Black & White Const. Co., Inc. v. Bolden Contractors, Inc.

• Decision Date: 13 June 1988
• Docket Number: No. 76372,76372
• Citation: 371 S.E.2d 421,187 Ga.App. 805
• Parties: BLACK & WHITE CONSTRUCTION COMPANY, INC. et al. v. BOLDEN CONTRACTORS, INC.
• Court: Georgia Court of Appeals

Page 421

371 S.E.2d 421

187 Ga.App. 805

BLACK & WHITE CONSTRUCTION COMPANY, INC. et al. v. BOLDEN CONTRACTORS, INC.

No. 76372.

Court of Appeals of Georgia.

June 13, 1988.

Rehearing Denied July 12, 1988.

Peter A. Wade, Atlanta, Mahlon C. Rhaney, Jr., Marietta, Gary P. Bunch, Lauren L. Becker, Atlanta, for appellants.

Jack H. Senterfitt, Atlanta, for appellee.

SOGNIER, Judge.

Black and White Construction Company, Inc. (B & W) brought an action against Bolden Contractors, Inc. (Bolden), its partner in a joint venture to perform masonry work on a construction project for the Miller Brewing Company. The multicount complaint, seeking the release and disbursement of funds held in escrow which had been paid to the joint venture, as well as damages for breach of the joint venture contract, was later amended to seek only an accounting. Bolden's answer and counterclaim sought damages for fraud, breach of fiduciary duty by various actions of B & W, including commingling of joint venture funds with its own monies, and an accounting of the joint venture funds. The first trial ended in a mistrial, after which the trial court, acting sua sponte, entered an order adding several parties to the action, including Masonry Contractors, Inc. (MCI) and the case again proceeded to trial, with Bolden recast as plaintiff, and B & W and MCI as defendants. At the close of the evidence, the trial court ruled that B & W had commingled some of its funds and funds belonging to the joint venture, but that after an audit, B & W had sufficiently accounted for these funds to prevent damages being awarded for the commingling. The remaining issues went to the jury, which returned a verdict in favor of Bolden against B & W and MCI based on fraud, awarding actual damages, punitive damages, attorney fees and litigation expenses. Judgment was entered on this verdict, and following the denial of their motions for a new trial, B & W and MCI appeal.

1. Appellants contend the trial court erred by failing to bifurcate the legal and equitable claims, thereby allowing the jury to hear prejudicial evidence relevant only to the equitable issue of accounting. First, appellants' argument that only legal issues, and not equitable issues, are triable before a jury, is specious; the cases cited by appellant do not stand for this proposition and appellants' reliance on Beacon Theatres v. Westover, 359 U.S. 500, 79 S.Ct. 948, 3 L.Ed.2d 988 (1959) and Southland Reship v. Flegel, 534 F.2d 639 (5th Cir.1976) is misplaced. Contrary to appellants' claim, the trial court properly decided the legal issues first, since "where determination of the equitable issues would be conclusive as to the legal issues, the legal issues must be tried first in order to prevent abrogation of the right to a jury trial." Southland Reship, supra at 644. See also Dairy Queen v. Wood, 369 U.S. 469, 82 S.Ct. 894, 8 L.Ed.2d 44 (1962).

Second, the question of severance of issues is a matter within the discretion of the trial court. Lansky v. Goldstein, 141 Ga.App. 345, 233 S.E.2d 437 (1977). In such cases, there is no reversible error absent a clear and manifest abuse of that discretion. See Sollek v. Laseter, 124 Ga.App. 131, 132, 183 S.E.2d 86 (1971). We find no such abuse of discretion here.

Finally, appellants do not specify what particular evidence, if any, relating to the accounting issue, was prejudicial to them. " 'It is the duty of the party asserting error to show it by the record. [Cits.] Assertions of evidence in briefs or enumerations of error cannot satisfy this duty. [Cit.]' [Cit.]" Bellamy v. Edwards, 181 Ga.App. 887, 892(7), 354 S.E.2d 434 (1987). Enumerations "should specifically and definitely set out the error complained of so that this court will not be compelled to grope in ascertaining what the error is...." Baker v. Metallizing Co., 103 Ga.App. 174(1), 118 S.E.2d 843 (1961). To warrant reversal, alleged error must be harmful, Whitehead v. Cogar, 180 Ga.App. 812, 813(1), 350 S.E.2d 821 (1986), and in view of the fact that the evidence presented as to the accounting ultimately persuaded the trial court that B & W had satisfactorily accounted for all monies and that no damages were awardable for commingling, appellants have not demonstrated how any such evidence was sufficiently prejudicial as to require reversal.

2. Appellants next maintain, in several related enumerations of error, that the trial court erred by adding MCI to the action, sua sponte, before the second trial. We note initially that there can be no question that OCGA § 9-11-21 permits the court to add parties on its own initiative, and this may be done at any stage in the proceedings. Guhl v. Tuggle, 242 Ga. 412, 413, 249 S.E.2d 219 (1978). We further reject outright appellants' claim that the addition was improper simply because MCI was added as a defendant in counterclaim since OCGA § 9-11-21 specifically allows the practice complained of. Appellants argue, however, that there are several other reasons why the addition of MCI was improper.

(a) There is no merit in appellants' argument that the equitable claims against MCI were barred by the doctrine of laches. Laches does not consist of mere lapse of time, Grant v. Fourth Nat. Bank of Columbus, 229 Ga. 855, 868, 194 S.E.2d 913 (1972), rendering Cartin v. Boles, 155 Ga.App. 248, 270 S.E.2d 799 (1980), cited by appellants, inapposite. There also must be prejudice or injury to the party sought to be added resulting from that passage of time. See Clover Realty v. J.L. Todd Auction Co., 240 Ga. 124, 126, 239 S.E.2d 682 (1977); Grant, supra. Aircraft Radio Systems v. Von Schlegell, 168 Ga.App. 109, 308 S.E.2d 211 (1983) is distinguished by its facts, since prejudice was clearly demonstrated in that case by the fact that the party sought to be added had died, necessitating joinder of the executrix instead, and substantially impairing the ability of the executrix to defend the action. In addition, the doctrine of laches is purely equitable and is not applicable to claims at law. Moore v. American Fin. System, 236 Ga. 610, 611(3), 225 S.E.2d 17 (1976). Since the only equitable claim here was one for an accounting, which all parties agreed was necessary, no adverse consequences resulted to MCI from the accounting, and appellants have shown no prejudice resulting to MCI from its addition as a party. The trial court properly refused to apply the doctrine of laches.

(b) Appellants next argue that the addition of MCI as a party was improper because the claims against it were barred by the statute of limitations. We do not agree. OCGA § 9-11-15(c) provides that "[w]henever the claim or defense asserted in the amended pleading arises out of the conduct, transaction, or occurrence set forth ... in the original pleading, the amendment relates back to the date of the original pleading. An amendment changing the party against whom a claim is asserted relates back to the date of the original pleadings if the foregoing provisions are satisfied, and if within the period provided by law for commencing the action against him the party to be brought in by amendment (1) has received such notice of the institution of the action that he will not be prejudiced in maintaining his defense on the merits, and (2) knew or should have known that, but for a mistake concerning the identity of the proper party, the action would have been brought against him."

Regardless of which statutes of limitation are applicable here, we find that all requirements of OCGA § 9-11-15(c) are satisfied. It is clear that the claims against MCI arose out of the same transaction or series of transactions as those asserted in the original suit, and our focus must therefore be on the second portion of the statute. The deposition testimony of Robert Arch Hamilton, the president of MCI, established such a commonality of interest between MCI and B & W that it would be difficult to maintain that MCI did not receive notice of the institution of the original action. Hamilton testified that in addition to having been the president and the owner of 42 percent of the stock in MCI, he was also the vice president of B & W, owned one-third of 70 percent of the stock in B & W, and was in on the formation of B & W. He further testified that William Amason, who had been president of B & W, had been the secretary and treasurer of MCI, had owned 42 percent of the stock in MCI, and that B & W and MCI had...