Covington Square Assoc.s v. Ingles Mkt.S Inc

Decision Date28 June 2010
Docket NumberNo. S10G0459.,S10G0459.
Citation287 Ga. 445,696 S.E.2d 649
PartiesCOVINGTON SQUARE ASSOCIATES, LLCv.INGLES MARKETS, INC.
CourtGeorgia Supreme Court

Michael A. Kessler, Alpharetta, for appellant.

Adam N. Struletz, Atlanta, for appellee.

CARLEY, Presiding Justice.

Covington Square Associates, LLC (Covington) leased space in a shopping center to Ingles Markets, Inc. (Ingles). After selling the shopping center in 2004, Covington brought suit against Ingles for damages allegedly resulting from its failure to pay a portion of the cost to hire a security guard. In December 2005, Ingles mistakenly sent a check for its portion of real estate taxes to Covington instead of the new landlord. Ingles notified Covington of the mistake and demanded return of the funds. However, Covington retained the funds as partial payment of the claimed security costs. Ingles then filed this action for conversion, attorney fees pursuant to OCGA § 13-6-11, and punitive damages, which was stayed pending the outcome of the other litigation. That litigation ended when the Court of Appeals affirmed the grant of Ingles' motion for summary judgment, ruling that the lease did not require payment of security guard expenses. Covington Square Assoc. v. Ingles Markets, 283 Ga.App. 307, 641 S.E.2d 266 (2007).

Thereafter, the trial court in the case at bar granted partial summary judgment in favor of Ingles, ruling that Covington wrongfully asserted dominion or control over Ingles' property and that Ingles is entitled to attorney fees and punitive damages, but leaving for trial determination of the amounts thereof. The trial court based its attorney fees ruling on the fact that Covington refused to refund the money despite the outcome of the other litigation and caused Ingles the unnecessary trouble and expense of bringing suit where no bona fide controversy existed.

The Court of Appeals affirmed the trial court's rulings as to the conversion claim and attorney fees, but reversed as to punitive damages. With respect to attorney fees, the Court of Appeals held that they can be awarded on summary judgment if the movant is entitled to them as a matter of law and that, [a]pplying the any evidence standard under these circumstances, [cit.] the trial court did not err in ruling that Ingles was entitled to attorney fees as a matter of law....” Covington Square Assoc. v. Ingles Markets, 300 Ga.App. 740, 744(2), 686 S.E.2d 359 (2009). Having granted certiorari to review this holding, we conclude that the language of OCGA § 13-6-11 prevents a trial court from ever determining that a claimant is entitled to attorney fees as a matter of law.

In its entirety, OCGA § 13-6-11 provides as follows:

The expenses of litigation generally shall not be allowed as a part of the damages; but where the plaintiff has specially pleaded and has made prayer therefor and where the defendant has acted in bad faith, has been stubbornly litigious, or has caused the plaintiff unnecessary trouble and expense, the jury may allow them.

For many years, the Court of Appeals has recognized that [t]he intent of the law, as shown by the words, ‘the jury may allow them,’ is to leave the matter of expenses of litigation to the jury trying the case. [Cit.] Taylor v. Estes, 85 Ga.App. 716, 719(2), 70 S.E.2d 82 (1952). See also Hyde v. Gill, 236 Ga.App. 729, 734(3), 513 S.E.2d 278 (1999); American Medical Transport Group v. Glo-An, 235 Ga.App. 464, 467(3), 509 S.E.2d 738 (1998); J.M. Clayton Co. v. Martin, 177 Ga.App. 228, 232(6), 339 S.E.2d 280 (1985); Brannon Enterprises v. Deaton, 159 Ga.App. 685, 687, 285 S.E.2d 58 (1981); Sapp v. Howe, 79 Ga.App. 1, 3(4), 52 S.E.2d 571 (1949); Patterson & Co. v. Peterson, 15 Ga.App. 680, 684(4), 84 S.E. 163 (1915).

As a result, ‘it has long been held ... that in suits where the expenses of litigation might be recovered as part of the damages, it is error for the trial court to direct a verdict therefor. The matter of such expenses is left solely to the jury. (Cits.) [Cit.] Polma, Inc. v. Coastal Canvas Products Co., 199 Ga.App. 616, 618(7), 405 S.E.2d 531 (1991). See also Tab Sales v. D & D Distrib., 153 Ga.App. 779, 780(2), 266 S.E.2d 558 (1980); Patterson & Co. v. Peterson, supra. Whether a plaintiff has “met any of the preconditions for an award of attorney fees and litigation expenses set forth in OCGA § 13-6-11[is] solely a question for the jury. [Cit.] City of Atlanta v. Broadnax, 285 Ga.App. 430, 440(6), 646 S.E.2d 279 (2007) (affirming judgment on jury verdict in favor of defendant). [S]uch an award under this statute necessitates jury determination. [Cits.] Fontaine Condo. Assn. v. Schnacke, 230 Ga.App. 469, 471(3), 496 S.E.2d 553 (1998) (vacating trial court's award of attorney fees after it denied jury trial thereon).

Consistent with this precedent, the Court of Appeals has correctly held that, because both the liability for and amount of attorney fees pursuant to OCGA § 13-6-11 are solely for the jury's determination, a trial court is not authorized to grant summary judgment in favor of a claimant therefor. Hyde v. Gill, supra; American Medical Transport Group v. Glo-An, supra; Page v. HSI Financial Svcs., 218 Ga.App. 283, 286(5), 461 S.E.2d 239 (1995), rev'd on other grounds Henderson v. HSI Financial Svcs., 266 Ga. 844, 471 S.E.2d 885 (1996); Joseph Camacho Assoc. v. Millard, 169 Ga.App. 937, 939(2), 315 S.E.2d 478 (1984); Fountain v. Burke, 160 Ga.App. 262, 264(3), 287 S.E.2d 39 (1981); Pritchett v. Rainey, 131 Ga.App. 521, 522, 206 S.E.2d 726 (1974).

Ingles argues that the Court of Appeals, citing City of Marietta v. Holland, 252 Ga. 299, 304(3), 314 S.E.2d 97 (1984), has stated that [e]xpenses of litigation under OCGA § 13-6-11 can be awarded on summary judgment, but the movant must be entitled to them as a matter of law. [Cit.] Rivergate Corp. v. BCCP Enterprises, 198 Ga.App. 761(2), 403 S.E.2d 65 (1991) (reversing summary judgment). See also Rasmussen v. Nodvin, 174 Ga.App. 203, 205(4), 329 S.E.2d 541 (1985) (reversing summary judgment). However, the Holland opinion does not state that litigation expenses under the statute can be awarded on summary judgment. Instead, this Court examined whether there was any genuine issue of material fact as part of its determination that the trial court not only erroneously granted plaintiff's motion for summary judgment, but also erred in denying summary judgment in favor of the defendants. Therefore, rather than authorizing summary judgment for a claimant under OCGA § 13-6-11 Holland is explained by the proposition that [o]nly in the rare case where there was absolutely no evidence to support the award of expenses of litigation would the trial court be authorized to grant summary adjudication on such issues.” American Medical Transport Group v. Glo-An, supra. See also Brito v. Gomez Law Group, 289 Ga.App. 625, 628(2), 658 S.E.2d 178 (2008). Other cases relied on by Ingles, as well as statements that determination of the preconditions in the statute is “generally” for the jury, are also explained by the simple proposition quoted above from American Medical Transport Group v. Glo-An, supra. Merlino v. City of Atlanta, 283 Ga. 186, 191(4), 657 S.E.2d 859 (2008); Tyler v. Lincoln, 272 Ga. 118, 122(2), 527 S.E.2d 180 (2000); Stargate Software Intl. v. Rumph, 224 Ga.App. 873, 878(4), 482 S.E.2d 498 (1997); Webster v. Brown, 213 Ga.App. 845, 846(2), 446 S.E.2d 522 (1994).

Both Ingles and the Court of Appeals relied on D & H Constr. Co. v. City of Woodstock, 284 Ga.App. 314, 318-319(2), 643 S.E.2d 826 (2007) and Graves v. Diambrose, 243 Ga.App. 802, 803-804(2), 534 S.E.2d 490 (2000). However, neither decision states that summary judgment can be granted in favor of a claimant under OCGA § 13-6-11. Furthermore, contrary to Ingles' argument and the Court of Appeals' opinion here, it is not at all clear that the trial court in either case granted...

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    ...pursuant to OCGA § 13–6–11 is normally an issue for a jury. Covington Square Associates, LLC v. Ingles Markets, Inc., 287 Ga. 445, 446–447, 696 S.E.2d 649 (2010). As discussed above, there are genuine disputes of material fact as to whether defendants acted in bad faith in their dealings re......
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