, ought to make us wary of an injunction that effectively prevents a Virginia court from passing upon the governance of a Virginia company under Virginia law, especially when the same issues of governance are not squarely presented in the court below. See generally American Med. Security v. Parker, 279 Ga. 201, 207-208 (612 SE2d 261) (2005) (Carley, J., concurring) (discussing principle of comity). In any event, there is no indication that the court below considered any of these questions when it issued an injunction in this case.

To be sure, some of the issues presented in the Georgia and Virginia cases are the same. The claim in Virginia that the property management agreement for Fort Belvoir remains in effect raises a question about whether the agreement already has terminated by its own terms upon the occurrence of “theft, fraud, or other knowing or intentional misconduct” by Pinnacle, an issue squarely presented in the Georgia case. And to the extent that Pinnacle seeks damages in Virginia for the bringing of a lawsuit in Georgia that, Pinnacle claims, has no merit or concerns inconsequential and trivial things, its claims directly implicate the merits of the case below. So, I do not doubt that the court below might properly enter some injunction with respect to the Virginia lawsuit. And perhaps it might even properly enter the injunction that it did, barring Pinnacle from pursuing all of its claims in Virginia. But if it is to do so, the court below must correctly assess the facts, including what precisely is at issue in the Virginia litigation. Because the court did not do so, I would vacate the injunction and remand for further proceedings.

I am authorized to state that Judge Doyle joins in this dissent.

Decided December 1, 2011

Page, Scranton, Sprouse, Tucker & Ford, Marcus B. Calhoun, Jr., Greenberg Traurig, Michael J. King, for appellants.

Buchanan & Land, Jerry A. Buchanan, Lori M. Leonardo, for appellees.

       The Military Housing Privatization Initiative (“MHPI”) was established by Congress in 1996 to facilitate privatization of military housing. In doing so, MHPI was authorized to enter into agreements with private developers to own, maintain, and operate military housing.

       The statute provides that the court’s injunctions bind not only the direct parties to the action, but also the parties’ “officers, agents, servants, employees, . . . attorneys, and . . . persons in active concert or participation with them.” OCGA § 9-11-65 (d).

       By “Pinnacle,” I mean American Management Services LLC and American Management Services East LLC, the defendants in the court below.

       I agree with the majority that the plaintiffs in this case have standing to seek an injunction and that, although the court below could not directly enjoin Pinnacle affiliates that were not before it, it could enjoin Pinnacle from acting through those affiliates to circumvent its injunction.