author: McFadden, Judge.

text:
    A15A2081.
    CALLOWAY et al. v. CITY OF WARNER ROBINS et al.
    (783 SE2d 175)
   McFadden, Judge.

The appeal in this wrongful death action is from the grant of summary judgment to a city and city clerk on sovereign immunity grounds. Because there exist no genuine issues of material fact as to the applicability of the doctrine of sovereign immunity, we affirm.

“Summary judgment is appropriate when no genuine issues of material fact remain and the moving party is entitled to judgment as a matter of law.” Stennette v. Miller, 316 Ga. App. 425, 426 (729 SE2d 559) (2012) (citation omitted). On appeal, we review a trial court’s grant or denial of summary judgment de novo, construing the evidence and all reasonable inferences therefrom in the light most favorable to the nonmoving party. SKC, Inc. v. eMag Solutions, 326 Ga. App. 798 (755 SE2d 298) (2014).

So viewed, the evidence shows that the City of Warner Robins issued a business license/occupation tax permit to Sheila Henderson, authorizing her to operate a child day care service. On July 31, 2011, three-year-old Andrew Calloway was at the day care facility when he died of heat stroke. He had been left inside an automobile for several hours. Andrew and Brittany Calloway, the child’s parents, filed a wrongful death action against Henderson, and day care workers Martha Andrews and Johnnie Mae Grayer — as well as the City of Warner Robins, and City Clerk Alton Mattox.

With regard to the city and Mattox, the complaint alleged that they had negligently issued the business license to Henderson without following certain procedures. The city and the city clerk moved for summary judgment, and the trial court granted the motion on the grounds that the claims against them are barred by the doctrine of sovereign immunity and that their conduct did not proximately cause the child’s death. The Calloways appeal.

1. Sovereign immunity.

The Calloways contend that the trial court erred in finding that both the City of Warner Robins and the city clerk are immune from suit under the doctrine of sovereign immunity. We disagree.

As our Supreme Court has explained, the question of sovereign immunity turns, in this context, on the distinction between ministerial duties and governmental functions.

Under Georgia law, municipal corporations are protected by sovereign immunity pursuant not to Article I of the Constitution but rather Article IX, Section II, Paragraph IX, unless that immunity is waived by the General Assembly. With particular regard to municipal corporations, our General Assembly has enacted OCGA § 36-33-1 which reiterates that “it is the public policy of the State of Georgia that there is no waiver of the sovereign immunity of municipal corporations of the state and such municipal corporations shall be immune from liability for damages.” OCGA § 36-33-1 (a). The same statute, however, also provides for a narrow waiver of a municipal corporation’s sovereign immunity, expressly providing in subsection (b) that “municipal corporations shall not be liable for failure to perform or for errors in performing their legislative or judicial powers. For neglect to perform or for improper or unskillful performance of their ministerial duties, they shall be liable.” OCGA § 36-33-1 (b). This provision has for more than a century been interpreted to mean that municipal corporations are immune from liability for acts taken in performance of a governmental function but may be liable for the negligent performance of their ministerial duties. The propriety of the trial court’s ruling on [the] motion [for summary judgment] thus turns on whether [the city and the clerk’s issuance of a business license] involved a governmental function.

City of Atlanta v. Mitcham, 296 Ga. 576, 577-578 (1) (769 SE2d 320) (2015) (citations and punctuation omitted).

(a) City of Warner Robins.

As the trial court correctly found, a municipality’s “issuance of a permit or license is a governmental function[.]” Boatwright v. Mayor & Council of Flemington, 189 Ga. App. 676, 677 (3) (377 SE2d 1) (1988), reversed on other grounds by Mayor & Council of the City of Flemington v. Boatwright, 259 Ga. 175 (377 SE2d 843) (1989). See also City of Thomson v. Davis, 92 Ga. App. 216, 218-219 (1) (88 SE2d 300) (1955) (municipality’s act of granting or revoking a business license constitutes a governmental function). Thus, even assuming, as alleged in the complaint, that the City of Warner Robins negligently issued the business license to Henderson, the city is still immune from suit for the negligent exercise of that governmental function. Under the doctrine of sovereign immunity, a “municipality is exempt from liability for an injury resulting from the failure to exercise [governmental functions] or from their improper or negligent exercise.” Mitcham, supra at 579 (2) (citation omitted). See also Hurley v. City of Atlanta, 208 Ga. 457, 458 (67 SE2d 571) (1951) (city not liable for negligent performance of governmental function). And because there is no evidence of a “waiver of the [c]ity’s sovereign immunity in this case, [the Calloways are] precluded from pursuing [their] negligence claims against . . . the City [of Warner Robins].” Mitcham, supra at 583 (3) (citations omitted).

(b) City Clerk Mattox.

The Calloways argue that City Clerk Mattox was sued in his individual capacity and thus is not entitled to the protection of sovereign immunity. However, a review of the complaint plainly contradicts the argument and reveals that Mattox was sued only in his official capacity. The style of the complaint does not indicate, as it did with other named defendants, that Mattox was being sued in his individual capacity; rather, it named Mattox as a defendant only “in his Official Capacity as City Clerk of City of Warner Robins, Georgia.” Moreover, the body of the complaint identified Mattox as the city clerk and averred that he “served in this capacity at all times relevant to the facts underlying this lawsuit.” Likewise, the complaint also stated that “[a]t all times relevant to the facts set forth in this Complaint., Defendant Mattox was acting under his authority as the City Clerk of Warner Robins and to further the business of the City of Warner Robins.” Thus, it is clear that Mattox was not sued in his individual capacity and was instead sued only in his official capacity. See Bd. of Commrs. of Glynn County v. Johnson, 311 Ga. App. 867, 871-873 (2) (717 SE2d 272) (2011) (complaint clearly showed that members of board of commissioners were sued only in their official capacities).

“Suits against public employees in their official capacities are in reality suits against the state and, therefore, involve sovereign immunity.” Cameron v. Lang, 274 Ga. 122, 126 (3) (549 SE2d 341) (2001) (citation and punctuation omitted). The Calloways are therefore precluded from pursuing their negligence claims against Mattox in his official capacity. See Mitcham, supra. Accordingly, “we affirm the trial court’s [summary judgment] order as to [the] claims asserted against [Mattox] in his official capacity.” Jobling v. Shelton, 334 Ga. App. 483, 486 (1) (779 SE2d 705) (2015). See also Campbell v. Goode, 304 Ga. App. 47, 50 (2) (695 SE2d 44) (2010) (claim against a city police officer in his official capacity was, in reality, a suit against the city and was thus barred by sovereign immunity).

Decided March 16, 2016 —

Reconsideration denied April 13, 2016.

McArthur Law Firm, Katherine L. McArthur, Caleb F. Walker, Jessica A. Applegate; Adams & Adams, Charles R. Adams III, for appellants.

Chambless, Higdon, Richardson, Katz & Griggs, Thomas F. Richardson, Frances L. Clay, James P. Langstaff, for appellees.

2. Proximate cause.

Because of our holdings above affirming the grant of summary judgment to the city and the city clerk on sovereign immunity grounds, we need not address “the alternative ground [of no proximate cause] relied upon by the trial court.” Gwinnett Place Assocs. v. Pharr Engineering, 215 Ga. App. 53, 56 (2) (449 SE2d 889) (1994).

Judgment affirmed.

Ellington, P. J., and Dillard, J., concur.


source: Caselaw Access Project

author: Rickman, Judge.

license: Public Domain

text:
    A15A2171.
    WELLS v. THE STATE.
    (783 SE2d 178)
   Rickman, Judge.

Adam Wells and Jhurik Forrester were jointly tried for armed robbery, and a jury found them guilty. Following the denial of his motion for new trial, Wells appeals his conviction. He contends that: (1) the trial court erred by denying his motion for a directed verdict of acquittal; (2) the trial court erred by denying his motion to strike a juror for cause; and (3) his trial counsel provided ineffective assistance when he failed to request a lesser included charge of theft by receiving stolen property or theft by taking stolen property. We affirm.

1. Wells contends that the trial court erred by denying his motion for a directed verdict of acquittal on the basis that at the end of the State’s case, there was a lack of evidence implicating him in the commission of a crime, and that it was only during his co-defendant’s testimony that evidence revealed Wells’s involvement in the incident.

When a criminal defendant challenges the sufficiency of the evidence supporting his conviction, the relevant question is whether, after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt. As long as there is some competent evidence, even though contradicted, to support each fact necessary to make out the State’s case, the jury’s verdict will be upheld. The standard of review for the denial of a motion for a directed verdict of acquittal is the same as for determining the sufficiency of the evidence to support a conviction.

(Punctuation and footnotes omitted; emphasis in original.) Flores v. State, 308 Ga. App. 368-369 (1) (707 SE2d 578) (2011). “The test established in Jackson v. Virginia, is the appropriate one to use when the sufficiency of the evidence is challenged, whether the challenge is from the denial of a directed verdict or the denial of a motion for new trial based upon alleged insufficiency of the evidence.” (Punctuation and footnote omitted.) James v. State, 316 Ga. App. 406, 408 (1) (730 SE2d 20) (2012).

Viewed in the light most favorable to the prosecution, the evidence adduced by the State showed the following. Forrester responded to an ad W. G. had placed on Craigslist to sell a laptop computer. On May 29, 2012, around 6:00 p.m., the two met in the parking lot of a certain store to conduct W. G.’s sale and Forrester’s purchase of the computer. For his sense of security, W. G. had placed in the driver door pocket of his vehicle a gun. Forrester was dropped off at the location; W. G. parked his vehicle, and Forrester approached.

During the transaction, after W. G. had removed the computer from its box and turned it on, he turned around and Forrester had W. G.’s gun in his hand. Forrester put the gun behind him and wielded a big “kitchen knife” at W. G., demanding W. G. to give up his computer and iPhone. W. G. relinquished the items, and they were placed in a bag. W. G. hit the alarm button on his keys, and Forrester took the bag and ran away. W. G. chased Forrester to “kind of the corner of the building,” but stopped when he realized that he was unarmed and Forrester had two weapons. W. G. observed Forrester enter the passenger side of a newer model black Honda Accord vehicle. Surveillance cameras captured images of a matching vehicle arriving and leaving the parking lot around the time of the robbery. Two bystanders, a husband and wife, who had parked their vehicles near W. G.’s vehicle witnessed W. G. running after Forrester in the parking lot. The husband identified Forrester in court as the individual he had seen W. G. chasing. W. G. used another bystander’s cell phone to call police and report the incident. A recording of the 911 call was played for the jury.

Through undercover investigation, the next day police detectives located the vehicle they suspected was involved in the armed robbery. At approximately 1:51 p.m., the vehicle was stopped for traffic infractions. Wells was the driver; Forrester was the passenger. The officer who initiated the stop noticed an iPhone in the center console and, knowing that an iPhone was one of the items stolen in the armed robbery the vehicle was suspected of being involved in, asked Wells for consent to search the vehicle. Wells consented. In the trunk, police recovered a “butcher” knife “just kind of laying [sic] by itself in the trunk.” Police asked Wells about the knife, and Wells looked at Forrester and said “You’re the one who was in my trunk.” Police continued searching the trunk and located the gun that was taken from W. G.’s vehicle; the gun was wrapped in a t-shirt. Forrester consented to a search of his person. Police recovered from Forrester’s person W. G.’s iPhone.

After the State rested, Forrester testified. He admitted that the knife found in the trunk was his and that it was on his person during his interaction with W. G.; but he denied having wielded the knife at W. G. Forrester testified that W. G. brandished a gun, and that he (Forrester) did “instinctively reach and disarm [W. G.] of” the gun. Forrester testified that he threw the gun in a bag and took the bag and ran away, and that W G. chased him, wielding another gun and threatening to kill him. Wells was waiting nearby in his vehicle, and after Forrester entered, they fled. Wells and Forrester drove with no destination in mind for about ten to fifteen minutes before stopping at a gas station to search the bag. The bag contained an iPhone, a laptop computer, and a gun. Forrester testified that he placed the knife in the trunk; Wells unloaded the gun and wrapped it in a t-shirt; and later that night, he (Forrester) sold the laptop computer.

Once it is shown that goods were stolen in a robbery, absence of or unsatisfactory explanation of the possession of the goods will support a conviction for robbery based upon recent possession of the stolen goods. Whether a defendant’s explanation of possession is satisfactory is a question for the jury; so is lack of explanation.

(Citation, punctuation and footnote omitted.) Thomas v. State, 256 Ga. App. 712, 713 (1) (569 SE2d 620) (2002).

Forrester’s testimony linking Wells to the armed robbery was corroborated by evidence of W. G.’s gun being located in the vehicle Wells was driving less than 24 hours after it was reported stolen, and of W. G.’s cell phone being located on Forrester, a passenger in Wells’s vehicle. Moreover, a knife consistent with the description given by W. G. as the one Forrester wielded at him during the robbery was also located in the vehicle, and the vehicle matched the description of the getaway vehicle described by W. G. and captured on surveillance camera images. The totality of the evidence was sufficient to authorize the jury to find Wells guilty beyond a reasonable doubt of intentionally aiding and abetting Forrester in the commission of armed robbery. See Thomas, 256 Ga. App. at 713 (1) (“absence of or unsatisfactory explanation of the possession of the goods will support a conviction for robbery based upon recent possession of the stolen goods”). See also James, 316 Ga. App. at 408 (1) (“only slight evidence of a defendant’s identity and participation from an extraneous source is required to corroborate the accomplice’s testimony and support the verdict”); Smith v. State, 234 Ga. App. 586, 592-594 (7) (a), (c) (506 SE2d 406) (1998) (“evidence of recent, unexplained (or unsatisfactorily explained) possession of stolen goods may be sufficient to give rise to an inference that the defendant committed the robbery”); and see Wise v. State, 325 Ga. App. 377, 380 (1) (752 SE2d 628) (2013) (“[W]e have held that a getaway driver who waits for his co-defendant to return to the car can be found guilty as a party to the crimes committed by the co-defendant.”). Accordingly, this contention is without merit.

2. Wells contends that the trial court erred by denying his motion to strike a juror for cause.

[F]or a juror in a criminal case to be excused for cause on the statutory ground that her ability to be fair and impartial is substantially impaired, it must be shown that she holds an opinion of the guilt or innocence of the defendant that is so fixed and definite that the juror will not be able to set it aside and decide the case on the evidence or the court’s charge on the evidence.... The law presumes that potential jurors are impartial, and the burden of proving partiality is on the party seeking to have the juror disqualified. In the absence of evidence that the juror held a fixed and definite opinion concerning the guilt or innocence of the defendant that she could not set aside and that she could not decide the case on the evidence or the court’s instructions, the trial court did not abuse its discretion in failing to excuse her for cause.

(Citations omitted.) Poole v. State, 291 Ga. 848, 852 (3) (734 SE2d 1) (2012). “Whether to strike a juror for cause is within the discretion of the trial court and the trial court’s rulings are proper absent some manifest abuse of discretion.” (Punctuation and footnote omitted.) Lewis v. State, 279 Ga. 756, 760 (3) (a) (620 SE2d 778) (2005).

Wells urges that prospective juror V. G. should have been excused for cause on the basis that she had formed an opinion as to appellant’s culpability and was not subsequently rehabilitated as to her ability to be impartial. The transcript shows, however, that V. G. answered affirmatively when asked whether she could set aside her “opinions on the matter” long enough to listen to the facts of the case and listen to the law that the judge gave in order to make a fair and impartial decision.

Nothing in the juror’s responses compels a finding that she had formed an opinion of [Wells’s] guilt or innocence that was so fixed and definite that she would be unable to set the opinion aside, or that she would be unable to decide the case based upon the court’s charge and upon the evidence. It was not an abuse of discretion to refuse to excuse the juror.

(Citation omitted.) Corza v. State, 273 Ga. 164, 167 (3) (539 SE2d 149) (2000); see Miller v. State, 275 Ga. 730, 736-738 (5) (571 SE2d 788) (2002).

3. Wells contends that his trial counsel provided ineffective assistance when he failed to request a lesser included charge of theft by receiving stolen property or theft by taking stolen property.

To prevail on a claim of ineffective assistance, [Wells] must prove both that the performance of his lawyer was deficient and that he was prejudiced by this deficient performance.[] To prove that the performance of his lawyer was deficient, [Wells] must prove that the lawyer performed his duties at trial in an objectively unreasonable way, considering all the circumstances, and in the light of prevailing professional norms. And to prove that he was prejudiced by the performance of his lawyer, [Wells] must prove a reasonable probability that, but for counsel’s unprofessional errors, the result of the proceeding would have been different. A reasonable probability is a probability sufficient to undermine confidence in the outcome. This burden is a heavy one. We conclude that [Wells] has failed to carry his burden.

(Citations and punctuation omitted.) Walker v. State, 296 Ga. 161, 168-169 (3) (766 SE2d 28) (2014).

Decided March 22, 2016 —

Reconsideration denied April 13, 2016

Haddad Law Group, Juwayn N. Haddad, for appellant.

Daniel J. Porter, District Attorney, Christopher M. Quinn, Marlene S. Zekser, Assistant District Attorneys, for appellee.

At the hearing on Wells’s motion for new trial, trial counsel testified that after discussion with Wells, “[w]e had an all-or-nothing defense.” Trial counsel further testified that he

made the decision that we would force the jury to decide [Wells’s] fate on the most serious charge, thinking that based on the evidence presented they would not be able to — not all 12 of them would be able to decide beyond a reasonable doubt that [Wells] participated in something like that.

Trial counsel testified that he sought to prevent the jury from reaching a “compromise verdict.”

Whether to request a charge on a lesser crime or to pursue an “all or nothing” defense generally is a matter of trial strategy. Brown v. State, 285 Ga. 324, 327-328 (4) (676 SE2d 221) (2009). Here, it was not objectively unreasonable for Wells’s lawyer to pursue a defense that was consistent with Wells’s claim that he did not participate in the charged crime. Therefore, his trial lawyer’s performance was not deficient based upon a failure to request an instruction authorizing the jury to convict on an offense not charged. See generally Walker, 296 Ga. at 172 (3) (c); Brown, 285 Ga. at 327-328 (4).

Judgment affirmed.

Dillard and McFadden, JJ., concur.

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

         Strickland v. Washington, 466 U. S. 668, 687 (III) (104 SCt 2052, 80 LE2d 674) (1984).


author: McMlLLIAN, Judge.

text:
    A15A2313.
    MERRILL RANCH PROPERTIES, LLC v. AUSTELL et al.
    (784 SE2d 125)
   McMlLLIAN, Judge.

Appellant Merrill Ranch Properties, LLC (“Plaintiff” or “Appellant”) brought suit against appellees seeking, among other things, to set aside certain transfers and conveyances that Plaintiff contends were made in violation of Georgia’s Uniform Fraudulent Transfers Act, OCGA § 18-2-70 et seq. (the “UFTA”). The trial court granted summary judgment to appellees, and Plaintiff filed this appeal. We now affirm in part, reverse in part, and remand for further proceedings as more fully set forth below.

The underlying facts, although somewhat complex and confusing, are largely undisputed. In 2006, the Peoples Bank of Winder, Georgia (“Peoples Bank”) extended a $100 million revolving line of credit (the “Loan”) to WHM Merrill Ranch Investments LLC (the “Borrower”). The Loan was evidenced by a Loan Agreement dated September 28, 2006 and a Promissory Note executed “of approximately even date herewith”; it was secured by certain real property located in Arizona. The Loan was guaranteed by real estate developer W. Harrison Merrill (“Harrison Merrill”) and eight trust entities he controlled (collectively “Guarantors”). In addition to Peoples Bank, numerous other banks held participation interests in the Loan.

Over time, $89 million was extended to the Borrower under the Loan. However, the Borrower was unable to make the required payments on the debt, and the Loan was declared in default on or around September 26, 2008. A few months later, in February 2009, Peoples Bank purchased by credit bid the Arizona property securing the Loan, and in April 2009, Peoples Bank instituted proceedings in Arizona against the Borrower and Guarantors to recover the deficiency owing after the sale of the property (the “Arizona litigation”).

While the Arizona litigation was pending, on September 28, 2009, Peoples Bank entered into a written agreement with a “Steering Committee of Subparticipant Lenders,” to sell its interest in the Loan and collateral (“Agreement”). The Agreement expressly provided that an unidentified legal entity would be created prior to closing to consummate the transaction, and Plaintiff was formed about a month later for this purpose. On October 28 and 29, 2009, Peoples Bank executed a series of documents, including an allonge to the note, which transferred and assigned its interests in the Loan to Plaintiff, and Plaintiff wired the purchase money for the Loan to Peoples Bank.

After Plaintiff was substituted for Peoples Bank in the Arizona litigation, the parties settled the suit for $10 million, plus post-judgment interest, and the judgment was entered accordingly on June 14, 2011. Plaintiff petitioned to domesticate the judgment in the Superior Court of Fulton County, Georgia and on August 15,2011, the court entered an order domesticating the Arizona judgment.

During post-judgment discovery, Plaintiff determined that shortly after the Loan was declared in default in September 2008, three limited liability companies with corporate relationships to Merrill companies made transfers of unsecured real property (collectively the “2008 LLC Real Estate Transfers”) to various newly-created entities that were, in turn, directly or indirectly “owned” by trusts established for the benefit of Harrison Merrill, his then-wife whom he was in the process of divorcing, and his five children (“Children’s Trusts”). Although the 2008 LLC Real Estate Transferors were neither guarantors of the Loan nor Judgment Debtors and the property transferred had not been pledged to secure the Loan, the LLC Real Estate Transferors were at least partially owned by several of the Judgment Debtors.

Additionally, Plaintiff discovered that at the beginning of 2010, the Item Nine Will Trust, which is one of the Judgment Debtors, transferred its membership interests in five limited liability companies to the Merrill Family Partnership, LLC, which was “owned” by the Children’s Trusts (“Item Nine Will Transfer”). And another transfer also occurred sometime at the beginning of 2010 when Merrill Mining,, LLC transferred stock it owned in S-Corporation Florence Copper Mining Inc. either directly or indirectly to the Children’s Trusts (“Merrill Mining Transfer”). Although neither Florence Copper nor Merrill Mining were guarantors of the Loan or Judgment Debtors, Judgment Debtor MCRT was a member of Merrill Mining, LLC.

On July 30, 2012, Plaintiff filed its initial complaint under the UFTA seeking to set aside or impose a constructive trust on the assets involved in the Merrill Mining Transfer. Shortly before the suit was filed, on March 9,2012, and then after the suit was filed on December 19, 2013, Plaintiff obtained charging orders against the membership and ownership interests of various Judgment Debtors in numerous limited liability companies, including the 2008 LLC Real Estate Transferors and the Merrill Mining Transferor.

Plaintiff amended its complaint several times, and on January 9, 2014, Plaintiff filed a motion and proposed amended complaint to add additional defendants and/or fraudulent transfer claims based on the 2008 Real Estate Transfers and the 2010 Item Nine Will Transfer. On April 22, 2014, the trial court granted Plaintiff’s motion to amend, and on April 29, 2014, Plaintiff amended its complaint to add these fraudulent transfer claims and defendants.

Subsequently, the parties filed opposing motions for summary judgment, and following a hearing, the trial court denied Plaintiff’s summary judgment motion and granted appellees’ motion, entering judgment in favor of appellees on all claims. The trial court based its ruling on the following findings: (1) the Loan assignment to Plaintiff was ineffective and thus Plaintiff was not the holder of the Loan; (2) even if the assignment of the debt was proper, the fraud claims were not assignable as a matter of law; (3) Plaintiff lacked standing under the UFTA because it was not a creditor or subsequent creditor of the non-judgment debtor LLC transferors; and (4) the Loan, domesticated Arizona Judgment, and charging orders did not create “a direct nexus” or basis of direct liability between Plaintiff and the LLC transferors. As more fully set forth below, we now reverse in part and affirm in part the trial court’s order and remand for further proceedings consistent with this opinion.

1. As a preliminary matter, we must decide if the Loan was properly assigned to Plaintiff. To answer this question, we must determine if, as the trial court found, the assignment of the Loan to Plaintiff was ineffective because Peoples Bank had already assigned the Loan to the Steering Committee pursuant to the terms of the Subparticipant Agreement.

We begin our analysis by turning to the relevant provisions of the Agreement, which we review under the usual rules of contract construction, JBM Investments, LLC v. Callahan Indus., Inc., 293 Ga. App. 580, 582 (1) (667 SE2d 429) (2008), mindful that “[w]here contract language is unambiguous, construction is unnecessary, and the court simply enforces the contract according to its clear terms.” (Citation and punctuation omitted.) Losey v. Prieto, 320 Ga. App. 390, 391 (739 SE2d 834) (2013). Contrary to the trial court’s findings, the Subparticipant Agreement did not effect an immediate transfer and assignment of the Loan by People’s Bank to the Steering Committee of the subparticipant banks. Rather, the unambiguous terms of the Agreement show that the actual transfer and assignment of the Loan was to be made at a future date. For example, the Agreement expressly provides that the Seller’s rights in the Loan and Loan documents would be sold, transferred, assigned and conveyed “[u]pon satisfaction of the terms and conditions contained herein, . . .” including a due diligence review conducted to the “Buyer’s” satisfaction of the relevant documents. (Emphasis supplied.) Further, the Agreement also expressly provides that a not-yet-in-existence entity, such as the Plaintiff, would be created by the Buyer for the purpose of actually consummating the transaction, defined in the Agreement as the Closing. The evidence appears undisputed that the Plaintiff was formed about a month later to close the Loan and that the only “Closing” that took place occurred on or about October 28,2009, when an allonge was executed, the guaranties and security instruments were transferred and assigned to Plaintiff, and Plaintiff wired the purchase money to Peoples Bank.

“A party may assign to another a contractual right to collect payment, including the right to sue to enforce the right. But an assignment must be in writing in order for the contractual right to be enforceable by the assignee.” (Citation and punctuation omitted.) Hosch v. Colonial Pacific Leasing Corp., 313 Ga. App. 873, 874 (2) (722 SE2d 778) (2012); Ware v. Multibank 2009-1 RES-ADC Venture, LLC, 327 Ga. App. 245, 251-52 (4) (758 SE2d 145) (2014). Here, the transfer and assignment of the Loan occurred with the execution of the allonge and other documents from Peoples Bank to Plaintiff. Accordingly, the trial court erred by granting summary judgment to Defendants based on a finding that the Loan had not been effectively assigned to Plaintiff.

2. That does not end our inquiry, however, because the trial court also cited other reasons why the Plaintiff lacked standing to pursue its claims. We begin this portion of our analysis by looking to the relevant provisions of the UFTA.

At the pertinent time, OCGA § 18-2-74 (a) (1) (2014), the actual fraud provision of the UFTA pursuant to which Plaintiff filed its claims, provided as follows:

A transfer made or obligation incurred by a debtor is fraudulent as to a creditor, whether the creditor’s claim arose before or after the transfer was made or the obligation was incurred, if the debtor made the transfer or incurred the obligation: (1) With actual intent to hinder, delay, or defraud any creditor of the debtor [.]

Thus, a creditor is entitled to seek relief under the UFTA for transfers made, or obligations incurred, by a debtor with actual intent to hinder, delay, or defraud any creditor of the debtor. However, while under the UFTA, a fraudulent transfer claim can only be brought by a “creditor” against a “debtor,” the UFTA contains broad definitions of those terms. A “creditor” is a “person who has a claim”; a “debtor” is a “person who is liable on a claim”; and a “claim” is “a right to payment, whether or not the right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured.” OCGA § 18-2-71 (3), (4), (6) (2014); RES-GA Hightower, LLC v. Golshani, 334 Ga.App. 176, 178 (1) (a) (778 SE2d 805) (2015), cert. denied, January 11, 2016. The UFTA also includes an expansive definition of “transfer,” which includes “every mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with an asset or an interest in an asset and includes payment of money, release, lease, and creation of a lien or other encumbrance.” OCGA § 18-2-71 (12) (2014). And “asset” is defined as “property of a debtor” with certain exceptions. OCGA § 18-2-71 (2) (2014).

Applying these definitions here, it is clear that Plaintiff meets the definition of a “creditor” under the UFTA with respect to the Judgment Debtors, who were the original Borrower and Guarantors of the Loan, and appellees make no contention otherwise. But only one of the transfers in this case — the Item Nine Will Trust Transfer — was made by a Judgment Debtor. The question then is whether Plaintiff is a creditor with standing to seek relief under the UFTA with regards to the other four transfers, which were made by non-judgment debtor limited liability companies. According to Plaintiff, it became a creditor of these non-judgment debtor LLC transferors by virtue of the charging orders, which created a “right to payment” from, and thus, according to Plaintiff, a “claim” against, any LLC entity named in the charging orders, including the LLCs who made the 2008 Real Estate Transfers and the 2010 Merrill Mining Transfer.

Plaintiff misapprehends the nature of a charging order. As we recently explained in Gaslowitz v. Stabilis Fund I, LP, 331 Ga. App. 152, 152, n. 2 (770 SE2d 245) (2015),

[a] charging order is [simply] a statutory provision [found in OCGA § 14-11-504] “that enables the judgment creditor (of a member of a limited liability company) to realize the value of the judgment debtor-member’s distributional interest, while at the same time protecting both the (limited liability company’s) ability to continue to operate and the interests of the other members.” 51 AmJur2d Limited Liability Companies §23.

“Thus, from the limited liability company’s standpoint, it is business as usual except that any distributions to the member subject to the charging order are diverted to the judgment creditor.” (Emphasis supplied.) Mahalo Investments III, LLC v. First Citizens Bank & Trust Co., Inc., 330 Ga. App. 737, 743 (769 SE2d 154) (2015).

Importantly for the issue we must decide in this case,

[a] charging order . . . gives no direct remedy against company property, Nigri v. Lotz, 216 Ga. App. at 205 (2), and company assets ... would not be subject to satisfaction of [a member’s individual] debt. “A member has no interest in specific limited liability company property.” OCGA § 14-11-501 (a). See generally Acree v. McMahan, 276 Ga. 880, 881 (585 SE2d 873) (2003) (a third-party creditor may not disregard corporate form so as to reach corporate assets to satisfy claims against an individual corporate insider); Word v. Stidham, 271 Ga. App. [435, 437 (609 SE2d 651) (2004)] (“[T]he holder of an interest in [a limited liability] company has no interest in specific property owned by the company.”)

Gaslowitz, 331 Ga. App. at 156 (2).

It is clear from the foregoing that a charging order does not create a debtor-creditor relationship between the judgment creditor who obtained the charging order and the LLC whose member’s interests are being charged. However, in its reply and supplemental briefs to this Court, Plaintiff makes additional arguments concerning its standing to challenge the LLC transfers, starting with the general premise that LLCs are not immune from claims under the UFTA. We agree that LLCs are not immune from claims under the UFTA if a debtor-creditor relationship exists between the person seeking relief under UFTA and the LLC (e.g., if the LLC owed a debt to the plaintiff). But where, as in this case, a creditor of a member of the LLC does not also have a debtor-creditor relationship with the LLC, the creditor does not also become a creditor of the LLC by obtaining a charging order against the LLC. Accordingly, the creditor does not have standing under the UFTA to set aside a transfer of assets made by the LLC solely by obtaining a charging order against the LLC.

Plaintiff also argues that it has standing under the UFTA to set aside the Merrill Mining Transfer because Judgment Debtors Harrison Merrill and MCRT, through its trustee, “participated” in the transfer by “instruct[ing]” that the transfer be made and executing the necessary documents. As stated above, a transfer is broadly defined under OCGA § 18-2-71 (12) oftheUFTAto include both direct and indirect transfers of an asset or an interest in an asset, and an asset is defined as property of the debtor. Thus, under the plain language of the UFTA, participating or even directing that a transfer of property be made has no consequence unless the asset was property of the debtor, which it was not here. And although as Plaintiff argues, our Supreme Court in Bishop v. Patton, 288 Ga. 600, 608, n. 5 (706 SE2d 634) (2011), overruled in part on other grounds, SRB Investment Svcs., LLLP v. Branch Banking and Trust Co., 289 Ga. 1, 5 (3), n. 7 (709 SE2d 267) (2011), has recognized that the transfer need not be made by the debtor directly, that case involved the withdrawal of funds by the debtor’s son in a jointly owned bank account and is thus readily distinguishable because the funds being transferred were actually property of the debtor (as well as the son/joint account holder).

Moreover, although Plaintiff disavows that it is proceeding under an “alter ego” theory, Plaintiff is essentially asking to disregard the corporate form and find that a creditor of a member of an LLC is also a creditor of the LLC for purposes of attaching the LLC’s assets and preventing their transfer in order to satisfy the debt. In a somewhat different context, our Supreme Court has held that a creditor may not reach the assets of a corporation or LLC to satisfy a debt of one of its shareholders or members. McMahan, 276 Ga. at 881. See also Otero v. Vito, 2009 U. S. Dist. LEXIS 86638, at *19 (M.D. Ga. 2009) (citing Aeree, held that “Georgia law does not recognize ‘reverse veil-piercing,’ that is, piercing of the veil, ‘to the extent that it would allow an “outsider,” such as a third party creditor, to pierce the veil in order to reach a corporation’s assets to satisfy claims against an individual corporate insider’ ”); see generally In re Christine M. Stadler, No. 04-91944, 2005 Bankr. LEXIS 571, at *3 (Bankr. N.D. Ga. March 30, 2005) (LLC in which debtor in bankruptcy was the sole member was not itself a debtor subject to the automatic stay provisions of the Bankruptcy Code). We find that authority persuasive here.

Based on the foregoing, we agree with the trial court that the Plaintiff did not have standing under the UFTA to set aside the transfer of assets made by the non-judgment debtors in the 2008 Real Estate Transfers or the 2010 Merrill Mining LLC Transfer. Accordingly, the trial court properly granted summary judgment to Defendants on these claims.

3. Defendants further argue that, as the trial court found, an additional ground exists to grant summary judgment on Plaintiff’s claims to set aside the allegedly fraudulent 2008 Real Estate Transfers which, in addition to being made by a non-judgment debtor, were made before the Loan was assigned to Plaintiff in 2009. Specifically, Defendants argue that Plaintiff’s claims to set aside these pre-Loan assignment transfers also fail under our Supreme Court’s longstanding precedent in Security Feed & Seed Company of Thomasville v. NeSmith, 213 Ga. 783 (102 SE2d 37) (1958).

Applying NeSmith, we recently considered this exact issue in RES-GA Hightower, LLC v. Golshani, in which we determined whether “an assignee to a debt [has] standing to assert a claim that the debtor fraudulently conveyed property in violation of... the UFTA.” (Punctuation omitted.) 334 Ga. App. at 176. Although noting that “under the plain terms of the UFTA, an assignee to debt ordinarily would qualify as a ‘creditor’ who has a ‘claim,’” id. at 178 (1) (a), we were nevertheless constrained by NeSmith and our Supreme Court’s interpretation of Georgia’s Anti-Assignment Statute, OCGA § 44-12-24, to hold that because such claims are not assignable under Georgia law, an assignee of debt is precluded from pursuing a pre-assignment fraudulent transfer claim under the UFTA. Golshani, 334 Ga. App. at 180 (1) (a).

Although Plaintiff makes a number of arguments in an attempt to limit the application of NeSmith, we previously considered and rejected the same or substantially similar arguments in Golshani. Moreover, Plaintiff’s attempt to distinguish Golshani as “irrelevant” to the present case by arguing that our opinion “presumes that there is a contract which actually assigns a claim of fraud or fraudulent transfer” (emphasis omitted) is likewise unavailing. Golshani and the present case are factually indistinguishable insofar as both involve standing to assert a fraudulent transfer claim based on the assignment of a debt.

It is also important to note, as we did in Golshani, that the General Assembly amended the UFTA in 2015 so that the term “creditor” is now defined as “a person who has a claim, regardless of when the person acquired the claim, together with any successors or assigns.” OCGA § 18-2-71 (4) (emphasis supplied). Additionally, the 2015 amendment added subsection (c) to OCGA § 18-2-74, so that section now provides that “[i]f a creditor is a successor or assignee, a right of action under subsection (a) of this Code section is automatically assigned to such successor or assignee.” However, these amendments only apply to transfers made or obligations incurred on or after July 1, 2015, and only to a right of action accruing after July 1, 2015, and are of no effect here. See Ga. L. 2015, pp. 996, 1029, § 7-1 (d). Accordingly, based on the foregoing, we affirm the trial court’s order to the extent it determined that Plaintiff does not have standing under the UFTA to contest the transfers that occurred prior to the assignment of the Loan.

4. Lastly, we turn to the only transfer at issue in this case that was made by a Judgment Debtor — the Item Nine Will Trust Transfer. Although Defendants acknowledge, at least implicitly and assuming the Loan was effectively assigned, that Plaintiff has standing as a creditor under the UFTA to pursue this claim, they argue that summary judgment was also properly granted as to this fraudulent transfer claim because it is time-barred pursuant to OCGA § 18-2-79 (l). That section, which applies to claims such as the ones in this case brought under the actual fraud provisions of OCGA § 18-2-74 (a) (1), provides that “[a] cause of action with respect to a fraudulent transfer or obligation ... is extinguished unless action is brought... within four years after the transfer was made or the obligation was incurred or, if later, within one year after the transfer or obligation was or could reasonably have been discovered by the claimant.” O CGA § 18-2-79 (1) (2014).

Decided March 28, 2016 —

Reconsideration denied April 13, 2016

Bryan Cave, William V. Custer IV, Jennifer B. Dempsey, Laura A. Williams, for appellant.

Schreeder, Wheeler & Flint, John A. Christy; Chausmer Law, Aaron B. Chausmer; Thomerson, Spears & Robl, Robert E. Spears, Jr., for appellees.

The parties appear to agree that the Item Nine Will Transfer occurred on or about January 1, 2010, and the record shows that Plaintiff first sought to assert a claim based on this transfer on January 9, 2014, at the earliest, when it sought leave to amend its complaint. Thus, this claim is time-barred unless Plaintiff is entitled to invoke the one-year discovery period also included in OCGA § 18-2-79 (1), which begins to run when the transfer “was or could reasonably have been discovered” by the party seeking relief under the UFTA. As Defendants acknowledge, issues concerning a plaintiff’s diligence usually must be resolved by the trier of fact, but nevertheless urge us to decide this issue as a matter of law. However, we decline to do so here in light of the fact that the record more than strongly suggests that efforts were made to conceal some or all of the transfers from Plaintiff and especially since the trial court has not considered this issue in the first instance. Accordingly, this case is remanded to the trial court for further proceedings on this issue.

Judgment affirmed in part and reversed in part, and case remanded with direction.

Barnes, P. J., and Ray, J., concur.

       Plaintiff’s initial complaint was filed on July 30, 2012, and amended numerous times to add additional claims against additional defendants.

       There are numerous appellees listed on the notice of appeal and the relevant parties will he more specifically identified below.

       We will refer to the operative provisions of the UFTA as they existed at the time the challenged transfers were made and the complaint was filed, while noting that the UFTA has since been amended in 2015 and is now called the Uniform Voidable Transactions Act (‘TTVTA”). See Ga. L. 2015, p. 996, § 4A-1 (effective July 1, 2015).

       Some of the confusion in this case stems from the frequency in which “Merrill” appears as part of the name of the persons or entities involved or referenced in this case, including Plaintiff and various defendants, and from the fact that a number of the trusts and LLCs involved and referenced in this case also have overlapping names. We have attempted to simplify the facts whenever possible, and have eliminated details that, while possibly pertinent to post-appeal or potential post-summary judgment proceedings, are not relevant to our analysis.

       “This Court reviews the grant of summary judgment de novo, viewing the evidence in the light most favorable to the nonmovant.” Godwin v. Mizpah Farms, LLLP, 330 Ga. App. 31, 31 (766 SE2d 497) (2014).

       The trust Guarantors were a single trust created under Line Item Nine of the Will of Arthur Jesse Merrill (“the Item Nine Will Trust”), and seven “breakout” trusts —• WHM Management Trust; WHM Merrill Ranch Trust; Merrill Communities & Resorts Trust (MCRT); WHM Chattahoochee Hills Trust; WHM Copper Mountain Trust; WHM Paloma Trust; and WHM Sky Valley Trust. The breakout trusts were created from the original Item Nine Will Trust as part of an organizational restructuring in 2006.

       The defendants in the Arizona litigation — i.e., the original Borrower and Guarantors of the Loan, will hereinafter be referred to as “Judgment Debtors.”

       The 2008 Real Estate Transfers were made by WHM Paloma Investments, LLC; WHM Sky Valley Investments LLC; and Indian Creek Resort LLC. These entities will he referred to as the 2008 LLC Real Estate Transferors.

       Although the stock transfer documents were dated June 8,2008, evidence was presented that the documents were actually executed between June 1, 2009 and February 18, 2010, and there now appears to be some agreement between the parties that this transfer took place sometime in January or February 2010; accordingly, we will assume likewise for the purpose of this appeal.

       Florence Copper Mining Inc. was not named as a defendant below and is not a party to this appeal.

       Judgment Debtors MCRT and Harrison Merrill, and non-judgment debtors Merrill Mining, LLC, the Trustees of the Children’s Trusts, and Harrison Merrill’s children were named as defendants in the initial complaint. Plaintiff alleges that as a result of this transfer, proceeds from the imminent sale of the mining rights owned by Florence Copper were distributed to the Children’s Trusts instead of Merrill Mining, LLC, which would have, according to Plaintiff, then been required by its Operating Agreement to distribute the proceeds to Judgment Debtor MCRT.

       Pursuant to OCGA § 14-11-504 (a), “[o]n application to a court of competent jurisdiction by any judgment creditor of a member or of any assignee of a member, the court may charge the limited liability company interest of the member or such assignee with payment of the unsatisfied amount of the judgment with interest.”

       “An allonge is a piece of paper attached to a promissory note on which parties write endorsements for which there is no room on the instrument itself.” (Citation omitted.) Milestone v. David, 251 Ga. App. 832, 832, n. 1 (555 SE2d 163) (2001).

       The Defendants also make the additional argument that, even assuming the Loan was properly assigned to Plaintiff, there was no evidence presented that the claims at issue in this case were assigned to Plaintiff. But this argument is unavailing as it pertains to the Judgment Debtors named as parties in this case, as they are bound by the Arizona Judgment, which was entered by consent and domesticated in Georgia after Plaintiff was substituted as a party in the Arizona litigation. Moreover, we need not parse this issue as to the non-judgment debtors since Plaintiff’s UFTA claims fail against them for other reasons as set forth in Divisions 2 and 3.

       Whether a transfer is made with actual intent to defraud a creditor is determined by reference to subsection (b) of OCGA § 18-2-74, which contains a non-exhaustive list of factors, commonly called the “badges of fraud,” which may be considered in determining intent to defraud. See Target Corp. v. Amerson, 326 Ga. App. 734, 737 (1) (755 SE2d 333) (2014). The transferors’ intent was not addressed by the trial court and is not an issue in this appeal.

       The relief available to a creditor under Georgia’s UFTA against a fraudulent transfer is set out in OCGA § 18-2-77, and includes, among other things, avoidance of the transfer to the extent necessary to satisfy the creditor’s claim and attachment against the asset transferred or other property of the transferee.

       Thus, Georgia’s version of UFTA does not distinguish between creditors who hold judgments against persons liable to them on a debt and those who do not.

       Instead, appellees argue this claim must fail because it is time-barred under OCGA § 18-2-79 (1) of the UFTA. We will address this contention in Division 4.

       Although Plaintiff cites to both the Arizona and Georgia limited liability company acts and charging order provisions, A.R.S. § 29-601 et seq. and Chapter 11 of Title 14 of the Georgia Code, the charging orders in this case were issued by a Georgia court and make no reference to the Arizona statute. Thus, we will confine our analysis to Georgia’s charging order statutes.

       In Gaslowitz, we held that a judgment creditor of a member of an LLC has no right to seek an accounting of the assets of the LLC. 331 Ga. App. at 155 (2).

       The issue in Mahalo was whether an application for a charging order against a member’s distributional interests in an LLC must be filed by the judgment creditor as a separate action, apart from the original action in which the judgment creditor obtained the judgment against the member of the LLC, and in a court with jurisdiction over the LLC. We concluded that under the LLC charging order statute, it is only necessary for a court to have jurisdiction over the judgment debtor to have the authority to enter a charging order against the judgment debtor’s distributional interests in an LLC, and that, therefore, an action for a charging order may be filed under the same case number and in the same court that issued the original unsatisfied judgment against the debtor. Mahalo, 330 Ga. App. at 743.

       For purposes of this analysis only, and notwithstanding our holding in Division 2, we will assume a debtor-creditor relationship existed between the transferors of the 2008 Real Estate Transfers and the Plaintiff.

        Golshani was decided on October 16, 2015, and appellant’s initial brief to this Court in this case was filed on August 31, 2015, and its reply brief was filed on October 8, 2015. Thus, appellant first posited these arguments in its supplemental brief filed after oral argument.

       Although raised below, the trial court was not required to reach this issue based on its determination that Plaintiff could not maintain any of its claims against any of the defendants because the assignment of the Loan was ineffective.


author: Ray, Judge.

text:
    A15A2324.
    TESTON et al. v. SOUTHCORE CONSTRUCTION, INC.
    (783 SE2d 921)
   Ray, Judge.

Angela Teston and her husband sued SouthCore Construction, Inc. seeking to recover from injuries she sustained when Teston tripped and fell over electric cords that were exposed during an office renovation. After discovery, the trial court granted SouthCore’s motion for summary judgment. Teston appeals from that order. For the following reasons, we reverse the trial court’s grant of summary judgment.

We review the grant of a summary judgment motion de novo, viewing the evidence and all reasonable inferences and conclusions drawn from it in the light most favorable to the nonmovant. Nosiri v. Helm, 301 Ga. App. 380, 380 (687 SE2d 635) (2009).

The facts show the following: At the time of her fall, Teston was an employee of TitleMax of Georgia, Inc. The TitleMax store front housed two related businesses, TitleMax and Equity Auto Loan, a/k/a Instaloan, which are both subsidiaries of TMX Finance, LLC. The store was “divided pretty evenly straight down the center,” with TitleMax employees’ desks on the right side of the room and Equity Auto Loan employees’ desks on the left side. The desks and furniture on the two sides of the room were arranged in nearly identical fashion.

Prior to the date of the fall, TMX contracted with SouthCore to renovate the premises in preparation for a new business to occupy the space. To prepare for the renovation, SouthCore began to move furniture from the Equity Auto Loan side of the store. Employees had been told about the move before it happened, and the work occurred outside of business hours. The evening before Teston’s fall, South-Core removed most of the desks and office furniture from their usual locations on the Equity Auto Loan side of the premises. The items remaining after removal were the desk typically used by the store’s manager, Rickie Jarvis (the “Jarvis desk”), and a credenza along the wall opposite the TitleMax side of the store. The desk had been pulled several feet away from the wall. The fax machine had been moved to the end of the Jarvis desk. At the time of Teston’s fall, the TitleMax side of the store had remained unchanged.

As a result of the removal of the desks and the rearrangement of the remaining furniture, electric cords that had been previously concealed by the desks were exposed. Notably, there were exposed cords that ran from the Jarvis desk to the outlet on the wall. A mat had been placed over a portion of the newly exposed cords, but there was a portion of the cords uncovered near the desk and near the wall. Jarvis testified that there was only a “very small gap” between the mat and his desk where the cords were exposed. Although Teston knew that SouthCore had removed furniture from the Equity Auto Loan side of the store and employees had generally been warned to “be careful” during the renovation, neither SouthCore nor TMX warned her or anyone of the hazardous condition created by the exposed cords, specifically.

On the date of her injury, Teston was at work on the TitleMax side of the store when she needed access to an employee work schedule and the fax machine, both of which she believed to be located on the J arvis desk. As she walked across to the Equity Auto Loan side of the store to the Jarvis desk, Teston noticed a clear floor mat near the desk, but she did not notice any exposed cords. Teston testified that she did not see the cords “because [she] wasn’t looking down.” As Teston began to return to her desk, she walked by the left side of the Jarvis desk, tripped on the newly exposed electric cords, and fractured her wrist. During her deposition, Teston drew a diagram of her path to the Jarvis desk and her attempted return path, which indicates that she took a similar path both to and from the Jarvis desk.

Jarvis testified that he did not provide SouthCore with any instruction in regard to removing the furniture and did not have any knowledge as to how SouthCore received instruction, if any, from TMX. Jarvis also testified that SouthCore was responsible for putting the mat out that partially covered the cords exposed by the desk removal.

SouthCore filed a motion for summary judgment, which the trial court granted. In its order, the trial court found that the circumstances in this case created an exception to the rule that a plaintiff-invitee typically has no obligation to continuously look down while walking because Teston’s knowledge of the recent furniture rearrangement “imposed upon her a heightened obligation to look for open and obvious hazards where she was walking.” Therefore, the trial court held that “it is unreasonable for a person entering an office from which most furnishings have been removed to fail to look for hazards such as exposed cables.” Teston then filed a motion in the trial court requesting that the order be reconsidered. In her motion, Teston argued that the trial court relied upon incorrect assumptions of fact. The trial court denied the motion for reconsideration in an order that accepted several facts set forth in the motion as true. The trial court reiterated its ruling that the removal of the office furniture from the Equity Auto Loan side of the store “triggered a heightened obligation to look for potential hazards created by the changes she was aware of.” Teston appeals from those orders.

Teston argues, in two enumerations of error, that the trial court erred in concluding, as a matter of law, that she did not exercise ordinary care for her own safety in traversing the Equity Auto Loan side of the store, and that she had a “heightened obligation to look for hazards.”

The trial court is authorized to conclude, as a matter of law, that the facts do or do not show negligence on the part of the defendant or plaintiff only where the evidence is plain, palpable and undisputable. Robinson v. Kroger Co., 268 Ga. 735, 740 (1) (493 SE2d 403) (1997). Further, “[i]t is the plaintiff’s knowledge of the specific hazard precipitating a slip and fall which is determinative, not merely her knowledge of the generally prevailing hazardous conditions or of hazardous conditions which plaintiff observes and avoids.” (Citation and punctuation omitted; emphasis supplied.) Nosiri, supra at 381 (1).

Here, there is no question that Teston was aware that desks had been removed and that the Equity Auto Loan side of the store front had been rearranged. She had been informed of the renovation, it was obvious that furniture in the store had been removed and rearranged overnight, and there is testimony that employees had been warned to be careful in the store. However, there is no evidence that, at the time of her fall, Teston was aware of the existence of the cords protruding from under the clear plastic floor mat to the Jarvis desk. “Whether [Teston] exercised that duty of care commensurate with her knowledge ... is a circumstance to be considered by the jury in determining if appellant exercised due care for her personal safety.” (Citation and punctuation omitted.) Nosiri, supra at 381 (1).

Teston testified that although she traversed the clear floor mat covering the cables when she first approached the Jarvis desk, she did not see the cables because she was not looking down at the floor as she walked. In Robinson, supra, our Supreme Court rejected the argument that a plaintiff “fails to exercise ordinary care for personal safety as a matter of law when [she] admits she failed to look at the location where she subsequently placed her foot.” Id. at 743 (1) (emphasis supplied). This is because an invitee is “not required to maintain a constant lookout, but is entitled to assume that the owner/occupier has exercised reasonable care to make the premises safe.” (Citation and punctuation omitted.) J. H. Harvey Co. v. Reddick, 240 Ga. App. 466, 472 (c) (522 SE2d 749) (1999) (plaintiff who slipped and fell in a grocery store did not fail to exercise ordinary care for her own safety, such that summary judgment was warranted to defendant grocery store, despite testimony that the plaintiff did not look down at the floor before she fell).

Therefore, “the issue is whether, taking into account all the circumstances existing at the time and place of the fall, the invitee exercised the prudence the ordinarily careful person would use in a like situation.” Robinson, supra at 748 (2) (b). Although we note that this case may not be the strongest case for imposing liability upon SouthCore, as a jury might conclude that Teston should have seen the cords that caused her fall, we do not find that the circumstances in this case automatically require such a finding and warrant an award of summary judgment in SouthCore’s favor. Because we find that

reasonable minds can differ, taking into account all the circumstances at the time and place of the incident, the evidence does not plainly, palpably, and indisputably lead to the conclusion that [Teston’s] placement of her foot on a site she had not previously inspected visually is an act which is a want of such prudence as the ordinary careful person would use in a like situation.

(Citations and punctuation omitted.) Robinson, supra at 743 (1). See Nosiri, supra (summary judgment in favor of defendant was not appropriate when plaintiff-employee had previously expressed concern about wires lying across the floor of her work area, she had previously moved phone cords that posed a danger to her, and on the day she fell, she was unaware where, or if, there was a cord present in the passageway and her view of the cords she tripped on was obstructed by other employees standing nearby).

Judgment reversed.

Barnes, R J., and Mercier, J., concur.

On Motion for Reconsideration.

Upon motion for reconsideration, SouthCore argues that the trial court’s grant of summary judgment in its favor should have been affirmed under the “right for any reason” doctrine. See City of Gainesville v. Dodd, 275 Ga. 834, 835 (573 SE2d 369) (2002) (“Under the ‘right for any reason’ rule, an appellate court will affirm a judgment if it is correct for any reason, even if that reason is different than the reason upon which the trial court relied”) (citation omitted). We remain unpersuaded.

1. SouthCore first asserts that we should have affirmed the trial court’s grant of summary judgment under the “right for any reason” doctrine because it was not an “occupier” of the TitleMax building at the time of Teston’s fall and, thus, it owed no duty of care to her. However, even if we assume, without deciding, that SouthCore was not an owner or occupier of the TitleMax location, it “had the duty to use ordinary care” in its removal of the furniture as it prepared to renovate the storefront. (Citations omitted.) Kelley v. Piggly Wiggly Southern, 230 Ga. App. 508, 509 (1) (496 SE2d 732) (1998). A jury issue exists as to whether SouthCore’s act of covering the exposed electric cords with floor mats, but leaving portions of the cords exposed, would constitute the use of ordinary care. See id. (“The ‘routine’ issues of premises liability, i.e., the negligence of the defendant and the plaintiff, and the plaintiff’s lack of ordinary care for personal safety are generally not susceptible of summary adjudication.”) (citation and punctuation omitted).

Decided March 28, 2016 —

Reconsideration denied April 13, 2016

Scheer, Montgomery & Call, Craig A. Call; Barnes & Cohen, Rebecca H. Cozart, for appellants.

Brown, Readdick, Bumgartner, Carter, Strickland & Watkins, Bradley J. Watkins, for appellee.

2. SouthCore next contends that summary judgment in its favor was appropriate under the “right for any reason” rule because Teston had previously traversed the area covered by the floor mats prior to her fall and, thus, that she had at least equal knowledge of the exposed electric cords. We disagree.

Contrary to SouthCore’s argument, Teston’s deposition does not reveal that she had successfully traversed over the alleged defective condition — i.e., the exposed electric cords, prior to her fall. Rather, Teston’s deposition reveals that, prior to her fall, she crossed the cables where they were covered by the clear mat, which did not present a dangerous condition, although it would have indicated that the cables were present at that location if she had looked down. There is no evidence in the record as to whether Teston successfully negotiated prior to her fall the area not covered by the floor mats where the electric cords were exposed. Accordingly, it cannot be decided as a matter of law that Teston had knowledge of the specific hazard that caused her fall. See Landrum v. Enmark Stations, 310 Ga. App. 161, 164 (2) (712 SE2d 585) (2011) (summary judgment in favor of gas station not appropriate because there was no record evidence that plaintiff-customer had successfully negotiated an uneven crack in the pavement of the gas station parking lot prior to her fall. Although plaintiff had previously walked in that area of the parking lot, it was possible that plaintiff had taken a slightly different route upon return to her car when she tripped).

Motion for reconsideration denied.

       A photograph showing a partial view of the cords and mat is a part of the record.

       We acknowledge that at trial SouthCore will have an appealing argument that Teston should have seen the exposed electric cords prior to her fall. We leave resolution of that issue to the jury.


author: BARNES, Presiding Judge.

text:
    A15A2336.
    ALR OGLETHORPE, LLC et al. v. HENDERSON et al.
    (783 SE2d 187)
   BARNES, Presiding Judge.

This suit arose after ALR Oglethorpe, LLC, bought two parcels of land and then discovered after the closing that one of the parcels was still burdened by a recorded access easement. ALR and five individuals who had invested in related limited liability companies (collectively, ALR) sued C. Gerald Henderson, Title Resources Corp. - Savannah, and Title Resources Corporation (collectively, Henderson) for professional negligence in preparing the title examination and abstract. The trial court granted Henderson’s motion to dismiss, finding that the statute of limitation had run before suit was filed and also finding that the suit was barred by the doctrine of res judicata. ALR appeals, and because we agree that the suit was barred by the doctrine of collateral estoppel, we affirm.

The parties do not dispute the underlying facts pertinent to this appeal. ALR retained the law firm Coleman Talley LLP to perform a title search on two contiguous tracts of land along the south bank of the Savannah River for a development project known as the Savannah River Landing. Coleman Talley asked Fidelity National Insurance Company to prepare a title commitment for the properties, and Fidelity hired an attorney, R. E. Hodges, to prepare a title abstract. Hodges then hired Henderson, whose abstract revealed the existence of an access easement across one of the tracts but failed to identify all of the parties benefitted by the easement across the tract.

Fidelity listed the access easement on a schedule of exceptions included with the title commitment, and Coleman Talley drafted an agreement to terminate the easements signed only by the benefitted parties who were identified in the title abstract. Fidelity then removed the exception to the title commitment, and the property sales closed in May 2006.

In fall 2007, the individual investors loaned $4.2 million to Oglethorpe Landings Holdings, LLC, which was ALR’s sole member. The money was intended to be a short-term bridge loan for development costs until other financing could be arranged. But when ALR presented a proposed subdivision plat to the Savannah Metropolitan Planning Commission, a contiguous property owner objected because the proposed plat provided no means of access to that owner’s property, which was still benefitted by a recorded easement over property now owned by ALR. As ALR said in its complaint, the still-existing “easement rights prohibited the approval of the subdivision map, and therefore brought the entire Savannah River Landings project to a halt.” Lacking an approved subdivision plat, ALR had difficulty marketing the project.

ALR alleged in its complaint that the individual investors learned of the easement issue in January 2008. The title insurance company, Fidelity, negotiated the termination of the remaining easement rights, which were relinquished in June 2008. The Savannah River Landing project ultimately failed, and multiple suits against various parties were filed, transferred, dismissed and reinstated. Some of the suits overlapped, with claims against some defendants proceeding in two courts simultaneously.

For example, in September 2009 in the State Court of Chatham County, ALR sued Coleman Talley for malpractice and sued the property sellers for failing to disclose the outstanding easement. The sellers filed a third-party complaint against the title insurance company, which filed and then dismissed a fourth-party complaint against R. E. Hodges, Jr., LLC, the company it hired to prepare the title abstract. ALR filed its own complaint against Hodges as a fourth-party defendant, and Hodges was served on November 16, 2010.

Hodges moved to dismiss ALR’s claim against him, arguing that he had performed the title abstract before March 2006, and therefore the four-year statute of limitation had expired at least by March 2010. On January 24, 2012, the Chatham County court granted Hodges’ motion to dismiss, holding that the statute of limitation had expired before Hodges was sued.

The Chatham County court subsequently granted summary judgment to the property sellers in October 2012, who were the only defendants residing in Chatham County, and the case was transferred to the State Court of Fulton County, one of Coleman Talley’s counties of residence. ALR appealed the grant of summary judgment to the property sellers, and this court affirmed that judgment without opinion in ALR Oglethorpe v. Peeples, 334 Ga. App. XXIII (Case No. A15A1358) (November 20, 2015) (unpublished).

Meanwhile, on January 6, 2012, ALR filed another suit in Chatham County against Coleman Talley and Henderson, which is before us in this appeal. ALR attached expert affidavits to its complaint, averring that the law firm had ethical conflicts related to its representation of the individual plaintiffs and that all of the defendants had breached the applicable standard of care in failing to discover and disclose the easement that still burdened the property after ALR bought it. ALR alleged that it lost potential sales as a result of its failure to gain the city’s approval of its development plan due to the then-existing easement rights burdening one of the two tracts.

As previously mentioned, Henderson moved to dismiss the claims against him, arguing that the four-year statute of limitation began to run on the claim when the title examination was completed, which was at the latest March 2006. Therefore, under any set of facts as pled, he asserted, the suit filed in January 2012 was time-barred. He also argued that the allegations against him were res judicata based on the previous Chatham County case alleging malpractice against Hodges based on the same title examination and abstract as the current case.

In February 2015, ALR filed a motion seeking permission to add itself as an additional plaintiff in its capacity as Coleman Talley’s assignee. ALR represented that it had settled its claims against Coleman Talley in September 2014 and had taken an assignment of the firm’s claims against Henderson. Henderson subsequently consented to the motion to add ALR in its capacity as assignee of Coleman Talley’s claims.

In June 2015, the trial court issued the order now on appeal, granting Henderson’s motion to dismiss the initial claims of ALR, although not dismissing ALR’s claims against Henderson in its capacity “as assignees of Coleman Talley, LLP, and its insurer,” which were hot the subject of the motion to dismiss. The trial court found that the suit involved a title examination that took place at least by March 20, 2006, when Coleman Talley prepared an agreement terminating the easement rights of the benefitted parties listed in the title abstract, that the applicable statute of limitation was four years, and that the statute of limitation expired no later than March 20, 2010, long before this suit was filed. The court also found that the claims against Henderson were barred by the doctrine of res judicata, based on the previous suit against the property sellers and the adjudication on the merits of ALR’s claims against Hodges.

1. ALR asserts on appeal that the trial court erred in granting Henderson’s motion to dismiss based on the doctrine of res judicata. While we conclude that res judicata does not apply here, collateral estoppel does, and thus we affirm the trial court under the “right for any reason” rule.

The law of res judicata and collateral estoppel is somewhat confusing, primarily due to our failure to clearly and consistently distinguish the two separate doctrines. The former, also known as claim preclusion, requires a plaintiff to bring all his claims against a party (or its privies) arising out of a particular set of circumstances in one action; while the latter, sometimes called issue preclusion, prevents relitigation of an issue already litigated by the parties (or their privies). In other words, under the doctrine of res judicata, a judgment on the merits in a prior suit bars a second suit involving the same parties or their privies based on the same cause of action. Under the doctrine of collateral estoppel, on the other hand, the second action is upon a different cause of action and the judgment in the prior suit precludes relitigation of issues actually litigated and necessary to the outcome of the first action.

(Citations and punctuation omitted.) Sorrells Constr. Co. v. Chandler Armentrout & Roebuck, P.C., 214 Ga.App. 193, 193-194 (1) (447 SE2d 101) (1994). See also OCGA § 9-12-40; Karan, Inc. v. Auto-Owners Ins. Co., 280 Ga. 545, 546 (629 SE2d 260) (2006). “[Unlike res judicata, collateral estoppel does not require identity of the claim — so long as the issue was determined in the previous action and there is identity of the parties, that issue may not be re-litigated, even as part of a different claim.” (Citation and punctuation omitted.) Body of Christ Overcoming Church of God v. Brinson, 287 Ga. 485, 486 (696 SE2d 667) (2010).

(a) Issue preclusion. ALR argues that res judicata does not apply to bar its claim in this case because its causes of action are not identical in both cases. The prior case alleged only professional malpractice, and this case also alleges negligent misrepresentation and breach of contract.

As to the professional malpractice claim, the causes of action are obviously identical. ALR is correct, however, that the causes of action in both cases are not identical, and “that, strictly speaking, the doctrine of res judicata does not apply.” Body of Christ, 287 Ga. at 487. “The fact that the subject matter of different lawsuits may be linked factually does not mean that they are the same ‘cause’ within the meaning of OCGA § 9-12-40. For that doctrine to act as a bar, the cause of action in each suit must be identical.” (Citation and punctuation omitted.) Morrison v. Morrison, 284 Ga. 112, 115 (3) (663 SE2d 714) (2008).

But

the rule with reference to the doctrine of estoppel by judgment^ or collateral estoppel,] is somewhat different, in that there can be an estoppel by judgment whenever there has been litigation between the same parties, even though based upon a different cause of action, as to such matters only as were necessarily or actually adjudicated in the former litigation.

House v. Benton, 42 Ga. App. 97, 97-98 (155 SE 47) (1930). See also Boozer v. Higdon, 252 Ga. 276, 278 (1) (313 SE2d 100) (1984).

The trial court in this case, which also heard and decided the prior case, noted that the claims in both cases relied “on precisely the same title examination as Plaintiffs relied on in the first action against defendant R.E. Hodges, Jr., LLC.” The current litigation, although framed to include different causes of action, can only survive if the claim against Henderson falls within the statute of limitation, and that question is determined by Henderson’s relationship with Hodges. In the previous litigation, the court determined that the action against Hodges was barred by the running of the statute of limitation. “This litigation therefore involves [a determinative] issue that had been resolved on the merits in prior litigation, satisfying one aspect of collateral estoppel.” Body of Christ, 287 Ga. at 487.

(b) Identity of parties. ALR argues that Hodges and Henderson were not privies merely because they were both parties to a contract, contending that “their interests in this litigation and the [p]rior [a]ction completely diverge” because each could blame the other for defects in the title abstract. Whether Henderson and Hodges are privies is a more difficult issue than whether the other two requirements for applying collateral estoppel are met, because usually parties are in privy with each other because both represent rights to the same property. See Dalton Paving & Constr. v. South Green Constr. of Ga., 284 Ga. App. 506, 508 (643 SE2d 754) (2007) (“[T]he term privity denotfes] mutual or successive relationship to the same rights of property.”). But that is a simplistic view of the doctrine of privity, which is broader than simply whether parties share a property interest.

“A privy is generally defined as one who is represented at trial and who is in law so connected with a party to the judgment as to have such an identity of interest that the party to the judgment represented the same legal right.” (Citation and punctuation omitted.) Brown & Williamson Tobacco Corp. v. Gault, 280 Ga. 420, 421 (1) (627 SE2d 549) (2006) (addressing res judicata bar).

There is no definition of “privity” which can be automatically applied to all cases involving the doctrines of res judicata and collateral estoppel, since privity depends upon the circumstances. Privity may... be established if the party to the first suit represented the interests of the party to the second suit.

(Citations and punctuation omitted.) Id. at 422 (1).

In its complaint, ALR contended that Coleman Talley sought a title commitment from Fidelity National Insurance Company, that Fidelity retained Hodges to provide the necessary title abstract, and that Hodges in turn retained Henderson to prepare the title abstract. Thus, ALR contended that the chain of responsibility for failing to prepare a proper title abstract flowed from Coleman Talley to Fidelity to Hodges to Henderson. ALR was aligned against Hodges in the prior case and is aligned against Henderson in this case. In its statute of limitation argument, ALR contends that the six-year statute for written contracts for professional services might apply in this case based on “the business relationship between R. E. Hodges, Fidelity, and the Henderson [defendants.” ALR further argues that “[discovery could disclose the existence of a written agreement” for professional services to which ALR was a third-party beneficiary. In other words, Henderson’s liability could flow from a written contract with Hodges, if one existed, because Hodges hired Henderson to prepare the title abstract.

But regardless of whether Hodges and Henderson could conceivably be opposing parties in a contract dispute between each other or could blame each other for any malpractice that occurred, for purposes of this lawsuit, ALR is claiming to be the third-party beneficiary of a possible written contract between Hodges and Henderson, and therefore the interests of Hodges and Henderson are aligned in both the prior litigation and the current one. Henderson’s liability is premised upon him having a contract with Hodges, and the prior action against Hodges was dismissed because the statute of limitation had run before suit was filed. If Hodges is not liable because the statute had run, then Henderson could not be liable either.

[I]t is not required that all the parties on the respective sides of the litigation in the two cases shall have been identical, but it is sufficient as to identity of parties if those by and against whom the defense of res judicata is invoked in the latter case were real parties at interest or privies as to the controversy in the former case.

Darling Stores Corp. v. Beatus, 199 Ga. 215 (3) (33 SE2d 701) (1945). We conclude that, under the unique facts and circumstances present here, Hodges and Henderson were in privity for collateral estoppel purposes. See Dalton Paving, 284 Ga. App. at 508 (developer, owners, and property manager were “in essence third party beneficiaries of the subcontract” between plaintiff general contractor and defendant subcontractor, who previously arbitrated claim over contract).

(c) Adjudication on the merits. The third prerequisite for the application of the doctrine of collateral estoppel requires that the prior claim be adjudicated on the merits by a court of competent jurisdiction. Body of Christ, 287 Ga. at 486. The trial court in the previous case granted Hodges’ motion to dismiss based on the expiration of the statute of limitation. While ALR argues that this dismissal did not constitute an adjudication on the merits, we disagree.

The statute of limitation is an affirmative defense which acts as a bar to recovery. Dismissal based upon the expiration of the statute of limitation is in essence dismissal for failure to state a claim upon which relief can be granted. A dismissal on this ground is a decision on the merits.

(Citations omitted.) Towe v. Connors, 284 Ga. App. 320, 321 (644 SE2d 176) (2007).

The question for collateral estoppel purposes is whether the previously litigated issues were essential to the judgment entered in the prior action. If so, those issues cannot be litigated again, and as discussed in Division 1 (a), if the claims in a subsequent case rely on an issue previously decided, then the collateral estoppel bar applies. Although we held in Black Island Homeowners Assn. v. Marra, 263 Ga. App. 559, 562-563 (2) (588 SE2d 250) (2003), that a dismissal based on the statute of limitation did not bar a subsequent case on collateral estoppel grounds, the facts reveal why the analysis in that case does not apply to the one at bar. In Black Island, a prior claim against a homeowners’ association for mowing uninhabited areas in violation of restrictive covenants was dismissed on statute of limitation grounds because the mowing had begun more than two years before suit was filed. Id. at 561. The trial court found that a subsequent suit to enjoin the association from mowing was not barred by collateral estoppel, and we agreed, because “the trial court did not need to reach the merits of the owners’ initial mowing claim in order to find that claim barred by the statute of limitation.” Id. at 562-563 (2). Because “[m]owing is a distinct, separate act that constitutes an alleged breach each time it occurs,” the statute of limitation dismissal in the prior case did not resolve any issue essential to the subsequent case, which was not barred by collateral estoppel. Id. at 561 (1) (b). In contrast, the running of the statute of limitation is an issue essential to ALR’s claims against Henderson in this case related to the 2006 title search.

Decided March 23, 2016 —

Reconsideration denied April 13, 2016

Savage & Turner, Brent T. Savage, Kathryn H. Pinckney, for appellants.

Cohen Pollock Merlin & Small, GusH. Small, Kevin T. O’Sullivan, for appellees.

No party, plaintiff or defendant, is permitted to stand his case before the court on some of its legs, and if it falls, set it up again on the rest in a subsequent proceeding, and thus evade the bar of the former judgment. It is the body of a case and not certain of its limbs only, that the final judgment takes hold upon.

Perry v. McLendon, 62 Ga. 598, 604-605 (1879). As all three prerequisites to finding this action barred by the doctrine of collateral estoppel have been met in this case, the trial court did not err in granting judgment to the defendants.

2. ALR’s remaining enumeration of error regarding the trial court’s finding that the statute of limitation had run on this claim is moot in light of our ruling in Division 1.

Judgment affirmed.

Ray and McMillian, JJ., concur in judgment only.

       The individual investors are Jules Paderewski, Bernard Portman, Charles Xdleson, Cora Bett Thomas, and Allison Stanley as the executor of Danny Stanley’s estate.

       The record in Court of Appeals Case No. A15A1358 includes a consent order issued in October 2014 by the Fulton County trial court dismissing with prejudice ALR’s claims against Coleman Talley.