Alston & Bird LLP v. Hatcher Mgmt. Holdings, LLC.
| Decision Date | 01 March 2016 |
| Docket Number | No. A15A1677.,A15A1677. |
| Citation | 785 S.E.2d 541,336 Ga.App. 527 |
| Court | Georgia Court of Appeals |
| Parties | ALSTON & BIRD LLP v. HATCHER MANAGEMENT HOLDINGS, LLC. |
Robbins Ross Alloy, Belinfante Littlefield, Jason Alloy, Rachel Frazier Gage, Richard L. Robbins, Atlanta, Joshua Barrett Belinfante, for Appellant.
Caldwell, Propst & DeLoach, Harmon W. Caldwell Jr., Harry W. MacDougald, Jeremy Mark Moeser, Atlanta, for Appellee.
Hatcher Management Holdings, LLC, (“the Company”) filed suit against Alston & Bird LLP (“the Firm”), asserting legal malpractice and breach of fiduciary duty claims. The Firm filed a notice of nonparty fault pursuant to OCGA § 51–12–33, seeking to apportion damages among the Company and multiple nonparties. The trial court granted the Company's motion to strike the notice and certified the issue for immediate review. This Court granted the Firm's application for interlocutory appeal, and for the reasons that follow, we reverse the trial court's order striking the Firm's apportionment notice.
In 2000, Maury Hatcher employed the Firm and one of its trust and real estate partners, John Sawyer, to create the Company, which was established to hold the assets, including real estate, of the Hatcher family patriarch as an estate planning mechanism.1 Maury was the manager of the Company, which was comprised of various Hatcher family members, including Maury and several of his siblings. According to the Company, Maury secretly liquidated and redeemed his interest in the Company, personally valuing his interest, which constituted a breach of his fiduciary duty, and he embezzled a large portion of the Company's assets. In January 2009, Maury resigned from the Company, but Sawyer and the Firm continued to act at his direction, despite their continued representation of the Company; the Firm did not disclose the conflict of interest to the Company, nor did it inform the Company of Maury's actions.
In December 2009, the Company sued Maury in Fulton County and, following a trial on damages, obtained a judgment against him in the amount of $4,046,937. In May 2012, the Company filed the instant case against the Firm, asserting claims of legal malpractice and breach of fiduciary duty; the Firm was the only named defendant. The Firm moved for summary judgment, and the trial court denied the motion.
Thereafter, the Firm filed a notice of nonparty fault pursuant to OCGA § 51–12–33, informing the Company that the Firm intended to ask the trier of fact to apportion fault for the Company's alleged damages among the Firm and several non-parties, including Maury Hatcher, Jerry B. Hatcher, Alan B. Hatcher, and Caldwell & Watson, LLP. In the notice, the Firm alleged that Jerry and Barry Hatcher caused and contributed to the Company's damages by, inter alia: improperly claiming to be managers when they were not; failing to investigate Maury's actions after his questionable accounting; failing to provide financial statements when they were managers; delaying taking legal action against Maury to preserve Company assets; failing to take sufficient action to collect the judgment against Maury; and wasting Company money on legal fees, loans, and compensation for themselves without member approval. The Firm alleged that Caldwell & Watson, counsel for the Company, caused and contributed to the Company's damages by: failing to advise Company members of Jerry and Barry Hatcher's mismanagement and improper actions, including withholding financial information; delaying filing suit against Maury; and failing to diligently pursue claims and the judgment against Maury. Finally, with regard to Maury, the Firm referred to the various documents in the record alleging his wrongdoing, including embezzlement of Company assets.
The Company moved to strike the Firm's notice of nonparty fault, arguing that (1) apportionment of damages was available only under subsection (b) of OCGA § 51–12–33, which the Company alleges applies only to cases brought against multiple defendants; and (2) there was no evidence upon which to apportion damages. In a brief order, lacking explanation for its ruling, the trial court struck the Firm's apportionment notice. This appeal followed.
The Firm argues that the trial court erred by striking its notice of nonparty fault. In response, the Company contends that Georgia's apportionment statute, OCGA § 51–12–33(b), clearly and unambiguously limits apportionment of damages to cases “[w]here an action is brought against more than one person....” While this assertion is correct, apportioning fault, not damages, is the issue in this case.
In its entirety, OCGA § 51–12–33 provides:
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