author: ELLINGTON, Presiding Judge.

text:
    A15A0271.
    2010-1 SFG VENTURE LLC et al. v. LEE BANK & TRUST COMPANY.
    (775 SE2d 243)
   ELLINGTON, Presiding Judge.

Pursuant to a granted application for an interlocutory appeal, 2010-1 SFG Venture LLC and Milwaukee Hotel Owner LLC (collectively “Venture”) contend that the Superior Court of Fulton County erred in denying their motion for summary judgment on Lee Bank & Trust Company’s (“Lee Bank’s”) claims. For the following reasons, we reverse the court’s order in part, vacate it in part, and remand with direction.

Summary judgment is proper when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. A de novo standard of review applies to an appeal from a [grant or] denial of summary judgment, and we view the evidence, and all reasonable conclusions and inferences drawn from it, in the light most favorable to the nonmovant.

(Citations and footnote omitted.) GEICO Gen. Ins. Co. v. Wright, 299 Ga. App. 280, 281 (682 SE2d 369) (2009). So viewed, the record shows the following.

This case arises out of a commercial real estate loan for approximately $15 million, which was originated by non-party Specialty Finance Group LLC (“SFG”) in 2008 to DOC Milwaukee LP (“the borrower”) to fund the construction of a hotel in Milwaukee, Wisconsin. The hotel was part of the collateral for the loan. After SFG originated the Loan, Lee Bank bought a 3.36% interest in the loan for $500,000, the sale of which was memorialized in a “Participation Agreement” signed by the president and CEO of Lee Bank.

Pursuant to the participation agreement, Lee Bank, in exchange for its purchased interest, was entitled to receive its pro rata share of the payments the borrower made on the loan. The agreement also obligated Lee Bank to pay its pro rata share of any losses and expenses sustained in connection with the loan. SFG, as the holder of the largest percentage interest in the Loan (about 47%) retained the “reasonable discretion” to make decisions concerning the administration of the loan. However, it also required SFG to “exercise the same degree of care in administering the loan that SFG customarily exercises in administering similar loans for its own account.” The agreement provided that Lee Bank purchased its interest “on a non-notification, all servicing rights retained by SFG basis .’’Although SFG agreed to make “reasonable efforts under the circumstances then applicable” to consult with Lee Bank concerning any actions taken with respect to the loan, the agreement provided that “in all events the decision of SFG shall control.” Further, although the agreement provided that SFG would inform Lee Bank of any default by the borrower, SFG retained the right “to sell or otherwise dispose of the [hotel] without the prior approval of [Lee Bank] and the commercially reasonable decision of SFG shall be binding as to the best manner in which to proceed with respect to the completion or construction, operation, management and disposition of the [hotel].”

The agreement also contained specific provisions governing any breaches of the participation agreement by SFG or by Lee Bank. With respect to an alleged breach by SFG, the agreement provided that, “[i]f SFG shall fail to cure any material default by SFG under this agreement” within 30 days, Lee Bank would have, in addition to its rights at law and equity, a right to require SFG to repurchase its participation interest, less certain costs and subject to any regulatory limitations.

The agreement also limited SFG’s liability for any action taken with respect to the loan or participation agreement as follows:

17. Limitation on Liability of SFG. SFG shall not be liable for any action taken or omitted to be taken by it or by any of its employees, members, officers, managers, contractors or agents, or any of them, for any errors of judgment under, or in connection with this Agreement, or any of the Loan Documents, except in the case of gross negligence or willful misconduct.

The record shows that the borrower initially made regular payments on the loan, that SFG made regular remittances to Lee Bank of its 3.36% share of those loan payments, and that Lee Bank accepted and retained those remittances. The borrower, however, eventually defaulted on the loan by failing to make loan payments and by halting construction of the hotel. Shortly thereafter, the loan guarantors declared bankruptcy. In May 2009, SFG’s parent company, Silverton Bank, was closed and, a year later, the FDIC was appointed receiver for Silverton and SFG. The FDIC sold SFG’s loan portfolio, including SFG’s interest in the instant loan, to an affiliate of Venture.

Following its purchase of the loan from the FDIC, Venture assumed SFG’s role as lead lender under the purchase agreement. Venture took control of the hotel and, over a three-and-a-half year period, made repairs to it, paid insurance and real estate taxes, pursued legal action against the borrower, and negotiated settlements with contractors who had placed liens against the property. In its efforts to secure and to maintain the value of the hotel, Venture incurred over $6 million in expenses. Venture issued regular demands to the participant banks for their pro rata shares of these expenses. For example, in 2010 and 2011, it demanded of Lee Bank payments of $20,243.27, $9,070.27, $11,504.99, and $3,424.27.

By letter dated January 3,2013, Lee Bank informed Venture that it believed that the expenses incurred in connection with the loan were grossly unreasonable. It considered Venture to be in breach of the participation agreement by failing to notify it of “material adverse information.” Lee Bank demanded that “Venture acknowledge that the Participation Agreement! has] been terminated and to restore [Lee Bank’s] consideration by repurchasing [its] participation interest ] within thirty (30) days” of the date of the letter. Lee Bank also demanded that Venture remit to it its pro-rata share of any proceeds of the sale of any collateral “without offset or diminution.” On January 31,2013, Venture sued Lee Bank for breaching its obligation under the participation agreement. Lee answered, denying responsibility for the expenses, and brought counterclaims for breach of contract and rescission.

While the lawsuit was pending, Venture retained a commercial real estate firm to sell the renovated hotel. Venture’s intention to sell the hotel was published to a website that it had created to keep participant banks informed of its loan management activities. The real estate agent procured six offers, the highest of which was for $12 million. The $12 million offer and the associated contract documents were shared with the participant banks; none of the banks objected to the sale price. The hotel was sold in October 2013; thereafter, Venture distributed $141,163.94 to Lee Bank. According to Venture, this amount represented Lee Bank’s share of the proceeds ($347,695.69) less that portion of expenses due Venture from Lee Bank ($206,531.75).

In early August 2013, an Atlanta-based consulting firm inspected the property at the request of counsel for Lee Bank, and it appraised the hotel in the condition it had been on May 12, 2012, before the renovation was complete. The firm opined that the appraised value of the hotel as of that date was $17.1 million.

On January 31, 2014, Venture moved for summary judgment on Lee Bank’s counterclaims for breach of contract and for rescission arguing, inter alia, that Paragraph 17 of the participation agreement limited SFG’s (and hence Venture’s) liability only to those acts or omissions that amounted to gross negligence or willful misconduct. The trial court denied the motion. In its order, the court determined that the limitation of liability provision in the participation agreement was unenforceable because the provision was not prominently displayed in the agreement. Additionally, with respect to Lee Bank’s breach of contract claims, the trial court ruled that Lee Bank could pursue a breach of contract claim based on Venture’s failure to repurchase Lee Bank’s participation interest. And, with respect to Lee Bank’s rescission claim, the trial court found that questions of fact remain as to whether Lee Bank’s offer to restore the consideration it received under the agreement was reasonable under the circumstances. It is from these rulings that Venture appeals.

1. (a) Venture contends that the trial court erred in concluding that Paragraph 17 of the participation agreement, a clause that limited SFG’s (and hence Venture’s) liability to acts or omissions that amounted to gross negligence or willful misconduct, was unenforceable because it was not sufficiently prominent in the agreement. Our review of this claim of error is de novo. For the following reasons, the limitation of liability clause at issue was valid and enforceable, and the trial court erred in concluding to the contrary.

It is the paramount public policy of this state that courts will not lightly interfere with the freedom of parties to contract. A contracting party may waive or renounce that which the law has established in his or her favor, when it does not thereby injure others or affect the public interest. Exculpatory clauses in Georgia are valid and binding, and are not void as against public policy when a business relieves itself from its own negligence.

(Citation omitted.) Neighborhood Assistance Corp. of America v. Dixon, 265 Ga. App. 255, 256 (1) (593 SE2d 717) (2004). Given this paramount public policy, courts “exercise extreme caution in declaring a contract void as against public policy, and should do so only when the case is free from doubt and an injury to the public interest clearly appears.” Piedmont Arbors Condominium Assn. v. BPI Constr. Co., 197 Ga. App. 141, 142 (397 SE2d 611) (1990).

In determining whether Paragraph 17 of the agreement is enforceable under Georgia law, we note that “because exculpatory clauses may amount to an accord and satisfaction of future claims and waive substantial rights, they require a meeting of the minds on the subject matter and must be explicit, prominent, clear and unambiguous.” (Citation and punctuation omitted.) Holmes v. Clear Channel Outdoor, 284 Ga. App. 474, 477 (2) (644 SE2d 311) (2007). In this case, the trial court determined that the limitation of liability clause was not sufficiently prominent, focusing on the fact that the clause was “written in the same serif font [as the rest of the contract], with the same heading style, and there are no bolded or italicized words within [the clause].”

In determining whether a limitation of liability clause or an exculpatory clause is sufficiently prominent, courts may consider a number of factors, including whether the clause is contained in a separate paragraph; whether the clause has a separate heading; and whether the clause is distinguished by features such as font size. See, e.g., Parkside Center v. Chicagoland Vending, 250 Ga. App. 607, 611-612 (2) (552 SE2d 557) (2001) (clause held unenforceable because it was contained at the end of a paragraph, which did not have its own heading, but was one of many listed under the heading “Miscellaneous,” and was printed in the same font size as the surrounding provisions); Imaging Systems Intl. v. Magnetic Resonance Plus, 227 Ga. App. 641, 644-645 (1) (490 SE2d 124) (1997) (an exculpatory clause was held enforceable where it was contained in its own paragraph, with the capitalized heading “LIMITATION OF LIABILITY’).

While font size is one of many important factors, it is not determinative of whether an exculpatory or limitation of liability clause is sufficiently prominent. For example, in Grace v. Golden, 206 Ga. App. 416, 417-418 (1) (b) (425 SE2d 363) (1992), an exculpatory clause was placed after the legal description in a security deed and was in the same typeface as the legal description. We held that the exculpatory clause was nevertheless prominent enough to be enforceable in light of the fact that the deed was only two pages long and the clause was located in a place where the party signing the document, who had a duty to review the document, would have seen it. Under those circumstances, we concluded the drafters of the document had not intended to “camouflage” the provision so as to prevent it from being detected at closing. Id.

In this case, the limitation of liability clause was contained entirely within its own paragraph. It was announced, in bold font and underlined text, by a heading that clearly informed the reader of the clause’s content: “Limitation on Liability of SFG.” The clause was the seventeenth of thirty paragraphs in a twelve-page document. The paragraph was part of a collection of like paragraphs pertaining to the rights, responsibilities, representations, and warranties of SFG and the participating banks. The limitation of liability clause was not hidden in the minutiae of unrelated provisions.

Moreover, the participation agreement itself reveals that Lee Bank had helped draft the agreement and, therefore, should have been aware of its contents. The parties averred in the participation agreement that the agreement was “negotiated by both parties with the representation and advice of their legal counsel.” As a consequence, the parties agreed to waive the right to have the contract construed “against the draftsman of any provision” of the agreement. Additionally, the agreement was signed on behalf of Lee Bank by its president and CEO, a person with three decades of experience in the banking industry and with “extensive experience in commercial lending, banking standards, and banking operations.” The CEO gave an affidavit stating that he was familiar with loan participation agreements, that he understood their risks, and that he had read the contract. He even admitted that he was aware of the limitation of liability clause. This contract was a commercial contract between sophisticated business entities with equal bargaining power, not a consumer contract or a contract of adhesion. Thus, the limitation of liability provision, when viewed in this context, had all the hallmarks of “a reasonable allocation of risks in an arms-length business transaction.” RSN Properties, Inc. v. Engineering Consulting Svcs., Ltd., 301 Ga. App. 52, 54-55 (686 SE2d 853) (2009) (holding that a limitation of liability clause in a contract for professional engineering services did not violate public policy).

Given these circumstances, we hold that the limitation of liability clause was sufficiently prominent and that Lee Bank has not demonstrated that declaring the clause unenforceable clearly serves the public interest. See, e.g., RSN Properties, Inc. v. Engineering Consulting Svcs., Ltd., 301 Ga.App. 52, 54-55; Imaging Systems Intl. v. Magnetic Resonance Plus, 227 Ga. App. at 644-645 (1); Grace v. Golden, 206 Ga. App. 416, 417-418 (1) (425 SE2d 363) (1992). Consequently, the trial court erred in ruling that the clause was unenforceable.

(b) Lee Bank argues that, in the event this Court finds the limitation of liability clause sufficiently prominent, as we have done, see Division 1 (a), supra, we should nevertheless affirm the trial court’s ruling under the “right for any reason” rule because the limitation of liability clause is ambiguous as to whether it applies to breach of contract claims. Lee Bank has failed, however, to identify any such ambiguity.

The clause expressly limited SFG’s liability for “any action taken or omitted to be taken ... in connection with this Agreement, or any of the Loan Documents, except in the case of gross negligence or willful misconduct[.]” “[A]ny action taken or omitted to be taken” is broad enough to include conduct which may give rise to either a tort or to a breach of contract. See Imaging Systems Intl. v. Magnetic Resonance Plus, 227 Ga. App. at 644 (1) (“The meaning of ‘any’ in context is ‘all.’ ”). Further, it is axiomatic that “a single act or course of conduct may constitute not only a breach of contract but an independent tort as well[.]” Orkin Exterminating Co. v. Stevens, 130 Ga. App. 363, 365 (203 SE2d 587) (1973). Thus, we hold that the limitation of liability clause specifically limited SFG’s (and hence successor-in-interest Venture’s) potential liability for breaches of the agreement to those breaches arising from a specific type of conduct — gross negligence or willful misconduct. See Chemical Bank v. Security Pacific Nat. Bank, 20 F3d 375, 378 (9th Cir. Cal. 1994) (A credit agreement that specifically limited the agent bank’s potential liability for breaches of the agreement to “its own gross negligence or willful misconduct” was enforceable.); Firstar Metropolitan Bank & Trust v. FDIC, 964 FSupp. 1353, 1356-1357 (I) (D.Ariz. 1997) (Aparty to a contract can specifically limit its liability under a contract for claims sounding in breach of contract arising from its “own gross negligence or willful misconduct.”); Federated Project and Trade Finance Core Fund v. Amerra Agri Fund, LP, 2014 N.Y. Misc. LEXIS 1596 (No. 651986/12) (N.Y. Sup. Ct. decided April 4, 2014) (The defendant was entitled to summary judgment on the plaintiffs’ cause of action for breach of contract, given the existence of the limitation of liability clause and the fact that the defendant’s conduct did not amount to gross negligence or wilful misconduct as a matter of law.). The cases cited by Lee Bank are distinguishable.

(c) Lee Bank also argues that the limitation of liability clause conflicts with other provisions of the agreement defining what circumstances constitute a breach of the agreement and, because those provisions do not reference or specifically incorporate the limitation of liability, the limitation of liability clause should be stricken. We have found no Georgia law, nor has Lee Bank cited to any, that requires every contract provision that may be affected by a contract’s limitation of liability clause or an exculpatory clause to reference the clause. Moreover, under Georgia law, “[a] contract must be construed so as to reconcile its different provisions and to reject a construction that leads to a contradiction.” (Citation omitted.) Anderson v. Anderson, 274 Ga. 224, 228 (3) (552 SE2d 801) (2001).

In this case, although certain clauses of the participation agreement set forth circumstances which would constitute a breach of the participation agreement, they must be read in conjunction with the limitation of liability clause. When read in conjunction with the limitation of liability clause, it is apparent that a breach of the participation agreement does not result in liability — that is, it is not a compensable breach — unless it is the result of conduct that constitutes gross negligence or willful misconduct. Lee Bank has not demonstrated any alternate basis for holding the limitation of liability clause unenforceable.

2. (a) Given our holding that the limitation of liability clause is enforceable, see Division 1, supra, whether Lee Bank’s counterclaims for breach of contract and rescission may proceed to a jury depend on whether the evidence is sufficient to create a jury question as to whether Venture’s conduct (which forms the basis of the alleged material defaults or breaches of contract) rises to the level of willful misconduct or gross negligence under the circumstances presented here. For the following reasons, we vacate the court’s order denying Venture’s motion for summary judgment on Lee Bank’s counterclaims for breach of contract and rescission and remand with direction.

Gross negligence is defined as the failure to exercise that degree of care that every man of common sense, however inattentive he may be, exercises under the same or similar circumstances; or lack of the diligence that even careless men are accustomed to exercise.... Wilful misconduct is based on an actual intention to do harm or inflict injury.

(Citations, punctuation and footnote omitted.) Currid v. DeKalb State Court Probation Dept. 274 Ga. App. 704, 707 (2) (618 SE2d 621) (2005). See also OCGA § 51-1-4 (defining “slight diligence” and “gross negligence”). “In other words, gross negligence has been defined as equivalent to the failure to exercise even a slight degree of care.” (Citation and punctuation omitted.) Heard v. City of Villa Rica, 306 Ga. App. 291, 294 (1) (701 SE2d 915) (2010). “Questions of negligence and diligence, even of gross negligence and slight diligence, usually are matters to be determined by the jury, but in plain and indisputable cases the court may solve the question as a matter of law.” (Citation and punctuation omitted.) Id. at 295 (1). See also Morgan v. Horton, 308 Ga. App. 192, 198 (3) (707 SE2d 144) (2011) (accord).

Lee Bank averred that Venture was in breach of the participation agreement based upon the following: (1) Venture failed to notify Lee Bank of materially adverse changes to the loan and the hotel; (2) failed to consult with Lee Bank concerning the management and disposition of the hotel; (3) failed to disburse certain funds to Lee Bank; and (4) failed to manage, repair, and sell the hotel in a commercially reasonable manner.

Specifically, with respect to Venture’s management decisions, Lee Bank objects to Venture’s decision to incur in excess of $6 million in expenses on a $15 million loan, its decision to settle with a title insurance company, its failure to obtain an appraisal of the hotel before selling it, and its decision to sell the hotel for less than what Lee Bank contended was its fair market value. Lee Bank averred that these acts, under the circumstances, constituted “gross negligence and/or willful misconduct.”

Given its ruling that the limitation of liability clause was unenforceable, the trial court did not address whether the evidence adduced presented a jury question as to whether Venture’s conduct could be considered willful misconduct or gross negligence. And, because the record on this issue has yet to be fully developed, as explained in Division 2 (b) below, we remand the case to the trial court to consider whether such a jury question exists.

(b) Lee Bank argues that, although Venture’s decisions may have been commercially reasonable for Venture in light of the fact it purchased SFG’s interest in the loan at a considerable discount, its decisions with respect to the participant banks were grossly unreasonable and tantamount to willful misconduct:

Had Venture treated this Loan as one made from its own money, Venture would have sought to maximize its return by selling the Property at or near its market value. However, because Venture’s investment was discounted, Venture could sell the collateral for $5.1 million below market value and still make a profit, whereas the participants suffered huge losses.

Lee Bank moved the court for an order compelling Venture to produce financial documents which would reveal Venture’s motivations for buying the loan from the FDIC, its discount on the loan, its rationale for making over $6 million in repairs to the hotel, and the reasoning behind selling the property at auction for $12 million. Given its ruling on the limitation of liability clause, the court denied the motion to compel, stating that whether Venture was motivated to make a quick return at Lee Bank’s expense was irrelevant. However, given our ruling in Division 1, whether Venture was motivated to make a quick profit at the expense of the participant banks is relevant. Indeed, it is the crux of the matter. An understanding of Venture’s investment position in the loan allows the factfinder to infer whether Venture was making decisions to maximize its own profit at the expense of the participating banks or whether it was exercising that same degree of care in administering the loan that SFG (and hence Venture) was required by the agreement to exercise, that is, the degree of care that it would use in administering similar loans for its own account. A complete understanding of what Venture had to gain or lose as a result of its management decisions concerning the hotel is relevant to a consideration of whether Venture’s actions, vis-á-vis the participant banks, were commercially reasonable or grossly negligent. Consequently, we also vacate that portion of the court’s order denying Lee Bank’s motion to compel and direct the court to reconsider the motion in light of this opinion.

3. Venture argues that it was also entitled to summary judgment on Lee Bank’s rescission and breach of contract claims on alternate bases. For the following reasons, we find these arguments without merit.

(a) Rescission. Venture argues that Lee Bank failed to return the payments it received under the agreement; therefore, it argues, Lee Bank’s claim for rescission must fail. The record shows, however, that Lee Bank offered to restore the consideration it received in its initial answer and counterclaims and repeated the offer in its amended pleadings. It also made the offer during oral argument on its motion for summary judgment.

A contract may be rescinded for substantial nonperformance or material breach. Cutcliffe v. Chesnut, 122 Ga. App. 195, 201 (2) (176 SE2d 607) (1970). OCGA § 13-4-62 provides that “[a] party may rescind a contract without the consent of the opposite party on the ground of nonperformance by that party but only when both parties can be restored to the condition in which they were before the contract was made.” This means that “[t]he parties must be returned as nearly as possible to the status quo ante.” (Citations omitted.) Southern Prestige Homes v. Moscoso, 243 Ga. App. 412, 417 (4) (532 SE2d 122) (2000). It does not mean, however, that the law requires in all circumstances that the rescinding party return the consideration received under the contract as a condition precedent to pursuing a claim for rescission. The failure to offer restoration

does not defeat [a] rescission claim as a matter of law. There are circumstances under which a party need not offer restoration in order to rescind a contract, such as where nothing of any value is received by the party seeking to rescind; and where the amount received under the contract sought to be rescinded may be less than the amount actually due the party seeking to rescind. Moreover, the rule that he who desires to rescind a contract must restore whatever he has received under it is one of justice and equity and must be reasonably construed and applied. The object of the rule is theoretically to place the parties in statu quo; but the rule is equitable, not technical, and does not require more than that such restoration be made as is reasonably possible and such as the merits of the case demand.

(Citations and punctuation omitted.) Radio Perry, Inc. v. Cox Communications, Inc., 323 Ga. App. 604, 609 (1) (b) (746 SE2d 670) (2013). See also Smith v. McWhorter, 173 Ga. 255, 273 (160 SE 250) (1931) (“One rescinding [a] contract is not required to return consideration, when to do so would be unreasonable or impossible.”) (citations and punctuation omitted); Remediation Svcs., Inc. v. Georgia-Pacific Corp., 209 Ga. App. 427, 433 (1) (433 SE2d 631) (1993) (“No tender is required where the party seeking to rescind has received nothing of value, or where any amount received under the contract may be less than the amount due to the party seeking to rescind”) (citations omitted).

In this case, the evidence shows that Lee Bank, in exchange for purchasing a $500,000 participation interest from SFG, received its 3.36% share of the loan payments for about a year before the borrower defaulted. As a result of the default, the bank had to charge off $200,000 of the loan as a loss. The bank was also later assessed $247,000 in expenses associated with Venture’s servicing of the loan and management of the collateral. According to Venture, it remitted $141,163.94 to Lee Bank. This amount represented Lee Bank’s share of the proceeds of the sale of the hotel ($347,695.69) less that portion of expenses due Venture from Lee Bank ($206,531.75). Thus, while Lee Bank received “benefits” under the contract, those benefits only marginally offset its losses. Venture, on the other hand, retained the benefit of Lee Bank’s participation interest (which it obtained by purchasing the loan at a discount); moreover, it has recovered from Lee Bank the servicing expenses owed it under the participation agreement by deducting them from the sale of the hotel. Under these circumstances, requiring Lee Bank to remit a check to Venture for the funds it had received pursuant to the participation agreement prior to rescinding the contract would not restore the “status quo” between the parties to the agreement — in fact, Venture was never a part of the original status quo. Arguably, it would put Venture in a superior position. Under such circumstances, we cannot say that the trial court erred in finding that a jury question remained concerning whether Lee Bank’s offer to restore to Venture any benefits that it may have received under the agreement was reasonable. See Intl. Software Solutions, Inc. v. Atlanta Pressure Treated Lumber Co., 194 Ga. App. 441, 442 (390 SE2d 659) (1990) (“Restoration does not require that the opposite party be placed in exact status quo, but only that he be placed substantially in his original position, and that the rescinding party shall derive no unconscionable advantage from the rescission. We are satisfied the record before us shows that appellees’ in-court offer of restoration of appellant’s [property] met these tests.”) (citation and emphasis omitted).

(b) Breach of Contract. Venture argues that Lee Bank’s breach of contract claim fails because (i) Lee Bank failed to prove “actual damages” and (ii) because Section 10 of the participation agreement, which requires Venture to repurchase Lee Bank’s interest in the loan in the event of a material default, constitutes an unenforceable liquidated damages provision. We find no merit to these arguments.

Lee Bank has asserted that its actual damages are $500,000 — the amount of its participation interest — plus interest, expenses, and attorney fees. Lee Bank asserts a right to this amount by virtue of Section 10 of the participation agreement, which required Venture to repurchase Lee Bank’s participation interest in the event of an uncured material default under the agreement. While this amount may be “liquidated” in the sense that it is established both by the amount of Lee Bank’s interest in the loan and by the terms of the right-to-repurchase clause, this right-to-repurchase clause is not a liquidated damages provision under Georgia law. A liquidated damages provision is an agreement between the parties to limit recovery for a breach of the contract to a specified amount. Section 10 of the agreement, however, does not so limit the amount of damages recoverable for a breach of the agreement. Rather, by its plain language, it gives Lee Bank the “option,” not the obligation or the sole remedy, to demand that Venture repurchase its interest in the event of an uncured material default. This option is expressly “in addition to all other remedies available to it at law or in equity.”

Venture argued below that Section 10 of the agreement provides the participant bank with an option to seek a remedy that is in the nature of a specific performance. And Lee Bank argued that it had exercised that option, and that Venture was in material default of the agreement when it did not repurchase. Based upon those allegations, Lee Bank averred in its counterclaim that Venture had breached its obligation to repurchase.

Ultimately, under these circumstances, we conclude that it does not matter how we characterize the repurchase clause. In this case, we hold that the failure to timely repurchase the participation interest upon proof of a material default constitutes an independent breach of the participation agreement that, if proven, would entitle Lee Bank to pursue money damages for the alleged failure to repurchase. See Sun American Bank v. Fairfield Financial Svcs., 690 FSupp.2d 1342, 1368 (M.D. Ga. 2010) (“[W]hether [the] repurchase [clause] is construed as liquidated damages or specific performance, it is a reasonable remedy for a serious breach with consequences that cannot be measured.”); ORIX Real Estate Capital Markets, LLC v. Superior Bank, FSB, 127 FSupp.2d 981, 983 (II) (A) (N.D. Ill. 2000) (“The payment of the liquidation price of a loan is payment of an amount of money, which is completely fungible____There is [thus] no practical difference between this ‘repurchase’ remedy and compensatory damages.”).

Decided July 9, 2015

Morris, Manning & Martin, Robert P. Alpert, Jeffrey K. Douglass, Ryan C. Burke, for appellants.

Thompson, OBrien, Kemp & Nasuti, Aaron M. Kappler, William J. Shaughnessy, for appellee.

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

Dillard and McFadden, JJ., concur.

       “[T]he construction of a contract is a matter of law, which is subject to de novo review.” (Footnotes omitted.) Richard Bowers & Co. v. Clairmont Place, LLC, 324 Ga. App. 673, 676 (a) (751 SE2d 481) (2013).

       Whether the clause at issue is characterized as a limitation of liability clause or an exculpatory clause is immaterial because “Georgia case law does not appear to treat such clauses differently for purposes of review.” Monitronics Intl., Inc. v. Veasley, 323 Ga. App. 126, 135 (2), n. 20 (746 SE2d 793) (2013) (physical precedent only as to Division 2).

       See also Lanier at McEver v. Planners & Engineers Collaborative, 284 Ga. 204, 205 (1) (663 SE2d 240) (2008) (“As a general rule, a party may contract away liability to the other party for the consequences of his own negligence without contravening public policy, except when such an agreement is prohibited by statute.”) (citation and punctuation omitted); Piedmont Arbors Condominium Assn. v. BPI Constr. Co., 197 Ga. App. 141, 142 (397 SE2d 611) (1990) (“Absent a public policy interest, contracting parties are free to contract to waive numerous and substantial rights, including the right to seek recourse in the event of a breach by the other party.”) (citations and punctuation omitted); compare Peck v. Rollins Protective Svcs., Inc., 189 Ga. App. 381, 383 (2) (375 SE2d 494) (1988) (contract clause limiting liability for negligent acts does not serve to limit liability for wilful and wanton conduct).

       If the language of a contract is clear and unambiguous, we enforce the contract according to its terms. Lostocco v. D’Eramo, 238 Ga. App. 269, 275 (d) (518 SE2d 690) (1999).

       We note that the limitation of liability clause does not contain any “self-limiting” language; that is, it does not limit its application to conduct or actions performed “in accordance with” the terms of the participation agreement, but only “in connection” with it. See U.S. Bank Nat. Assn. v. Builders Bank, 2011 U. S. Dist. LEXIS 31597 (No. 08C5648) (N.D. Ill. decided March 25,2011) (When a bank’s unilateral decision to extend a loan’s maturity date and reduce the interest rate violated the participation agreement, the provision limiting liability to acts of gross negligence or willful misconduct did not protect it from a breach of contract claim because the bank’s actions were not “in accordance with” the participation agreement as specified in the limitation of liability clause.).

       Lee Bank cites Dept. of Transp. v. Arapaho Constr., 180 Ga. App. 341, 343 (1) (349 SE2d 196) (1986) and C&S/Sovran Corp. v. First Fed. Sav. Bank, 266 Ga. 104, 105 (1) (463 SE2d 892) (1995). In Arapaho, a contract termination provision (which was reviewed as an exculpatory clause) allowed the Department to terminate its contract, without penalty, under certain listed circumstances. The clause, however, did not explicitly mention whether the Department could terminate the contract when it was in breach of the contract. The claim at issue in Arapaho did not involve one of the circumstances specifically listed in the termination provision; accordingly, this Court concluded that the provision could not be construed as limiting the Department’s liability for the breach at issue. See Dept. of Transp. v. Arapaho Constr., 180 Ga. App. at 343-344 (1). In C&S/Sovran Corp., a termination provision was likewise construed as an exculpatory clause. The Court concluded that, because the termination provision did not mention whether the drafter of the contract could terminate the contract when it was in breach of the contract, the drafter would not be permitted to invoke the provision in order to avoid all liability - and to avoid specific performance, as contemplated elsewhere in the agreement — in light of its breach. See C&S/Sovran Corp. v. First Fed. Sav. Bank, 266 Ga. at 106-107 (1). Neither of these cases is factually analogous to the instant case.

       Lee Bank averred that Venture had breached “Sections 4, 7, 9, 10, 15, and 26” of the participation agreement. It also averred that it had the right to rescind the participation agreement “[a]s a result of Venture’s breaches” of “Sections 4, 7, 9, 10, 15, and 26” of the participation agreement and that Venture should be ordered to pay it $500,000 plus interest, expenses, and attorney fees.

       OCGA § 13-6-7 provides: “If the parties agree in their contract what the damages for a breach shall he, they are said to be liquidated and, unless the agreement violates some principle of law, the parties are bound thereby.”

       Specific performance is generally available “whenever the damages recoverable at law would not be an adequate compensation for nonperformance.” OCGA § 23-2-130.

       Georgia’s appellate courts have never directly determined whether a repurchase clause in a loan participation agreement amounts to specific performance or is in the nature of liquidated damages provision. Rather, this Court has enforced repurchase clauses similar to the clause at issue in this case, treating the failure to repurchase as a breach of contract in its own right. In Cleveland Motor Cars, Inc. v. Bank of America, 295 Ga. App. 100 (670 SE2d 892) (2008), a bank brought suit against a car dealer for failing to repurchase loans it had sold to the bank. In the sale agreement, the dealer “expressly promised to repurchase the loan if a buyer’s identity was fraudulent.” Id. at 102. We affirmed the grant of summary judgment to the bank, finding that the dealer had breached the contract by failing to repurchase. In an earlier case, Rod’s Auto Finance, Inc. v. Finance Co., 211 Ga. App. 63 (438 SE2d 175) (1993), a finance company purchased auto loans from two car dealers, under an agreement that required the dealers to repurchase the loans if the debtor did not promptly commence making timely payments. We remanded the case to the trial court with instructions to determine whether there remained a genuine issue of material fact concerning whether any debtor failed to make a timely first payment. In the absence of a fact issue, the finance company would be “entitled to summary judgment on its claim that the seller of that account must repurchase it.” Id. at 64 (2). In both cases, we held that a repurchase was required upon breach of certain terms of the agreement. Therefore, the subsequent failure to repurchase upon notice of the breach was itself found to be a breach.


source: Caselaw Access Project

author: Miller, Judge.

license: Public Domain

text:
    A15A0295.
    In the Interest of L. R. M., a child.
    (775 S.E.2d 254)
   Miller, Judge.

After the juvenile court found L. R. M. deprived, the paternal grandmother filed a motion to intervene seeking custody of and visitation with the child. The juvenile court denied the grandmother’s motion to intervene, and she appeals, contending that the juvenile court erred in denying her motion because she had an absolute right to intervene under OCGA § 19-7-3 (b) (1), the Grandparent Visitation Statute. The grandmother also contends that the trial court erred in denying her motion on the merits because it applied the wrong legal standard and failed to consider the best interests of the child. For the reasons that follow, we affirm.

“On appeal, we review the evidence in the light most favorable to the juvenile court’s order.” (Citation omitted.) In the Interest of S. K., 248 Ga. App. 122 (545 SE2d 674) (2001).

So viewed, the evidence shows that L. R. M. was born in June 2012 and lived with his mother and father at the paternal grandmother’s house. In May 2013, after the father was incarcerated for possession of methamphetamine and theft, L. R. M. continued to live with his mother at the grandmother’s house. During this time, the grandmother cared for the child and provided financial assistance to pay for the child’s daycare, diapers, and food.

In July 2013, the Division of Family and Children Services (“DFCS”) filed a deprivation petition against the mother, who had an active case plan for drug use and inadequate supervision, alleging that the mother had unresolved substance abuse problems and was inadequately supervising her children, including L. R. M. In August 2013, the juvenile court entered an emergency order authorizing DFCS to remove the children from the grandmother’s home and granting temporary custody to DFCS. DFCS then placed L. R. M. and his siblings in the home of a maternal sister.

In October 2013, the juvenile court found that L. R. M. was deprived based on the mother’s substance abuse problem and the mother’s and the incarcerated father’s inability to provide adequate supervision, housing, and support for the child. The juvenile court ordered DFCS to develop a case plan to reunite L. R. M. with the mother. The mother’s case plan required her to, among other things, obtain a substance abuse assessment, complete a drug treatment program, remain drug free for six months, submit to random drug screens, obtain stable housing and income, pay child support, and attend all scheduled visits.

Following L. R. M.’s removal from her home, the grandmother was allowed two hours of supervised visitation every other week. By February 2014, the grandmother was allowed to have overnight visits, and she was aware that she was not to allow the mother to have unsupervised visits with L. R. M. In April 2014, however, DFCS terminated her unsupervised visits because of concerns that the grandmother was allowing the mother to have unsupervised visits with L. R. M., and because the mother had been arrested. Regarding the mother’s arrest, the evidence showed that the mother was arrested on an outstanding bench warrant during a drug bust while in the company of the grandmother’s other son, who had been recently released from prison. The mother was in jail for approximately 15 days, and after her release, she was arrested a second time for disorderly conduct.

Around that time, the grandmother filed the instant motion to intervene, seeking visitation and custody of L. R. M. under OCGA § 19-7-3. The juvenile court held a hearing on the grandmother’s motion. During the hearing, the mother testified that she wanted the grandmother to have custody of L. R. M. until she could regain custody, provided that she was able to visit the child. The mother admitted that since her children were removed, she had not attended an inpatient drug treatment program as recommended. The evidence also showed that the grandmother worked as a truck driver, and that she took care of her disabled mother who lived with her. Although the mother and grandmother both claimed that they had not lived together since August 2013, other evidence showed that the mother had been living with the grandmother.

The DFCS case manager testified that L. R. M. was doing well in his current placement, and she did not want to separate him from his siblings. The case manager also had concerns about L. R. M. living with the grandmother because she allowed her adult children and L. R. M.’s mother to have access to the house and the grandmother’s children and the mother were not positive influences and might expose L. R. M. to criminal activity. The case manager, however, was amenable to resuming unsupervised visitations after a period of supervised visitation.

Following the hearing, the juvenile court denied the grandmother’s motion to intervene, finding that OCGA § 19-7-3 does not provide an unconditional right to intervene, allowing permissive intervention would prejudice the adjudication of the case, and placing L. R. M. outside the custody of DFCS would impede the case plan to reunify the children. The juvenile court also denied the grandmother’s request for visitation because she had no right to visitation and she failed to establish that the health or welfare of L. R. M. would be harmed unless visitation was granted or that the child’s best interest would be served by visitation. The juvenile court provided, however, that DFCS was authorized, but not required, to offer visitation to the grandmother. This appeal followed.

1. Before addressing the merits of the grandmother’s enumerations of error, we must address whether we have jurisdiction to consider this direct appeal. See Mauer v. Parker Fibernet, LLC, 306 Ga. App. 160, 161 (701 SE2d 599) (2010) (“[A]n appellate court has a duty to raise the question of jurisdiction in all cases where there may be doubt about its existence.”) (citations omitted).

Generally, the denial of a motion to intervene is not a final judgment and thus, is reviewable under the interlocutory appeal procedure. See Davis v. Deutsche Bank Nat. Trust Co., 285 Ga. 22, 23 (673 SE2d 221) (2009). Pleadings and motions, however, are construed according to their substance and function and not merely by nomenclature. See Forest City Gun Club v. Chatham County, 280 Ga. App. 219, 220 (633 SE2d 623) (2006).

In this case, the grandmother filed her motion to intervene seeking custody and visitation under OCGA § 19-7-3 after the juvenile court entered its deprivation order in which it gave DFCS temporary custody of L. R. M. Under OCGA § 5-6-34 (a) (11), a direct appeal is authorized from “[a] 11 judgments or orders in child custody cases awarding, refusing to change, or modifying child custody or holding or declining to hold persons in contempt of such child custody judgment or orders [.]” This Court has held that orders resulting from petitions for grandparent visitation and custody are directly appeal-able under OCGA § 5-6-34 (a) (11). See, e.g., Hargett v. Dickey, 304 Ga. App. 387, 388 (1) (696 SE2d 335) (2010); see also Ire the Interest of J. N., 302 Ga. App. 631, 634 (1) (691 SE2d 396) (2010) (a juvenile court’s order denying a motion seeking a custody modification based on changed circumstances in a deprivation matter was a final directly appealable judgment under OCGA §§ 5-6-34 (a) (1) and 15-11-3). Since the trial court denied the grandmother’s petition for custody and visitation, the denial of the grandmother’s motion is directly appealable.

2. The grandmother contends that the trial court erred in ruling that she did not have an unconditional right to intervene under OCGA § 19-7-3 (b). Pretermitting whether the juvenile court erred in ruling that the grandmother did not have a right to intervene, the grandmother has failed to establish reversible error. Notably, although the juvenile court technically denied her motion to intervene, the juvenile court held a hearing in which the grandmother was allowed to present evidence in support of her request for visitation and custody, and it fully considered the merits of her claims before denying her motion. See O’Neal v. Oxendine, 237 Ga. App. 171, 177 (3) (514 SE2d 908) (1999) (no reversible error shown even though trial court denied petitioner’s motion to intervene, because petitioner was nevertheless allowed to participate in hearing).

As to the merits of her motion, the grandmother has failed to show that the trial court erred in denying her request for visitation and custody. The grandmother contends that the trial court erred because, in determining that the health and welfare of L. R. M. would not be harmed by the lack of visitation under OCGA § 19-7-3 (c), the trial court failed to consider the fact that L. R. M. lived with the grandmother, the grandmother provided financial support, and the grandmother established a pattern of regular care and visitation with the child. The grandmother also contends that the trial court ignored provisions of OCGA § 19-7-3 (c) and (d) requiring the trial court to give deference to the parents’ wishes that the grandmother have visitation.

The decision to grant or deny a grandparent’s petition for visitation is within the discretion of the trial court, and we will affirm the court’s decision absent an abuse of that discretion. See Srader v. Midkiff, 303 Ga. App. 514, 516 (1) (693 SE2d 856) (2010). Where there is any evidence to support the trial court’s ruling, we cannot say there was an abuse of discretion. See Vines v. Vines, 292 Ga. 550, 552 (2) (739 SE2d 374) (2013).

Under OCGA § 19-7-3 (c), a trial court may grant visitation rights to a grandparent if the court finds that the health and welfare of the child would be harmed unless visitation is granted, and if the best interests of the child would be served by such visitation. Although the grandmother argues that subsection (c) applies, the more pertinent standard governing this case is set forth in subsection (d) because the father was incarcerated.

Under OCGA § 19-7-3 (d):

[I]f one of the parents of a minor child dies, is incapacitated, or is incarcerated, the court may award the parent of the deceased, incapacitated, or incarcerated parent of such minor child reasonable visitation to such child during his or her minority if the court in its discretion finds that such visitation would be in the best interests of the child. The custodial parent’s judgment as to the best interests of the child regarding visitation shall be given deference by the court but shall not be conclusive.

In this case, although the trial court was required to give some deference to the mother’s desire to let the grandmother have custody and visitation, the mother’s judgment about the best interests of L. R. M. was not conclusive, and the trial court’s rejection of the mother’s request was supported by the evidence presented at the hearing. That evidence showed that DFCS took L. R. M. into custody while the child was living with the grandmother and mother, and there is some evidence that the mother continues to live with the grandmother despite their protestations otherwise. The conditions precipitating DFCS’s involvement have remained, as the mother has not made any progress with her DFCS case plan, continues to use drugs, and has failed to attend a drug treatment program. Additionally, the grandmother knew that the mother was not allowed to have unsupervised visitation with L. R. M., yet the grandmother ignored this restriction and allowed the mother to have such visitation while L. R. M. was in the grandmother’s care. Finally, the DFCS case manager was concerned about having L. R. M., who was doing well in his current placement, live with the grandmother because the grandmother allowed the mother, who had unrehabilitated substance abuse issues, to have access to her house. In light of these circumstances, there was no abuse of discretion in denying the grandmother’s request for custody and visitation.

Decided July 9, 2015.

Tracy A. Brown, for appellant.

Samuel S. Olens, Attorney General, Shalen S. Nelson, Senior Assistant Attorney General, Calandra A. Harps, Jennifer T. McComas, Assistant Attorneys General, for appellee.

Judgment affirmed.

Andrews, P. J., and Branch, J., concur.

       At the time proceedings were commenced, the father was listed as the putative father of L. R. M., but he legitimated the child in February 2014.

       As part of his case plan goals, the father was required to obtain stable housing and attend visitation upon his release from confinement.

       ... In considering whether the health or welfare of the child would be harmed without such visitation, the court shall consider and may find that harm to the child is reasonably likely to result where, prior to the original action or intervention:
      (A) The minor child resided with the grandparent for six months or more;
      (B) The grandparent provided financial support for the basic needs of the child for at least one year;
      (C) There was an established pattern of regular visitation or child care by the grandparent with the child; or
      (D) Any other circumstance exists indicating that emotional or physical harm would he reasonably likely to result if such visitation is not granted.
      OCGA § 19-7-3 (c).


author: McMillian, Judge.

text:
    A15A0545.
    FREEMAN v. THE STATE.
    (775 S.E.2d 258)
   McMillian, Judge.

Following a jury trial in September 2013, Emmanuel Philemon Freeman was convicted of two counts of cruelty to children in the second degree and two counts of cruelty to children in the first degree and was sentenced to twenty years, seven to serve. Freeman timely filed a motion for new trial, as amended, which the trial court denied. On appeal, Freeman challenges the sufficiency of the evidence as to each conviction and further asserts that the trial court erred in denying his motion for a mistrial and that the State failed to prove venue on several counts. Finding no error, we affirm.

Viewed in the light most favorable to the jury’s verdict, the evidence shows that E. F. was born to Freeman and Averielle Outler on March 25, 2009. At the time of his one-month checkup on May 6, 2009, his pediatrician, Iyer Rajamani, found that he was in good health, with normal eyesight and a normal head circumference of 40 cm. When Dr. Rajamani next examined E. F., on July 9, 2009 during an appointment for routine vaccinations, she immediately saw that his head was “really big” and measured the circumference as 49 cm. Because the growth of E. F.’s head was “definitely unusual” and he had a “sunset appearance,” which is caused by excess cerebrospinal fluid pushing the eyeballs downward, she instructed Freeman to take E. F. straight to a children’s hospital to determine the cause of the swelling.

At the hospital, doctors confirmed that E. F. had excess fluid on his brain and performed surgery to insert a shunt to relieve the pressure on his brain. Dr. Stephen Messner, a pediatrician and expert in child abuse evaluations, was called to evaluate E. F. As part of the work-up, the hospital completed a skeletal survey of E. F., which included an x-ray of all of his bones. The x-rays showed a healing fracture of four ribs on E. F.’s left side, a healing fracture of his left femur, and a healing fracture of his right tibia. Doctors also concluded, based on MRI results, that E. F.’s brain had atrophied, which would result in permanent brain damage, and that his optic nerves and retina were damaged. Dr. Messner found no evidence of infection that could have caused any of E. F.’s injuries, and both Freeman and Outler indicated to him that they were not aware of any accidents that could have caused the injuries.

Based on the constellation of injuries, Dr. Messner concluded that E. F.’s injuries were caused by physical abuse. As a result, E. F.’s older sister, O. F., who was 14 months old at the time, was also evaluated. X-rays revealed that O. F. also had fractures of two ribs on her left side that were in the healing stage. Detective James Watson of the Clayton County Police Department was called to Scottish Rite Hospital on July 17, 2009, where he spoke with Outler, who told him that she had noticed E. F.’s head swelling approximately three weeks before the July 9 appointment with Dr. Rajamani. She, her husband, and their two children had been living at an apartment in Clayton County since April 2009 and she could think of no accidents or illnesses that could have caused E. F.’s injuries. She also confirmed that she and her husband were their only caretakers and that they did not use babysitters or family members to assist them in caring for the children.

Freeman also spoke with Detective Watson and told him that he had also noticed the swelling of E. F.’s head sometime in June and that he and Outler were the only individuals caring for their children. Freeman denied any history of accident or trauma that would explain E. F.’s injuries but admitted that he “plays too rough” with his children and “doesn’t know his own strength.” Based on Watson’s interviews with doctors and the defendants, E. F. and O. F. were placed in protective custody. Freeman and Outler were charged with four counts of first degree cruelty to children (Counts IV, VI, VIII, and X), two counts of second degree cruelty to children (Counts I and II), and four counts of aggravated battery (Counts III, V, VII, and IX) stemming from their abuse of E. F. and O. F. and their subsequent failure to seek medical attention for their children.

At trial, Dr. Messner explained that the children’s rib fractures were not the result of normal handling and that it would require “significant force” to cause them to crack, particularly since infants’ bones are typically more pliable than those of adults. In addition, he opined that E. F.’s injuries were most likely caused by “shaken baby syndrome,” which occurs when a baby is grasped, squeezed, and then shaken back and forth, causing their arms and legs to whip around and the brain to rotate within the skull. Dr. Messner also testified that, due to the presence of callus or new bone being formed, all of the fractures had to have occurred at least one to two weeks prior to the x-rays, and based on the parents’ statements, the various injuries likely occurred sometime in June. And in his expert opinion, E. F.’s prognosis would have been better if he had been brought to the hospital at that time rather than in July. Freeman testified at trial in his own defense and denied shaking or harming either of his children. The jury found Freeman guilty on four counts: Count I (cruelty to children in the second degree for failing to seek medical attention for E. F. after noticing his head swelling); Count II (cruelty to children in the second degree for fracturing O. F.’s ribs); Count VIII (cruelty to children in the first degree for fracturing E. F.’s ribs); and Count X (cruelty to children in the first degree for fracturing E. F.’s leg).

1. We first address Freeman’s challenge as to the sufficiency of the evidence.

When an appellant challenges the sufficiency of the evidence to support 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.

(Citation omitted.) Salazar v. State, 326 Ga. App. 627, 627 (1) (757 SE2d 224) (2014). And “[t]he appellant no longer enjoys a presumption of innocence, and an appellate court determines only the legal sufficiency of the evidence and does not weigh the evidence or assess the credibility of the witnesses.” (Citation omitted.) Id.

A person commits the offense of cruelty to children in the first degree “when such person maliciously causes a child under the age of 18 cruel or excessive physical or mental pain.” OCGA § 16-5-70 (b). A person commits the offense of cruelty to children in the second degree “when such person with criminal negligence causes a child under the age of 18 cruel or excessive physical or mental pain.” OCGA § 16-5-70 (c). Criminal negligence is defined as “an act or failure to act which demonstrates a willful, wanton, or reckless disregard for the safety of others who might reasonably be expected to be injured thereby.” OCGA § 16-2-1 (b).

(a) As to Count I, Freeman argues that he had no indication in June 2009 that anything was wrong with the size of E. F.’s head and that photographs from July 2009 presented by the State did not show a severe abnormality of the head that would cause a normal person to suspect that the child had a serious condition. However, the State presented evidence, through the testimony of Detective Watson, that Freeman was aware of the infant’s head swelling in June 2009. And the jury was free to find the testimony of Detective Watson credible and to reject Freeman’s testimony. See, e.g., Wheeler v. State, 293 Ga. 247, 248 (744 SE2d 792) (2013); Nicely v. State, 291 Ga. 788, 790 (1) (733 SE2d 715) (2012) (“it is the role of the jury to resolve conflicts in the evidence and to determine the credibility of witnesses, and the resolution of such conflicts adversely to the defendant does not render the evidence insufficient”) (citation and punctuation omitted). We therefore find that the State presented sufficient evidence to support his conviction as to Count I. See Morast v. State, 323 Ga. App. 808, 812 (748 SE2d 287) (2013) (evidence sufficient to support conviction for cruelty to children in the first degree where defendant knew for several days child was suffering from dog and human bites and excessive vomiting but did not seek medical attention).

(b) With respect to Counts II, VIII, and X, Freeman asserts that the State presented no evidence as to how these injuries occurred or that he was responsible for them. However, Dr. Messner testified that the location and nature of the rib fractures show — with “very high specificity” — that the injuries were the result of child abuse, specifically from a “squeezing” force. He also explained that leg fractures in a nonmobile infant with no history of accidental trauma is diagnostic of child abuse. The evidence further showed that Freeman and Outler were the sole caretakers for the children, and Freeman testified that Outler would never harm the children. Freeman nonetheless argues that the State presented only circumstantial evidence and points to his testimony that perhaps O. F.’s ribs were fractured when he fell while holding her one time as a reasonable hypothesis that the State failed to exclude.

“Certainly, a conviction based upon circumstantial evidence requires that the proven facts not only be consistent with the hypothesis of guilt, but that they exclude every other reasonable hypothesis save that of the guilt of the accused.” Dyer v. State, 295 Ga. 173, 176 (1) (758 SE2d 301) (2014). “However, whether the evidence does exclude every other reasonable hypothesis is ordinarily a question for the jury, and this finding by the jury will not be disturbed unless the verdict is unsupportable as a matter of law.” Id. Given the record before us, including Dr. Messner’s testimony that he would not expect to see this type of injury as the result of an accident, we cannot say that the jury’s guilty verdicts were unsupportable as a matter of law. See Hinds v. State, 296 Ga. App. 80, 82-83 (1) (673 SE2d 598) (2009) (evidence, including that defendant was involved in abuse of both children, was sufficient to support a conviction of cruelty to children where child sustained significant injuries over a period of time while in defendant’s care); Thompson v. State, 262 Ga. App. 17, 18-19 (1) (585 SE2d 125) (2003) (evidence, though circumstantial, was sufficient to sustain defendants’ convictions for cruelty to children where there was evidence that the child had suffered multiple bone fractures while in the care of the defendants, they did not seek prompt medical treatment, and they were evasive in explaining the injuries).

2. Freeman also contends that the trial court committed reversible error when it permitted the State to “parade[ ]” E. F. in front of the jury. We review a trial court’s evidentiary ruling under an abuse of discretion standard. See Williams v. State, 328 Ga. App. 876, 880 (1) (763 SE2d 261) (2014). At trial, E. F.’s foster mother testified regarding his condition, including the fact that he was not able to talk, walk, feed, or toilet himself at four years old. The State asked her to step down and bring E. F. into the courtroom. Over the defendants’ objections, the trial court allowed her to do so.After she wheeled E. F. into the courtroom in a stroller, the State asked her one final question regarding her care of E. F. The record reveals that during this brief questioning, E. F. “groaned several times out loud.” Freeman asserts that the State presented E. F. to the jury not as evidence but to inflame the jury and prejudice it against Freeman. He further argues that because E. F. could not be called as a witness due to his age and medical condition, and the State had already presented evidence regarding his condition, “it was not necessary to parade him in front of the jury like some freak at a side show.”

Because Freeman’s trial took place after January 1,2013, Georgia’s new Evidence Code applies. Under our new Code, relevant evidence is broadly defined as “evidence having any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence.” OCGA § 24-4-401. However, even “[Relevant evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence.” OCGA § 24-4-403 (mirroring Federal Rule of Evidence 403).

Our Supreme Court has recently addressed the balancing test presented in OCGA § 24-4-403:

Unfortunately, there is no mechanical solution for this balancing test. Instead, a trial court must undertake in each case a considered evaluation of the proffered justification for the admission of such evidence and make an independent determination of whether the probative value of the evidence “is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence.”

(Citations omitted.) State v. Jones, 297 Ga. 156, 163 (3) (773 SE2d 170) (2015). The Supreme Court also noted with approval several Eleventh Circuit cases illustrating that the trial court’s discretion to exclude evidence under the balancing test of Rule 403 “is an extraordinary remedy which should be used only sparingly since it permits the trial court to exclude concededly probative evidence” and that “in close cases, balance under Rule 403 should be struck in favor of admissibility.” (Citations and punctuation omitted). Id. at 164.

Here, evidence of E. F.’s condition is clearly relevant to the State’s charges, including that Freeman caused E. F. “bodily harm... by rendering his brain, a member of his body, useless by violently shaking him, causing permanent brain damage.” See Smith v. State, 246 Ga. App. 191, 193-194 (3) (539 SE2d 881) (2000) (injuries sustained in aggravated assault are always relevant and trial court did not err in permitting victim to display his injuries); Prayor v. State, 217 Ga. App. 56, 58 (4) (456 SE2d 664) (1995) (rejecting defendant’s contention that the paralyzed victim should have been forced to testify via camera so that his injuries would not be apparent to the jury); Cail v. State, 194 Ga. App. 584, 584-585 (1) (391 SE2d 444) (1990) (trial court did not err in permitting the State to exhibit child victim to the jury for the purpose of displaying his scar from the assault despite the child’s tender age and lack of any actual dispute over the nature of his injuries).

And although viewing E. F. in person may have been prejudicial to Freeman, we cannot say that the probative value of this evidence was substantially outweighed by the danger of unfair prejudice. As the Eleventh Circuit has noted, “in a criminal trial relevant evidence is inherently prejudicial; it is only when unfair prejudice substantially outweighs probative value that the rule permits exclusion.” (Citations omitted; emphasis in original.) United States v. King, 713 F2d 627, 631 (III) (11th Cir. 1983). Thus, “[t]he major function of Rule 403 is to exclude evidence of scant or cumulative probative force, dragged in by the heels for the sake of its prejudicial effect.” (Citation and punctuation omitted.) United States v. Aguila-Urbay, 480 Fed. Appx. 564, 567 (11th Cir. 2012). And we do not find that direct evidence of the permanent nature of E. F.’s injury was of scant probative force.

Furthermore, we also agree with the State that pursuant to OCGA § 17-17-9, referred to as the “Crime Victims’ Bill of Rights,” E. F. had the right to be present at the trial. The Crime Victims’ Bill of Rights provides in part that “[a] victim has the right to be present at all criminal proceedings in which the accused has the right to be present.” OCGA § 17-17-9 (a). See also Nicely, 291 Ga. at 795 (2) (“the Crime Victims’ Bill of Rights promotes legitimate state interests, namely the interest of the State in according to crime victims the same right to be present as the Constitution accords to the accused”). This enumeration of error provides no basis for a new trial.

3. In his sixth, seventh, and eighth enumerations of error, Freeman asserts that the State failed to prove venue beyond a reasonable doubt as to Counts II, VIII, and X. Specifically, he argues that the State provided no evidence that E. F. or 0. F. were injured in their Clayton County residence. OCGA § 17-2-2 (a) requires that all “[cjriminal actions shall be tried in the county where the crime was committed, except as otherwise provided by law.” However, “[i]f in any case it cannot be determined in what county a crime was committed, it shall be considered to have been committed in any county in which the evidence shows beyond a reasonable doubt that it might have been committed.” OCGA § 17-2-2 (h).

This Court has explained that “[t]he State may use both direct and circumstantial evidence to prove venue.” (Citation omitted.) Jones v. State, 329 Ga. App. 439, 444 (1) (b) (765 SE2d 639) (2014). And “[vjenue is a question for the jury, and its decision will not be set aside if there is any evidence to support it.” (Citation omitted; emphasis in original.) Taylor v. State, 328 Ga. App. 551, 554 (1) (759 SE2d 892) (2014).

Here, the evidence showed that Freeman and Outler moved with their children to an apartment in Clayton County in April 2009 and that they were the children’s sole caretakers. And Dr. Messner testified that, because the bone fractures identified in E. F. and O. F. were in the “healing phase,” they must have occurred at least one to two weeks in the past and at most “a few months” in the past. Thus, there was evidence to support the jury’s conclusion that the children’s injuries occurred in Clayton County. See Glenn v. State, 278 Ga. 291, 295-296 (2) (602 SE2d 577) (2004) (medical evidence as to when the child’s injury most likely occurred, along with evidence as to where the child was staying at the time, provided sufficient evidence of venue as to conviction for cruelty to children); Taylor, 328 Ga. App. at 554 (1) (“Even though the victim was unable to testify with precision in which county the attack took place, she was not required to do so to establish the proper venue. Her testimony established that she was abducted from and returned to Dooly County. This was sufficient to establish Dooly County as the proper venue.”) (citation and punctuation omitted). Accordingly, the trial court did not err in denying Freeman’s motion for new trial.

Judgment affirmed.

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

Decided July 9, 2015.

Stanley W. Schoolcraft III, for appellant.

Tracy Graham-Lawson, District Attorney, Elizabeth A. Baker, Assistant District Attorney, for appellee.

       The jury acquitted Freeman on four counts of aggravated battery and two additional counts of cruelty to children in the first degree.

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

       Outler was tried along with Freeman and convicted of one count of cruelty to children in the second degree and two counts of cruelty to children in the first degree.

       The trial court also denied defendants’ subsequent motion for a mistrial on the same grounds.

       We note that there is nothing in the record to indicate that the State acted in any way to treat E. E in a disrespectful manner.

       See Ga. L. 2011, pp. 99, 214, § 101.

       See Ga. L. 2011, p. 99, § 1 (stating the legislative intent to adopt the Federal Rules of Evidence as interpreted by the United States Supreme Court and Circuit Courts of Appeals, as of January 1, 2013, with any conflicts among the Circuit Courts of Appeals to be resolved by following the Eleventh Circuit Court).

       For purposes of this statute, a victim is defined as “[a] person against whom a crime has been perpetrated or has allegedly been perpetrated.” OCGA § 17-17-3 (11) (A).

       The record reveals that the trial court correctly charged the jury that venue is “a jurisdictional fact that must be proved by the State beyond a reasonable doubt as to each crime charged in the indictment just as any element of the offenses.” See Lanham v. State, 291 Ga. 625, 626-627 (3) (732 SE2d 72) (2012) (urging “trial courtj ] to give a separate charge on venue to encourage prosecutors to make certain they prove venue and to alert juries to their specific role in determining venue”).


author: DOYLE, Chief Judge.

text:
    A15A0689.
    PETRENKO v. MOSERI et al.
    (775 S.E.2d 272)
   DOYLE, Chief Judge.

Kelly Petrenko appeals the trial court’s denial of her motion for new trial. She contends that the trial court erred by (1) allowing the defendant to open and conclude closing arguments after the defendant had introduced evidence; (2) allowing the defendant to withdraw its evidence after it had been admitted; (3) not charging the defendant with evidence that was used in its cross-examination of the plaintiff, but not formally tendered; and (4) readmitting Defendant’s Exhibit 1 as Plaintiff’s Exhibit 9, over the plaintiff’s objection. For reasons that follow, we affirm.

Petrenko sued Stephen Moseri for injuries she sustained in an automobile collision she alleged was caused by Moseri. Moseri’s insurer paid Petrenko $30,000. Petrenko also had a $100,000 uninsured motorist policy issued by State Farm Mutual Automobile Insurance Company (“State Farm”), and State Farm elected to proceed in Moseri’s name in this case.

The exhibit initially marked as Defendant’s Exhibit 1 was identified during the videotaped deposition testimony of Petrenko’s treating physician, which was played for the jury at trial during Petrenko’s case-in-chief. Before the deposition was played, the trial court conferred with counsel for both parties about the deposition exhibits. The court stated, “Plaintiff’s [Exhibits] 1 and 2 are admitted without objection, and Defendant’s [Exhibit] 1 is admitted without objection, correct?” Petrenko’s counsel responded, “That is correct,” but State Farm’s counsel did not respond. After further discussion, the court again stated that the same exhibits were admitted without objection and that the evidence was for the jury’s consideration.

During the deposition, State Farm’s counsel asked Petrenko’s doctor about Defendant’s Exhibit 1:

COUNSEL: After you provided opposing counsel with a medical narrative, you received a call from opposing counsel’s office on November 1st, 2012, is that right[?]
DOCTOR: I believe so, yes.
COUNSEL: And they basically called to tell you that they had some areas of concern with the narrative you presented, correct?
DOCTOR: I believe, yeah. It’s been a long time ago.
COUNSEL: Well, that’s what it says in your note, in your office note, right?
DOCTOR: Can I see that?
COUNSEL: Yes.
DOCTOR: Okay, that was my assistant who took the call, not me. . . .
COUNSEL: Doctor, I’m showing you what’s been marked as Defendant’s Exhibit No. 1. Is that exhibit a true and accurate copy of a record of a phone conversation which was kept in the ordinary regular course of your business here at Resurgens Orthopaedics?
DOCTOR: Yes.
COUNSEL: All right. And it’s your understanding that after you prepared the narrative, that opposing counsel called your office and indicated that they had some concerns or questions about the narrative, correct?
DOCTOR: That’s what my assistant documented.

During this testimony, Petrenko’s counsel objected on the grounds of hearsay, best evidence, and mischaracterization of evidence. The substance of the exhibit states, “Attorney’s office called and stated that there were some areas of the narrative that were in question and to please call back to discuss the questions.”

After the deposition was played, there was further discussion about the exhibits, and counsel for State Farm stated that he had not tendered Defendant’s Exhibit 1. State Farm’s counsel conceded that, prior to trial, he had received an e-mail from Petrenko’s counsel asking if he intended to tender Defendant’s Exhibit 1 to the doctor’s deposition. If not, Petrenko’s counsel proposed that they delete the portions of the doctor’s deposition that discussed it. State Farm’s counsel responded that he did intend to tender that exhibit and that they could deal with any objection Petrenko’s counsel might have at trial. During trial, however, State Farm’s counsel stated that his trial strategy had changed and that he did not intend to introduce the document. At that point, the trial court ruled that it would exclude Defendant’s Exhibit 1, prohibit State Farm from mentioning anything about the exhibit, and allow State Farm’s counsel to open and conclude closing arguments provided he did not tender any other evidence. Petrenko’s counsel stated that he disagreed with the court’s ruling.

During State Farm’s closing argument, which was not transcribed, Petrenko’s counsel obj ected that State Farm had violated the court’s order by mentioning the conversation that was memorialized in Defendant’s Exhibit 1. As a solution, counsel for Petrenko proposed that the court tender the document as a defense exhibit and allow Petrenko to conclude closing arguments. The judge ruled:

Since the testimony of the doctor in his deposition mentioned the very subject for which we are discussing this area, and since the document, Defendant’s Exhibit 1, was part of that discussion, or that testimony, and since [the p] laintiff took the deposition of the doctor for preservation of testimony and to be played to the jury in lieu of his appearance, I’m going to allow the document in. But I’m allowing it in, in part and chief of the [p]laintiff’s case. And, therefore, the [d]efendant will have, still, the opportunity to open and close, and [the p] laintiff can utilize the document to the best of his benefit, or — and the [djefendant can use it to the best of his benefit.

Petrenko’s counsel did not object to the court’s ruling at that point.

Following closing arguments, the jury awarded Petrenko $12,774. Because the parties had stipulated prior to trial that any verdict would be reduced by the $30,000 payment made by Moseri’s liability insurer, judgment was entered for Petrenko in the amount of $0. Pursuant to OCGA § 5-5-22, Petrenko filed a motion for new trial or in the alternative motion to set aside, contending that the trial court improperly removed Defendant’s Exhibit 1 from evidence and improperly readmitted the document as Plaintiff’s Exhibit 9, thereby denying her the opportunity to open and conclude closing arguments. The trial court denied Petrenko’s motion.

1. Petrenko contends that the trial court erred by permitting State Farm to withdraw Defendant’s Exhibit 1 after it had been admitted, thereby allowing State Farm to open and conclude closing argument.

“In civil actions, where the burden of proof rests with the plaintiff, the plaintiff is entitled to the opening and concluding arguments except that if the defendant introduces no evidence or admits a prima-facie case, the defendant shall be entitled to open and conclude. . . .” The record does not show that State Farm ever formally tendered Defendant’s Exhibit 1 at trial. Initially, it appears that the trial court assumed, with Petrenko’s concurrence, that all documents identified in the doctor’s deposition would be admitted and so ruled, outside the presence of the jury. State Farm, however, never affirmatively offered the exhibit into evidence on its behalf. And during the deposition, the doctor was shown the exhibit, but did not read from it or disclose its contents other than to admit that his assistant had documented a telephone call from plaintiff’s counsel regarding questions about the medical narrative he had prepared. Accordingly, we conclude that the exhibit was not “admitted” as a defense exhibit and did not deprive State Farm of the right to open and conclude closing arguments. We therefore need not address Petrenko’s contention that State Farm should not have been allowed to withdraw the exhibit.

2. Petrenko contends that the trial court erred by not requiring State Farm to tender into evidence an exhibit used in its cross-examination of Petrenko to refresh her recollection about prior work absences.

On cross-examination, Petrenko was asked whether she had missed time from work prior to the automobile collision, and she said “no.” The following then transpired:

COUNSEL: All right. Ma’am, do you recall that you actually were absent from work, called in sick for whatever reason, on March 28th, 2011, less than a month before the accident. Then, again, on April 12, 2011, then again on April 13, 2011. Do you recall that?
PETRENKO: No, I don’t recall that.

State Farm’s counsel identified Defendant’s Exhibit 2 and showed it to Petrenko to see if it would refresh her recollection. Petrenko’s counsel objected, arguing that it was improper to have the witness testify about the exhibit without tendering it. The trial court allowed Petrenko to look at the document to see if it refreshed her recollection, and the questioning resumed.

COUNSEL: Do you recall, ma’am — do you recall, first of all, that you called in sick at your job at ER Solutions on March 28th, 2011?
PETRENKO: I mean, as the record shows, yes, I did, but it was — I was —
COUNSEL: I don’t want to talk about the records, I just want to ask — just answer the question, do you recall —
PETRENKO: Okay, yes.
COUNSEL: — if you called in sick March 28th, 2011? PETRENKO: Now — now I do.
COUNSEL: And now do you also recall that you called in sick on April 12th, 2011?
PETRENKO: I — I do.
COUNSEL: And do you recall that you called in sick on April 13th, 2011?
PETRENKO: I do.

Where, as here, a witness states that she does not remember, the proper use of a prior statement is to refresh her memory. “And documents used to refresh a witness’s present recollection generally cannot be admitted in evidence” unless they are otherwise admissible.

In support of her argument that Defendant’s Exhibit 2 should have been admitted into evidence, Petrenko relies on two cases involving the rule applicable under the prior version of OCGA § 17-8-71, which provided that a criminal defendant will lose the right to open and close argument to the jury if he introduces evidence. Petrenko relies on these cases because they interpret language similar to the language of OCGA § 9-10-186 regarding a civil defendant’s right to open and conclude closing argument if he introduces no evidence. The cases, however, are distinguishable. In Kennebrew v. State, the defense presented to the jury an entire tape-recorded statement of a co-indictee, which statement the court ruled was the equivalent of a formal tender of evidence, divesting defendant of the right to open and close final argument. And in Thompson v. State, defense counsel had a witness read his prior written statement in its entirety to himself and then testify that it did not contain certain descriptive information, thereby introducing new evidence into the record and causing defendant to lose the right to open and conclude closing argument. Here, the exhibit was neither read nor shown to the jury, and Petrenko’s testimony was limited to a recollection of information contained in the document. The trial court therefore did not err by not requiring State Farm to tender the exhibit.

Decided July 9, 2015.

Smith, Welch, Webb & White, JohnP. Webb, Grant E. McBride, for appellant.

Waldon, Adelman, Castilla, Hiestand & Prout, Jonathan M. Adelman, Rakhi D. McNeill; Cruser & Mitchell, J. Robb Cruser, Ashley A. Macnamara, for appellees.

3. Petrenko contends that the trial court erred by readmitting Defendant’s Exhibit 1 as Plaintiff’s Exhibit 9, over Petrenko’s objection. In fact, Petrenko’s counsel did not object after the trial court readmitted the document. Although counsel had previously stated that he wanted the exhibit attributed to State Farm so that Petrenko would have the right to open and conclude closing argument, he stated that he would honor the court’s decision either way, and he did not object after the court ruled. Under the circumstances, Petrenko waived her right to object on this basis on appeal.

Judgment affirmed.

Dillard, J., concurs. Ellington, P. J., concurs in judgment only.

       State Farm’s trial strategy changed because Moseri ultimately admitted fault for the accident, thereby eliminating the need to present his testimony and allowing State Farm to open and conclude closing arguments if it did not present any evidence.

       OCGA § 9-10-186.

       Cf. Aldridge v. State, 237 Ga. App. 209, 214-215 (6) (515 SE2d 397) (1999) (presenting documents’ contents to the jury was equivalent of formal tender of evidence that would divest defendant of the right to open and close final arguments), construing prior version of OCGA § 17-8-71, which provided in relevant part: “If the defendant introduces no evidence, his counsel shall open and conclude the argument to the jury after the evidence on the part of the [Sjtate is concluded.”

       Defendant’s Exhibit 2 is not part of the record on appeal.

       See Bischoff v. Payne, 239 Ga. App. 824, 825-826 (1) (522 SE2d 257) (1999).

       Id. at 826.

       267 Ga. 400, 403-404 (4) (480 SE2d 1) (1996).

       265 Ga. App. 696, 697-698 (1) (595 SE2d 377) (2004).

        See Ahmed v. Clark, 301 Ga. App. 426,428 (688 SE2d 361) (2009) (“although a party may have initially objected to an exhibit, that party’s failure to make a contemporaneous objection at the time the exhibit is re-tendered waives the objection”) (citation omitted).