Armstrong Transfer & Storage Co., Inc. v. Mann Const., Inc.
| Decision Date | 04 May 1995 |
| Docket Number | Nos. A95A1060,A95A1061 and A95A1062,s. A95A1060 |
| Citation | 217 Ga.App. 538,458 S.E.2d 481 |
| Court | Georgia Court of Appeals |
| Parties | ARMSTRONG TRANSFER & STORAGE COMPANY, INC. et al. v. MANN CONSTRUCTION, INC. et al. FIREMAN'S FUND INSURANCE COMPANY v. ARMSTRONG TRANSFER & STORAGE COMPANY, INC. et al. MANN CONSTRUCTION, INC. v. ARMSTRONG TRANSFER & STORAGE COMPANY, INC. et al. |
James W. McKenzie, Jr., Duluth, for Armstrong.
Webb, Carlock, Copeland, Semler & Stair, D. Gary Lovell, Jr., Porter & Barrett, Sidney R. Barrett, Jr., Long, Weinberg, Ansley & Wheeler, K. Marc Barre, Jr., Paul L. Weisbecker, Atlanta, for Fireman's Fund and Mann Const. Co.
These three appeals are from the judgment entered on the jury's verdict and the trial court's denial of motions for new trial and an alternative motion for judgment n.o.v. filed by the respective parties.
Armstrong Transfer & Storage Company, Inc. (Armstrong) operates a moving and storage business and Property Leasing IV, Inc. (PLI) is a holding company for the real property owned by Armstrong. On May 10, 1989, Armstrong executed an agreement to purchase from Sam Leveto and Clay Futch certain real property located in a Gwinnett County business park. PLI subsequently purchased the property on July 28, 1989. One year later, PLI entered into a contract with Mann Construction, Inc. (Mann) for the construction of an office/warehouse facility on the property. Pursuant to the requirements of the construction contract, Mann procured a performance bond with Fireman's Fund Insurance Company as the surety.
In late August or early September 1990, during the initial development of the property, a grading subcontractor discovered debris and trash buried within the intended building areas on the property. Discussions ensued between Leveto and Tim Wilson, the commercial real estate agent involved in the sale of the property, regarding the removal of the debris, and a proposal was made for Leveto and Futch to pay $10,000 to remove the waste. It is undisputed that any offer to pay for the removal of the waste was subject to the approval of Futch. A letter memorializing the contents of the oral agreement was forwarded to Leveto for his signature. There is no evidence that Leveto signed the document. Leveto later tendered two checks totaling over $14,000 and a release in final settlement of the matter, and the tender was unequivocally rejected by Armstrong and PLI through counsel.
The organic debris located within the intended building area of the property was subsequently removed by an excavating company and the office warehouse facility was completed in the spring of 1991. However, by September 1991, cracks appeared in the floor slab of the building and substantial movement of the walls had occurred on the rear side of the facility as a result of movements in the adjacent sloped ground. The evidence was in dispute as to the cause of movement. The roof of the facility began leaking. Mann unsuccessfully attempted to eliminate the leakage. Fireman's Fund denied PLI's repeated demands to correct the alleged structural defects.
Armstrong and PLI commenced the instant action based upon negligence, breach of contract, and fraud against Leveto, Futch, and their development company Lifestyle Communities, Inc. (Lifestyle), and against Wayne Raffield, 1 Mann, and Fireman's Fund for fraud, negligence, and breach of warranty. Following a two-week jury trial, the jury returned a verdict in favor of PLI and against Mann and Fireman's Fund in the amount of $180,000 for breach of contract related to the construction of the roof, and in favor of Mann and Fireman's Fund and against PLI for breach of contract related to the structural damage to the facility. Mann was awarded $42,510 on its counterclaim against PLI for Mann's construction of a parking lot at the office/warehouse. Both Mann's and PLI's motions for pre-judgment interest were denied by the trial court, and judgment was entered on the jury's verdict. Armstrong, PLI, and Mann filed motions for new trial, and Mann additionally filed a motion for judgment n.o.v. The trial court denied both motions for new trial and Mann's motion for judgment n.o.v., and these three appeals followed.
In Case No. A95A1060, Armstrong and PLI appeal the trial court's denial of their motion for new trial and the judgment entered on the jury's verdict. In Case No. A95A1061, Fireman's Fund appeals the judgment entered against it in favor of PLI for damages based upon the breach of the construction contract. In Case No. A95A1062, Mann appeals the denial of its motions for new trial and for judgment n.o.v.
1. Armstrong and PLI contend that a new trial is warranted because there was an issue of fact for jury resolution as to whether Lifestyle, Leveto, and Futch engaged in active/passive concealment of the buried debris. Specifically, Armstrong and PLI argue that Lifestyle, Leveto, and Futch deliberately permitted the burial of the debris on the property and failed to disclose the existence and location of the organic material. "However, the cases creating and interpreting th[e] [passive concealment] doctrine have been clear to limit it to controversies between residential homeowners and residential builder/sellers as an exception to the doctrine of caveat emptor." (Punctuation omitted.) Condon v. Kunse, 208 Ga.App. 856, 858(2), 432 S.E.2d 266 (1993). See also Toys 'R' Us v. Atlanta Economic Dev. Corp., 195 Ga.App. 195(1), 393 S.E.2d 44 (1990). Consequently, this doctrine is inapplicable in the present case which involves the sale of commercial property. See id. As in Condon, supra, we decline to extend this doctrine to the sale of commercial realty, especially in this case where Armstrong and PLI had an affirmative contractual duty to inspect the property prior to the sale.
A directed verdict was also warranted on Armstrong and PLI's claim for fraud based upon active concealment. (Citations and punctuation omitted.) Webb v. Rushing, 194 Ga.App. 732, 733(1), 391 S.E.2d 709 (1990). The record is devoid of any evidence that Leveto or Futch actually knew that the debris was buried in the intended building areas of the property. Leveto specifically denied knowledge of the buried debris and Futch was not called by Armstrong and PLI as a witness at trial.
2. Next, Armstrong and PLI maintain that the trial court erred in directing a verdict in favor of Leveto, Futch, and Lifestyle, because there was some evidence that Leveto breached an oral promise to pay the cost to remove the debris.
(Citations and punctuation omitted.) Bellsouth Advertising etc., Corp. v. McCollum, 209 Ga.App. 441, 444(2), 433 S.E.2d 437 (1993).
In the present case, Stoops, president of Armstrong and PLI, specifically denied having a contract with Leveto to remove the buried debris. Moreover, there was no mutual assent to the essential terms of any oral contract including the cost of the removal of the debris. See Valiant Steel etc. v. Roadway Express, 205 Ga.App. 237, 421 S.E.2d 773 (1992).
3. Armstrong and PLI further argue that a new trial was warranted because the jury's verdict is contrary to, and strongly against the weight of the evidence adduced at trial on their claim for damage to the south wall of the office/warehouse facility. Specifically, they maintain that Mann had a contractual obligation to insure that the surrounding soils supported the construction of the office/warehouse building and met minimum load-bearing requirements for improvements.
There was evidence produced at trial that showed that the soil underneath the building was properly compacted. A geotechnical engineer testified that the testing performed on the soil underneath the warehouse and the adjacent area surrounding the building showed that the soil met or exceeded the 95 percent standard proctor maximum density as provided in the contract. The compaction density is an indirect measure for achieving the proper load-bearing capacity. Expert testimony demonstrated that the rear slope of the property collapsed because the slope was too steep for the strength of the soil and not as a result of the density of the soil underneath the building. Since there was some evidence to show that Mann did not breach its contractual obligation as alleged, a new trial was not warranted.
In addition, Armstrong and PLI were not entitled to a directed verdict on their breach of contract claim based upon a contractual provision governing the contractor's duty to disclose errors or omissions contained in the contract documents. The contract provision at issue, Paragraph 3.2.1, is limited to errors in the contract documents and does not encompass any alleged failure of Raffield to disclose to the project inspector the existence of a burial pit. Nor does the alleged conduct fall within the terms of Paragraph 3.2.2.
4. Contrary to their assertions, the trial court was proper in directing a verdict against Armstrong and PLI on the issue of assessed attorney fees and expenses of litigation. As the trial court correctly found, a bona fide controversy existed between the parties which is demonstrated by the jury's verdict. Under...
To continue reading
Request your trial
-
Matter of Graham
...for fraud must include a requirement of "reasonable reliance" on the part of the creditor, Armstrong Transfer & Storage Co., Inc. v. Mann Constr., Inc., 217 Ga.App. 538, 543, 458 S.E.2d 481 (1995), Bankruptcy Code section 523(a)(2)(A) requires the creditor to have "justifiably relied" on th......
-
MEADOW RIVER LUMBER v. Univ. of Ga. Research
...emphasis on fraud). 20. Id.; Deckert v. Foster, 230 Ga.App. 164, 495 S.E.2d 656 (1998). 21. Armstrong Transfer, etc., Co. v. Mann Constr., 217 Ga.App. 538, 539(1), 458 S.E.2d 481 (1995). 22. Smalls v. Blueprint Dev., 230 Ga.App. 556, 557-558(1), 497 S.E.2d 54 23. See, e.g., Transitron Elect......
-
Savage v. KGE Associates Ltd. Partnership
...See Crotts Enterprises v. John Payne Co., 219 Ga.App. 173, 174(2), 464 S.E.2d 844 (1995); Armstrong Transfer &c. Co. v. Mann Constr., 217 Ga. App. 538, 539(1), 458 S.E.2d 481 (1995); Condon v. Kunse, 208 Ga.App. 856, 858(2), 432 S.E.2d 266 (1993); Toys `R' Us v. Atlanta Economic Dev. Corp.,......
-
Ryland Group v. Daley
...Savannah Indus. Constr. &c. v. Sumner, 189 Ga.App. 319, 320, 375 S.E.2d 486 (1988); see also Armstrong Transfer &c. Co. v. Mann Constr., 217 Ga.App. 538, 543(7), 458 S.E.2d 481 (1995). 4. Adamson Co. v. Owens-Illinois Dev. Corp., supra at 656-657, 309 S.E.2d 5. Ryland's reliance on termite ......
-
Construction Law - Brian J. Morrissey
...Id. 22. Id., 469 S.E.2d at 699. 23. Id. at 181, 469 S.E.2d at 699. 24. Id., 469 S.E.2d at 700. 25. Id. at 182, 469 S.E.2d at 700. 26. 217 Ga. App. 538, 458 S.E.2d 481 (1995). 27. Id. at 538, 458 S.E.2d at 482. 28. Id. 29. Id. 30. Id. 31. Id., 458 S.E.2d at 483. 32. Id. 33. Id. 34. Id. 35. I......