Clark v. West

• Decision Date: 28 June 1990
• Docket Number: No. A90A0096,A90A0096
• Parties: CLARK v. WEST et al.
• Court: Georgia Court of Appeals

Page 884

395 S.E.2d 884

196 Ga.App. 456

CLARK v. WEST et al.

No. A90A0096.

Court of Appeals of Georgia.

June 28, 1990.

Rehearing Denied July 17, 1990.

James D. Burns, Decatur, for appellant.

J.L. Jordan, Atlanta, Ray Gary, Mableton, for appellees.

SOGNIER, Judge.

Luvenia Clark brought an action for wrongful foreclosure against Thomas and Mildred West, seeking to set aside the foreclosure sale as well as to recover damages for her mental pain and suffering and attorney fees. The trial court granted Clark's motion for partial summary judgment and pursuant thereto set aside the foreclosure sale and cancelled the deed under power. Approximately a month later, the trial court dismissed the remainder of Clark's action when she failed to appear for a peremptory calendar. Thereafter, Clark refiled the suit on those matters prayed for in the original suit which had not been granted in the partial summary judgment. The Wests' motion to dismiss was granted by the trial court, and Clark appeals.

Appellant contends the trial court erred by granting appellees' motion to dismiss. Although the actual grounds upon which the trial court granted appellees' motion are unclear, several possible reasons are stated in the trial court's order: (a) appellant was not entitled to relief because she had pursued her complaint in equity to satisfaction; (b) the relief appellant was seeking was in the nature of punitive damages, which are not available because the underlying action sounded only in contract; and (c) her claim for attorney fees and expenses of litigation should have been included in the original motion for summary judgment.

We note initially that the dismissal of the first action for failure to appear at a peremptory calendar was without prejudice, USCR 20(A), and thus the refiling of appellant's suit within six months of the dismissal was proper. OCGA § 9-2-61(a).

(a) The trial court apparently agreed with appellees' argument below, based on this court's statement in Langley v. Stone, 112 Ga.App. 237, 239(2), 144 S.E.2d 627 (1965), that if a foreclosure is wrongful, the "injured party [may] rescind the sale and tender the amount owed on the property or affirm the sale and sue for a breach of the duty to conduct the sale fairly." The gist of appellees' argument is that an injured party must elect between an equitable action for cancellation of the foreclosure sale and a suit for damages, and pursuit of one to satisfaction results in the exclusion of the other. We agree that this principle applies if the injured party is seeking to redress only the loss of the value of the property. That is, the injured party may not both set aside or cancel the foreclosure and also recover damages for the value of the property. However, this court has approved actions in which both cancellation and damages were sought. See Andrews v. Holloway, 140 Ga.App. 622, 231 S.E.2d 548 (1976); Gilbert v. Cherry, 136 Ga.App. 417, 221 S.E.2d 472 (1975). In those cases, cancellation was sought to recover the property, and in addition, damages were sought for other breaches of duty and other losses. The latter procedure applies in the case at bar, because appellant sought both cancellation of the foreclosure sale to recover the property and also damages for her mental anguish, which resulted from the intentional nature of appellees' acts, alleging that appellees clearly knew the note was not in default and they had no right to foreclose. It strains credulity to insist that the recovery of appellant's wrongfully foreclosed residence has made her whole, and we find no bar in law or in logic to a recovery of damages for her humiliation and emotional distress should evidence at trial establish the truth of the allegation in her pleadings that the foreclosure was instituted intentionally and without basis. Accordingly, we do not agree that because the foreclosure sale had been cancelled, appellant could not pursue her separate claim for damages.

(b) Nor do we agree that appellant's claim for damages for mental anguish is in the nature of punitive damages, as the trial court found. The lower court reasoned that the damages sought by appellant were those recoverable under OCGA § 51-12-5, which are "additional" damages, in that they are awarded in addition to other damages, and are in the nature of "punitive" damages; but even if appellant sought those damages allowed pursuant to OCGA § 51-12-6 (where the entire injury is to the peace, happiness or feelings of the injured party), the damages alleged were "vindictive" and therefore "punitive." The trial court found that "punitive" damages would not lie here because no actual damages were recovered and because punitive damages may not be awarded in cases arising on contracts.

We do not agree with the trial court that a wrongful foreclosure action sounds only in contract. There exists a statutory duty upon a mortgagee to exercise fairly and in good faith the power of sale in a deed to secure debt. OCGA § 23-2-114. Although arising from a contractual right, breach of this duty is a tort compensable at law. See, e.g., Curl v. First Federal Savings & Loan Assn., 243 Ga. 842, 843-844(2), 257 S.E.2d 264 (1979) (affirmed the award of damages for mental pain and aggravation and punitive damages in an action for wrongful foreclosure); Decatur Investments Co. v. McWilliams, 162 Ga.App. 181, 182(2), 290 S.E.2d 526 (1982) (affirmed an award of punitive damages in a wrongful foreclosure action); see also 20 E.G.L., Mortgages and Bonds for Title, § 69, p. 584. Thus, even if punitive damages were sought, they were awardable here.

We find, however, that as pleaded by appellant, the damages sought are those allowed in OCGA § 51-12-6. "As a general precept, damages for mental distress are not recoverable in the absence of physical injury where the claim is premised upon ordinary negligence. [Cit.] However, when the claim is for intentional misconduct, damages for mental distress may be recovered without proof of physical injury. [Cit.]" Hamilton v. Powell, Goldstein, Frazer & Murphy, 252 Ga. 149, 150, 311 S.E.2d 818 (1984).

East River Savings Bank v. Steele, 169 Ga.App. 9, 311 S.E.2d 189 (1983), relied on by the dissent, does not control the facts sub judice. In Steele, the plaintiff's claim was that a negligent wrongful foreclosure was sufficiently humiliating to establish a cause of action for intentional infliction of emotional distress, whereas here appellant's cause of action is for an intentional wrongful foreclosure, and in addition to cancellation of the foreclosure, she has prayed for the recovery of damages which flow from the intentional nature of the tort. We cannot approve the dismissal of appellant's remaining claims simply by labeling them a cause of action for "intentional infliction of emotional distress," where the complaint alleges an established tort--wrongful foreclosure--and seeks damages pursuant to OCGA § 51-12-6 for mental distress as a result of its intentional commission. Established law in this State allows the award of damages for such a claim. See Hamilton, supra 252 Ga. at 150, 311 S.E.2d 818. Accordingly, the trial court erred by dismissing appellant's claim for damages.

(c) The trial court also erred by dismissing appellant's claim for attorney fees. We find no basis for the trial court's conclusion that "these issues should have been presented to and taken up before the Court on the Motion for Partial Summary Judgment." OCGA § 9-11-56(a) specifically authorizes a motion for summary judgment upon a "claim," rather than upon an action as a whole, and OCGA § 9-11-56(d) provides specifically for partial summary judgment. There is no requirement that all claims pleaded be included in a motion for partial summary judgment.

Moreover, we do not agree that attorney fees sought pursuant to OCGA § 13-6-11 are not available to appellant here. She has alleged bad faith and stubborn litigiousness. If she can prove these allegations and present proper proof of the value of the attorney fees she has expended, see First Bank of Clayton County v. Dollar, 159 Ga.App. 815, 817-818(4), 285 S.E.2d 203 (1981), we find no bar to an award pursuant to OCGA § 13-6-11. Bowers v. Fulton County, 227 Ga. 814, 815, 183 S.E.2d 347 (1971), cited by the trial court, holds that, in general, attorney fees are not required as an element of just compensation in condemnation cases and is not applicable to this case.

Judgment reversed.

McMURRAY, P.J., and COOPER, J., concur.

BANKE, P.J., and BEASLEY, J., concur specially.

CARLEY, C.J., DEEN, P.J., and BIRDSONG and POPE, JJ., dissent.

BANKE, Presiding Judge, concurring specially.

I agree with the majority that East River Savings Bank v. Steele, 169 Ga.App. 9, 311 S.E.2d 189 (1983), is distinguishable from the present case, but not on the ground that it involved a negligent rather than an intentional wrongful foreclosure. The plaintiff in that case alleged that the defendant had wrongfully attempted to foreclose on certain partnership property in which he (the plaintiff) owned an interest "and that such attempts amounted to intentional infliction of emotional distress upon [him] personally." Id. at 9, 311 S.E.2d 189. The reason this court ruled against the plaintiff in the East River case was not because the alleged misconduct of the defendant was merely negligent but because it was considered to be "analogous to the filing of legal pleadings." The court cited Ga. Power Co. v. Johnson, 155 Ga.App. 862, 863, 274 S.E.2d 17 (1980), for the proposition that the filing of legal pleadings cannot be considered sufficiently "humiliating, insulting, or terrifying" to support an action for intentional infliction of emotional distress. East River Savings Bank, supra 169 Ga.App. at 10, 311 S.E.2d 189.

The defendant in Georgia Power Co. v. Johnson, supra, had instituted condemnation proceedings against certain property owned by the plaintiff and in so doing was alleged to...