Lowman v. Advanced Drainage Systems, Inc.

• Decision Date: 18 August 1997
• Docket Number: No. A97A1593,A97A1593
• Parties: , 97 FCDR 3156 LOWMAN v. ADVANCED DRAINAGE SYSTEMS, INC.
• Court: Georgia Court of Appeals

Page 427

491 S.E.2d 427

228 Ga.App. 182, 97 FCDR 3156

LOWMAN v. ADVANCED DRAINAGE SYSTEMS, INC.

No. A97A1593.

Court of Appeals of Georgia.

Aug. 18, 1997.

Gibson & Spivey, Douglas L. Gibson, Waycross, for appellant.

Daniell S. Landers, Waycross, for appellee.

BIRDSONG, Presiding Judge.

This case first visited this Court in 1993 and is here again after new trial following remand. See Advanced Drainage Systems v. Lowman, 210 Ga.App. 731, 437 S.E.2d 604.

Advanced Drainage Systems, Inc. (ADS) filed a suit on account against Lloyd Lowman. Lowman installed septic tanks made by ADS. Lowman contended that contrary to ADS' assurances, ADS' piping system was not suitable for use in the "fine sand" Georgia coastal plain area where Lowman installed ADS' septic tanks. Between 1984 and 1988, Lowman installed 185 of ADS' septic tanks; about 25 of those tanks failed, causing considerable unpleasant damage to those property owners and damaging Lowman's reputation accordingly. Lowman thus filed a counterclaim against ADS. The trial court granted a directed verdict in favor of ADS on its suit on account, and a jury awarded Lowman $130,000 on his counterclaim.

ADS appealed, contending first that Lowman's claim for damage to reputation was unsupported by evidence because there was no showing of the wanton or wilful misconduct necessary to support such a claim where no physical injury is involved. Id. at 732(1), 437 S.E.2d 604, citing Hamilton v. Powell, Goldstein, Frazer, etc., 167 Ga.App. 411 415(2), 306 S.E.2d 340. Lowman contended there was evidence of such wilful and wanton conduct because he gave evidence that ADS knew the pipe used would not work in Lowman's area but nevertheless represented to Lowman that the system would work. We held that the evidence showed ADS had no knowledge contrary to its representations until a report was issued in 1987, and "[n]o evidence was presented that the misrepresentations upon which Lowman and others allegedly relied were made after 1987 when ADS had knowledge of the problems associated with the use of [this] pipe in areas where fine sand is found. Thus, the record does not support a finding of wanton and wilful conduct by ADS[, and] Lowman's claim for damage to reputation should not have been presented to the jury.... ADS is entitled to a new trial." Advanced Drainage Systems, supra at 733(1), 437 S.E.2d 604.

For the same reason, viz., because "the record does not support Lowman's claim that ADS knew its representation concerning [suitability of the pipe] was false at the time the alleged misrepresentations were made" (id. at 734-735(2), 437 S.E.2d 604), we held Lowman had no claim under the "economic loss" rule, which, unless there is personal injury, limits claims for defective products to contract warranty actions except in cases of "accident" by sudden and calamitous event or "misrepresentation" involving false information known to be relied on by the injured party. Id. at 734, 437 S.E.2d 604.

On remand of the case for new trial, Lowman sought to show, as additional evidence, that he did rely on false representations after the 1987 report, which report he had inadvertently learned of at the first trial. However, the trial court prohibited Lowman from introducing evidence of damages to reputation and denied his motion to amend his complaint to allege fraud. The case was heard by the court without a jury, based on the previous trial transcript, but permitting Lowman to make an offer of proof to support his claim for damages to his reputation. The trial court found in favor of ADS on its suit on account.

Lowman now appeals, contending that based on the new evidence offered on remand, he should have been allowed to assert a claim for damages to his reputation and a claim for fraud. Held:

The "law of the case" rule controls the issue in this appeal. The "law of the case" rule, though formally abolished, still applies to rulings by one of our appellate courts in a particular case; such rulings are binding in all subsequent proceedings in the same matter, including a second trial. McLean v. Continental Wingate Co., 222 Ga.App. 805, 806, 476 S.E.2d 83; Continental Corp. v. Dept. of Transp., 185 Ga.App. 792, 793, 366 S.E.2d 160. An exception to this rule exists where the evidentiary posture of the case changes after remand by the appellate court. See May v. Macioce, 200 Ga.App. 542, 544, 409 S.E.2d 45. The evidentiary posture may change when a new issue not previously addressed by an appellate court is properly raised, or when the original evidence is insufficient but is later supplemented. McLean, supra at 807, 476 S.E.2d 83; MOM Corp. v. Chattahoochee Bank, 203 Ga.App. 847, 418 S.E.2d 74.

The posture of the evidence has not changed in this case so as to permit appellant to relitigate issues already decided by this Court. The 1987 report...