author: Branch, Judge.

text:
    A13A1331.
    ARCHER WESTERN CONTRACTORS, LLC et al. v. HOLDER CONSTRUCTION COMPANY et al.
    (751 SE2d 908)
   Branch, Judge.

Appellants Archer Western Contractors and Capital Contracting Company (collectively, “AWC”) filed the instant suit against appellees Holder Construction Company, Manhattan Construction Company, C. D. Moody Construction Company, and Hunt Construction Group (collectively, “HMMH”) seeking a declaration that HMMH’s assertion of its right to withhold payments to its subcontractor AWC was barred by res judicata. HMMH filed a motion to dismiss AWC’s action and to compel arbitration, which the trial court granted. On appeal from this order, AWC argues that the trial court erred when it granted HMMH’s motion to dismiss because the arbitration provision is unenforceable and because the trial court, rather than an arbitrator, was required to determine whether res judicata barred HMMH’s assertion of its right to withhold payments. We disagree with these contentions and therefore affirm.

Whether a valid and enforceable arbitration agreement exists is “a question of law.” Miller v. GGNSC Atlanta, 323 Ga. App. 114, 117 (1) (746 SE2d 680) (2013). We therefore review a trial court’s order granting or denying a motion to compel arbitration de novo. Id.

Although this appeal is an outgrowth of litigation that has occupied our appellate courts since 2011, the relevant facts are not in dispute. In late 2004, the City of Atlanta

entered into a contract (“the Main Contract”) with a joint venture comprised of defendants [HMMH] regarding the construction project, f] The General Contractor entered into a contract (“the Subcontract”) with a joint venture comprised of defendants [AWC] to perform work on the project. Pitts was employed by [AWC] to work on the project. [AWC] contracted with A&G Trucking for trucking and hauling work on the project.
Pursuant to the Main Contract, [HMMH] would serve as construction manager for the construction of the Atlanta airport’s Maynard Holbrook Jackson, Jr., International Terminal, identified in the Main Contract as the “project.” The Main Contract authorized [HMMH] to enter into subcontracts with other entities. [HMMH] was obligated to require any subcontractors to be bound to it by the terms of the Main Contract and to assume to it all obligations and responsibilities which it assumed to the City under the Main Contract. The Main Contract also provided that, “where appropriate, [HMMH] shall require each Subcontractor to enter into similar agreements with its Sub-Subcontractor.”
The Main Contract specified that [HMMH], its subcontractors, and its sub-subcontractors were named insureds under the City’s “Owner’s Controlled Insurance Program,” which was made a part of the Main Contract. The stated purpose of the Owner’s Controlled Insurance Program was “to provide one master insurance program that provides broad coverage with high limits that will benefit all participants involved in the project.” The Main Contract required that the named insureds comply with all requirements of the Owner’s Controlled Insurance Program, which pertinently provided: “[HMMH] shall, at its own expense, purchase and maintain such insurance as will protect Contractor, Owner, Construction Manager, Design Consultant, and their Trustees, Directors, Officers, Partners, Agents, Representatives, and Employees from claims of the type set forth below: Automobile, Bodily Injury and Property Damage Liability Insurance covering all automobiles, whether owned, non-owned, leased or hired, with not less than the following limits: . . . Bodily Injury - $10,000,000 per person and occurrence.”

(Punctuation and emphasis omitted.) Estate of Mack Pitts v. City of Atlanta (“Pitts I”), 312 Ga. App. 599, 601-602 (719 SE2d 7) (2011).

HMMH hired AWC as one of its subcontractors on Phase 2 of the project.

Pursuant to the [Phase 2] Subcontract, [AWC] agreed to be bound by the terms of the Main Contract, to assume toward [HMMH] all duties and obligations that [HMMH] owed the City under the Main Contract, and to bind all lower tier subcontractors to the obligations set forth in the Main Contract and the Subcontract. The Subcontract expressly required [AWC] to maintain automobile liability insurance coverage for “owned, hired and non-owned vehicles with a $10,000,000 combined single limit for bodily injury and property damage.”

(Punctuation omitted.) Pitts I, 312 Ga. App. at 602.

In June 2007, a truck operated by A&G Trucking, a subcontractor hired by AWC, killed Mack Pitts, a worker at the site. After Pitts’s estate was unable to collect the judgment of $5.57 million it obtained against A&G, the estate sued the City, HMMH, and AWC, asserting inter alia that Pitts had been a third-party beneficiary of the Subcontract’s provisions requiring defendants’ lower tier subcontractors, including A&G, to obtain $10 million of automobile liability coverage. In the course of the estate’s action, HMMH asserted a cross-claim against AWC that AWC had breached its duty under the Phase 2 subcontract to indemnify HMMH as to the estate’s claims.

In December 2010, the trial court granted the Pitts defendants’ motions for summary judgment on the ground that Pitts had not been a third-party beneficiary of the Phase 2 subcontracts. The estate appealed this ruling to this Court, which concluded that Pitts had indeed been a third-party beneficiary of the Phase 2 subcontracts. See Pitts I, 312 Ga. App. at 603-604 (1) (a) (i). The City appealed this Court’s ruling to the Supreme Court of Georgia, which vacated this Court’s decision in Pitts I and remanded for further consideration of the third-party beneficiary question. See Archer Western Contractors v. Estate of Mack Pitts (“Pitts II’), 292 Ga. 219, 230 (4) (735 SE2d 772) (2012). On remand, this Court once again concluded that Pitts had been a third-party beneficiary of the Phase 2 subcontracts. Estate of Mack Pitts v. City of Atlanta (“Pitts III”), 323 Ga. App. 70 (746 SE2d 698) (2013). We therefore reversed the trial court’s grant of summary judgment to the construction companies as well as its denial of summary judgment to the estate. Id.

In the same December 2010 order that granted summary judgment to the Pitts defendants and formed the basis of the Pitts I, II, and III appeals, the trial court also denied HMMH’s cross-motion for summary judgment and granted AWC’s cross-motion for the same, holding that AWC had no duty to defend or indemnify HMMH from any losses incurred in the course of operations at the construction site under the Phase 2 subcontract. HMMH did not appeal this portion of the December 2010 order. In December 2011, however, HMMH notified AWC that it would not make any additional payments to AWC under these two parties’ Phase 3 subcontract until the conclusion of the Pitts litigation.

AWC brought this action seeking a declaration that it was owed money under Phase 3 of the project and that the trial court’s order in the Phase 2 litigation precluded HMMH from withholding payments due under the Phase 3 subcontract when such withholding was premised on AWC’s alleged breach of the Phase 2 subcontract. In its answer and counterclaim, HMMH justified its refusal to make additional payments on the ground that AWC had “breached its contractual obligations to HMMH” in the Phase 2 subcontract, in that AWC had failed to “ensur[e] that A&G carried the requisite insurance,” resulting in damage to HMMH. HMMH then notified AWC of its decision to arbitrate this dispute under Article 14.3.2 of the Phase 3 subcontract, which provided that disputes “arising out of or related to the Work or the [Phase 3] Subcontract or any breach thereof... shall be decided, at the sole option of [HMMH], by binding arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association then in effect.” AWC responded that a forum selection clause in a supplemental provision of the Phase 3 subcontract placed “venue and jurisdiction” for any “legal action or proceeding . . . exclusively in the Federal District Court for the Northern District of Georgia or the State Courts in Fulton County, Georgia.” AWC also asserted that because HMMH had not appealed the trial court’s 2010 ruling that AWC had no duty to defend or indemnify HMMH from losses arising from the construction project, HMMH could no longer argue that it did not owe AWC money under the Phase 3 subcontract.

After a hearing, the trial court found that the instant dispute was within the scope of the Phase 3 subcontract’s arbitration clause, which was not supplanted by the supplemental provision, and that because the arbitration agreement was governed by the Federal Arbitration Act and applicable federal law, the res judicata effect of the trial court’s 2010 judgment was for the arbitrator, not a court, to decide.

1. We first consider the law applicable to the Phase 3 subcontract at issue, including its arbitration provisions.

AWC has not disputed the trial court’s holding that the Federal Arbitration Act (“FAA”) applies here. However, the Phase 3 subcontract, which includes the arbitration provisions at issue, also includes a general provision that “[a] 11 matters relating to the validity, performance, or interpretation of this Subcontract shall be governed by the laws of the state where the Project is located” — here, Georgia. When a Georgia court rules on the issue whether parties agreed to arbitrate a claim under the FAA, it is “required to apply ordinary state law principles governing the formation of contracts.” Simmons Co. v. Deutsche Financial Svcs. Corp., 243 Ga. App. 85, 89 (2) (532 SE2d 436) (2000). Further, the rule of lex fori provides that “Georgia courts will apply Georgia law governing procedural or remedial matters,” and this Court has characterized the GAC as “a body of procedural law setting forth the public policy of this State with respect to the enforcement of agreements to arbitrate.” Continental Ins. Co. v. Equity Residential Properties Trust, 255 Ga. App. 445, 445 (565 SE2d 603) (2002). “State law may apply where parties agree to be bound by state arbitration law, so long as that law does not conflict with the FAA.” North Augusta Assocs. Partnership v. 1815 Exchange, 220 Ga. App. 790, 792 (1) (469 SE2d 759) (1996).

2. AWC’s first contention is that the Phase 3 subcontract’s provision placing “venue and jurisdiction” of any “legal action or proceeding” arising from the subject matter of the subcontract “exclusively” in specific Georgia courts supplants the subcontract’s arbitration provisions. We disagree.

The arbitration provision at issue here states that disputes “arising out of or related to the Work or the [Phase 3] Subcontract or any breach thereof... shall be decided, at the sole option of [HMMH], by binding arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association then in effect.” As the trial court noted, the arbitration provision also provides that “[i]n the event that [HMMH] elects not to arbitrate, any lawsuit brought hereunder must be brought in a court of competent jurisdiction in the state where the Project is located or in the State of Georgia, where both parties agree to submit to jurisdiction and venue.” Finally, and as we have noted above, the supplemental provision places “venue and juris diction... exclusively in the Federal District Court for the Northern District of Georgia or the State Courts in Fulton County, Georgia,” such that “[AWC] hereby consents and submits to the exclusive personal jurisdiction of such courts, and consents, submits to and agrees that venue for such legal action or proceeding is proper in said courts and county, regardless of [AWC]’s domicile.” (Emphasis supplied.)

We are bound to construe any contract, whether it includes an agreement to arbitrate or not, in such a way as to give effect to each part of that contract. SeeOCGA § 13-2-2 (4). It is not only possible but necessary to read the arbitration provisions and the supplemental provision together such that HMMH has the power to elect in the first instance whether a dispute “arising out of or related to the Work or the Subcontract or any breach thereof” should go into arbitration. If HMMH elects not to send such a dispute into arbitration, an outcome clearly contemplated by the first-quoted section of the arbitration provision, both the second section of the arbitration provision and the supplemental provision place venue and jurisdiction of any legal actions arising from the subject matter of the work or subcontract in a Georgia federal or state court. Like the trial court, then, we find no ambiguity or inconsistency between the subcontract’s arbitration provisions and the supplemental provision designating “exclusive” venue and jurisdiction for legal actions concerning disputes HMMH might elect not to arbitrate.

3. AWC also argues that a Georgia court enforcing an agreement to arbitrate under the FAA should first decide whether a dispute otherwise headed for arbitration is barred by res judicata. Again, we disagree.

Against the backdrop of [the federal] policy favoring arbitration, a court uses a two-step process to determine reach of an arbitration agreement. First, a court must ascertain if the agreement’s terms reach the plaintiff’s claims. Second, a court must decide if any “legal constraints external to the parties’ agreement” prevent application of the agreement to require arbitration of [a p]laintiff’s claims.

Hopkins v. World Acceptance Corp., 798 FSupp.2d 1339, 1344 (I) (B) (N.D. Ga. 2011), quoting Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, 473 U. S. 614, 628 (II) (105 SCt 3346, 87 LE2d 444) (1985). Because “arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit,” the question whether parties have submitted a dispute to arbitration “is an issue for judicial determination unless the parties clearly and unmistakably provide otherwise.” (Citations and punctuation omitted.) Howsam v. Dean Witter Reynolds, Inc., 537 U. S. 79, 83 (II) (123 SCt 588, 154 LE2d 491) (2002).

As a preliminary matter, it is clear that AWC’s declaratory action, which is the “claim” at issue in this appeal, concerns AWC’s right to payments under the Phase 3 subcontract. As such, and as the trial court held, AWC’s action was subject to the parties’ agreement to arbitrate claims arising “out of the Work or the Subcontract or any breach thereof.” See Hopkins, 798 FSupp.2d at 1345 (I) (C) (concluding that an arbitration agreement applied to a plaintiff’s claims when those claims arose out of agreement and transactions between the parties).

Although “a gateway dispute about whether the parties are bound by a given arbitration clause raises a ‘question of arbitrability’ for a court to decide,” the Howsam Court noted that such a question does not arise “where parties would likely expect that an arbitrator would decide the gateway matter.” (Citation omitted.) 537 U. S. at 84 (II) . Specifically, “procedural questions which grow out of the dispute and bear on its final disposition are presumptively not for the judge, but for an arbitrator, to decide.” (Citation omitted.) Id. Thus “are arbitrator shall decide whether a condition precedent to arbitrability has been fulfilled,” and where the parties have not explicitly agreed otherwise, “prerequisites such as time limits, notice, laches, estoppel, and other conditions precedent to an obligation to arbitrate... are for the arbitrators to decide.” (Citation and punctuation omitted; emphasis supplied.) Id. at 85 (II). Following Howsam, the United States Court of Appeals for the Eleventh Circuit has concluded that res judicata is just such an issue of “procedural arbitrability” properly left to an arbitrator. Klay v. United Health Group, 376 F3d 1092, 1109 (III) (11th Cir. 2004) (because “[arbitrators . . . are empowered, absent an agreement to the contrary, to resolve disputes over whether a particular claim may be successfully litigated anywhere at all,” the issue of res judicata “was for the arbitrator to decide in the first instance.”).

We are persuaded that the question before us—whether HMMH’s defense of nonpayment of money allegedly due to AWC under the Phase 3 subcontract is barred as res judicata as a result of the trial court’s unappealed 2010 order concerning HMMH’s cross-claim under the Phase 2 subcontract—is both “procedural” and one that emerged “out of the [parties’] dispute,” Howsam, 537 U. S. at 84 (III), and thus, as the Eleventh Circuit concluded, properly left “for the arbitrator to decide in the first instance.” Klay, 376 F3d at 1109 (III); see also Macon-Bibb Hosp. Auth. v. Nat. Treasury Employees Union, 265 Ga. 557, 558 (1) (458 SE2d 95) (1995) (decisions of the federal courts applying federal law “are not binding on [a Georgia appellate court], but their reasoning is persuasive”) (citations omitted).

The Supreme Court of Georgia’s decision in Bryan County v. Yates Paving & Grading Co., 281 Ga. 361 (638 SE2d 302) (2006), does not compel a different result. Although that decision held that a question of res judicata was properly for the trial court, it did so under the rubric of the Georgia Arbitration Code, rather than its federal counterpart. Id. at 362-363. Like the trial court, we find this a critical distinction, for two reasons. First, the Georgia Arbitration Code, in OCGA § 9-9-5 (a), specifically grants the trial court “discretion in deciding whether to apply” a bar by limitation of time — a provision that has no analogue in the FAA, and which does not apply to the instant case. It was on the basis of OCGA § 9-9-5 (a) that the Bryan County Court concluded that res judicata was a matter for the trial court. 281 Ga. at 362-363. Second, and even assuming that “there is no presumption” under Georgia law that “an arbitrator is in a better position than a court to apply a legal doctrine such as res judicata,” id. at 363 n. 2, the Eleventh Circuit has persuasively determined that a defense of res judicata is not a gateway dispute as to whether an agreement to arbitrate under the FAA is valid or whether a party’s specific claim falls within the scope of the agreement, but is rather a question, like waiver, laches, and estoppel, that bears on the final disposition of the parties’ dispute and thus presents an issue of arbitrability for the arbitrator to decide. See Klay, 376 F3d at 1109.

Decided November 22, 2013.

Hendrick, Phillips, Salzman & Flatt, William D. Flatt, Casey Gilson, Robert P. White, for appellant.

For these reasons, we conclude that the trial court did not err when it granted HMMH’s motion to dismiss and to compel arbitration.

Judgment affirmed.

Phipps, C. J., concurs. Ellington, P. J., concurs in judgment only.

Carlton Fields, Walter H. Bush, Jr., Christopher B. Freeman, for appellee.

       All of the parties to the current declaratory action were defendants in the Pitts litigation.

       Compare the FAA, 9 USCS § 1 et seq., with the Georgia Arbitration Code (“GAC”), OCGA § 9-9-1 et seq.

       OCGA § 9-9-5 (a) provides:

        If a claim sought to be arbitrated would be barred by limitation of time had the claim sought to be arbitrated been asserted in court, a party may apply to the court to stay arbitration or to vacate the award, as provided in this part. The court has discretion in deciding whether to apply the bar. Aparty waives the right to raise limitation of time as a bar to arbitration in an application to stay arbitration by that party’s participation in the arbitration.
      (Emphasis supplied.)

       “The FAA preempts state laws that undermine enforcement of private arbitration agreements. ‘To the extent that a state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress,’ it will be preempted by the FAA.” Simmons Co. v. Deutsche Financial Svcs. Corp., 243 Ga. App. at 88 (2), quoting Volt Information Sciences v. Bd. of Trustees of Leland Stanford Junior Univ., 489 U. S. 468, 477 (109 SCt 1248, 103 LE2d 488) (1989). Although the parties have not explicitly raised the issue of preemption, we must necessarily conclude that OCGA § 9-9-5 (a) of the GAC is preempted by the FAA and does not apply in this case. To hold otherwise would undermine the purposes and objectives of the FAA. See American Gen. Financial Svcs. v. Jape, 291 Ga. 637, 644 (732 SE2d 746) (2012) (Nahmias, J., concurring) (Congress’s intent, expressed through the FAA, is “to move the parties to an arbitrable dispute out of court and into arbitration as quickly and easily as possible”) (citations and punctuation omitted). Not only would the application of OCGA § 9-9-5 fail to move this arbitrable dispute out of court and into arbitration as quickly as possible, but it would also undermine the agreement’s enforceability by forcing it into court.


source: Caselaw Access Project

author: Miller, Judge.

license: Public Domain

text:
    A13A1384.
    BUDEANU v. THE STATE.
    (751 SE2d 924)
   Miller, Judge.

Following a bench trial, Petru Budeanu appeals from his conviction of two counts of attempting to entice a child for indecent purposes (OCGA §§ 16-6-5 (a); 16-4-1) and the denial of his motion for new trial, contending that the evidence was legally insufficient and that the record fails to show that he made a knowing and intelligent waiver of his right to a jury trial.

On appeal from a criminal conviction,

the evidence must be viewed in the light most favorable to the verdict, and the defendant no longer enjoys the presumption of innocence; moreover, an appellate court does not weigh the evidence or determine witness credibility but only determines whether the evidence is sufficient under the standard of Jackson v. Virginia, 443 U. S. 307 (99 SC 2781, 61 LE2d 560) (1979).

(Citation omitted.) Cordy v. State, 315 Ga. App. 849 (1) (729 SE2d 13) (2012).

Viewed with all inferences in favor of the trial court’s findings, the evidence shows that, in May 2009, C. C., then 14 years of age, and V. A., then 13 years old, lived in the same apartment complex and often spent the night with each other. On May 25, C. C. and V. A. were walking V. A.’s new puppy in their pajamas around 7:00 or 8:00 a.m. after C. C. had spent the night with V. A. As they were walking, they noticed a white and gray van pull into the neighbor’s driveway where they were standing. Thinking that the van was going to park there, the girls walked on to V. A.’s family’s driveway in front of her townhome. As they did so, the van backed out of the neighbor’s driveway and pulled into V. A.’s family’s driveway. Budeanu got out of the van, took a few steps toward them, and asked “[y]ou want sex?” or “[d]o you want to have sex?” The girls began to try to get into V. A.’s family’s apartment and knocked hard on the front door. When they were trying to open the door, Budeanu asked their names, then said “[n]o, no, no, don’t open the door[,]” and “[d]o you want to have sex?” V. A.’s stepfather opened the door, and the girls told him what had happened. When the door opened, Budeanu got in his van and left.

According to V. A.’s stepfather, who is Romanian as is Budeanu, parking places are assigned to the townhomes and V. A.’s family’s townhome was Number 69, located near the rear of the complex. When the stepfather opened the door that day, the girls looked scared and said a guy asked them about sex. V. A.’s stepfather went outside and saw the van pulling off. V. A.’s stepfather did not call the police that day but spoke to them three weeks later after C. C.’s father had called them.

C. C.’s father testified that his family lived in Town Home Number 12, near the front of the complex. C. C.’s father saw the van drive into the complex on the morning of May 25, while he was out walking his dogs. He had seen the van several times before in his complex and the complex next door. C. C.’s father spoke to Budeanu about two days after the incident with his daughter. He advised Budeanu that he was told that Budeanu asked C. C. to have sex. He told Budeanu “[n]ow, I don’t know if it’s true or not, but the next time I see you over here me and you are going to have a problem and I advise you to leave.” Budeanu responded that he did not do anything, but left anyway. Thereafter, C. C.’s father continued to see the van in the complex. Three weeks after the incident, on June 18, he followed the van to the rear of the complex, got a license number, and called police.

1. Considering the waiver of jury trial first, we agree with Budeanu that the State failed to prove that he voluntarily, knowingly, and intelligently waived his right to a jury trial.

A defendant’s right to trial by a jury is a fundamental constitutional right that the defendant must personally, knowingly, voluntarily, and intelligently choose to waive. Balbosa v. State, 275 Ga. 574, 575 (1) (571 SE2d 368) (2002); Thomas v. State, 297 Ga. App. 416, 419 (2) (677 SE2d 433) (2009). “A defendant’s consent to a trial without a jury need not be in any particular, ritualistic form; the trial court need only conduct an inquiry of the accused on the record so as to ensure that the waiver is knowing, voluntary and intelligent[.]” (Punctuation and footnote omitted.) Ealey v. State, 310 Ga. App. 893, 894 (714 SE2d 424) (2011).

When a defendant challenges his purported waiver of the right to a jury trial, the State bears the burden of showing that the waiver was made both knowingly and intelligently, either “(1) by showing on the record that the defendant was cognizant of the right being waived; or (2) by filling a silent or incomplete record through the use of extrinsic evidence which affirmatively shows that the waiver was knowingly and voluntarily made.” (Citations and punctuation omitted.) Allison v. State, 288 Ga. App. 482, 485-486 (2) (654 SE2d 628) (2007). This may be done by use of testimony from, or an affidavit of, trial counsel about his specific recollections; routine or standard practices; and evidence regarding the defendant’s intelligence and cognitive ability. See id. at 486 (2); Jones v. State, 294 Ga. App. 169, 170 (1) (670 SE2d 104) (2008).

There is nothing in the record signed by Budeanu to indicate a waiver of a jury trial. Further, there is no record of any colloquy showing that the trial court asked Budeanu sufficient questions on the record to ensure that his waiver of a jury trial was knowing, voluntary, and intelligent. The trial court’s only statement regarding this issue is at the beginning of the bench trial when he states: “... it’s my understanding, [trial counsel] ... that your client has previously waived his right to a jury trial and agreed to a trial by the Court sitting without a jury.” Trial counsel responded “[t]hat is correct, Your Honor.” Although Budeanu voiced no objection at this point, his failure to object to a bench trial shows, at most, only that such waiver was voluntary, not that it was also knowing and intelligent. See Jones, supra, 294 Ga. App. 170 (1); cf. Balbosa, supra, 275 Ga. at 575 (1) (when trial counsel waives the right to a jury trial in defendant’s presence, it shows only that waiver was voluntary).

Trial counsel testified at the motion for new trial hearing that he discussed with Budeanu the issue of whether to have a jury or bench trial at least twice. Because Budeanu was Romanian and did not speak English well, his family retained an interpreter to attend attorney/client meetings. An interpreter also participated in his trial. According to trial counsel,

I don’t really think Mr. Budeanu had a preference. He might not have understood exactly what was going on. I understood what was going on, and I think [the interpreter] did, too. And that’s why — it wasn’t a clear cut answer; the decision was not clear cut. There were advantages and disadvantages of both sides. So he pretty much just paid attention to what I said through [the interpreter] and asked questions.

(Emphasis supplied.)

Asked if he had ever explained his rights to Budeanu, trial counsel stated that

I did not really discuss with him. I just told him that we could do it either way. I did not ever tell him that — distinguish where those rights came from, whether they were statutory or constitutional or by precedent. I just told him we would do it either way and we had to decide; it was an important issue to decide.

Appellate counsel asked trial counsel at the motion for new trial hearing “[a]s I understood your testimony and in our discussions previously, you’re very clear that you never told Mr. Budeanu that he had a constitutional right to a jury trial; is that correct?” Trial counsel responded: “I did not tell him that, no.”

The record is devoid of any testimony from trial counsel indicating that Budeanu understood that he had a right to a jury trial and made a conscious choice to waive that right. Cf. Jones, supra, 294 Ga. App. at 170 (1) (having discussions with trial counsel are, alone, insufficient to establish that defendant knowingly and intelligently waived right to jury trial). As stated above, the trial court’s only comment on the issue of waiver was to note that Budeanu had previously waived his right to a jury trial. There was no inquiry by the trial court as to his understanding of his rights or the ramifications of the waiver.

In the absence of a written waiver, colloquy with the trial court, or any extrinsic evidence of a waiver, the State failed to meet its burden of proving that Budeanu knowingly and intelligently waived his right to a jury trial. Therefore, we reverse his convictions for attempting to entice a child for indecent purposes.

2. We now consider whether Budeanu may be retried on these charges.

“[T]he Double Jeopardy Clause precludes a second trial once the reviewing court has found the evidence legally insufficient.” Ricketts v. Williams, 242 Ga. 303 (248 SE2d 673) (1978). “[I]t makes no difference whether the decision on the insufficiency of the evidence is made by the trial court or the reviewing court. The result is the same. . . .” Id. at 303-304. However, “[a]s a general rule, a post-conviction reversal or grant of a motion for new trial which is not based on insufficiency of the evidence does not preclude retrial.” (Citation omitted.) State v. D’Auria, 229 Ga. App. 34, 35 (492 SE2d 918) (1997). Thus, if “the evidence meets the standard of Jackson v. Virginia, [443 U. S. 307 (99 SCt 2781, 61 LE2d 560) (1979)] the case may be retried.” Lively v. State, 262 Ga. 510, 512 (3) (421 SE2d 528) (1992).

“A person commits the offense of enticing a child for indecent purposes when he solicits, entices, or takes any child under the age of 16 years to any place whatsoever for the purpose of child molestation or indecent acts.” OCGA § 16-6-5. The offense of enticing includes the element of asportation which is satisfied regardless of whether the taking involves physical force, enticement, or persuasion. Cimildoro v. State, 259 Ga. 788, 789 (1) (387 SE2d 335) (1990).

A person is guilty of criminal attempt if “with intent to commit a specific crime, he performs any act which constitutes a substantial step toward commission of that crime.” OCGA § 16-4-1.

Budeanu argues that the State failed to present any evidence of the element of asportation, which is essential for a conviction of enticing a child for indecent purposes under OCGA § 16-6-5 (a). Cimildoro, supra, 259 Ga. at 789 (1).

The trial court, in denying Budeanu’s motion for new trial on insufficiency of the evidence, stated, regarding defense counsel’s argument that there was no evidence of asportation,

[w]hile this is true, the defendant was charged not with enticing a child, but with criminal attempt to entice a child. Evidence of asportation is not necessary to support a conviction of criminal attempt to entice a child for indecent purposes. Dennard v. State, 243 Ga. App. 868 [(534 SE2d 182)] (2000).

This statement by the trial court is incorrect under the law. A review of Dennard reveals that the italicized portion of the trial court’s ruling is not the holding of Dennard. That case involved the appeal of the denial of Dennard’s special demurrer to the indictment. Count 3 of the indictment charged Dennard with attempting to commit the offense of enticing a child for indecent purposes “in that he arranged a meeting via the internet with a child under 16 years of age, to come to a place, for the purpose of child molestation or engaging in an indecent act.” Dennard, supra, 243 Ga. App. at 873 (c). Dennard contended that the indictment was fatally defective in that it failed to allege asportation, an essential element of the crime of enticing a child for indecent purposes. This Court found that

the fact that something is an element of the completed offense does not mean that it is an element of the offense of criminal attempt. The relevant question is whether the defendant took a substantial step toward commission of a crime. With respect to the crime of enticing a child for indecent purposes, it is immaterial whether the asportation element is achieved through the use of‘physical force, enticement, or persuasion.’ Thus, if the intended victim had responded to Dennard’s enticement by proceeding to the arranged meeting place, the element of asportation would have been satisfied. Although the indictment does not allege actual asportation, it does allege that Dennard arranged to meet the victim for the purpose of committing indecent acts. Accordingly, we cannot say that the indictment fails to allege the taking of a substantial step toward commission of the crime.

(Punctuation and footnotes omitted; emphasis supplied.) Dennard, supra, 243 Ga. App. at 873-874 (c).

The indictment against Budeanu alleges criminal attempt to entice a child for indecent purposes in that, with regard to each victim,

on or about the 25th day of May, 2009, with the intent to solicit, entice or take any child under the age of 16 years, for purposes of child molestation or indecent acts, said accused performed an act which constitutes a substantial step toward commission of said crime, to wit: did verbally solicit [the victims] to engage in sexual intercourse ....

Here, the indictment does allege the intent to “solicit, entice, or take” the victims (i.e., asportation) and, therefore, this indictment would be sufficient under Dennard. The pertinent issue here, however, is whether the evidence adduced was legally sufficient to prove a substantial step toward committing a violation of OCGA § 16-6-5 (a). We find that it was.

Following issuance of Heard v. State, 317 Ga. App. 663 (731 SE2d 124) (2012), Budeanu asked the trial court to reconsider its decision regarding asportation in light of that case. There, a conviction of attempt to commit enticing a child for indecent purposes was overturned because defendant’s text message requesting that the victim send him a naked picture would not satisfy the element of asportation because the request did not attempt to entice or persuade the victim to go to another place. This Court held that “[w]ithout evidence that Heard attempted to move the victim ‘any place whatsoever,’ the State failed to prove that Heard possessed the requisite intent to commit the crime of enticing a child and that he took a substantial step toward committing that crime.” Heard, supra, 317 Ga. App. at 666.

In response to the motion for reconsideration, the trial court found that

it was reasonable, based on the evidence offered at trial, for the finder of fact to find that by propositioning the children how and where he did, [Budeanu] showed his intent to commit the underlying crime, while at the same time taking a substantial step toward commission of that crime.

Decided November 22, 2013.

Donna A. Seagraves, for appellant.

J. Bradley Smith, District Attorney, Samuel E. Skelton, Assistant District Attorney, for appellee.

“Both this Court and the Supreme Court of Georgia have held that the element of ‘soliciting, enticing, or taking’ of a child requires asportation — i.e., to satisfy this element of the crime, the evidence must show some movement of or by the child.” (Citations and punctuation omitted.) Tudor v. State, 320 Ga. App. 487, 490-491 (2) (740 SE2d231) (2013) (Evidence that, in response to defendant’s direction, child moved from living room couch to kitchen table, where defendant molested her, was sufficient to prove enticing a child.).

Here, the evidence showed that Budeanu asked the girls if they wanted to have sex. When they attempted to flee to the apartment, he tried to dissuade them by saying “no, no, no” and again asked if they wanted to have sex. We believe that a rational trier of fact could reasonably infer that Budeanu was attempting to entice or persuade the girls to move away from the apartment door and go to another place to have sex with him, such as his van. Certainly, Budeanu did not intend to follow the girls into the apartment or to have sex with them where they stood at the apartment door. A jury could reasonably infer that Budeanu was trying to lure the girls somewhere else based upon his words and actions. Therefore, we find that there was at least some evidence that Budeanu took a substantial step toward enticing the two girls for indecent purposes, and, as a result, there is sufficient evidence to authorize a retrial. Jackson v. Virginia, 443 U. S. 307 (99 SCt 2781, 61 LE2d 560) (1979); Heard, supra, 317 Ga. App. at 666.

Judgment reversed.

Barnes, P. J., concurs. Ray, J., concurs fully as to Division 1 and in judgment only as to Division 2.


author: Phipps, Chief Judge.

text:
    A13A1390.
    McCORMACK v. THE STATE.
    (751 SE2d 904)
   Phipps, Chief Judge.

After a bench trial, James McCormack was convicted of two counts of possessing a controlled substance (alprazolam and hydrocodone), two counts of possessing drugs not in the original containers, and being a pedestrian on the roadway. On appeal, McCormack contends, inter alia, that the trial court erred by denying his motion to suppress evidence obtained after police stopped and searched him. For the reasons that follow, we hold that the state failed to prove that the officer’s opening of a pill container found in McCormack’s pocket was justified on the bases claimed below, and therefore reverse the judgment of conviction on the controlled substances charges. However, because the conviction for being a pedestrian on the roadway was not based on unlawfully seized evidence, and McCormack has not asserted error in connection with that conviction, that conviction is affirmed.

1. McCormack contends that the trial court erred by denying his motion to suppress evidence obtained during a stop and search of his person. Specifically, he asserts that the warrantless search and seizure were not justifiable based either on Terry or on his consent, as argued by the state. We agree.

In reviewing the grant or denial of a motion to suppress, we construe the evidence in a light most favorable to upholding the trial court’s findings and judgment. When the trial court’s findings are based upon conflicting evidence, we will not disturb the lower court’s ruling if there is any evidence to support its findings, and we accept that court’s credibility assessments unless clearly erroneous. The trial court’s application of law to undisputed facts, however, is subject to de novo review.

Construing the evidence most favorably to uphold the findings and judgment, the evidence showed the following. A police officer testified that on December 10, 2011, at approximately 11:30 a.m., he responded to a report of a “person walking in the roadway causing a traffic hazard.” When the officer arrived, he saw McCormack walking in the roadway, and saw vehicles “stop to avoid hitting him.” The officer approached McCormack and asked what he was doing in the roadway. McCormack “appeared to be under the influence of something, his speech was slurred and he didn’t seem . . . coherent.”

The officer saw a pocket knife clipped to the outside of McCormack’s pants pocket. He then conducted “a pat-down to make sure [McCormack] didn’t have anything on him, any illegal substances or [other] weapons.” The officer felt a small square hard box in McCormack’s pants pocket. The officer testified that he did not believe that the object was a weapon, instead i£believ[ing] it to be contraband” because people “put narcotics and illegal substances in those containers” and McCormack appeared to be “under the influence of something.” The officer testified that he was not certain from patting down McCormack’s clothing that the pill box, a type which he confirmed could be purchased at a store and which people also use to store medication such as aspirin, was contraband.

The officer asked McCormack what the object was. McCormack replied that it was a box for his pills. The officer asked McCormack if he (the officer) could remove the box from the pocket, and McCormack replied “yes.” The officer removed the box and asked McCormack what was inside. McCormack replied that the box contained Xanax and Lortab pills. The officer opened the box and found pills inside; the pills were not in their original containers. The parties stipulated below that the pills (though identified by different names at the hearing) were alprazolam andhydrocodone, and that McCormack did not have prescriptions for the drugs.

Both McCormack and the arresting officer testified at the hearing on the motion to suppress. To the extent their testimony conflicted, the court specifically found the officer’s testimony more credible.

In moving to suppress the items seized and statements he had made about the pills, McCormack argued that a Terry pat-down was not authorized and that, even if it were, the officer exceeded the lawful scope of such a search by removing the pill box and opening it without McCormack’s consent. The state countered that the search was justified because the officer was authorized to frisk McCormack for weapons, during the frisk the officer felt a pill box that he believed to be contraband, and McCormack consented to the officer’s retrieval of the pill box. The state argued that “ultimately, this case comes down to credibility as far as the consent issue,” that McCormack had consented to the retrieval of the box, and “whether or not he was allowed to open it is not at issue here.” In denying the motion, the court found that the officer was justified in patting down McCormack for weapons, and that McCormack had consented to the removal of the box from his pocket; notably, the court said nothing about whether consent to the opening of the box was given or necessary. The court found that the search of the box was consensual and lawful.

(a) Was the opening of the box justifiable as part of a Terry pat-down? It was not.

[T]he narrow purpose of a Terry pat-down is to ensure the safety of the officer and others at the scene, and its purpose is not to obtain evidence of crimes for use at trial. Any search which exceeds this constitutionally permissible purpose, therefore, is deemed constitutionally unreasonable, and any evidence resulting from such a search must be excluded. Thus, under Terry and its progeny an officer is authorized to pat down only a suspect’s outer clothing.

“[I]f, during a lawful pat-down search, an officer feels an object whose contours or mass makes it immediately identifiable as contraband, that officer can seize the item.” “[A] pat-down search is conducted solely for the purpose of insuring the safety of the officer and of others nearby, not to procure evidence for use at a subsequent trial.” Further, “[njothing in Terry can be understood to allow a generalized cursory search for weapons or, indeed, any search whatever for anything but weapons.”

In this case, the officer saw a pocket knife clipped to McCormack’s pants pocket as he walked in the middle of the roadway and was authorized “to undertake a protective ‘pat down’ of the outer surface of clothing for weapons if [he] ha[d] reasonable apprehension that [McCormack] [wa]s armed or dangerous, and limited questioning reasonably related to the circumstances that justified the initiation of the momentary stop.” Assuming arguendo that the officer’s apprehension that McCormack had other weapons was reasonable and the pat-down for weapons was thus permitted, the officer could not have lawfully either removed the box or opened it as part of a Terry pat-down for weapons. The officer testified that he did not believe that the small box he felt in McCormack’s pocket during the pat-down was a weapon, and he was not able to immediately identify it as contraband; he testified that he was not certain that the pill box was contraband, and asked McCormack what the box was and what it contained.

Thus, given the state’s burden of proving that the warrantless search was lawful, and its stated justification below for the search (namely, that McCormack consented to the officer’s removal of the pill box from his pocket during a lawful Terry frisk), the opening of the box would have to have been justified based on McCormack’s consent.

(b) Was the opening of the pill box lawful based on McCormack’s consent? While the removal of the pill box from the pocket was justifiable based on consent, the opening was not.

“[I]t is the State that bears the burden of proving that [McCormack] voluntarily consented to the removal of the [box] and the subsequent search thereof, and we are required to scrutinize closely any alleged consent given by a suspect to police.”

Although the trial court found that McCormack had consented to the officer removing the pill box from his pocket (as the law authorized it to find from the evidence presented), “the State introduced no evidence that [McCormack] consented to the officer’s opening of the box.” Therefore, the state failed to show, and the court erred by finding, that the search of the box was valid because McCormack had consented. Thus, the state failed to meet its burden of proving that the search was lawful in this case.

Decided November 22, 2013.

Lloyd J. Matthews, for appellant.

Tracy Graham-Lawson, District Attorney, DeahB. Warren, Frances C. Kuo, Assistant District Attorneys, for appellee.

Notably, the state asserts on appeal that the officer was also authorized to open the box incident to McCormack’s arrest, and that the officer had “probable cause to believe that the box contained contraband” based on McCormack’s behavior and “his voluntary admission regarding his possession of Lortab and Xanax.” But “[t]he state did not make [these] argument^] at the trial level and thus has waived its right to argue [them] on appeal.”

Accordingly, the court erred in denying McCormack’s motion to suppress, and the judgment of conviction as to the four controlled substances counts is reversed.

2. Based on our holding in Division 1, we do not consider McCormack’s contention regarding the court’s overruling of his objection to the admission of a police report in evidence at the hearing.

3. Inasmuch as McCormack does not assert any error as to the pedestrian on a roadway conviction, and that conviction is supported by sufficient evidence independent of that which should have been suppressed, that conviction is affirmed.

Judgment affirmed in part and reversed in part.

Ellington, P. J., and Branch, J., concur.

       OCGA §§ 16-13-30 (a) (prohibiting possession of controlled substances, under specified circumstances), 16-13-28 (a) (1) (defining alprazolam as a controlled substance), 16-13-26(1) (A) (ix) (defining hydrocodone as a controlled substance).

       OCGA § 16-13-75 (a) (pertinently providing that possession of controlled substances shall be legal only if such drugs are in the original container in which they were dispensed by the pharmacist and are labeled according to OCGA § 26-3-8).

       OCGA § 40-6-96 (c).

       See Terry v. Ohio, 392 U. S. 1 (88 SCt 1868, 20 LE2d 889) (1968).

        Adkinson v. State, 322 Ga. App. 1 (743 SE2d 563) (2013) (citation omitted).

        Williams v. State, 318 Ga. App. 715, 718 (734 SE2d 535) (2012) (citations omitted).

        Mason v. State, 285 Ga. App. 596, 597 (647 SE2d 308) (2007).

       Id. (citations omitted).

        Cartwright v. State, 265 Ga. App. 520, 521 (594 SE2d 723) (2004) (footnote omitted).

       See Davis v. State, 232 Ga. App. 450, 451 (1) (501 SE2d 241) (1998) (citation and punctuation omitted).

       See Williams, supra; Brown v. State, 293 Ga. App. 564, 566 (1) (667 SE2d 410) (2008); Cartwright, supra.

       See Carter v. State, 319 Ga. App. 624, 625 (737 SE2d 724) (2013).

       Id.; Morris v. State, 239 Ga. App. 100, 101 (1) (a) (520 SE2d 485) (1999) (“Avalid consent eliminates the need for either probable cause or a search warrant.”) (citations and punctuation omitted).

        Williams, supra at 718-719 (citation omitted); see State v. Jourdan, 264 Ga. App. 118, 120 (1) (589 SE2d 682) (2003).

        Mason, supra at 597-598.

       See id. (reversing the denial of motion to suppress where, during Terry pat-down, defendant consented to the officer removing a matchbox from his pocket, but there was no evidence that defendant had consented to the officer opening the matchbox; the fact that in the officer’s experience people often stored contraband in such boxes did not justify opening the box, as the box was not readily identifiable as contraband and the officer was not concerned that a weapon was hidden therein); Cartwright (reversing the denial of motion to suppress where an officer retrieved a box during a pat-down search for weapons, pulled it from the defendant’s pocket and then opened it; the search exceeded the scope of a weapons pat-down even though officer had come across similar boxes containing illegal drugs); Jourdan, supra (affirming the grant of a motion to suppress where the defendant had consented to a pat-down for weapons but, after the officer patted him down, found a cigarette box in the defendant’s pocket and asked him to remove it, the officer opened the box and found methamphetamine; searching the contents of the box exceeded the scope of the lawful pat-down, because the officer did not think that the box contained a weapon, and the state had not shown that the defendant’s consent to the pat-down extended to the opening of the box). Compare Morris v. State, 239 Ga. App. 100, 101 (520 SE2d 485) (1999) (search of matchbox found during pat-down was lawful based on defendant’s consent, where officer asked whether he could examine the box and defendant told him to “go ahead.”).

       See Cartwright, supra at 522 (1).

        State v. McCarthy, 288 Ga. App. 426, 429 (2) (654 SE2d 239) (2007) (citation omitted); see generally Harper v. State, 285 Ga. App. 261, 266 (2) (645 SE2d 741) (2007).

       See Cartwright, supra at 521 (1).

       See Mason, supra at 598.

       The officer testified that he saw McCormack walking in the middle of the roadway, and that vehicles “were having to stop to avoid hitting him.” See OCGA § 40-6-96; see generally Jackson v. Virginia, 443 U. S. 307, 319 (III) (B) (99 SCt 2781, 61 LE2d 560) (1979).

       See generally Curry v. State, 271 Ga. App. 672, 676-677 (2) (610 SE2d 635) (2005).


author: MCMILLIAN, Judge.

text:
    A13A1035.
    SHEPHERD v. GREER, KLOSIC & DAUGHERTY.
    (750 SE2d 463)
   MCMILLIAN, Judge.

Appellant Kathleen Ann Shepherd appeals from the trial court’s order denying her motion for partial summary judgment and granting partial judgment to the law firm of Greer, Klosic & Daugherty (“GKD”) on its suit to enforce an attorney’s lien. As more fully set forth below, we now reverse.

After a bus hit the car she was operating, Shepherd retained GKD to represent her in pursuing personal injury claims against the Metropolitan Atlanta Rapid Transit Authority (“MARTA”). Shepherd signed an “Attorney-Client” contingency fee contract (“Contract”), which included a provision setting out the compensation GKD was entitled to receive from Shepherd in the event she terminated the firm’s employment prior to recovery on her claims. Prior to settling, Shepherd, in fact, terminated GKD’s representation, and GKD filed an attorney’s lien pursuant to OCGA § 15-19-14.

Shepherd subsequently reached a settlement with MARTA, and GKD sent Shepherd a demand for payment. Shepherd, however, refused to pay the amounts included within the lien that were allegedly attributable to time spent by a GKD paralegal working on her case, asserting that the termination provision only required her to pay for the time spent by John Daugherty, the GKD attorney working on her case. GKD then filed a petition to enforce its lien in the approximate amount of $54,000, which included over $37,851 in attorney fees, $13,512 in paralegal fees at the rate of $125 an hour and $2,658 in expenses. In response to GKD’s motion for partial summary judgment, Shepherd maintained her position that the amount sought for paralegal fees should be excluded from the lien.

The trial court, citing Missouri v. Jenkins, 491 U.S. 274 (109 SCt 2463, 105 LE2d 229) (1989), found that the “Contract unambiguously includes the time that [GKD’s] paralegal spent performing work traditionally done by an attorney [(hereinafter referred to as ‘professional services’)] at the rate of $125.00 per hour” and, after deducting a duplicate entry and subtracting the charges for the time the paralegal spent working on nonprofessional services, ordered Shepherd to pay $50,459.31 to GKD. Shepherd then filed the present appeal.

The sole issue on appeal is whether the termination provision of the Contract requires Shepherd to pay GKD for services performed by a GKD paralegal. Because our review is at the summary judgment stage and the interpretation of a contract, including the existence or nonexistence of any ambiguities in the contract, usually involves a question of law for the court to resolve, our review is de novo. Freund v. Warren, 320 Ga. App. 765, 768 (740 SE2d 727) (2013). Reynolds Properties, Inc. v. Bickelmann, 300 Ga. App. 484, 487 (685 SE2d 450) (2009).

The overarching principle that guides our construction of the Contract is to effectuate the intent of the parties as set out in the language of the agreement. Homelife Communities Group v. Rosebud Park, LLC, 280 Ga. App. 120, 122 (633 SE2d 423) (2006). Moreover,

[i]f that intention is clear and it contravenes no rule of law and sufficient words are used to arrive at the intention, it shall be enforced irrespective of all technical or arbitrary rules of construction. Further, the construction which will uphold a contract in whole and in every part is to be preferred, and the whole contract should be looked to in arriving at the construction of any part. Moreover, no construction is required or even permitted when the language employed by the parties in the contract is plain, unambiguous, and capable of only one reasonable interpretation. . . .

(Citations omitted.) Id. See also Freund v. Warren, 320 Ga. App. at 768-769; White v. Kaminsky, 271 Ga. App. 719, 721 (610 SE2d 542) (2004). In determining whether the contract language is “plain, unambiguous, and capable of one reasonable interpretation,” we have defined ambiguity to mean “duplicity, indistinctness, an uncertainty of meaning or expression used in a written instrument, and it also signifies being open to various interpretations.” (Punctuation omitted.) McGuire Holdings, LLLP v. TSQ Partners, LLC, 290 Ga. App. 595, 602 (2) (b) (660 SE2d 397) (2008). Freund, 320 Ga. App. at 769. In other words, “[a] word or phrase is ambiguous when its meaning is uncertain and it may be fairly understood in more ways than one.” Id. at 769, n. 4.

Accordingly, we turn first to the relevant terms of the Contract, which provide:

In the event there has been no settlement, verdict or judgment prior to the termination of attorneys, client(s) agree(s) to pay attorneys the sum of two-hundred-seventy-five ($275.00) dollars per hour for services rendered, or the percentage of the last highest offer for compromise or settlement by the responsible party, or the insurance indemnity carrier of the responsible party, whichever, when calculated, is higher.

Shepherd contends that the $275 per hour for services rendered refers only to the services provided by her attorney, consistent with what her attorney explained to her would be paid upon termination of the Contract prior to settlement. GKD, on the other hand, asserts that “attorneys” as defined in the Contract refers to the firm as a whole, and that “services rendered,” which is not defined, includes all professional services rendered by the firm. GKD further contends that it should not be penalized for voluntarily charging less than $275 per hour for paralegal services.

As more fully explained below, we find that an ambiguity exists concerning the services that were compensable under the termination provision of the Contract. Although GKD argues correctly that the first paragraph of the Contract appears to use the term “attorneys” to refer to the law firm of GKD and not an individual attorney or attorneys, we do not agree that this means that the term attorneys unambiguously encompasses all GKD employees, at least to the extent they are rendering professional services. In fact, the term attorneys is used throughout the Contract, and many of these other instances clearly pertain to legal work that could only be performed by a licensed member of the bar. Further, although the term “services” is not specifically limited in the Contract to professional services performed by an attorney, we agree with Shepherd that the insertion of a specific dollar amount for those services that corresponds with the rate Daugherty charged at that time for his services calls into question whether the parties intended for “services rendered” to be limited to those performed by the attorney or whether they intended that term to be more broadly applied to include the work performed by paralegals on her case. Accordingly, we find that the term “services,” as used in the termination provision, is uncertain and open to more than one meaning.

Moreover, unlike GKD, we do not believe that the United States Supreme Court’s holding in Jenkins and Richlin Security Svc. Co. v. Chertoff, 553 U.S. 571 (128 SCt 2007, 170 LE2d 960) (2008), which involved issues of federal statutory interpretation, should be engrafted onto this Attorney-Client contingent fee contract in the absence of any indication that the parties intended to use the federal definitions in the Contract. See Jenkins, 491 U.S. at 285 (recovery of paralegal fees under the Civil Rights Attorney’s Fees Awards Act of 1976, 42 USC § 1988); Richlin, 553 U.S. at 573 (in which the court decided a similar issue under the Equal Access to Justice Act, 5 USC § 504 (a) (1) (2006 ed.) and 28 USC § 2412 (d) (1) (A) (2000 ed.)).

Although we conclude that the termination provision of the Contract is ambiguous concerning whether it obligates Shepherd to pay paralegal fees, e.g., McGuire Holdings, 290 Ga. App. at 602 (2) (b), that does not necessarily mean that a jury must resolve this issue. Rather, it is only when the ambiguity remains after applying the rules of construction that a jury must resolve the issue of what the ambiguous language means. White v. Kaminsky, 271 Ga. App. 719, 721 (610 SE2d 542) (2004). Accordingly,

[wjhere an ambiguity exists, ... we resolve that ambiguity by applying the statutory rules of construction to ascertain the intent of the parties. Garrett v. Southern Health Corp. of Ellijay, 320 Ga. App. 176, 182 (1) (739 SE2d 661) (2013); OCGA § 13-2-2. Those rules require us to interpret any isolated clauses and provisions of the contract in the context of the agreement as a whole, Jones v. Destiny Indus., 226 Ga. App. 6 (2) (485 SE2d 225) (1997); to construe any ambiguities most strongly against the party who drafted the agreement, Hertz Equip. Rental Corp. v. Evans, 260 Ga. 532 (397 SE2d 692) (1990); and to give the contract a “reasonable construction that will uphold the agreement rather than a construction that will render the agreement meaningless and ineffective.” (Citation omitted.) McLendon v. Priest, 259 Ga. 59, 60 (376 SE2d 679) (1989).

Willesen v. Ernest Communications, Inc., 323 Ga. App. 457, 459-460 (1) (746 SE2d 755) (2013). Moreover, “[wjhile ‘(p)arol evidence is inadmissible to add to, take from, or vary a written contract,’ we may consider the parol evidence presented by the parties in light of [any] unresolved ambiguity. OCGA § 13-2-2 (1).” Krogh v. Pargar, LLC, 277 Ga. App. 35, 39 (2) (625 SE2d 435) (2005). See also Unifund Financial Corp. v. Donaghue, 288 Ga. App. 81 (653 SE2d 513) (2007); Holcim (US), Inc. v. AMDG, Inc., 265 Ga. App. 818 (596 SE2d 197) (2004).

In this case, and even after construing the Contract against GKD as the maker, we find it necessary to turn to the parol evidence to ascertain the parties’ intent. Krogh, 277 Ga. App. at 39-40. In her verified interrogatory responses, Shepherd said that at the time she signed the Contract, Daugherty explained to her that in the event the Contract was terminated, he would charge her $275 an hour for the time he spent working on the case and that at no point during the conversation did he inform her that he would also be charging $125, or any other amount, for the work performed by his support staff. On appeal, GKD argues that it would be improper to consider this evidence to vary or contradict the terms of an unambiguous contract, but offers no argument and no citation to the record to dispute that this conversation occurred or that Daugherty made this statement to Shepherd. But we have concluded that the Contract, particularly the termination provision, is ambiguous and thus, our inquiry could have ended here — with a finding that the unrebutted parol evidence showed that the parties intended for only Daugherty’s fees to be paid upon termination of the Contract.

Decided November 14, 2013

Reconsideration denied November 26, 2013

S. Bradley Houck, for appellant.

Greer, Klosik & Daugherty, John F. Daugherty, for appellee.

However, although we are not required to cull the record or make arguments on behalf of a party, we nevertheless have exercised our discretion and reviewed the portions of the record which appear to be relevant to this issue. Cox v. Southern Guar. Ins. Co., 254 Ga. App. 776, 778 (2) (563 SE2d 882) (2002). That review has revealed that GKD did in fact file an affidavit in response to Shepherd’s motion for summary judgment in which Daugherty averred that Shepherd and he “never discussed her terminating [him] if hired and if that was a concern I would have told her to hire another attorney.” Although this statement does not directly contradict all of Shepherd’s statement concerning what was said to her at this meeting about this issue, it does appear to contradict her assertion that they specifically discussed what she would be required to pay if she terminated Daugherty. Thus, the ambiguity in the Contract cannot be resolved by applying the rules of contract construction, and a jury must resolve the issue of what the ambiguous language means and what the parties intended. White v. Kaminsky, 271 Ga. App. at 721. Accordingly, the trial court’s order is reversed and the case remanded for trial.

However, in so holding, we emphasize that this opinion is limited to the particular contract and peculiar circumstances presented in this case, and we would stress that all agreements, including those between an attorney and client, should be drafted with an eye toward avoiding latent and patent ambiguities such as those present here.

Judgment reversed.

Andrews, P. J., and Dillard, J., concur.

       Por ease of reference, this provision will be referred to as the “termination provision:

       Among other references, the Contract provides the “attorneys” will decide whether to prosecute the claim, the “attorneys” have the option and discretion to use outside counsel, the “attorneys” may hire investigators to assist them, and, pertinently, the attorneys may file an attorney’s fee lien.


author: DOYLE, Presiding Judge.

text:
    A13A1195.
    BEDSOLE v. ACTION OUTDOOR ADVERTISING JV, LLC et al.
    (750 SE2d 445)
   DOYLE, Presiding Judge.

Benjamin K. Bedsole filed suit against Action Outdoor Advertising JV, LLC, Steve Galberaith, John A. Hartrampf, Jr., Laurence T. McCurdy III, Galberaith Holdings, LLC, Hartrampf Holdings, LLC, and McCurdy Holdings, LLC (collectively, “the defendants”), alleging that the defendants orally agreed to pay him for an equity interest in millions of dollars of billboard assets. Bedsole’s claims, as amended, include breach of contract, quantum meruit, unjust enrichment, promissory estoppel, breach of fiduciary duty, and punitive damages. The trial court granted summary judgment to the defendants, and Bedsole appeals. For the reasons that follow, we affirm in part and reverse in part.

A party is entitled to summary judgment “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.” Summary judgment is proper if the defendants “present[ ] evidence negating an essential element of the plaintiff’s claims or establish [ ] from the record an absence of evidence to support those claims. If [the] defendant^] establish^ ] those requirements, the plaintiff must point to specific evidence giving rise to a triable issue.” The appellate court conducts a de novo review of an order granting or denying a motion for summary judgment, viewing “the evidence, and all reasonable inferences drawn therefrom, in the light most favorable to the nonmovant.”

So viewed, the record shows that in 1998, Galberaith, Hartrampf, and McCurdy formed H.G., LLC, which sold advertising space on existing billboards that the owners contributed to the company. The company also constructed, operated, and maintained additional billboards and sold billboard inventory. Pursuant to H.G.’s operating agreement, each of the men owned a one-third interest, no one member could bind the company, and “a person [could] be admitted as an additional member by the unanimous vote of the other members and the new member’s consent in writing to be bound by this agreement.” In 2000, H.G. became Action Outdoor Advertising JV, LLC (“Action Outdoor”).

In 1998, Bedsole became associated with H.G. as an independent contractor; his job responsibilities included “handling] billboard sales, display sales, advertising contracts, artwork[,] production!)] and collections.” According to Bedsole, in 2000, Galberaith, Hartrampf, and McCurdy asked him to work with them in exchange for “a monthly check to live on” and a “ ‘subordinated’ ” interest in Action Outdoor. Bedsole understood that his “ownership interest would be realized when . . . billboard inventory [was sold],” and he

would be paid for [his] subordinated interest by taking the total value of a deal sold less the costs associated with the deal and multiplying that amount by [five percent] in the year 2000, [six percent] in . . . 2001, [seven percent] in . . . 2002, [eight percent] in... 2003, [nine percent] in... 2004[,] and [ten percent] in . . . 2005 and thereafter.

Sometime in 2000, Action Outdoor presented Bedsole with a written, one-page proposed “Letter of Agreement” and requested that he sign it. In the document, Action Outdoor proposed to provide Bedsole with “a subordinated interest as long as he remained an employee or exclusive independent contractor for Action Outdoor.” The subordinated interest began at five percent on June 1, 2000, and increased annually by one percent until reaching a maximum of ten percent on June 1, 2005. The document further provided:

The subordinated interest becomes a reality only in the event the outdoor advertising sign inventory owned by Action Outdoor Advertising JV, LLC. is sold to an unrelated third party. The formula for calculating the pay-out amount due [Bedsole] was agreed as follows:
Sale Price
Less: Original Development Cost
Net Profit
Times: % of Interest
Pay-Out Amount
In the event [Bedsole] leaves the employment of Action Outdoor or is no longer operating as an exclusive independent contractor on their behalf, the subordinated interest immediately expires and all rights to such interest are forfeited.

The proposed agreement also provided that Bedsole’s “annual base salary/compensation is $60,000 with a 5 [percent] increase due each anniversary period thereafter until June 1, 2005[,] at which time the compensation arrangement will be reviewed.” The proposal did not define “subordinated,” “interest,” “pay-out amount,” “development cost,” or “sign inventory.” Because he was concerned that the proposed agreement would permit Action Outdoor to unilaterally terminate his ownership interest in the billboard assets that he helped develop, Bedsole refused to sign it.

From 2000 to 2010, Action Outdoor sold signs in multiple separate transactions, and it compensated Bedsole following each one; the deals included the sale of both existing signs and unbuilt signs (leases and permits). According to McCurdy, Action Outdoor determined Bedsole’s compensation using the proposed agreement “as a guideline,” which it “followed . . . not exactly but closely.” McCurdy explained that Action Outdoor

didn’t use all the costs that were associated with each deal when we determined what [Bedsole] got paid. We actually gave him more than he should have gotten in some instances____ [W]e never included office expenses, we never included car expenses, we never included deferred salaries that we never took. There’s lots of other things that... we didn’t include.

Bedsole, on the other hand, states that his equity payments following billboard sales “were always calculated based upon the formula in the ‘Letter of Agreement.’ ” Various documents, both formal and informal, associated with the deals referred to Bedsole as equity holder or calculated equity payments due to Bedsole as a result of the sales.

In 2010, Action Outdoor paid Bedsole compensation for transactions the parties refer to as “DeKalb I” and “DeKalb II,” which included all remaining sign inventory, as well as leases, easements, and permits related thereto. Action Outdoor reduced Bedsole’s compensation for DeKalb I and II based on unpaid lease rental expenses associated with some of the assets. The DeKalb I and II deals closed on September 13, 2010. Action Outdoor terminated Bedsole on September 15, 2010.

In 2011, Galberaith Holdings, LLC, Hartrampf Holdings, LLC, and McCurdy Holdings, LLC (“the Holding Companies”), entered into a contract — “DeKalb III” — to sell to Clear Channel Outdoor billboard permits and to assign leases and easements acquired from Action Outdoor. In June or July 2011, McCurdy called Bedsole regarding his compensation and “threw out” a figure of $875,000, which was ten percent of the DeKalb III deal. Ultimately, however, neither the Holding Companies nor Action Outdoor paid Bedsole in connection with the DeKalb III transaction, explaining thereafter that the companies had no contractual obligation to do so; Bedsole was no longer an independent contractor providing services to any of the defendants; the sale did not involve existing structures or “sign inventory”; and Bedsole did not provide any services associated with the transaction. Instead, Action Outdoor offered Bedsole $150,000 from the DeKalb III transaction, labeling it as an offer of “additional severance pay”; Bedsole did not accept the offer.

On March 7, 2012, Bedsole filed suit against the defendants seeking to recover his share of the equity related to the DeKalb III transaction, as well as sums he alleges he should have received in his equity payout related to DeKalb I and II. Bedsole’s claims alleged in his initial and subsequent amended complaints include breach of contract, quantum meruit, unjust enrichment, promissory estoppel, breach of fiduciary duty, and punitive damages. The defendants filed a motion for summary judgment as to all of Bedsole’s claims. Following a hearing, the trial court granted the motion in a two-sentence order. This appeal followed.

1. Breach of contract. Bedsole contends that the trial court erred by granting summary judgment to the defendants on his claim for breach of contract. We agree.

“Georgia contract law requires a meeting of the minds of the parties, and mutuality, and in order for the contract to be valid the agreement must ordinarily be expressed plainly and explicitly enough to show what the parties agreed upon.” “A contract may be enforceable even though it rests only in words as remembered by the witnesses.”

To determine whether the parties mutually assented to all essential terms of the contract, the circumstances surrounding the making of the contract, such as correspondence and discussions, are relevant in deciding if there was a mutual assent to an agreement. Where such extrinsic evidence exists and is disputed, the question of whether a party has assented to the contract is generally a matter for the jury.
In determining whether there was a mutual assent, courts apply an objective theory of intent whereby one party’s intention is deemed to be that meaning a reasonable man in the position of the other contracting party would ascribe to the first party’s manifestations of assent, or that meaning which the other contracting party knew the first party ascribed to his manifestations of assent. Further, in cases such as this one, the circumstances surrounding the making of the contract, such as correspondence and discussions, are relevant in deciding if there was a mutual assent to an agreement. Where such extrinsic evidence exists and is disputed, the question of whether a party has assented to the contract is generally a matter for the jury.

Such evidence exists here.

Therefore, “the next question is whether [the parties] reached a verbal agreement as to all essential terms.” “The law does not favor destroying contracts on the basis of uncertainty, and a contract that may originally have been indefinite may later acquire more precision and become enforceable because of the subsequent words or actions of the parties.”

Here, given the aforementioned evidence of the parties’ understanding of their agreement, including their actions after Bedsole failed to sign the proposed Letter of Agreement, as well as the documents in the record detailing Action Outdoor’s computation of Bedsole’s compensation following each deal, there are genuine factual issues as to whether “the contract’s subject matter was established, the parties’ consideration was definite, and the parties’ mutual assent to all terms was complete.” Accordingly, the trial court erred by granting summary judgment to the defendants on Bedsole’s claim for breach of contract.

2. Promissory estoppel. Next, Bedsole argues that the trial court erred by granting summary judgment to the defendants on his claim for promissory estoppel. Again, we agree.

“The objection of indefiniteness may be obviated by performance and acceptance of performance.” Therefore,

even if the contract in this case could be considered too indefinite to enforce, a party may enter into a contract invalid and unenforceable, and by reason of the covenants therein contained and promises made in connection with the same, wrongfully cause the opposite party to forego a valuable legal right to his detriment, and in this manner by his conduct waive the right to repudiate the contract and become estopped to deny the opposite party any benefits that may accrue to him under the terms of the agreement.

“The elements of the equitable doctrine of promissory estoppel are that the defendant made a promise upon which he reasonably should have expected the plaintiff to rely, the plaintiff relied on the promise to his detriment, and injustice can be avoided only by enforcing the promise because the plaintiff forwent a valuable right.”

Here, Bedsole worked for Action Outdoor to help effectuate various sales transactions and paid a portion of the expenses, and as admitted by Hartrampf and McCurdy, the parties acted as if the letter agreement was in effect, and it was reasonable for Bedsole to expect that his equity compensation would be consistent with the formula set forth therein. Under these circumstances, the trial court erred by granting the defendants’ motion for summary judgment on Bedsole’s promissory estoppel claim.

3. Quantum meruit and unjust enrichment. Bedsole also challenges the trial court’s grant of summary judgment to the defendants as to his claims for quantum meruit and unjust enrichment.

OCGA § 9-2-7 provides that “[o]rdinarily, when one renders service or transfers property which is valuable to another, which the latter accepts, a promise is implied to pay the reasonable value thereof.” A claim of quantum meruit requires proof that

(1) the provider performed as agent services valuable to the recipient; (2) either at the request of the recipient or knowingly accepted by the recipient; (3) the recipient’s receipt of which without compensating the provider would be unjust; and (4) provider’s expectation of compensation at the time of rendition of services.

“The theory of unjust enrichment is basically an equitable doctrine that the benefitted party equitably ought to either return or compensate for the conferred benefits when there was no legal contract to pay.”

Here, assuming that it found that there was no contract between the parties, genuine issues of fact remain as to whether, with regard to DeKalb I and II, Bedsole provided services that benefitted Action Outdoor and were either requested or knowingly accepted by it; whether Bedsole expected to be compensated at the time he rendered the services; and whether Action Outdoor’s acceptance of his services without paying him would be unjust. Bedsole has not, however, pointed to any evidence in the record indicating what, if any, services he provided to Action Outdoor with regard to DeKalb III, in which Action Outdoor sold unbuilt billboard permits, leases, and easements. Accordingly, we reverse the trial court’s grant of summary judgment to the defendants as to Bedsole’s claims for quantum meruit and unjust enrichment with regard to the DeKalb I and II deals, and affirm the grant of summary judgment as to these claims with regard to DeKalb III.

4. Breach of fiduciary duty and punitive claims. Finally, Bedsole challenges the trial court’s grant of summary judgment to the defendants on his claims for breach of fiduciary duty and punitive damages.

“ ‘It is well settled that a claim for breach of fiduciary duty requires proof of three elements: (1) the existence of a fiduciary duty; (2) breach of that duty; and (3) damage proximately caused by the breach.’ ” OCGA § 23-2-58 provides that a fiduciary duty exists “where one party is so situated as to exercise a controlling influence over the will, conduct, and interest of another or where, from a similar relationship of mutual confidence, the law requires the utmost good faith, such as the relationship between partners, principal and agent, etc.”

The existence of a confidential or fiduciary relationship is a question for the jury. Such relationship may be created by law, contract, or the facts of a particular case. Moreover, because a confidential relationship may be found whenever one party is justified in reposing confidence in another, the existence of this relationship is generally a factual matter' for the jury to resolve.

“[Although some confidential relationships are created by law and contract (e.g., partners), others may be created by the facts of the particular case.” Thus, “a confidential relationship may exist between businessmen, depending on the facts.” An employer-employee relationship

is not the type of relationship such as that of principal and agent from which the law will necessarily imply confidentiality. Generally the relationship between an employer and employee is that of arms-length bargaining. This is not to say, however, that under a particular fact situation a confidential relationship can never exist between an employer and his employee.

Decided November 8, 2013

Reconsideration denied December 2, 2013

McMickle, Kurey & Branch, Scott W. McMickle, for appellant.

Schreeder, Wheeler & Flint, David H. Flint, Andrew J. Lavoie, Mark W. Forsling, for appellees.

Here, given the evidence in this case, including the relationship between Bedsole and the defendants, including his equity interest in Action Outdoor, there are genuine questions of fact regarding whether the defendants owed Bedsole a fiduciary duty, whether they breached it, and whether any breach proximately caused him damage. Accordingly, the trial court erred by granting summary judgment to the defendants on Bedsole’s claim for breach of fiduciary duty.

Judgment affirmed in part and reversed in part.

Barnes, P. J., and Miller, J., concur.

       OCGA § 9-11-56 (c).

       (Citation and punctuation omitted.) Thompson v. Floyd, 310 Ga. App. 674 (713 SE2d 883) (2011), quoting Oglethorpe Dev. Group v. Coleman, 271 Ga. 173, 173 (1) (516 SE2d 531) (1999).

       (Citation and punctuation omitted.) Cowart v. Widener, 287 Ga. 622, 624 (1) (a) (697 SE2d 779) (2010).

       For example, a December 2006 handwritten note addressed to Hartrampf and McCurdy included the calculations for Bedsole’s “[e]quity [p] ayout” following two deals. Aseparate, typed document titled, “SUMMARY — BEN’S RECAP — OLYMPUS SALE — SEPTEMBER 2010,” contains a calculation of the equity payout due to Bedsole based on the purchase price minus the development cost, multiplied by ten percent. A 2004 asset purchase agreement for the sale of billboard structures to Olympus Media, LLC, lists Bedsole as an equity holder, along with Galberaith, Hartrampf, and McCurdy. An April 2006 handwritten note regarding the “Leeds” signs contains a calculation of the equity payment to Bedsole based on the sales price, minus the cost to build, times Bedsole’s ten percent equity amount.

       Action Outdoor paid Bedsole severance through November 15, 2010.

       Action Outdoor was involved in litigation regarding its ability to construct billboard signs in portions of unincorporated north Fulton County, which areas later became newly formed cities. According to McCurdy, Bedsole paid ten percent of the legal fees associated with the Fulton County deal through August 2010. On June 13, 2011, the Supreme Court of Georgia ruled in favor of Action Outdoor, affirming the trial court’s grant of summary judgment to Action Outdoor regarding its ability to obtain billboard permits and construct billboards in those cities. See Fulton County v. Action Outdoor Advertising, JV, 289 Ga. 347 (711 SE2d 682) (2011).

       The trial court also granted Bedsole’s motion for summary judgment as to the defendants’ counterclaims and a motion to strike filed by the defendants. Those portions of the order are not at issue in this appeal.

       (Citation and punctuation omitted.) Athens Heart Center v. Brasstown Valley Resort, 275 Ga. App. 607, 608 (621 SE2d 565) (2005), citing OCGA § 13-3-1.

       (Punctuation omitted.) Jones v. White, 311 Ga. App. 822, 826 (1) (a) (717 SE2d 322) (2011). See also Turner Broadcasting System v. McDavid, 303 Ga. App. 593, 597-598 (1) (693 SE2d 873) (1) (2010) (collecting cases recognizing the validity of oral agreements).

       (Punctuation omitted.) Thompson, 310 Ga. App. at 681 (2).

       (Punctuation omitted.) Turner Broadcasting System, 303 Ga. App. at 597 (1).

       (Punctuation omitted.) Wright v. Cofield, 317 Ga. App. 285, 288 (2) (730 SE2d 421) (2012), quoting McKenna v. Capital Resource Partners, IV, 286 Ga. App. 828, 833 (2) (650 SE2d 580) (2007).

       (Punctuation omitted.) Reebaa Constr. Co. v. Chong, 283 Ga. 222, 223 (1) (657 SE2d 826) (2008).

        Thompson, 310 Ga. App. at 681-682 (2). See McKenna, 286 Ga. App. at 833-834 (2); Toncee, Inc. v. Thomas, 219 Ga. App. 539, 542 (2) (466 SE2d 27) (1995).

       (Punctuation omitted.) Thompson, 310 Ga. App. at 682 (3).

        Reebaa Constr. Co., 283 Ga. at 224 (2).

        Thompson, 310 Ga. App. at 682 (3).

       See id.; Ambrose v. Sheppard, 241 Ga. App. 835, 837 (528 SE2d 282) (2000).

       See Hollifield v. Monte Vista Biblical Gardens, 251 Ga. App. 124, 128-129 (2) (a) (553 SE2d 662) (2001).

       Id. at 130 (2) (c).

       See Christie v. Rainmaster Irrigation, 299 Ga. App. 383, 389 (4) (682 SE2d 687) (2009).

        UWork.com, Inc. v. Paragon Technologies, 321 Ga. App. 584, 594 (4) (740 SE2d 887) (2013).

       (Punctuation omitted.) Levine v. SunTrust Robinson Humphrey, 321 Ga. App. 268, 280 (7) (740 SE2d 672) (2013).

        Cochran v. Murrah, 235 Ga. 304, 306 (219 SE2d 421) (1975).

       Id. at 307.

       Id.

       See Levine, 321 Ga. App. at 281 (7) (b); Cochran, 235 Ga. at 307.

       The defendants argue that they are entitled to summary judgment on Bedsole’s claim for punitive damages simply because his claim for breach of fiduciary duty fails as a matter of law, and they make no additional argument on appeal with regard to punitive damages. Therefore, based on our holding that there are genuine issues of fact as to the breach of fiduciary duty claim, we also reverse the grant of summary judgment as to punitive damages, without addressing the issue of whether “the defendants’] actions showed willful misconduct, malice, fraud, wantonness, oppression, or that entire want of care which would raise the presumption of conscious indifference to consequences” as required under OCGA § 51-12-5.1 (b).