TAI Computer, Inc. v. CLN ENTERPRISES

• Citation: 516 S.E.2d 340,237 Ga. App. 646
• Decision Date: 13 April 1999
• Docket Number: No. A99A0486.,A99A0486.
• Parties: T.A.I. COMPUTER, INC. v. CLN ENTERPRISES, INC.
• Court: United States Court of Appeals (Georgia)

516 S.E.2d 340

237 Ga. App. 646

T.A.I. COMPUTER, INC. v. CLN ENTERPRISES, INC.

No. A99A0486.

Court of Appeals of Georgia.

April 13, 1999.

Mark P. Groves, Marietta, for appellant.

Isenberg & Hewitt, Melvin L. Hewitt, Jr., Atlanta, for appellee.

BLACKBURN, Presiding Judge.

T.A.I. Computer, Inc. appeals from the trial court's denial of its motion to set aside the default judgment entered in favor of CLN Enterprises, Inc. and its motion for new trial. T.A.I. Computer contends the trial court erred by: (1) awarding damages without holding a hearing in violation of OCGA § 9-11-55(a) because the alleged damages were unliquidated; (2) refusing to set aside the judgment although T.A.I. Computer was wrongly named as defendant; (3) granting default judgment when T.A.I. Computer lacked notice; and (4) granting default judgment although CLN Enterprises did not comply with Uniform Superior Court Rule 15. For the reasons discussed below, we reverse in part, affirm in part and remand the case to the trial court.

CLN Enterprises is a computer company which purchased computer products from T.A.I. Computer, a computer products distributor. On November 18, 1997, CLN Enterprises filed suit against T.A.I. Computer asserting counts in conversion, quantum meruit, and bad faith. CLN Enterprises alleged that T.A.I. Computer failed to refund the $20,287.30 it had paid for returned items. T.A.I. Computer failed to answer the suit, and on February 2, 1998 CLN Enterprises moved for the entry of default judgment. Attached to the motion was an affidavit in support of CLN Enterprises' claim for attorney fees.

The trial court determined that the damages were liquidated and entered judgment against T.A.I. Computer in the amount of $23,977.37, which included the principal sum, pre-judgment interest, costs and attorney fees. T.A.I. Computer filed motions to set aside the judgment, to open default, and for a new trial. The trial court denied the motions. "A trial court's decision regarding a motion to set aside a judgment will not be reversed absent a showing of manifest abuse of discretion." Kent v. State Farm Mut. Auto. Ins. Co., 233 Ga.App. 564, 566(2), 504 S.E.2d 710 (1998).

1. (a) T.A.I. Computer contends the trial court erred in holding the damages were liquidated and in entering judgment against it for damages without a trial and proof of damages.

If [a] case is still in default after the expiration of the period of 15 days, the plaintiff at any time thereafter shall be entitled to verdict and judgment by default, in open court or in chambers, as if every item and paragraph of the complaint or other original pleading were supported by proper evidence ... unless the action... involves unliquidated damages, in which event the plaintiff shall be required to introduce evidence and establish the amount of damages before the court without a jury, with the right of the defendant to introduce evidence as to damages and the right of either to move for a new trial in respect of such damages.

OCGA § 9-11-55(a).

Damages are liquidated when they are

an amount certain and fixed, either by the act and agreement of the parties, or by operation of law; a sum which cannot be changed by the proof; it is so much or nothing; and that the term does not necessarily refer to a writing: an open account is the reverse of this.

(Punctuation omitted.) Sellers v. Nodvin, 207 Ga.App. 742, 746(3), 429 S.E.2d 138 (1993). On a motion for default judgment, the amount of damages must be ascertainable from the pleadings. Hazlett &c. Constr. Co. v. Virgil Womack Constr. Co., 181 Ga. App. 25, 26(2), 351 S.E.2d 218 (1986); Sellers, supra.

Here, the complaint alleged that CLN Enterprises had purchased computer equipment from T.A.I. Computer, that CLN Enterprises returned the equipment, that T.A.I. Computer wrongfully failed to refund the purchase price, and that the amount to be refunded totaled $20,287.30. However, the invoices or agreements from which the amount of damage was derived were not attached to the complaint and incorporated therein. Thus CLN Enterprises did not establish with certainty the amount of the obligation as the law requires. See Hazlett &c. Constr. Co., supra. Compare Henry v. Adair Realty Co., 141 Ga.App. 182, 183(1), 233 S.E.2d 39 (1977) (damages were liquidated where the complaint alleged facts from which damages could be determined by simple mathematical calculation). Consequently, the damages are unliquidated for the purposes of OCGA § 9-11-55(a).

The fact of the default alone did not convert the damages into a liquidated claim. The conclusory allegations of the amount owed were not sufficient to render the damages liquidated. Otherwise every case where a specific amount is stated in the complaint as due and owing would be turned into a liquidated amount by the default, and the Code section's provision for trial as to damages involving unliquidated amounts in contract cases would rarely if ever occur. Accordingly, the trial court's determination that the damages alleged were liquidated was erroneous.

(Citations and punctuation omitted.) Sellers, supra at 746-747, 429 S.E.2d 138. This case must be remanded for a determination of the amount of damages by the trial court.

(b) T.A.I. Computer also contends the trial court erred by awarding attorney fees based solely on the affidavit of the attorney for CLN Enterprises. As the issue may be raised on remand, we want to make clear that on default judgment an award of attorney fees which is based solely on an affidavit is not necessarily erroneous, so long as the affidavit meets the requisite level of proof. See Oden v. Legacy Ford-Mercury, 222 Ga. App. 666, 668(2), 476 S.E.2d 43 (1996). Here, counsel had the requisite personal knowledge to testify to the hours he personally worked and the rate he charged. However, the testimony regarding the tasks performed lacks sufficient particularity. "While a factfinder may...