Floyd v. First Union Nat. Bank of Georgia

• Citation: 417 S.E.2d 725,203 Ga.App. 788
• Decision Date: 20 March 1992
• Docket Number: No. A91A1944,A91A1944
• Parties: FLOYD, et al. v. FIRST UNION NATIONAL BANK OF GEORGIA.
• Court: United States Court of Appeals (Georgia)

Page 725

417 S.E.2d 725

203 Ga.App. 788

FLOYD, et al. v. FIRST UNION NATIONAL BANK OF GEORGIA.

No. A91A1944.

Court of Appeals of Georgia.

March 20, 1992.

Reconsideration Denied April 3, 1992.

Certiorari Denied June 25, 1992.

James W. Wallis, Jr., Carrollton and Kenneth A. Smith, Atlanta, for appellants.

Troutman, Sanders, Lockerman & Ashmore, Herbert D. Shellhouse, Atlanta and Wallace K. Askew, Pine Mountain, for appellee.

BIRDSONG, Presiding Judge.

Thomas Floyd, Jr. and Cindy Smith, as co-executors of the Estate of Thomas Floyd, Sr., brought suit against First Union National Bank of Georgia for breach of contract by wrongful dishonor and conversion and seeking actual damages, punitive damages, and attorney fees. The complaint was filed December 12, 1988. First Union allowed the complaint to go into default; its answer being filed on January 27, 1989. This court upheld the trial court's denial of its motion to open default. First Union Nat. Bank of Ga. v. Floyd, 198 Ga.App. 99, 400 S.E.2d 393. After First Union's attempt to open default proved unsuccessful, this case proceeded to trial solely on the issue of damages. First Union filed pleadings and participated at the trial on damages. However, the trial court granted First Union's motion to quash plaintiffs' subpoena for the production at trial of certain financial records of the bank for purposes of proving punitive damages; during trial the court granted First Union's motion to prohibit plaintiffs from presenting any evidence regarding their claims for punitive damages and attorney fees. Thus, the case was tried before the jury with the sole damage issue being the amount of actual damages plaintiffs suffered because of the conversion and breach of contract. The jury returned a verdict in favor of plaintiffs in the amount of $25,000, and the trial court entered final judgment in that amount. The co-executors appealed. Held:

1. Appellants in effect contend the trial court erred by excluding all evidence supporting their claims for punitive damages and attorney fees. Appellants specifically prayed for both punitive damages and attorney fees, and their complaint demanded judgment on both those claims "in an amount to be determined at trial" rather than in a specific dollar amount. The trial court's holding is based on the rationale that because appellants failed to attach a dollar figure to the punitive damages and attorney fees they demanded in their complaint, an award of any amount of money for those claims would exceed in amount that prayed for in contravention of OCGA § 9-11-54 (c)(1). For reasons hereinafter discussed, we cannot affirm the trial court's holding.

OCGA § 9-11-54(c)(1) pertinently provides that "[a] judgment by default shall not be different in kind from or exceed in amount that prayed for in the demand for judgment." Appellants specifically prayed for both punitive damages and attorney fees in an amount to be determined at trial. Thus, the demand for judgment both as to punitive damages and attorney fees was "open-ended." Accordingly, the case of Harbor Light Marina v. Ellis, 190 Ga.App. 389, 378 S.E.2d 746 is controlling. The pleading in this case does not conflict with the constraints of OCGA § 9-11-54(c)(1). Harbor Light Marina, supra; compare West v. Nodvin, 196 Ga.App. 825, 832(5), 397 S.E.2d 567 (an award of punitive damages in the amount of $76,000 did not exceed the amount prayed for in the demand for judgment, under the provisions of OCGA § 9-11-54(c)(1), where the prayer was cast " 'in the amount of not less than $25,000.00' ") and Henry v. Sneiders, 490 F.2d 315 (9th Cir.).

Moreover, in Ticor Constr. Co. v. Brown, 255 Ga. 547, 340 S.E.2d 923, the Supreme Court upheld a default judgment for $12,000 compensatory damages even though the plaintiff sought only an unspecified amount of compensatory damages in its demand for judgment. While the issue in the case at bar was not specifically addressed in Ticor and while no transcript of the proceedings exists, the Supreme Court stated: "Where no transcript exists, we normally assume that the evidence amended the pleadings to conform to the judgment." Id. at 548(2), 340 S.E.2d 923. Thus, it is apparent that the Supreme Court was not oblivious to the nuances regarding the demand for damages in default judgment cases, yet affirmed the judgment without any express reservation that a fundamental unfairness may have occurred.

The pertinent pleadings in the cases relied upon by the dissent are distinguishable from the pleadings in the case and from the pleadings in both Harbor Light Marina, supra, and West v. Nodvin, supra. In particular, in Dempsey v. Ellington, 125 Ga.App. 707, 708, 188 S.E.2d 908, the pleading in addition to requesting the court to compel the buyer's performance merely contained a general prayer " '[f]or such other and further relief as to the court appears necessary to do complete justice between the parties.' " The Dempsey case subsequently was placed on the default calendar and the jury ultimately returned a verdict for $5,000 in damages. The pleading on its face contains no express claim for monetary relief, and thus it is conceivable that a defendant, particularly one acting pro se, could be lulled into accepting default under the false assumption that no such award would be forthcoming. It was recognized in Betts v. First Ga. Bank, 177 Ga.App. 359, 339 S.E.2d 616, citing Orkin Exterminating Co. v. Townsend, 136 Ga.App. 50, 53(2), 220 S.E.2d 14, that the basis for the rule in CPA § 54(c)(1) is that it would be fundamentally unfair to allow complainant, by its pleadings, to lull or mislead defendant into believing that only a certain type and dimension of relief was being sought and then, should the defendant attempt to limit the scope and size of the potential judgment against him by not appearing, allow the court to give a different type of relief or a larger damage award. As stated succinctly by Hardy Gregory, Jr., Ga.Civil Practice, § 7-1(C)(1), the rule in CPA § 54(c)(1) is a "rule of fairness.... [The defendant] should not be subjected to some greater judgment than that sought in the complaint, where he had no notice it would be sought nor any opportunity to defend against the greater amount." (Emphasis supplied.) And, as the author further notes, "[t]he principle of no excess judgment in default situations is a shield, and not a sword." Id. at 538. In the case at bar, the pleadings clearly placed defendant bank upon due notice that plaintiffs were seeking an "open-ended" monetary award both for punitive damages and attorney fees. (Incidentally, pursuant to statute, a defendant may file a timely motion for more definite statement to clarify vague or ambiguous pleadings. OCGA § 9-11-12(e). Once placed on due notice of an open-ended demand, it would appear that any further efforts to obtain a more definite and certain statement of the pleadings immediately could be requested by the defendant by way of an OCGA § 9-11-12(e) motion.) Under these circumstances, no fair risk exists that defendant was lulled or misled to the point where it could not make an intelligent decision whether to let the case go into default. Moreover, in this case, First Union was given due notice of the jury trial on damages; it filed certain pleadings, entered an appearance, argued motions, presented evidence to the court, exercised its right of cross-examination, and argued to the jury.

Additionally, the cases pertinent to the issue under consideration do not support the essence of the dissent that because appellants did not specify the precise monetary amount of punitive damages in the demand in their complaint, any amount awarded appellants would exceed per force the amount for which prayed. To require such surgical precision of pleading serves no useful purpose, conflicts with general pleading practice (see generally OCGA § 9-11-8(a)(2)), and tends to penalize plaintiffs unnecessarily rather than protecting per se defaulting defendants.

Appellee cites a purported decision of this court rendered in Phillips v. Pride, Case No. A90A1800, and later withdrawn, although an admission is made in its brief that having been withdrawn "this specific Georgia authority no longer exists." Suffice it to say, this withdrawn decision is lacking in value as precedent and is not binding on lower courts within the meaning of Ga.Const. of 1983, Art. VI, Sec. V, Par III. It is in effect an unreported case. "No unreported opinion shall be cited as a physical or binding precedent of the Court." Court of Appeals Rule 37(b).

As above discussed, the real purpose of CPA § 54(c)(1) is to give due notice to defendants so they will not be lulled or misled in their decision to enter into default, and to maintain a default procedure which is efficient, effective and fundamentally fair to all parties. This purpose has been achieved in this case.

2. Appellants assert the trial court erred in granting defendant's motions in limine and thereby prevented appellants/plaintiffs from presenting any evidence whatsoever to the jury in support of their claims for punitive damages. In view of our holding in Division 1 above, we find that the trial court did err as enumerated. Competent evidence is admissible when relevant to the issue of punitive damages. Cf. OCGA § 24-1-1(1); 51-12-5.1(d)(2); Privitera v. Addison, 190 Ga.App. 102, 105(1), 378 S.E.2d 312 (punitive damages are appropriate for conversion as a tort).

3. Appellants assert the trial court erred in quashing their subpoena which sought production of defendant's net worth information which was to be used in the assessment of punitive damages. We agree.

First Union's argument at trial that punitive damages could not be collected in view of OCGA § 9-11-54(c)(1) is without merit. See Division 1 above.

First Union's argument that the subpoena should be quashed because evidence of net worth is not admissible in the assessment of punitive damages also...