Nayani v. Hassanali, A21A1509

CourtUnited States Court of Appeals (Georgia)
Writing for the CourtMcFadden, Presiding Judge.
Citation868 S.E.2d 465,362 Ga.App. 313
Decision Date20 January 2022
Docket NumberA21A1509
Parties NAYANI v. HASSANALI et al.

362 Ga.App. 313
868 S.E.2d 465

NAYANI
v.
HASSANALI et al.

A21A1509

Court of Appeals of Georgia.

January 20, 2022


868 S.E.2d 467

Yasha Heidari, Yenniffer Steffany Delgado, Norcross, for Appellant.

Matthew Tyson Parrish, Heather Huggins Sharp, Atlanta, for Appellee.

McFadden, Presiding Judge.

362 Ga.App. 313

Kamal Nayani appeals from the order granting partial summary judgment to the defendants in his lawsuit alleging, among other things, that Amina Hassanali committed fraud to induce him to purchase shares in her professional corporation, Amina Medical Consultant, P.C. We hold that Nayani may not pursue his claims

362 Ga.App. 314

because his contract to purchase shares in the professional corporation is void. So we affirm.

1. Factual and procedural background.

"Summary judgment is proper ‘if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.’ OCGA § 9-11-56 (c)." Cowart v. Widener , 287 Ga. 622, 623 (1) (a), 697 S.E.2d 779 (2010). "On appeal from the denial or grant of summary judgment, the appellate court must conduct a de novo review of the evidence to determine whether there exists a genuine issue of material fact, and whether the undisputed facts, viewed in the light most favorable to the nonmoving party, warrant judgment as a matter of law." Newstrom v. Auto-Owners Ins. Co. , 343 Ga. App. 576, 577 (1), 807 S.E.2d 501 (2017) (citation and punctuation omitted).

So viewed, the record shows that Hassanali is a primary care physician. In 1999 or 2000, she organized a professional corporation, Amina Medical Consultant, P.C., to practice medicine. In April 2018 Nayani and his wife approached Hassanali about entering a partnership. The three agreed that Hassanali would sell Nayani a 40 percent ownership interest in her professional corporation and that she would retain a 60 percent ownership interest.

On May 4, 2018, Nayani, Hassanali, Amina Medical Consultant, and Hassanali's company Amina Property, LLC, the medical practice's landlord, entered an agreement for the sale of shares in and the management of Amina Medical Consultant. Nayani had given the terms to an attorney, who drafted the agreement. Hassanali did not have her own attorney.

Under the agreement, Hassanali sold Nayani 40 percent of the professional corporation for $20,000. The agreement provided that Hassanali would become the medical director of the practice with a salary of $8,000 per month, pro rated should she work more or

868 S.E.2d 468

fewer than 13 shifts per month, and that Nayani would become the managing director of the practice, with a salary of $6,000 per month. The agreement further provided that Hassanali would receive 60 percent of the profits and Nayani would receive 40 percent of the profits.

The parties amended the agreement in November 2018 and again in January 2019.

It was not long before Hassanali regretted entering the agreement and decided that she was not going to follow it. In January 2019, Hassanali told Nayani and his wife that if the practice did not show a profit within the next two months, she would take back the management of the practice.

362 Ga.App. 315

Hassanali took over in April 2019, instructing her staff no longer to give patient bills to Nayani for processing. She changed the locks on the business because Nayani and his wife had removed from the premises the keys to the cash box and the mailbox. She also removed Nayani's access to the business's checking account.

On April 30, 2019, Nayani filed the complaint against Hassanali, Amina Medical Consultant, and Amina Property. He asserted claims of fraud and breach of contract against Hassanali and Amina Property; a claim of breach of fiduciary duty against Hassanali; a demand for an accounting against all three defendants; and a claim for the judicial dissolution of Amina Medical Consultant.

Hassanali and Amina Property moved for partial summary judgment. The trial court granted summary judgment to the defendants on Nayani's claims for fraud against Hassanali and Amina Property; breach of contract against Amina Property; breach of fiduciary duty against Hassanali; an accounting as to all defendants; and judicial dissolution of Amina Medical Consultant. Nayani filed this appeal; he does not challenge the grant of summary judgment on his fraud claim against Amina Property.

We hold that the agreement for the purchase of shares in the professional corporation is void because it violates Georgia law. And because the agreement is void, Nayani cannot pursue his claims. So we affirm.

2. Law of professional corporations.

Under the Georgia Professional Corporation Act, OCGA §§ 14-7-1 through 14-7-7, "[s]hares in a professional corporation may only be issued to, held by, or transferred to a person who is licensed to practice the profession for which the corporation is organized and who, unless disabled, is actively engaged in such practice as an active practicing member of the issuing corporation...." OCGA § 14-7-5 (a). So the agreement at issue — which was founded on a promise to transfer shares in Amina Medical Consultant, a professional corporation for the practice of medicine, to Nayani, who is not licensed to practice medicine — violates OCGA § 14-7-5 (a).

[W]here a statute provides that persons proposing to engage in a certain business shall procure a license before being authorized to do so, and where it appears from the terms of the statute that it was enacted not merely as a revenue measure but was intended as a regulation of such business in the interest of the public, contracts made in violation of such statute are void and unenforceable. Where a statute enacts, for the purpose of securing a more effectual compliance with its requirements in respect to the licensing
362 Ga.App. 316
of certain occupations, that no one shall engage in or carry on any such occupation until he shall have obtained the license as provided by law, it is an express prohibition without more particular words.

Moore v. Dixon , 264 Ga. 797, 799-800 (2), 452 S.E.2d 484 (1994) (citations and punctuation omitted). Accord Ga. Cent. Credit Union v. Weems , 157 Ga. App. 439, 440 (1), 278 S.E.2d 88 (1981). See also OCGA § 13-8-1 ("A contract to do an ... illegal thing is void."). In other words, a contract that is only permitted to be entered into by a person holding a license issued as a regulatory measure is void if the person did not hold such a license at the time the...

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