Articles Posted in Supreme Court of Georgia

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Defendant Veterans Parkway Developers, LLC (“VPD”) appealed a Superior Court order granting injunctive relief and requiring an accounting in this suit by RMW Development Fund, II, LLC (“RMW”) stemming from VPD’s management of Veterans Parkway Apartments, LLC (the “Company”). The order at issue granted RMW an interlocutory injunction: (1) enjoining VPD from using funds in its possession or control to construct a second entrance to an apartment complex in Columbus (the “Property”), constructed and managed by the Company; (2) prohibiting VPD from using funds for any purpose other than the normal day-to-day expenses of the Property; and (3) requiring VPD to submit a monthly report of its expenses to the superior court, with copies to counsel for the parties. RMW filed suit against VPD alleging VPD’s breach of contract by its entering into an unauthorized management agreement and thereby paying an unauthorized management fee, and a claim for “promissory estoppel,” stemming from VPD’s alleged failure to use some of the Company’s funds for partial repayment of a development loan; RMW asked for VPD’s removal as manager of the Company and for the costs of litigation. Prior to the filing on the complaint, the Company had purchased a 60-foot strip of land for the purpose of creating a second entrance to the Property. At a hearing on the injunction, RMW argued that it could not undo any construction of the second entrance to the Property. VPD countered that RMW was, in reality, concerned about money being spent on the construction of the second entrance instead of being used to repay the loans made by RMW, and that any appropriate redress was monetary damages. Ultimately the injunction was granted and VPD appealed. The Supreme Court found after review of this matter that the trial court's injunction was not supported by the record, and that court abused its discretion in granting the injunction. The Supreme Court reversed the trial court and remanded this matter for further proceedings. View "Veterans Parkway Developers, LLC v. RMW Development Fund II, LLC" on Justia Law

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The issue this case presented for the Supreme Court's review arose from a deficiency action brought by appellant SunTrust Bank (“SunTrust”) as the assignee under a motor vehicle conditional sales contract following its repossession and sale of a motor vehicle purchased by appellee Mattie Venable. Specifically, the issue was which statute of limitations applied here: the four-year statute of limitation set forth in OCGA 11-2-725 (1) applicable to actions on contracts for the sale of goods, or the six-year statute of limitation found in OCGA 9-3-24, generally applicable to actions on simple written contracts. After review, the Court concluded that this action was subject to the four-year statute of limitation found in 11-2-725 (1). View "SunTrust Bank v. Venable" on Justia Law

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A mandatory arbitration clause is contained in each deposit agreement for customers of appellee SunTrust Bank. The clause permits an individual depositor to reject the agreement’s mandatory arbitration clause by giving written notice by a certain deadline. SunTrust claimed it drafted the arbitration clause in such a way that only an individual depositor may exercise this right to reject arbitration on his or her own behalf, thereby permitting that individual to file only an individual lawsuit against the bank. But SunTrust asserted that even if, as it has been determined here, the filing of a lawsuit prior to the expiration of the rejection of arbitration deadline operated to give notice of the individual plaintiff’s rejection of arbitration, the complaint could not be brought as a class action because the filing of a class action could not serve to reject the arbitration clause on behalf of class members who have not individually given notice. Jeff Bickerstaff, Jr., who was a SunTrust Bank depositor, filed a complaint against SunTrust on behalf of himself and all others similarly situated alleging the bank’s overdraft fee constitutes the charging of usurious interest. At the time Bickerstaff opened his account (thereby agreeing to the terms of SunTrust’s deposit agreement), that agreement included a mandatory arbitration provision. In response to the ruling of a federal court in an unrelated action finding the arbitration clause in SunTrust’s deposit agreement was unconscionable at Georgia law, and after Bickerstaff’s complaint had been filed, SunTrust amended the arbitration clause to permit a window of time in which a depositor could reject arbitration by sending SunTrust written notification that complied with certain requirements. SunTrust had not notified Bickerstaff or its other customers of this change in the arbitration clause of the deposit agreement at the time Bickerstaff filed his complaint, but the complaint, as well as the first amendment to the complaint, was filed prior to the amendment’s deadline for giving SunTrust written notice of an election to reject arbitration. It was only after Bickerstaff’s complaint was filed that SunTrust notified Bickerstaff and its other existing depositors, by language printed in monthly account statements distributed on August 24, 2010, that an updated version of the deposit agreement had been adopted, that a copy of the new agreement could be obtained at any branch office or on-line, and that all future transactions would be governed by the updated agreement. SunTrust appealed the order denying its motion to compel Bickerstaff to arbitrate his claim, and the Court of Appeals affirmed the trial court, finding that the information contained in the complaint filed by Bickerstaff’s attorney substantially satisfied the notice required to reject arbitration. Bickerstaff appealed the order denying his motion for class certification, and in the same opinion the Court of Appeals affirmed that decision, holding in essence, that the contractual language in this case requiring individual notification of the decision to reject arbitration did not permit Bickerstaff to reject the deposit agreement’s arbitration clause on behalf of other putative class members by virtue of the filing of his class action complaint. The Georgia Supreme Court reversed that decision, holding that the terms of the arbitration rejection provision of SunTrust’s deposit agreement did not prevent Bickerstaff’s class action complaint from tolling the contractual limitation for rejecting that provision on behalf of all putative class members until such time as the class may be certified and each member makes the election to opt out or remain in the class. Accordingly, the numerosity requirement of OCGA 9-11-23 (a) (1) for pursuing a class complaint was not defeated on this ground. View "Bickerstaff v. SunTrust Bank" on Justia Law

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Southern Resources Consultants, Inc. (“SRC”) was a Residential Service Provider (“RSP”), contracting with the Georgia Department of Behavioral Health and Developmental Disabilities (“DBHDD”) and the Georgia Department of Community Health (“DCH”) to operate group homes and provide care and oversight for Medicaid-funded individuals with developmental disabilities. Linda Mays (“Mays”) contracted with SRC to be a Host Home Provider (“HHP”) for one such woman, S.F., from approximately 2006 to 2014. S.F. became dissatisfied with SRC, and requested that her case manager, who was the Guardianship Case Manager for the Division of Aging Services of Georgia’s Department of Human Services (“DHS”) and S.F.’s legal guardian, change S.F.’s RSP. At the time of the request, DBHDD policy prohibited a HHP from terminating its contract with a RSP, such as SRC, and then continuing to serve the individual who had been in the care of the HHP. Consequently, at S.F.’s behest and believing it to be in S.F.’s best interests, the case manager requested a waiver of such policy from DBHDD so that S.F. could remain in Mays’s host home despite the termination of Mays’s relationship with SRC. DBHDD granted the waiver. S.F. then began to receive services from a new RSP, Southern International Living (“SIL”). SRC subsequently filed suit against Mays for breach of purported confidentiality3 and non-compete provisions in a “Work for Hire Agreement/ Contract/ Subcontract Agreement” (“Contract”), and for violation of the Georgia Trade Secrets Act of 1990 (“GTSA”), and subsequent unjust enrichment. This case reached the Georgia Supreme Court by way of an appeal of the superior court’s grant of an interlocutory injunction and for interlocutory and permanent injunctive relief, damages, attorney fees, and costs. The parties conceded that Mays had returned certain SRC confidential information at issue in the interlocutory injunction. The Supreme Court reversed the superior court as a nullity. Because the second and third provisions of the injunction were inextricably entwined and based upon a non-compete agreement that has since expired, these provisions were moot. Accordingly, the injunction was reversed in part, and the case remanded for further proceedings. View "Mays v. Southern Resources Consultants, Inc." on Justia Law

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This case involved a written contract between a vendor and a state agency that contained form language stipulating that amendments had to be in writing and executed by the agency and the contractor. Appellant Georgia Department of Labor (DOL) entered into the contract in question with appellee RTT Associates, Inc. (RTT) to have some computer software developed for the agency. RTT asserted that the contract was extended by course of conduct as well as by certain internal writings created by the agency. By the terms of Georgia’s constitution, the state waived its sovereign immunity for breach of contract when it enters into a written contract. At issue was whether an agency’s waiver of immunity from a breach of contract claim as a result of entering into a written contract remained intact in the event the contract was extended without a written document signed by both parties expressly amending the contract, as required by its terms. The trial court concluded sovereign immunity was not waived beyond the required completion date of the contract, but the Court of Appeals reversed. The Supreme Court reversed the appellate court, finding RTT failed to complete its contractual obligations before the contract expired. "Even if the parties’ conduct after the expiration of the contract could be found to demonstrate an agreement between the parties to continue to perform under the original contract, as a matter of law neither that conduct nor the internal documents created by DOL after the contract expired establishes a written contract to do so. Without a written contract, the state’s sovereign immunity from a contract action is not waived." View "Georgia Dept. of Labor v. RTT Associates, Inc." on Justia Law

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The Supreme Court granted an application of interlocutory appeal to determine whether the trial court erred when it denied enforcement of a prenuptial agreement. After a hearing, the trial court analyzed the agreement under the standard set forth in "Scherer v. Scherer;" the wife argued that the husband failed to establish eh made a full and fair disclosure of his financial condition. The trial court indeed found that though the agreement satisfied most of the Scherer test, the agreement was unenforceable due to the nondisclosure of certain material facts. Finding no error with this analysis, the Supreme Court affirmed the trial court's findings. View "Dodson v. Dodson" on Justia Law