Condo. Ass'n, Inc. v. Phoenix On Peachtree

• Decision Date: 07 November 2008
• Docket Number: No. A08A1535.,A08A1535.
• Parties: The PHOENIX ON PEACHTREE CONDOMINIUM ASSOCIATION, INC. v. The PHOENIX ON PEACHTREE, LLC, et al.
• Court: Georgia Court of Appeals

669 S.E.2d 229

294 Ga. App. 447

The PHOENIX ON PEACHTREE CONDOMINIUM ASSOCIATION, INC. v. The PHOENIX ON PEACHTREE, LLC, et al.

No. A08A1535.

Court of Appeals of Georgia.

November 7, 2008.

Johnson & Ward, Stanley E. Kreimer, Jr., Atlanta, for appellant.

Parks, Chesin & Walbert, David Frank Walbert, Scoggins & Goodman, David Lawrence Rusnak, Atlanta, for appellee.

SMITH, Presiding Judge.

The Phoenix on Peachtree Condominium Association, Inc. ("the Association") appeals from the trial court's order granting summary judgment in favor of The Phoenix on Peachtree, LLC, RBC Centura Bank, Eagle Bancshares, Inc., Eagle Real Estate Advisors, Inc. (collectively "defendants") and Jebco Ventures, Inc.¹ The Association claims the trial court erred by: (1) considering the affidavits of Stephen Draper; (2) denying its motion to compel and for additional time to respond; (3) granting summary judgment to the defendants based upon its conclusion that the Association lacked standing; (4) denying its motion to substitute real parties in interest; and (5) granting summary judgment to a defendant (Jebco Ventures, Inc.) that did not properly join in the pending summary judgment motion of other defendants. Because the trial court failed to give the Association an opportunity to substitute the real parties in interest, we vacate its order and remand this case for further proceedings.

The record shows that on May 15, 2006, the Association filed a complaint against numerous defendants alleging deficiencies and defects in the construction of the common areas of The Phoenix on Peachtree Condominium. On May 24, 2006, the Association served interrogatories and requests to produce on all of the defendants in this appeal. Each of these defendants received one interrogatory and one request to produce seeking information relating to defenses asserted by the defendants in their answers.

In each of the defendants' answers filed in June and July of 2006, they asserted that the Association lacked standing to bring the claims asserted in its complaint and that the Association's complaint was "barred by the absence of necessary and indispensable parties." In July 2006, all of the defendants, except Jebco Ventures, Inc.,² filed written objections to the discovery requests in which they asserted that they should not be required to respond to the discovery requests until the trial court determined whether the Association had standing to assert the claims in its complaint.

In August 2006, the Association's counsel sent a letter to defense counsel³ requesting a substantive response to his client's discovery requests. In this letter, the Association's counsel acknowledged that he understood that the objection "with regard to `capacity and standing' is that the Association is precluded by the condominium declaration from asserting the claims set forth in the complaint." He then asserted that the defendants' "argument ... is contrary to the express authority granted to the Association by OCGA § 44-3-106(h)" and urged them to comply with their "discovery obligations." On November 3, 2006, the Association filed a motion to compel discovery responses.

On December 19, 2006, the defendants amended their answers to include the following statement:

The Association has no right to assert the claims in this action by virtue of (1) the declaration of condominium for The Phoenix on Peachtree Condominium, as filed and recorded on July 12, 2001 in the office of the clerk, Fulton County Superior Court, and (2) the purchase agreements that the unit owners entered into when they purchased their legal interests in The Phoenix on Peachtree Condominium, which documents are attached here as Exhibits 1 and 2.

The defendants also submitted an affidavit from a senior credit officer with RBC Centura Bank, Stephen Draper, as Exhibit 3 to the amended answer. The next day, the defendants filed a motion for judgment on the pleadings, or in the alternative, for summary judgment in their favor based upon the Association's lack of capacity to bring the suit against them.

On January 19, 2007, new counsel for the Association filed a motion for additional time to respond to the defendants' motion for judgment on the pleadings based upon his recent entry into the case, as well as the defendants' refusal to respond to discovery. Out of "an abundance of caution," however, the Association also filed an opposition to the defendants' motion for summary judgment. In its opposition, the Association asserted summary judgment was inappropriate based upon an amendment of the condominium declaration, the defendants' failure to file certified copies of the original condominium declaration and purchase agreement, and the fact that it was not a party to the purchase agreement. The Association attached to its opposition an uncertified copy of a September 21, 2006 amendment to the condominium declaration that deleted the provision precluding suits by the Association.

Three days before the scheduled hearing on the outstanding motions, the defendants filed a supplemental affidavit from Draper providing a more detailed foundation for consideration of the purchase agreement, as well as a certified copy of the condominium declaration.

In a February 12, 2007 hearing, the trial court ruled that it would consider only the issue of the Association's standing in the hearing. The Association's counsel agreed in the hearing that the issue of standing "doesn't need discovery" and that he was "happy to be heard on that [issue] very quickly." At the conclusion of the hearing, the trial court granted Jebco Ventures, Inc.'s request to join the other defendants' pending motion to dismiss based upon the Association's lack of standing. The Association did not object to this request. The trial court reserved its ruling on the issue of standing and gave the Association seven additional days to file a post-hearing brief.

On February 19, 2007, the Association filed an affidavit from the Association's president, Steven Marshall. In his affidavit, Marshall explained that the Association amended the bylaws, pursuant to a two-thirds vote of the unit owners, to delete the provision prohibiting the Association from filing a lawsuit on the unit owners' behalf. Marshall also averred to the authenticity of a copy of the amendment attached to his affidavit. On the same date, the Association filed a post-hearing brief in which it objected to Jebco Ventures, Inc.'s verbal motion to join the pending motion of other defendants, objected to the untimely affidavit of Draper, and moved to add the unit owners as party plaintiffs in the event the trial court concluded that the Association lacked standing.

On February 8, 2008, the trial court issued an order granting summary judgment to the defendants on all counts and finding that all other pending motions were rendered moot. The trial court's order did not explain its reasoning, but did note that it had reviewed "the motions, briefs, and the full record." (Emphasis supplied.)

1. Before considering the merits of the standing issue before us, we must first consider whether the trial court properly considered all of the evidence before it. The Association contends that the trial court should not have considered Draper's first affidavit, because it lacked a sufficient evidentiary foundation demonstrating Draper's personal knowledge. It contends Draper's second affidavit should not have been...