Fulton Cnty. v. Soco Contracting Co.

• Court: Georgia Court of Appeals
• Writing for the Court: Ray, Presiding Judge.
• Citation: Fulton Cnty. v. Soco Contracting Co., 343 Ga.App. 889, 808 S.E.2d 891 (Ga. App. 2017)
• Decision Date: 15 November 2017
• Docket Number: A17A1001
• Parties: FULTON COUNTY, Georgia v. SOCO CONTRACTING COMPANY, INC.

343 Ga.App. 889

808 S.E.2d 891

FULTON COUNTY, Georgia

v.SOCO CONTRACTING COMPANY, INC.

A17A1001

Court of Appeals of Georgia.

Decided November 15, 2017

Reconsideration Granted November 15, 2017

Patrise M. Perkins-Hooker, Atlanta, Kaye W. Burrell, Denval A. Stewart, Atlanta; Johnson & Freeman, Ronald J. Freeman, Riverdale, Clayton County, Cathy R. Nash, Atlanta, Bethany B. White, Union City, for appellant.

Roberts Construction Law, David A. Roberts, Atlanta, for appellee.

Kelly J. Long Pridgen, Douglasville, Larry W. Ramsey, Jr., Atlanta, G. Joseph Scheuer, amici curiae.

Ray, Presiding Judge.

In 2013, Fulton County (the "County") and SOCO Construction Company, Inc. ("SOCO") executed a written contract for the construction of a cultural center. The contract was approved by the Fulton County Board of Commissioners. As a result of several delays, including those caused by change orders, inclement weather, and the shutdown of the federal government, the scope of the work and time line was altered.

SOCO filed the instant complaint against the County for, inter alia, breach of contract and bad faith performance of the contract. SOCO also sought attorney fees and injunctive relief. SOCO and the County filed cross-motions for summary judgment on all claims. The trial court granted summary judgment in favor of SOCO and against the County.¹ In the same order, the trial court also denied the County's motion for reconsideration of its denial of the County's motion to withdraw admissions.

We vacate the trial court's denial of the County's motion for summary judgment, which asserted that any claims arising from unwritten change orders are barred under the doctrine of sovereign immunity, and remand the case for further consideration. Further, we affirm in part and reverse in part the trial court's order denying the County's motion for reconsideration of its motion to withdraw admissions. Finally, we vacate and remand the trial court's ruling on attorney fees.

To prevail at summary judgment, the moving party must demonstrate that there is no genuine issue of material fact and that the undisputed facts, viewed in the light most favorable to the nonmoving party, warrant judgment as a matter of law.... We conduct a de novo review a trial court's grant of summary judgment.

(Citations and punctuation omitted.) Bright v. Sandstone Hospitality, LLC, 327 Ga. App. 157, 157-158, 755 S.E.2d 899 (2014).

In May 2013, the County and SOCO executed a written contract for the construction of the Aviation Community Cultural Center near the Fulton County Airport. The contract specified that the work should be completed within 287 days from the County's issuance of the notice to proceed or the day the work began, whichever came first, with that period to be increased by change order due to changes in the scope of work, or upon the occurrence of other delays or events not the fault of the contractor. Section 00700-87A of the "General Conditions" portion of the contract provides that

[a] Change Order is a written order to the Contractor signed to show the approval and authorization of the County, issued after execution of the Contract, authorizing a change in the Work and/or an adjustment in the Contract Sum or the Contract Time. Change Orders shall be written using forms designated by the County with Contractor providing supporting documentation as required by the Construction Manager. The Contract Sum and the Contract Time may be changed only by approved Change Order pursuant to Fulton County Procedure 800-6.... A Change Order signed by the Contractor indicates the Contractor's agreement therewith, including the adjustment in either or both of the Contract Sum or the Contract Time.

(Emphasis supplied.) It also provides that "[t]he County, without invalidating the Contract, may order changes in the Work within the general scope of the Contract as defined herein."

Fulton County Policy and Procedure 800-6 ("Fulton Procedure 800-6"), titled "Procedures for Handling Change Orders," provides that "except as otherwise provided ... , change orders shall be effected only through a written, bilateral agreement (Modification) between the County, acting through its Board of Commissioners, and the contractor." Procedure 800-6 allows for the authorization of change orders when needed, inter alia, to correct deficiencies in design or construction documents provided by architects or engineers, to remedy concealed conditions, abnormal inclement weather, and owner-requested changes within the scope of the contract. It further provides that the proper "Change Order Procedure" requires the "[a]greement between County and contractor for change [to be] clearly defined in a Written Modification," signed by the Contractor and approved by the Board of Commissioners. Section G (2) of Procedure 800-6, captioned "Extraordinary Circumstances," provides that the "County Manager is authorized to approve change orders regardless of the amount when due to extraordinary circumstances, work must be implemented before the Board of Commissioners can act." Such extraordinary circumstances include a "[l]oss of substantial resources due to delay, including delay to critical path schedule."

SOCO began work on the cultural center on May 29, 2013. However, SOCO did not achieve substantial completion of the project until May 29, 2014, beyond the time anticipated in the contract. SOCO contends that the construction of the cultural center was delayed due to, inter alia, adverse weather conditions, delays caused by the County's design for the cultural center, the County's unwillingness to make timely decisions on changes, and the impact that the federal government's shut down had on obtaining certain permits. As a result of these issues, the County ordered changes to SOCO's scope of work, and the County's program manager listed more than 30 change orders in its September 5, 2014, change order evaluation log. However, SOCO does not provide citations to the record, nor can we find any, indicating that the change orders were executed through bilateral, written agreements. SOCO admits that the County never issued a change order extending the contract time, despite these delays. Further, the County did not release its Certificate of Substantial Completion until February 17, 2015, and withheld release of certain retainage fees until January 21, 2015.

SOCO then filed suit against the County for breach of contract and bad faith. It also sought attorney fees and injunctive relief. The County answered. On June 30, 2015, SOCO sent its first Request for Admissions to the County by hand-delivery. The County did not respond until on August 3, 2015, 33 days later. Because the County's response to the Requests for Admissions was served to SOCO more than 30 days after service of the request, the Requests for Admissions were deemed admitted pursuant to OCGA § 9-11-36 (a) (2). See Adewumi v. Amelia Grove/Ashland Park Homeowners Assoc., Inc., 337 Ga. App. 275, 277 (2), 787 S.E.2d 761 (2016).

On April 26, 2016, the County filed a motion to withdraw the Requests for Admissions. The County attached an affidavit of Tommy Walton, a paralegal with the Fulton County Attorney's Office, who averred that the responses to the Request for Admissions were late due to an administrative error. The County also alleged that it mistakenly admitted SOCO's Request for Admission #37 that it was liable for "all damages alleged by SOCO in its Complaint." The trial court denied the motion to withdraw. The trial court also denied the County's petition for interlocutory review, and the County filed its motion for reconsideration of the trial court's denial of the motion to withdraw admissions.

On June 27, 2016, the County moved for summary judgment on the grounds that the trial court lacked subject matter jurisdiction because of sovereign immunity. In its final order, the trial court, inter alia, denied the motion for reconsideration and denied the County's motion for summary judgment. The County appeals from that order.

1. The County argues that the trial court erred in denying its motion for summary judgment because the trial court lacked subject matter jurisdiction due to the applicability of sovereign immunity. The County argues that although the State has waived sovereign immunity for the breach of any written contract, it did not waive immunity for causes of action arising from modifications to the written contract that failed to follow the written change order policy outlined in the contract. For the following reasons, we vacate the trial court's ruling on this issue and remand the case for further consideration.

In Georgia, the doctrine of sovereign immunity has constitutional status and may be waived only by an act of the General Assembly or by the Constitution itself. Ga. Dept. of Corrections v. Couch, 295 Ga. 469, 472 (2), 759 S.E.2d 804 (2014). The Georgia Constitution addresses the waiver of the State's immunity of liability for breach of contract as follows:

(c) The [S]tate's defense of sovereign immunity is hereby waived as to any action ex contractu for the breach of any written contract now existing or hereafter entered into by the [S]tate or its departments and agencies....

(e) Except as specifically provided in this Paragraph, sovereign immunity extends to the [S]tate and all of its departments and agencies. The sovereign immunity of the [S]tate and its departments and agencies can only be waived by an Act of the General Assembly which specifically provides that sovereign immunity is thereby waived and the extent of such waiver.

Ga. Const., Art. I, Sec. II, Par. IX (c) and (e). "The sweep of sovereign immunity under the Georgia Constitution is broad, [and its] plain and unambiguous text ... shows that only the General Assembly has the authority to waive the State's sovereign immunity." (Citation omitted.) Olvera v. Univ. Sys. of Ga.'s Bd. of Regents, 298 Ga. 425, 426, 782 S.E.2d 436 (2016).

"[S]overeign immunity is a threshold issue that...