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Next Week at the Court

April 18, 2014

On Monday, April 21, 2014, the Supreme Court of Georgia will hear argument in four cases, three of which are within the scope of our coverage. Summaries of the cases being argued are below.

The Court will also be releasing opinions in 17 cases on Tuesday morning, April 22, but none of the opinions are within the scope of our coverage.

Monday, April 21, 2014 10:00 am Sitting

S14Q0454 Federal Deposit Ins. Corp. v. Loudermilk et al.

This case began when the Buckhead Community Bank failed. Beginning in 2005, the Bank pursued an aggressive growth strategy, increasing its loan portfolio by 240% over the next two years, mostly in high-risk real estate and construction loans. The bank failed in December 2009 and the FDIC took over as the receiver. The FDIC then sued nine former officers and directors in federal court, alleging they were negligent and grossly negligent in violating the Bank’s loan policies, which resulted in $21.8 million in damage to the Bank. The former officers and directors moved to dismiss, arguing the business judgment rule protected them as directors and officers from claims of ordinary negligence. The federal court denied the motion without prejudice, but said it would certify the unsettled question of Georgia law.

The Northern District of Georgia certified the following question to the Supreme Court along with its order on the motion to dismiss:

  1. Does the business judgment rule in Georgia preclude as a matter of law a claim for ordinary negligence against the officers and directors of a bank in a lawsuit brought by the FDIC as receiver for the bank?

The case will be heard on April 21, 2014.

S13G1711 Lafarge Building Materials, Inc. v. Thompson

This case involves a dispute over a personal guaranty on a debt. In 2007, the company Thompson owned applied for a line of credit from LaFarge to purchase building supplies. Thompson filled out the application paperwork for his company to obtain credit, including signing a Continuing Guaranty section titled “Signature of Individual Guarantor.” Thompson’s company failed to pay more than $53,000 and LaFarge sued. The trial court granted summary judgment to LaFarge finding, among other things, that Thompson’s signature constituted a personal guaranty. The trial court then entered a judgment of $105,147 and Thompson appealed.

The Court of Appeals reversed the trial court in a 5-2 decision (Doyle, Phipps, Ellington, McFadden concurring; Barnes concurring in judgment only; Boggs and Branch dissenting). Writing for the majority, Judge Doyle explained that the Continuing Guaranty section did not sufficiently incorporate the rest of the application because it did not define who the Applicant was. The majority said this outcome was dictated by its prior decision in another case, LaFarge v. Pratt. Because there was no name of the principal debtor, the Statute of Frauds was not satisfied. In dissent, Judge Boggs would have found the guaranty satisfied the Statute of Frauds because there was only an ambiguity in the name of the Applicant, which could be solved through parol evidence.

On January 6, 2014, the Supreme Court of Georgia unanimously granted the petition for certiorari to review the following question:

  1. Did the Court of Appeals err in holding that the guaranty agreement at issue here did not identify the principal debtor with sufficient specificity to satisfy the Statute of Frauds? Compare Capital Color Printing, Inc. v. Ahern, 291 Ga. App. 101 (661 SE2d 578) (1) (2008), with LaFarge Building Materials, Inc. v. Pratt, 307 Ga. App. 767 (706 SE2d 131) (1) (2011).

The case will be heard on April 21, 2014.

S14A0620 Barzey v. City of Cuthbert

This case began when Deron Shorter was killed in 2010 while operating a mower for the City of Cuthbert. Shorter was not married and did not have any dependents, so the City denied his mother’s claim for his death benefit under the Worker’s Compensation Act. Barzey sued, claiming the statute’s limitations on death benefits to dependents (instead of heirs) violates the Equal Protection clause. The trial court granted summary judgment to the City and Barzey appealed.

The case will be heard on April 21, 2014.

Forthcoming Opinions

April 18, 2014
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On Tuesday, April 22, 2014, the Supreme Court will release opinions in 17 cases, none of which are within the scope of our coverage. The Court will also hear oral argument on Monday morning.

This Week at the Court

April 17, 2014

The Supreme Court of Georgia did not release any new opinions this week and is changing its usual argument schedule for this week. On Friday, the Court will hear argument on two cases at the Springer Opera House in Columbus, Georgia. One of the case is within the scope of our coverage and is summarized below.

Friday April 18, 2014 Special 10:00 am Sitting

S13G1843 Ambling Management Co., LLC et al. v. MillerS13G1852 City Views at Rosa Burney Park GP, LLC et al. v. Miller

This case began when Tramaine Miller arrived at City Views apartments to assist his disabled aunt with her medications. After parking in a handicapped space without the proper permit, Miller was approached by an off-duty police officer working security at the complex. When Miller failed to heed the officers’ instructions and placed what the officer believed was drugs in his mouth, the officer broke the window of the vehicle. The officer testified that he saw Miller reach for what the officer believed was a weapon and so he fired, hitting Miller in the face. Miller sued the apartment complex, the management company, the off-duty officer, and the apartment manager. The trial court granted summary judgment to the apartment complex on the issues of vicarious liability; negligent hiring, retention, entrustment, and supervision; premises liability; and punitive damages. Miller appealed.

A seven-judge panel of the Court of Appeals affirmed in part and reversed in part in a 5-2 vote (Doyle, Phipps, Barnes, Ellington, McFadden; Boggs and Branch, concurring in part and dissenting in part). Writing for the Court of Appeals majority, Judge Doyle explained that the trial court first improperly granted summary judgment on the vicarious liability issue. Liability for the torts of an off-duty officer does not automatically attach to the private company, because the officer may be exercising functions for the public at the time. Because there was some evidence supporting a finding that the officer was performing a security function instead of a police function prior to the shooting, the trial court should not have granted summary judgment. Because the vicarious liability portion of the case remains active, the majority found the trial court’s finding on punitive damages must be reversed as well. But the majority also found the trial court correctly determined that summary judgment was proper regarding Miller’s premises liability claim. Judges Boggs and Branch would have affirmed the trial court decision on the vicarious liability and punitive damages issues because the undisputed testimony showed the officer was trying to arrest Miller when he was shot.

On January 27, 2014, the Supreme Court of Georgia granted the petitions for certiorari in a 5-2 vote (Benham and Hunstein dissenting) to consider the following question:

  1. Did the Court of Appeals’s majority opinion err in focusing on the evidence of whether Officer Fisher was performing police duties not directed by his private employer at the time he approached and engaged Miller, instead of at the time the alleged causes of action arose?

The cases will be heard on April 18, 2014.

Next Week at the Court

April 4, 2014

On Monday, April 7, 2014, the Supreme Court returns for the first of three days of argument scheduled for April. Summaries of the cases within the scope of our coverage being argued are below.

Monday, April 7, 2014 10:00 am Sitting

S13G1812 Metropolitan Atlanta Rapid Transit Authority v. Reid

The case began when Reid was injured while an employee of MARTA in October 1999. Reid timely filed for worker’s compensation benefits and MARTA made 32 payments to him based on his temporary total disability before he was able to return to work in 2002. But 12 of those 32 payments were untimely or late based on the worker’s compensation statute. Reid did not raise any issues at the time. In 2010, Reid’s attorney requested MARTA pay the statutory penalty of 15% for each of the 12 late payments. MARTA refused, saying the demand was barred by the statute of limitations. Reid then filed a hearing request with the State Board, which denied the request. The Appellate Division of the State Board affirmed the denial, as did the Fulton County Superior Court. Reid filed an application for discretionary appeal, which the Court of Appeals granted.

The Court of Appeals (Branch and Ellington; Phipps concurring in judgment only) unanimously reversed the superior court decision, finding that the request was not a request for additional benefits resulting from a “change in condition.” That kind of request would be barred by the two-year statute of limitations contained in the worker’s compensation statute. Reid’s request was not a change in condition because it was not a change in status. In addition, the request is based on the initial claim for benefits, not a modification of a prior decision. As a result, the only statute of limitation which is relevant is the general statute on filing an initial claim, which was met because his claim was timely filed originally.

On January 6, 2014, the Supreme Court unanimously granted the petition for certiorari to consider the following question:

  1. Did the Court of Appeals err in holding that the proper statute of limitations for a claim of statutory penalties for late benefits payments in workers’ compensation cases under OCGA § 34-9-221 is the general statute of limitations, OCGA § 34-9-82, rather than OCGA § 34-9-104 (b), the change in condition statute of limitations?

The Court will hear oral argument on the case on April 7, 2014.

S14A0728 Jansen-Nichols v. Kinder Morgan Southeast Terminals, LLC et al.

This case involves helicopter flights over the home of Ms. Jansen-Nichols. Ms. Jansen-Nichols owns a house across the street from two of Colonial Pipeline’s pipes that carry gasoline and diesel fuel. Colonial owns easements that allow it to construct, operate, and repair the pipelines. On two occasions in May and June 2013, Colonial’s leak detection systems triggered and Colonial dispatched an inspector in a helicopter to visually inspect the pipeline. Ms. Jansen-Nichols claimed that the helicopters hovered low over her house, causing alarm to those inside. The inspector and pilots testified that helicopters flew at an altitude of 150 feet, staying along the edge of the easement for the length of the line. The trial court denied Ms. Jansen-Nichols’ motion for a preliminary injunction and she appealed.

The case will be heard on April 7, 2014.

Monday, April 7, 2014 2:00 pm Sitting

S14A0631 Selke et al. v. Carson et al.

This case involves the termination of sheriff’s deputies in Forsyth County. In February 2013, the Forsyth County sheriff terminated 11 deputies as part of a reduction in force. The deputies claimed their termination was based on political retaliation and age discrimination. The deputies attempted to appeal their terminations, but the sheriff and personnel services director both denied the requests. The deputies then brought a mandamus action to seek to compel the personnel services director to forward their appeals to the county’s civil service board. The trial court denied that request and granted the state’s motion to dismiss and the deputies appealed.

The case will be heard on April 7, 2014.

No Forthcoming Opinions

April 4, 2014
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The Supreme Court of Georgia will not be releasing any new opinions on Monday, but will be hearing argument in a number of cases.

Released Opinions

March 29, 2014
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The Supreme Court of Georgia completed the January term on Friday, when the Court released opinions in 14 cases. Three of those cases are within the scope of our coverage and the issues and opinions are summarized below. Unfortunately the practice of law prevented us from posting on Friday and we apologize for the delay.

S13A1650 Danforth v. Apple Inc.

This case involves the use of Georgia’s workplace violence statute against a former employee of the Apple store at Lenox Square Mall in Atlanta. Catherine Danforth began working at the Apple Store in August 2011 after having been diagnosed with a variety of different mental illnesses over the course of her life. After working at the store for a year, Apple fired Danforth for inappropriate verbal outbursts and displays of extreme emotion in front of customers. Several months after firing Danforth, Apple sought an injunction under Georgia’s workplace violence prevention statute (OCGA 34-1-7), claiming that Danforth was stalking its employees, sending long emails, leaving disturbing voicemails, and showing up at the store despite being asked not to do so. Following a hearing, a Cobb County Superior Court judge issued a permanent injunction prohibiting Danforth from entering any Apple store for a period of three years or having any contact with Apple employees. Danforth appealed.

The case was heard on November 19, 2013.

On March 28, 2014, the Supreme Court unanimously affirmed in part and vacated in part. Writing for the Court, Justice Nahmias explained that the evidence was sufficient to support an injunction under the workplace violence statute, but the scope of the injunction was too broad. Instead of being limited to Apple stores and the specific employees involved, it also prohibited communication with anyone in the world who is an Apple employee even if Danforth was unaware of the connection to Apple. Thus, while the Court affirmed the injunction order to the extent it involved Apple employees and the specific location, it vacated the injunction and remanded to the trial court to enter an order with a more limited scope.

S13G1709 England, Executrix v. Simmons et al.

This case involves the proper allocation of property in a will. (While we would not typically cover estate cases, this case involves the jurisdiction of the Supreme Court and thus is within our coverage.) Robert Haege operated a business, was unmarried, and had no children. In his will, he gave personal assets to his brother and sister, but gave business interests to several of his employees. Two employees filed a declaratory judgment action to clarify whether they were entitled to the business property. The superior court found that Haege was a sole proprietor of his business and that, as a result, all of the property used in his business was personal property. Thus, the superior court found there was no business property to give to the employees from Haege’s estate.

The employees appealed to the Supreme Court because it has exclusive jurisdiction in “all cases involving wills” under the Georgia Constitution. But the Supreme Court transferred the case to the Court of Appeals because the question on appeal was whether the estate contained “business property.”

The Court of Appeals then reversed the trial court in a 5-2 decision (McFadden, Phipps, Barnes, Ellington reversing; Doyle concurring in the judgment only; Boggs and Branch dissenting), finding that every part of the will had to be given meaning. As a result, the Court of Appeals remanded the case for the superior court to identify what assets were Haege’s business interests so that the sentence regarding Haege’s business interests could be given meaning. Judge Boggs in dissent would have found that no business property existed because it was not possible as a matter of law to distinguish between Haege and the business.

The Court of Appeals majority stated that it had jurisdiction to construe the terms of the will because it has the ability to determine issues that are “merely ancillary” to issues within the Supreme Court’s general appellate jurisdiction, and failing to decide the meaning of the will would undermine the Supreme Court’s transfer order. In dissent, Judge Boggs stated the Supreme Court already determined that the appeal did not require a construction of the will, but merely a determination whether any property existed for the bequests to transfer.

On November 14, 2013, the Supreme Court unanimously granted the petition for certiorari to review the following issues:

  1. Did the Court of Appeals err in deciding issues that are exclusively within the jurisdiction of this Court?
  2. Did the Court of Appeals err in finding that the decedent’s estate included business property to be distributed to the appellants pursuant to the decedent’s will?

The case was heard on February 17, 2014.

On March 28, 2014, the Supreme Court unanimously affirmed the decision of the Court of Appeals. Writing for the Court, Justice Blackwell explained that the most natural and reasonable understanding of the will’s provisions was that personal property connected to the business was to to be distributed to the appellants. The Court of Appeals was also correct in finding that the precise identification of the property amounting to business interests was for the factfinder.

S14A0114 Fulton County et al. v. City of Sandy Springs et al.

This case is a dispute between Fulton County and Sandy Springs about which government is responsible for maintaining stormwater detention ponds. In the 1970s, Fulton County obtained easements to construct and maintain two detention ponds to address surface flooding issues for homeowners. The County constructed the detention ponds inside what became the city limits of Sandy Springs in 2005. After Sandy Springs was incorporated, the city and County never signed an intergovernmental agreement regarding stormwater management. In 2009, Sandy Springs notified Fulton County that there were problems with the detention ponds that the County needed to address. Fulton County did not respond and Sandy Springs sued, seeking a writ of mandamus. The trial court determined that Fulton County was responsible for maintaining the ponds. The County appealed to the Supreme Court.

The case was heard on January 6, 2014.

On March 28, 2014, the Supreme Court affirmed in part and reversed in part in a 6-1 vote (Benham, dissenting). Writing for the Court, Justice Melton explained that Fulton County holds the easements and has responsibility to maintain them for as long as it holds them. Fulton County is not prohibited by the constitution or statutes relating to new cities from maintaining the easements, but is only responsible for the easements are transferred or terminated. Writing in dissent, Justice Benham would have found Fulton County was constitutionally prohibited from maintaining the easements.

Forthcoming Opinions – End of Distress in Sight

March 26, 2014
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As the Supreme Court of Georgia completes its distress period ahead of the end of the January term, the Court announced today it will release opinions in 14 cases on Friday, March 28, 2014 at noon. Three of those cases are within the scope of our coverage and are summarized below. We will update on Friday with links to the opinions.

S13A1650 Danforth v. Apple Inc.

This case involves the use of Georgia’s workplace violence statute against a former employee of the Apple store at Lenox Square Mall in Atlanta. Catherine Danforth began working at the Apple Store in August 2011 after having been diagnosed with a variety of different mental illnesses over the course of her life. After working at the store for a year, Apple fired Danforth for inappropriate verbal outbursts and displays of extreme emotion in front of customers. Several months after firing Danforth, Apple sought an injunction under Georgia’s workplace violence prevention statute (OCGA 34-1-7), claiming that Danforth was stalking its employees, sending long emails, leaving disturbing voicemails, and showing up at the store despite being asked not to do so. Following a hearing, a Cobb County Superior Court judge issued a permanent injunction prohibiting Danforth from entering any Apple store for a period of three years or having any contact with Apple employees. Danforth appealed.

The case was heard on November 19, 2013.

S13G1709 England, Executrix v. Simmons et al.

This case involves the proper allocation of property in a will. (While we would not typically cover estate cases, this case involves the jurisdiction of the Supreme Court and thus is within our coverage.) Robert Haege operated a business, was unmarried, and had no children. In his will, he gave personal assets to his brother and sister, but gave business interests to several of his employees. Two employees filed a declaratory judgment action to clarify whether they were entitled to the business property. The superior court found that Haege was a sole proprietor of his business and that, as a result, all of the property used in his business was personal property. Thus, the superior court found there was no business property to give to the employees from Haege’s estate.

The employees appealed to the Supreme Court because it has exclusive jurisdiction in “all cases involving wills” under the Georgia Constitution. But the Supreme Court transferred the case to the Court of Appeals because the question on appeal was whether the estate contained “business property.”

The Court of Appeals then reversed the trial court in a 5-2 decision (McFadden, Phipps, Barnes, Ellington reversing; Doyle concurring in the judgment only; Boggs and Branch dissenting), finding that every part of the will had to be given meaning. As a result, the Court of Appeals remanded the case for the superior court to identify what assets were Haege’s business interests so that the sentence regarding Haege’s business interests could be given meaning. Judge Boggs in dissent would have found that no business property existed because it was not possible as a matter of law to distinguish between Haege and the business.

The Court of Appeals majority stated that it had jurisdiction to construe the terms of the will because it has the ability to determine issues that are “merely ancillary” to issues within the Supreme Court’s general appellate jurisdiction, and failing to decide the meaning of the will would undermine the Supreme Court’s transfer order. In dissent, Judge Boggs stated the Supreme Court already determined that the appeal did not require a construction of the will, but merely a determination whether any property existed for the bequests to transfer.

On November 14, 2013, the Supreme Court unanimously granted the petition for certiorari to review the following issues:

  1. Did the Court of Appeals err in deciding issues that are exclusively within the jurisdiction of this Court?
  2. Did the Court of Appeals err in finding that the decedent’s estate included business property to be distributed to the appellants pursuant to the decedent’s will?

The case was heard on February 17, 2014.

S14A0114 Fulton County et al. v. City of Sandy Springs et al.

This case is a dispute between Fulton County and Sandy Springs about which government is responsible for maintaining stormwater detention ponds. In the 1970s, Fulton County obtained easements to construct and maintain two detention ponds to address surface flooding issues for homeowners. The County constructed the detention ponds inside what became the city limits of Sandy Springs in 2005. After Sandy Springs was incorporated, the city and County never signed an intergovernmental agreement regarding stormwater management. In 2009, Sandy Springs notified Fulton County that there were problems with the detention ponds that the County needed to address. Fulton County did not respond and Sandy Springs sued, seeking a writ of mandamus. The trial court determined that Fulton County was responsible for maintaining the ponds. The County appealed to the Supreme Court.

The case was heard on January 6, 2014.

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