WHOLE COURT

N O T IC E : M otions for re c ons i de r a tion m us t be

phy s ic a lly re ce iv e d in our cle r k’s off i c e w ithin te n

da y s of the da te of de c is ion to be de e m ed tim e ly file d.

http://w w w .ga a ppe a l s .us /r ule s

M ar ch 30, 2016



# I n th e Co u r t o f

A p p eals o f

G eo r g ia

A1 5 A1 83 0 , A1 5 A1 8 31 . W EST ASSET MANAGEM ENT, INC. v

. NW PARKW AY, LLC; an d v i ce v ers a. J E-0 8 7

, J E0 8 8

E LLI N G T O N , Pres i d i n g J ud g e.

NW Park w ay

, L LC, b ro u g h t t h i s act i o n i n t h e Su p eri o r Co u rt o f Co b b Co u n t y

ag ai n s t W es t As s et M an ag em en t

, In c. fo r cl ai m s ari s in g fro m a co m m erci al p ro p ert y

l eas e ag reem en t

. W es t fi l ed co un t ercl ai m s ari s i n g o u t o f t h e s am e l eas e. Bo t h p art i es

m o ved fo r s u m

m ary ju d g m en t, wh i ch t h e t ri al co u rt g ran ted in p art an d d en i ed i n p art

.

In Cas e N o

. A 1 5 A1 83 0

, W es t As s et ap p eal s th e tri al co urt ’ s ru l i ng s in v ari ou s

res p ect s

, an d i n Cas e No

. A1 5 A1 8 3 1, NW Park way cro s s

- ap p eal s

. Fo r t he reas on s

ex p lai n ed b el o w , we affi rm i n p art an d rev ers e i n p art

.

S um m ary ju dg m en t i s p ro per “ i f t h e p l ead i n g s

, dep o si t io n s, an s w e r s t o

i n t erro g at o ri es

, an d ad m i s s io ns o n fi le, to g et h er wi t h t he affi d av i t s

, i f an y

, s h o w t h att h ere i s no g en u in e i s s ue as t o an y m at eri al fact an d t h at t he m ov i n g p art y i s en t i t l ed

t o ju d g m en t as a m at t er o f l aw[.] ” OCGA § 9 -1 1-5 6 (c).

Su m m ary ju d g m en t s en

jo y n o p res u m

pt i o n o f co rrect ne ss on ap p eal

, an d

an ap p el l at e co u rt m

u s t s at i sfy i t s el f d e n ov o th at th e req ui rem en t s o f

OCGA § 9-1 1-5 6 (c) h av e b een m et

. In o u r d e n o v o rev i ew o f th e g ran t

[o r d en ial ] o f a m o t i o n fo r s u m m ary ju d g m en t

, we m

u s t v i ew th e

ev i d en ce, an d al l reas o n ab l e i n feren ces d rawn th erefro m

, i n t h e l i g h t

m o s t fav o rab le t o t h e n o n m o v an t

.

(Ci t at i o n s an d p u n ct u at i o n o m i t t ed

. ) Co wa r t v

. W i d e n e r

, 2 8 7 Ga. 6 2 2

, 6 2 4 (1 ) (a)

(6 9 7 SE2 d 7 79 ) (2 0 1 0 ). W h en

, as in t h i s cas e, t h e p art i es fi l e cro s s -m o ti o n s f o r

s u m m ary ju d g m en t

, “ each p art y m us t s h ow [t hat ] t h ere i s no g en u i ne i ss u e o f m at eri al

fact reg ard i n g t he res o l u ti o n o f [t h e es s en ti al ] p o i n ts of i n q ui ry an d th at each

,

res p ect i vel y

, i s en t i t l ed to s u m m ary ju d gm en t ; ei t h er p art y

, to p rev ai l b y s u m m ary

ju d g m en t

, m

u st b ear i t s b u rd en o f p ro o f.” Mo r g an En t er p r i s es

, In c. v. G o r d

o n Gi l l et t

Bu s in es s Rea l t

y

, 1 9 6 Ga. Ap p

. 1 1 2 (3 9 5 SE2 d 3 0 3 ) ( 1 9 9 0 ). See al s o W el l s Fa rg o

B a n k v. Twen t

y S i x Pr op er t ies

, LLC

, 3 2 5 Ga. A p p

. 6 6 2 (7 5 4 SE2 d 6 3 0) ( 2 0 1 4 )

(acco rd ). A g ran t o f su m

m ary ju d g m en t m

u s t b e affi rm ed i f i t i s ri g h t fo r an y reas o n,

i n cl u d i n g fo r an al t ern at e g ro u n d t h at t h e t ri al co u rt ch o s e n o t t o ad d res s i n g ran t i n g

s u m m ary ju d g m en t

, s o l o ng as t h e m o v an t rai s ed t h e i s s ue i n t h e t ri al co u rt an d t h e

2n o n m o v an t h ad a f a i r o p p o rt u n i ty t o res p o nd

. G eo r g ia -Pa ci f i c, LLC v. Fi el d

s

, 2 9 3 Ga.

4 9 9

, 5 0 4 (2 ) (7 4 8 SE2 d 4 0 7) (2 0 1 3 ); Ci t y o f Ga i n es vi ll e v. Do d

d

, 27 5 Ga. 83 4

, 8 3 9

(5 7 3 SE2 d 36 9 ) (2 0 02 ); Ab el l er a v. W il l ia ms o n

, 2 7 4 Ga. 3 2 4

, 3 2 6 (2 ) (5 5 3 SE2 d 8 0 6 )

(2 0 0 1). Th e rel ev an t fact s t h at fo l l o w are u n d i s p u ted u n l es s o t h erwi s e n o t ed

.

On J ul y 20

, 2 0 0 4

, NW Park way

, as les s o r, an d W o rl d wi d e As s et M an ag em en t

,

LLC (“ W o rl d wi d e”), W es t ’ s p red eces s o r-i n -i n t eres t

, as l es s ee, ex ecu t ed t h e l eas e at

i s su e fo r 7 0 ,0 0 0 s q u are feet of offi ce s p ace fo r a 2 0 -y ear t erm fro m Au g u st 1

, 2 0 0 4,

t o J u l y 31

, 2 0 24

. Th e l eas e was a so -cal l ed “ t r i p l e n e t l eas e” 1 th at (i n “ Sp eci al

St i p u l at io n 3 ”) m ad e W es t res p o n s i b l e fo r “ al l ex p en s es fo r t h e en t i re p ro p ert y an d

b u i l d i n g [ ] of an y n at ure w h at s o ev er d u ri n g t h e t erm o f t h i s l eas e,” i n cl u d i n g p ro p ert y

t ax es

, ex cep t t hat N W P a r k way “ s h al l b e res p o ns i b l e fo r an y ex p en s e d i rect l y

as s o ci at ed wi t h an d act ual l y i n cu rred wi t h res p ect t o t he co ncret e wal l s

, co ncret e s l ab

,

an d fo u n dat i o n .” W es t “ ack n o wl ed g e[d ] th at t h e p rem i ses [were] i n g o o d o rd er an d

rep ai r” at t h e b eg i n ni n g o f t he l eas e an d s p eci fi cal ly ag reed t o m ai n t ai n th e p rem i s es

1 See Bl ack ’ s L aw Di ct i o n ary (1 0 t h ed

. 2 0 1 4 ) (A “ t ri pl e n et l e a s e ” o r

“ n et -n et -n et l eas e” i s o ne “ in wh i ch t h e l es see p ay s al l t h e e x p e n s e s

, i n cl u d i n g

m o rt g ag e i n t eres t an d am o rt izat i o n

, l eav i n g t h e l es s o r w i t h an am o un t free o f al l

cl ai m s .”).

3at i t s o wn ex p en se an d t o su rren d er th e p rem i s es at th e t erm i n at i o n o f t h e l eas e i n as

g o o d co n d i t i o n as recei v ed , n o rm al wear an d t ear ex cep ted

.

Th e co n t ract (i n “ Sp eci al St i p u l at io n 4 ”) al l o w ed We s t t h e o p t i o n o f

t e r m i nat in g t h e co nt ract at fi ve y ear i n t erv al s

, at t h e en d o f t h e fi ft h

, t en t h

, a n d

fi ft een t h y ears

, p ro v i d ed

, i n t er al i a, t h at

, “ fo r s ai d o pt i o n t o b e val i d an d effect i ve,

[W es t ] s h al l . . . n o t b e i n d efau l t u n d er an y o f t h e p ro v i s io n s o f t h i s l eas e” an d t h at

W es t sh al l “ p ro v i d e [NW Park w ay ] wi t h wri t ten no t i ce (9 0 ) d ay s in ad v an ce o f t h e

en d o f t h e [fi v e-y ear i n terv al ] .” In t h e e v e n t o f s u ch earl y t erm in at i o n

, th e l eas e

p ro v id ed t h at W es t wo u l d co nt i n u e t o pay ren t fo r an ad d i t i o n al s i x m o n t h s an d

v acat e t h e p rem i s es b y t he en d o f t h at p eri o d

. Th e fi rs t fi v e-y ear i nt erv al en d ed J u l y

3 1

, 20 0 9

, m ean i n g th at t h e co n tract req u i red W es t t o g i v e n o t i ce on o r b efo re M ay 2,

2 0 0 9 , t o ex erci s e t h e earl y -t erm i n at i o n o p t i o n , an d t o v acat e b y J an uary 3 1 , 2 0 10

.

In earl y 2 00 8

, NW Park way o b t ai n ed a p ro fes si on al in s p ect i o n t o d et erm i n e

wh et h er W es t w as m ai n t ai n i ng t h e p ro p ert y

. Th e i n s p ect o r n o t ed ev i d e n c e o f

i n effect i v e d rai n ag e an d s t an d i n g wat er i n areas o f t h e ro o f, as wel l as m u l t i p l e areas

t h at h ad b een rep eat ed l y p at ch ed b ut ap p eared l i k el y to l eak

. Th e i n s p ect o r

co n cl u d ed

, “ [b ] as ed o n t he n u m b er o f l ay ers o f p at ch i n g m at eri al an d t h e d et eri o rat ed

co n di t i o n o f t h e to p l ay er o f m an y p at ch es

, t h e ro o f i s d u e fo r rep l aci ng ” an d al s o

4reco m

m en d ed cert ai n ot h er rep ai rs

. Bas ed o n t h e i n s p ect or’ s rep o rt

, N W Park way

req u es t ed i n a l et t er d at ed Feb ru ary 2 7

, 2 0 0 8

, th at W es t “ co rrect t h e[ ] d efi ci en ci es ”

i n d i cat ed i n t he rep ort

, i n cl u d i n g b y rep l aci ng t he ro o f. In a l et t er d at ed J u n e 2

, 2 0 0 8,

W es t as s ert ed t h at it w as NW Park way ’ s s o le o b l i g at i o n t o rep l ace t h e ro o f an d t h at

W es t was o b l i gat ed o n l y t o m ai n t ai n t he ro o f i n as g o o d co n d i t i o n as recei v ed

. W es t

d i d n o t rep l ace t h e ro o f.

In a l et t er d at ed J u ly 1 0

, 2 0 0 8

, NW Park way no t i fi ed W es t th at i t was i n d efau l t

u n d er t h e l eas e fo r fai l u re “ t o perfo rm an d p ay fo r t he req u i red ro o f an d o t h er rep ai rs ”

a n d d em an d ed t hat W es t cu re th e d efau l t wi t h in t h i rt y d ay s

. Aft er t h i rt y d ays

, N W

Park way n ot i fi ed W es t t h at i t had fai l ed to cu re t h e d efau l t wi t h i n t he t i m e al l o wed

an d t h at i t h ad th erefo re l o s t i t s “ ab i l i ty to cu r e [i t s] d efau l t u n d er th e Leas e” an d

“ fo rfei t ed [i t s] ri gh t t o t erm in a t e t h e L eas e pri o r t o J u ly 3 1

, 20 2 4 u nd er Sp eci al

St i p u l at io n 4 [.] ” W h en NW Park way sen t i t s co n t ract o r t o t h e p ro pert y t o rep l ace t h e

ro o f an d p erfo rm o t h er rep ai rs

, W es t d en i ed t h e co n t ract o r acces s

. In a l et ter d at ed

Au g u s t 1 5 , 2 0 0 8 , W es t s t at ed :

No p erm i s si o n h a s b een g ran t ed t o NW Park way t o sen d a ro o fi n g

v en d o r t o t h e prem i s es

. Un l es s t h ere i s an ag reem en t t o t h e c o n t r ary

,

[NW Park way ] h as n o ri g h t t o en t er u p o n th e prem i ses ex cep t w i t h

p erm i s s io n o f [W es t]

. . . . As we h av e s t at ed

, W es t h as rep ai red th e ro ofs

5as ap p ro p ri at e du ri n g t h e l eas e t erm

, an d

, wi l l co nt in u e to d o s o

. If [NW

Park way ] rem ov es t h e ex i s t i n g ro o f s y s t em

, i t wi l l b e i m p o ss i b l e fo r

W es t t o m ak e rep ai rs

. It i s t h e t en an t ’ s ro l e u n d er t h e Leas e A g reem en t

t o es t ab li s h th e ty

p e o f rep ai rs wh i c h are ap p ro p ri at e fo r t h e ro o fs

, n o t

[NW Park way ’ s ] ro l e. If [t h e co n t ract or] at t em p t s t o en t er t h e prem i s es

,

i t w i l l b e t u rn ed away

.

In Oct o ber 2 0 0 8

, NW Park way f i l e d t h i s act i o n

, s eek i n g d am ag es an d an

em erg en cy res t rai n i n g o rd er t o co m pel W es t t o al l ow t h e rep l acem en t of t h e ro o f an d

o t h er n e c e s s a r y rep ai rs

. In N o vem b er 2 0 0 8

, th e t ri al co u rt g ran t ed NW Park way ’ s

req u es t fo r a TRO an d en j oi ned W es t fro m i n terferi ng wi t h NW Park way o r i t

co n tract ors fro m rep l aci n g t h e ro o f an d rep ai ri n g t h e ex t eri o r of t h e bu i l d i n g s

. As t h e

t ri al co u rt no t ed

, W es t cl ai m ed t h at t h e ro o f d i d n o t n eed t o be rep l aced

, referri n g to

an ev al u at i o n perfo rm ed b y a ro o fi n g co m p an y i t h ad en gag ed

, b u t fai led t o p res en t

t h at co m p an y ’ s rep o r t t o t h e co u rt

. Th e co u rt fo u n d t h at W es t h ad fai l ed t o ad d uce

an y ev i d en ce t o co nt rad i ct t h e ev i d en ce p res en t ed b y NW Park way t h at t h e ro o f

n eed ed t o b e rep laced

. Aft er t h e co u rt i s s ued t h e TRO, NW Park way ’ s c h o s en

co n tract or perfo rm ed t h e wo rk ; t he c o s t t o r e p l ace t h e ro o f an d rep ai r t h e p ro p ert y

was $ 3 84 ,2 2 6

. In Decem b er 2 0 0 8

, W es t a n s we r e d NW Park way ’ s co m p l ai n t an d

as s ert ed co u n t ercl ai m s fo r frau d

, neg l i g en ce, b reach o f co n t ract

, an d set o ff an d

6req u es t ed a d e c l a r at o ry ju d g m en t t h at i t was en t i t l ed t o ex erci s e i ts ri g ht t o earl y

t erm i n at i o n

.

On D e cem

ber 3 1, 2 0 08

, W es t s en t a l et t er “ t o co n s t i t u t e [i t s ] n o t i ce o f earl y

t erm i n at i o n ” p u rs u an t t o Sp eci al St i p u l at i o n 4

. By l et t er d at ed J an u ary 2 6

, 2 00 9

, NW

Park way “ reject ed ” W es t ’ s t erm i n at i o n o n t h e b as i s t h at W es t was “ i n b reach o f t h e

l eas e fo r fai l i ng t o p ay ex p e n s e s f o r t h e rep l acem en t o f t h e ro o f an d o th er rep ai r

ex p en s es [,] ” w h ich p ro h i b i t ed W es t “ fro m t erm in at i n g t h e l eas e as t h e res u l t o f s u ch

fai l u re. ” I n M arch 2 0 0 9

, W es t fi l ed a m o t i on fo r p art i al su m m ary ju d g m en t o n i t s

req u es t fo r a d ecl a r a t o r y ju d g m en t t h at i t w as en t i t l ed to ex erci se it s ri g h t t o earl y

t e rm i n at i o n. At t h e s am e t i m e, wh i l e m ai n t ai n in g i t s po s i ti o n t h at it wa s n o t

res p o n s i b l e fo r r e p l a c i n g t h e ro o f u nd er t he l eas e, W es t fi l ed a req u es t fo r l eav e to

p ay i n t o t h e reg i s t ry o f t h e co u rt t h e d is p u t e d a m o u n t

, $ 3 8 4 ,2 2 6

, w h i ch was t h e

am ou n t NW Park w ay sp en t t o rep lace t h e ro o f an d rep ai r t h e b u i l d i n g s’ ex t eri o rs

. In

i t s req u es t t o pay t h e fu n d s in t o t h e reg i s t ry o f t h e co u rt

, W es t st at ed t hat i t was

s eek i n g t o p res erv e i t s ri g h t t o t e r m i n at e th e l eas e at th e en d o f t he fi rs t fi v e-y ear

i n t erv al

. In Ap ri l 2 0 09

, N W P a r k wa y am en d ed i t s co m p lai n t

, s eek i n g $ 3 8 4 ,2 2 6 in

d am ag es fo r ro o f-rel at ed ex p en s es , am o n g o t h er rel i ef.

7Th e tri al co u rt h eard W es t ’ s m o t i o n fo r p art i al su m m ary ju d g m en t o n Ap ri l 2 3,

2 0 0 9

, l es s th an t wo week s b efo re t h e d ead l i ne fo r g i v i n g n ot i ce o f t erm i n at io n b efo re

t h e e n d o f t h e fi rs t fi v e-y ear i n t erv al

. A t t h e h eari n g

, NW Park way ’ s co u n s el

ack n owl ed ged th at t h ere was a q u e s t i o n o f fact wh et h er t h e ro o f n eed ed rep ai r o r

n eed ed rep l acem en t

. W es t ’ s co un s el as k ed t h at

, becau s e t h e d ead l i n e was

ap p ro ach i n g

, t he co u rt accep t t h e m o n ey i n to t h e reg is t ry o f t h e co u rt s o t h a t W es t

co u ld cu re an y a r g u a b l e d efau l t an d s t at ed

, “ If th ere’ s s o m et h i n g el se t h at we’ re

re q u i r e d t o d o i n o rd er t o cu re t h i s d efau l t an d ex erci s e o u r t erm i n at i o n ri g h t

, t h en

,

. . . we wan t t o d o t h at .”

In Sep t em

b er 2 0 0 9

, t h e t ri al co u rt g ran t ed W es t ’ s m o t i o n fo r part i al s u m m ary

ju d g m en t

, on t h e b as i s

, i n t er al i a, t h at W es t w as n o t i n d efau l t o f t h e l eas e b ecau s e i t

d i d n o t h av e an o b li g at i o n t o rep l ace t h e ro o f an d en t ered a d ecl arat o ry ju d g m en t t h at

W es t was en t i t l ed t o ex erci s e i ts ri g h t t o earl y t erm in at io n

. Th e t ri al co u rt ex p res s l y

d ecl i ned t o reach t h e is s u es w h et h er W es t b reach ed t h e l eas e o r wh at d am ag es

, i f an y

,

NW Park way co u l d reco v er. NW Park way fi l ed a n o ti ce o f ap p eal

.

W h i l e d ock et i ng o f t h at fi rs t ap p eal

, Cas e No

. A1 0 A1 7 8 1

, was pen d in g

, W es t

act ed o n t h e t ri al co u rt ’ s ru l in g th at i t was en ti t l ed t o ex erci s e i t s ri g h t t o t erm i n at e t h e

l eas e at th e en d o f t h e fi rs t fi v e-y ear i n t erv al by v acat i n g t h e p ro p ert y

. W es t t en d ered

8p o s s e s s i o n a s o f J an u ary 3 1

, 2 0 1 0

, an d NW Park w ay accep t ed p os s es s i o n

, in

co m p l ian ce wi t h t he d ecl arat ory ju d g m en t “ u n ti l s u ch ti m e as it co u ld b e rev ers ed o n

ap p eal .” Th ereaft er, NW Park way t ran s ferred ut i l i t y acco u nt s s o t h at it co u l d k eep t h e

u t i l i t i es act i v e, t o o k o v er co n t ract s fo r cu s t o d ial s e r v i ces an d l an d s cap i n g

, p ai d

p ro p ert y t ax es , t ri ed t o fi n d a n ew t en an t

, an d l i s t ed t h e p ro p ert y fo r s al e.

On M arch 2 4

, 2 0 1 1

, we i s s u ed a deci si on i n Cas e No

. A1 0 A 1 7 8 1 an d rev ers ed

t h e Sep t em

b er 2 00 9 d ecl arat o ry ju d gm en t

, h ol d i n g : “ [b ] as ed o n t h e p l ai n l an g u ag e

o f th e l eas e, t h e tri al co u rt erred b y fi n d i n g t h at W es t w as n ot o bl i g at ed t o rep l ace t h e

ro o f an d b y b as i n g i t s det erm in at i o n t h at W es t was n o t in d efau lt u po n t h i s fi n d i n g.”

NW Pa r kwa y, LLC v. Lems er

, 3 0 9 Ga. Ap p

. 1 7 2, 1 7 7 (2 ) (7 09 SE2 d 8 5 8 ) (2 0 1 1 ), cert

.

d en ied

, N o v em

b er 30

, 2 01 1

. In ad d i t i o n, w e co n cl u d ed t h at t he u n d i s p ut ed ev i d en ce

es t ab l i s h ed t h at

, b y fai li n g t o rep l ace t h e ro of, W es t fai l ed t o co m pl y wi t h on e o f t h e

fo u r co n di t i on s preced en t f o r t h e earl y t erm i n at io n o p t io n t o ap p l y

. Id

. at 1 7 8 (3 ).

Th i s fai l u re “ co n s t i t u t ed d efau l t

, wh i ch p rev en t ed W es t fro m t im el y co m pl y i n g wi th

t h e t erm s o f t h e o p t i o nal earl y t erm i n at i o n cl au s e in ord er t o t erm i n at e at t h e fi v e-y ear

p o i n t .” (Fo o t no t e o m i t t ed .) Id

.

Th e tri al co u rt b el at ed l y ru l ed o n W es t’ s req u es t fo r l eav e t o p ay $ 3 8 4

, 2 2 6 i n to

t h e reg i s t ry o f th e co u rt an d g ran t ed t h e req u es t o n A u g u s t 2 9, 2 0 1 2

, “ nu n c p ro t u nc”

9A p ri l 3 0

, 2 0 0 9 (aft er th e heari n g an d befo re t h e d ead l i n e fo r n o ti ce o f e a r l y

t erm i n at i o n ).

In Decem ber 2 0 1 2

, NW Park way so l d t he p ro pert y

. In th e s al es ag reem en t

, NW

Park way g av e “ W arran ti es an d Rep res en t at i o n s” t h at “ [t ]h e re are no l eas es

. . . in

fo rce o r effect t hat g ran t t o an y p ers o n wh o m s o ev er o r an y en t it y w h a t s o e v e r an y

ri gh t

, t i t l e, i n teres t o r b en efi t i n o r t o al l o r an y p art o f t h e Pro p ert y .”

In Oct o b er 2 0 14 , NW

Park way fi l ed a m o t i on fo r p art i al s u m m ary ju d g m en t

,

as t o i t s Co u n t 1

, ro o f-rel at ed ex p en s es

, i t s Co u n t 2

, an t i ci p at o ry b reach of co n t ract

,

an d Wes t ’ s co u nt ercl ai m s (frau d

, n eg l i g en ce, b reach o f co nt ract

, s et o ff, an d

d ecl arat ory

rel i ef reg ard in g ri g h t t o earl y t erm i n at i o n). W es t al so fi l ed a m o t i o n fo r

p art i al s u m

m ary ju d gm en t

, as t o NW Park way ’ s Co u n t 2

, an t i ci pat o ry b reach o f

co n tract

, an d s p eci fi cal l y di s pu t ed t h e co m p o n en t s o f NW Park way ’ s cl ai m ed

d am ag es (ad d i t i on al ren t s

, l at e fees

, an d co n t ract ual at t o rn e y f e e s ). On M arch 1 2,

2 0 1 5 , t h e t ri al co u rt en t ered an o rd er ru l i n g o n t h e p art i es ’ cro s s m o t i o n s fo r p art i al

s u m m ary ju d g m en t

. Th e t ri al co u rt g ran t ed p art i al s um m ary ju d g m en t t o NW

Park way an d t o W es t i n cert ai n res p ect s an d d en i ed t h ei r m o t io n s as t o o t h er i s s u es

,

as s p eci fi ed b el o w.

101

. Th e tri al co u rt d en i ed i n p art t h e p art i es ’ cro s s-m o t io n s fo r s u m m ary

ju d g m en t o n N W Park way ’ s Co u n t 2

, i t s cl ai m fo r b reach an d an t i ci pat o ry b reach o f

t h e l eas e ag reem en t

, s eek i n g ren t s accru i ng aft er J a n u ary 20 1 0, ex p en s es

, l at e

ch arg es

, i n t eres t, an d co n t ract u al at t o rn ey fees

. 2 T hi s ru l i n g was s u p p o rt ed b y t h e

co u rt ’ s d et erm i n at i o n t h at m at eri al q u es t i o ns o f fact rem ai n reg ard in g wh et h er W es t

s at i s fi ed t h e co nd i t i o n s fo r t erm i n at i n g t h e l eas e at t h e en d of t he fi rs t fi v e-y ear

i n t erv al

. In p art i cu l ar, t h e tri al co u rt d et erm i n ed th at t h ere is a ju ry qu es t i o n reg ard i n g

W es t ’ s t en d er d efen s e, t h at i s

, t h at W es t ’s ten d er o f t h e ro o f-rel at ed ex pen s es

, by

m o vi n g t o d ep o s i t $ 3 8 4 ,2 2 6 i n t o t h e reg i s t ry of t he co u rt

, was s u ffi ci en t t o d efeat NW

Park way ’ s cl ai m t h at W es t b reach ed t h e l eas e b y f ai l i n g t o rep l ace th e ro o f. An

al t ern at i v e b as i s fo r t h e d en ial o f s u m m ary ju d g m en t o n NW Park way ’ s Co u n t 2 was

t h e co u rt ’ s d et erm i n at i on th at m at eri al q u es ti o n s o f fact rem ai n reg ard i n g wh et h er a

s u rren d er t o o k p l ace as o f J an u ary 2 0 1 0

, t hat i s , wh et h er NW Park way t o o k act i on s

i n co m pat i b l e wi t h t h e co n t i n u ed ex i s t en ce o f W es t ’ s l eas eh o l d aft er t h at d at e. Bo th

s i des ap p eal

.

2 Th e t ri al co urt ’ s ru l i n g d i s cu s s ed i n Di v i s io n 2

, i n fra, l i m i t s NW Park way ’ s

cl ai m fo r ren t s t o t h e p eri o d J an u ary 2 0 10 t h ro u g h Decem b er 2 0 1 2

, w h e n NW

Park way s o l d t h e p ro p ert y

.

11W e ag ree wi t h NW Park w ay t h at

, as a res ul t o f o u r d eci s i o n i n t he fi rs t ap p eal

,

t h e i s s ue wh et h er W es t sat i s fi ed t h e co n di t i o n s fo r t erm i nat i n g t h e l eas e at th e en d o f

t h e fi rs t fi v e-y ear in t erv al h as b een d eci d ed ad vers el y t o W es t

. NW Pa r kwa y, LLC v.

Lems er

, 3 0 9 Ga. Ap p

. at 1 78 (3 ). See OCGA § 9

- 1 1

- 6 0 ( h ) (“ [A] n y ru l i n g b y t h e

Su p rem e Co u rt o r t h e Co urt o f Ap p eal s i n a cas e s h al l b e b i n di n g i n al l s u b s eq u en t

p ro ceed in g s i n t h at cas e i n th e l o wer co u rt an d in t h e Su prem e Co u rt o r t h e Co u rt o f

Ap p eal s as t h e cas e m ay

b e.”); 1 H Ri ver d

a l e, LLC v. McCh es n ey Ca pi ta l Pa r t n er s

,

LLC

, 2 9 2 Ga. Ap p

. 8 4 1

, 8 4 3 -8 4 4 (6 6 6 SE2 d 8 ) (2 00 8 ) (Aft er ap p el l at e co u rt h el d t h at

p l ai n t i ffs were n o t en t it l ed t o d i s t ri b u t i o n o f p ro fi t s u n d er a n o p e rat i n g ag reem en t

,

t ri al co u rt w as p rec l u d e d f ro m g ran t i n g d efen d an t s ’ ren ewed m o t i o n fo r s u m m ary

ju d g m en t as t o pro fi t d i s t ri b ut i o n .); McLea n v. Cont i n en t a l W i n g a te Co

. , In c.

, 2 2 2 Ga.

Ap p

. 8 0 5

, 8 0 6 -8 0 7 (1 ) (4 7 6 SE2 d 8 3 ) (1 9 96 ) (Aft er a p p e l l a t e co u rt hel d t h at

co n tract ual p ro v i s i on was n o t un en fo rc e a b l y v ag u e, t ri al co urt was precl ud ed fro m

g ran t i n g d efen d an t s ’ ren ewed m o t i o n fo r su m m ary j u d gm en t

, o n g r o u n d s t h at

p ro v is i o n was t o o v ag u e to b e en fo rceab l e.). Ac c o r d i n g l y

, t h e t ri al co urt ’ s

d et erm i n at i o n t h at t h ere i s a ju ry q u es t i o n wh et h er W es t s at is fi ed t he co n d i t i o n s fo r

u n i l at eral l y t erm i n at i n g t h e l eas e at t h e en d o f t h e fi rs t fi v e-y ear i n t erv al was

i n co rrect

.

12W i t h reg ard t o We s t ’ s arg u m en t t h at i t cu red it s breach of i t s o b l ig at i o n to

rep l ace t h e ro of b y

m o v in g t o d ep o s i t $ 3 8 4 ,2 2 6 , t h e am o u n t NW Park way s p en t o n

rep ai rs

, i n t o t h e reg i st ry o f t he co u rt

, we ag ree w i th N W Park way t hat s u ch t en d er

co u ld n ot p ro s p ect i v el y ex cu s e W es t ’ s fai l u re t o s at i s fy i t s o t h er o bl ig at i o n s u n d er t h e

l eas e, e. g

., p ay m en t o f ren t

, g i v en t h e b i n d i n g d et erm i n at i on t h a t We s t w a s n ot

en t i t l ed t o t erm i n at e t h e l eas e at t h e en d o f t h e fi rs t fi v e-y ear i n t erv al

. Acco rd i n g l y

,

t h e tri al co urt ’ s d et erm i n a t i o n t h at t h ere i s a j u ry q u es t i on reg ard in g W es t ’ s t en d er

d efen s e was i n co rrect

.

In d en y i ng su m

m ary ju d g m en t o n NW Park way ’ s Co u n t 2

, t h e t ri al co u rt al s o

d et erm i n ed t h at m at eri al qu es t io n s o f fact rem ai n reg ard i n g wh et h er NW Park way ’ s

co n du ct i n J an u ary 2 0 1 0 res u l t ed i n a s u r r e nd er. A s W es t co n t en d s

, N W Park way

t o o k act i o n s t h at are po t en t i al ly i n co m p at i b l e wi t h t h e co n t i n ued ex i s t en ce of W es t ’ s

l eas eh o l d aft er t hat d at e, s u ch as p ay i ng u t i l i t i es

, s erv i ce co n t ract s

, an d pr ope r ty t ax es

,

al l o f wh i ch were W es t ’ s r e s p o n s i b i l i t y un d er t h e t ri p l e-n et l eas e, an d l i s t i n g t h e

p ro p er t y f

o r s al e. 3 Bu t NW Park way h as id en t i fi ed ev i d en ce, wh i ch i s un d i s p u t ed

,

3 See Ci r cl e K S to r es , In c. v. T.O.H. As so cs ., Lt d

. , 3 1 8 Ga. Ap p

. 7 53 , 7 5 6 (2 )

(7 3 4 SE2 d 7 5 2 ) (2 0 1 2 ) (“ A s u rren d er o f a l eas e b y o p erat io n o f l aw m ay ari s e fro m

an y co n di t i o n of fact s v o lu nt ari l y as s u m ed b y t h e p art i es an d i n co m p at i b l e wi t h t h e

co n ti n u ed ex i s ten ce o f t h e rel at i o n o f l a n d l o r d an d t en an t b et ween t h em

. W h ere a

l an d l o rd ex erci s es a co nt ro l o v er t h e p rem i s es i n co ns i s t en t wi t h t h e ten an t ’ s ri g ht o f

13t h at

, b ecau se t h e t ri al co u rt ’ s d ecl arat o ry ju d g m en t ru l in g al l o wed W es t t o v acat e t h e

p rem i s es an d t o s to p m ai n t ai n in g th e p ro p ert y

, NW Park way to ok t h o s e act i o n s in

o rd er t o prev en t d am ag e t o t h e p ro p ert y

. 4 Th ere i s n o ev i d en ce t hat NW Park way

accep t ed ren t fro m an o t h er t en an t o r o ccu p ied t h e p rem i s es i ts e l f an d co n d u ct ed

b u s i n es s o p erat i o n s t h ere. 5 Acco rd i ng l y

, t h e t ri al co u rt ’ s d et erm i n at i o n t h at t h ere i s

o ccu pa t i o n

, h e th ereb y di s ch arg es t h e ten an t fro m li ab i l i ty fo r fu t u re ren t

, an d a

can cel l at i o n o r res ci s s io n o f t h e co n t ract i s t hu s effect ed b y ag reem en t o f t h e p art i es

,

ex p res s o r i m

p li ed .”) (p un ct u at i o n an d fo ot no t es o m i t t ed ).

4 See Ci rcl e K S t o r es

, In c. v. T.O.H. As s o cs

., Lt d

. , 3 1 8 G a. Ap p

. at 7 5 7 (2 ) (“ To

s h o w a s u r r e n der, a m

u tu al ag reem en t b et ween l es s o r an d les s ee t h at t h e l eas e i s

t erm i n at ed m

us t b e cl earl y p ro v ed .”) (fo o t n o t e om i t t ed ); S i rd a h v. N. S p r i n g s As s ocs

. , 3 0 4 Ga. Ap p . 3 4 8 , 3 5 1 (1 ) (6 96 SE2 d 3 9 1 ) (2 0 1 0) (“ Th e m ere t ak i n g o f t h e k ey s t o

t h e leas ed prem i s es b y a l an d l o rd d o es n o t g i v e ri s e to an i n feren ce t h at t h e l an d l o rd

accep t ed s u rren d er o f t h e p r e m i s e s

. Li k ewi s e, th e m ere en t ry u p o n t he p rem i s es to

p ro t ect th e p ro p ert y aft er ab an d o n m en t b y t h e l es see wi l l n o t am o u n t t o an accep t an ce

o f a s u rren der o f a l eas e.”) (ci t at i o n s an d p u n ct u at i o n o m it t ed ); E rf an i v. Bi s h o

p

, 2 5 1

Ga. Ap p. 2 0

, 2 2 (1 ) (c) (5 5 3 SE2 d 3 2 6 ) (2 0 0 1 ) (acco rd ); La ws on v. Cr a w fo r d

, 2 2 0

Ga. Ap p

. 4 4 7

, 4 48 (4 69 SE2 d 5 0 7 ) (1 9 9 6 ) (W h ere a t en an t ab an d o ns l eas ed p rem i s es

wi t h o u t th e co n s en t o f t h e l an dl o rd

, “ t h e l an d lo rd h as th e o p t io n o f (1 ) t erm i nat i n g t h e

l eas e, (2 ) o b t ai n i n g an o th er ten an t w h i le h o l d i n g t he ori g i n al t en an t l i ab l e fo r an y

d e f i c i e n cy t h at m ay o ccu r, o r (3 ) p erm i t t i n g t he prem is es t o rem ai n v acan t wh i l e

co l l ect i n g t h e ag reed -u p o n ren t fro m t h e o ri g i n al t en an t

. . . . A s u rren d er o f p rem i s es

b y a l es see has n o l eg al effect u n t i l accep t ed b y t h e l es s o r.”) (ci t at i o n an d pu n ct u at i o n

o m it t ed ).

5 Cf. S a va n n a h Y

a ch t Co r p

. v. Th u n d

er b o lt M a r in e, In c.

, 2 9 7 Ga. Ap p

. 1 0 4,

1 1 1 (2 ) (6 7 6 SE2 d 7 2 8 ) (2 0 0 9) (wh ere l es s o r fo rced l es s ee’ s su b t en an t i n p o s s es s i o n

t o v acat e t h e pro p ert y

, occu p ied th e p ro p er t y i t s el f, an d b eg an o perat in g i t s o wn

m ari n a an d y ach t rep ai r b us i nes s t h ere, l eas e was t erm i nat ed b y o p erat i o n o f l aw).

14a ju ry q u es t i o n wh et h er NW Par k way accep t ed W es t ’ s s urren d er o f t h e l eas e as o f

J an u ary 2 0 1 0 was i nco rrect

, 6 an d t h e t ri al co u rt erred i n d en y i n g NW Park way ’ s

m o ti o n fo r s u m

m ary ju d g m en t i n t h i s reg ard

. Ci r cl e K S t o r es

, In c. v. T.O.H. As s ocs

.,

Lt d

. , 3 1 8 Ga. Ap p

. 7 5 7 -7 5 8 (2 ) (7 3 4 SE2 d 7 5 2 ) (2 0 1 2 ); S i r d ah v. N. S p r i n g s As s ocs

. ,

3 0 4 Ga. Ap p . 3 4 8 , 3 5 1 (1 ) (6 96 SE2 d 3 9 1 ) (2 0 1 0).

2

. Th e t ri al co u rt det erm in ed t h at NW Park way i s n o t en t i t l ed t o an y ren t s aft er

Decem b er 2 0 1 2

, wh en i t s o l d t h e p ro p ert y an d ex pres s l y d i scl ai m ed t he ex i s t en ce o f

an y leas e t hen i n fo rce t h at g ran t ed an y ri g h t

, t i tl e, in t eres t o r b en efi t i n t h e p ro p ert y

t o an y p ers o n or en t i ty

. Th e t ri al co u rt acco rd in g l y g ran t e d We st ’ s m o t i o n fo r

s u m m ary ju d g m en t o n NW Park way ’ s cl ai m fo r ren t s (Co u n t 2 ) i n p art

, as t o ren t s

accru i n g aft er Decem

b er 2 0 12

. NW Park way ap p eal s t h e p art i al g ran t o f W es t ’ s

m o ti o n

.

NW Park w ay co n ten d s t h at i t is en t i t l ed t o co l lect ren t fo r th e e n t i re 2 0 -y ear

t erm

, d es p i t e i t s sal e o f t h e p ro p ert y i n t h e ei g h t h y ear of th e l eas e, b ecau s e t h e l eas e

“ d i scl ai m s s et -o ffs o r d ed u ct i o n s ag ai n s t ren t .” Sp eci fi cal l y

, NW Park way p o i n t s to

Parag rap h 1

, wh i ch p ro v i d es t h at t h e bas e ren t o f t he l eas e “ s hal l b e p ay ab l e by

6 As ex p lai n ed i n Di v i s i o n 2

, i n fra, th e reco rd d oes es t ab l i s h t h at t h e l an d l o rd

t en an t rel at i on s h i p en d ed wh en NW Park way s o l d t h e p ro p ert y

i n Decem

b er 2 0 1 2

.

15[W es t ] i n m o n th l y i n s t al l m en t s o n o r b efo re th e fi rs t d a y o f each m o n t h i n ad v an ce

. . . wi th o u t an y p ri o r d em an d th ere f o re, an d wi t h o ut an y d ed u ct i o n or s et o ff

wh at s o ev er, an d s h al l be p ay ab l e t o [ NW Park way ] .” N W Park way arg u es t h at in

ag reei n g t o b as e ren t b ei n g d u e “ wi t h ou t an y ded u ct i on o r s et off wh at s o ev er” W es t

“ k n o wi n g l y accep t ed a ren t o b li g at i o n fo r a t erm o f t wen t y y ears ” reg ard l es s o f l at er

ev en ts

. Read i n co n t ex t wi th t h e “ t ri p l e-n et ” s t i p u l at i on an d p ro v i s io ns reg ard i n g

W es t ’ s o b l ig at i o n s t o p ay t he p ro p ert y tax es an d o t h er ex p en s es as so ci at ed wi t h t h e

p ro p ert y an d t o m ai n t ai n t he prem i s es at i ts o wn ex pen s e, h o wev er, we co n cl u d e t h at

t h e m od i fi er “ wi t h o ut an y d ed u ct i o n o r s et o ff wh at s oev er” refers t o W es t ’ s o bl i g at i o n

t o b ear al l ex p en ses as s oci at ed wi t h t h e p ro p ert y (wi t h t h e s peci fi ed ex cep t i o n o f

t h o s e i n cu rred wi t h res p ect t o t he co n cret e wal l s

, co ncret e sl ab

, an d fo u n dat i o n ). W e

fi nd n o b as is fo r co n s t ru i n g t h e m o d i f i e r “ wi t h o u t an y ded u ct i on o r s et o ff

wh at s o ev er” t o ob l i g at e W es t t o p ay ren t fo r a p eri o d w h en NW Park way lack s l eg al

o wn ers hi p o f t he p ro p ert y wi t h t h e co n co m i t an t ab i l i t y t o p ro v i d e W es t p o s s es s i o n

an d u s e o f t h e p ro p ert y as a t en an t. 7 Becau s e th e reco rd es t ab l i sh es t h at NW

7 See OCGA § 4 4 -6 -1 02 (“ Th e g ran t by o n e p ers o n t o an o t her o f an es t at e fo r

y ears o u t o f h i s o wn es tat e, wi t h rev ers i o n t o h i m s el f, i s u s u al l y term ed a l eas e.”); 4 4

-

7 -1 ( a ) (“ Th e rel at i on s hi p o f l an d l o rd an d t en an t i s creat ed wh en t h e o wn er o f real

es t at e gran t s t o an o th er pers o n

, wh o accep ts su ch g ran t

, t h e ri g ht si m p l y t o p o s s es s

an d en jo y t h e u s e of s u ch re a l e s t a t e e i t h e r fo r a fi x ed t i m e o r at t he wi l l o f t h e

16Park way ’ s s al e o f t h e p ro p ert y i n Decem b er 2 01 2 t e r m i n a t ed i t s lan d l o rd -t en an t

rel at i o n s h i p wi t h W es t

, W es t ’ s o b l i gat i o n t o p ay ren t un d er t h e l eas e fro m th at p o i nt

t o t h e o ri g i nal t erm i n at i o n d at e o f J u l y 3 1

, 2 0 2 4 n eces s ari l y en d ed

. No b l e v. Ker r

, 1 2 3

Ga. Ap p

. 3 19

, 3 1 9-3 20 (1 ) (1 8 0 SE2 d 6 0 1) (1 9 7 1). 8 Acco rd in g l y

, t h e t ri al co u rt d id

n o t err i n g ran ti n g W es t ’ s p art i al m o t i o n fo r s u m m ary ju d gm en t i n t h i s reg ard

.

3

. Th e t ri al co urt d et erm i n ed t h at t h ere are q u es t i o n s o f fact reg ard i n g wh et h er

t h e l eas e’ s l at e-ch arg es p ro v i s i o n

, Parag rap h 2 7

, i s an u n en fo rceab l e p en al t y an d

d en ied W es t ’ s m o t i o n fo r s u m m ary ju d g m en t o n NW Park way ’ s cl ai m fo r l at e fees

as p art o f Co un t 2 . W es t ap p eal s t h e p art i al d en i al o f i t s m o t i o n

.

g ran t o r.”); S

ha r p e v. Ma t h ews

, 1 2 3 Ga. 7 9 4, 7 9 7 -7 9 8 (2 ) (5 1 SE 7 0 6 ) (1 9 05 ) (Th e

rel at i o n o f l an d l o rd an d t en an t ari s es wh en a p art y o ccu p i es t h e l an d o r p rem i s es o f

an o th er i n s u b ord i n at i o n t o t h e o t h er’ s ti t le an d wi th hi s as s en t

, ex p res s o r i m p l i ed .).

8 NW Park way ’ s rel i an ce o n Amer i ca n Med

. Tr a n s p o r t Gr o u

p v. Gl o-An

, In c.

2 3 5 Ga. Ap p

. 4 6 4

, 4 6 6 (1 ) (5 0 9 SE2 d 7 3 8) (1 99 8 ), i s m is p l aced

. In t h at cas e, a l eas e

p ro v id ed t h at i n ev en t o f defau l t

, t h e l a n d l o rd co u l d ev ict t h e ten an t an d t h e t en an t

ag reed t o p ay

an y d am ag e t h e l an d l o rd m i g h t s u ffer b y reas o n o f t h e t erm i n at i o n o f

t h e t en an t ’s p o s s es s i o n

, s u ch as b y i n ab i l i t y t o rel et th e p rem i s es o n s at i s fact o ry

t erm s

, an d p ro vi d ed t h at t h e t en an t wo u l d p ay t h e s p eci fi ed ren t “ wi t h o u t d ed u ct i o n

o r s et o ff, fo r t h e en t i re t erm [o f t h e l eas e] .” W e h el d t hat t h e l eas e t erm s ex p res s ed

t h e p art i es ’ i n t en t i o n t o h o l d t h e t en an t res p o n s i b l e fo r aft er-accru ed ren t ev en s h o u ld

an ev i ct i o n t ak e p lace, an d

, t h erefo re, t h e l an d lo rd was en t i t l ed to su m m ary ju d g m en t

fo r ren t fo r t he l eas e t erm rem ai n i n g aft er t he t en an t ab an d o n ed t h e p rem i s es wi t h o ut

t h e l an d l o rd ’ s co n s en t an d t h e lan d l o rd w as u n ab l e t o rel et t he p rem i s es

. In co n t ras t

t o t hi s cas e, t h ere was n o ev i d en ce t h at t h e l an d l o rd ev er rep u d i at ed t h e co n ti n u at i o n

o f t h e l eas eh o l d b y

s el l i n g t h e p ro p ert y

an d d i scl ai m i ng t h e ex i st en ce o f an y l eas e.

17Parag rap h 27 p ro v i d es t h at “ t h ere s hal l b e du e an d p ay ab l e b y [W es t ] t o [NW

Park way ]

, as o f t h e fi ft h day o f each m o n t h d u ri n g t h e t erm [o f th e l eas e]

, a La t e

Ch arg e i n an am o u nt eq u al t o t en p ercen t o f al l s u m s w h i c h a r e d ue an d p ay ab l e

[u n d er t h e l eas e] b u t hav e n o t, as o f su ch d at e, b een recei v ed by [NW Park way ] .”

An o t h er p arag rap h p ro v i d ed fo r 1 5 p ercen t i n teres t t o accru e on p as t du e o bl i g at i o n s

.

OCGA § 1 3-6 -7 p ro v i des : “ If t h e p a rt ies ag ree i n t hei r co n tract wh at t h e

d am ag es fo r a b reach s h al l b e, t hey are s ai d t o b e l i q u i d at ed

, an d u n l es s t h e ag reem en t

v i o l a t e s s o m e p ri n ci p le o f l aw, t h e p art ies are bo u nd t h ereb y .” Bu t a p ro v i s i o n t h at

i s i nt en d ed t o d et er b reach es o f t h e co n t ract b y im p o s in g a pen al t y fo r a breach t h at

i s n o t a reas o n ab l e p re-es ti m at i o n of d am ag es i s u n en fo rceab l e u nd er Geo rg i a l aw.

S o u t h ea s t er n La n d F

u n d

, In c. v. Rea l Es ta t e W

o r l d

, In c.

, 2 3 7 Ga. 2 2 7

, 2 3 0 (2 2 7 SE2 d

3 4 0 ) (1 9 76 ); Al exa n d

er v. S t ei n i n g

, 1 97 Ga. Ap p

. 3 2 8

, 3 2 9 -3 3 0 (2 ) (3 9 8 SE2 d 3 9 0 )

(1 9 9 0). In o rd er t o res ol v e wh et h er a p ro v is i on fo r d am ag es fo r b reach am o u n t s to

“ l i q u i d at ed d am ag es ” u n d er OCGA § 1 3 -6 -7

, or i s an u n en fo rceab l e p en al t y cl au s e,

t h e t ri al co u rt at t he s u m

m ary ju d g m en t l ev el m

u s t c o n du ct a t ri p art i t e

i n q u i ry acco rd i n g to t h es e s tan d ard s : Fi rs t, t h e i n ju ry cau s e d b y th e

b reach m us t b e d i f fi cu l t o r i m

po s s ib l e o f accu rat e es t i m at i o n ; s eco n d

,

t h e p art i es m

us t i n t en d t o p ro v i d e fo r d am ag es rat h er t h an fo r a p en al t y ;

an d th i rd

, t he s u m s t i p u lat ed m u s t b e a reas o n ab l e p re-es t i m at e o f th e

l o s s

.

18Mo r

g a n En t er p r i s es

, In c. v. Go r d

o n Gi l l et t Bu s i n es s Rea l t

y

, 1 9 6 Ga. Ap p

. at 1 1 2

. At

t h i s s t ag e, th e b u rd en i s o n W es t t o s h o w t hat t h e l at e ch arg e i s a p en al t y as a m at t er

o f l aw. Id

. 9 “ In cas es of do ub t

, t h e co u rt s fav or th e co n s t ru ct io n [o f a co n tract ] wh i ch

h o l d s th e s t i pu l at ed s u m t o b e a p en al t y

, an d l i m it s t h e reco v ery t o t he am o u n t o f

d a m ag e[s ] act ual l y s h own

, rat h er t h an a l i q u i d at i o n o f t h e d am ag es .” (Ci t at i o n an d

p u n ct u at i o n o m i t t ed .) Fo r t u n e Br i dg e Co

. v. Dep t

. o f Tr a n s p

. , 2 4 2 Ga. 5 3 1

, 5 3 2 (2 5 0

SE2 d 4 0 1) (1 9 7 8). 1 0

W i t h reg ard t o t h e fi rs t f a c t o r

, W es t ap paren t l y co n ced es t h at t h e act u al

d am ag es cau s ed b y a l at e p ay m en t u n d er t he l eas e wo ul d b e d i ffi cu l t o r i m p o s s i b l e

t o accu rat el y es t i m at e. See O a m i v. Del k In t er ch a n g e, Lt d

. , 1 93 Ga. Ap p

. 6 4 0

, 6 4 1

-

6 4 2 (3 8 8 SE2 d 7 0 6) (1 9 8 9 ) (In rev i ewi n g a l at e ch arg e i n a l eas e wh i ch p ro v i d ed t h at

9 At t ri al t he bu rd en i s o n a d efau l t i n g part y t o s h ow t h at an al l eg ed li q u i d at ed

d am ag es p ro v i s i o n is act u al l y an u n en fo rceab l e p en al ty

. Id

. In ad d i t i o n

, we n o t e t h at

“ t ri al co urt s s h o u l d n ot o rd i n ari l y s u b m i t t h e i s s ue o f wh et h er a co n tract p ro v i d es fo r

l i qu i dat ed d am ag es o r a p en al ty t o t h e ju ry

. Th i s i s s u e s h o u l d b e d eci d ed as a m at t er

o f l aw, u n l es s aft er ap p l y in g t h e u s u al ru l es o f co n t ract co n s tru ct i o n

, an am b i g u i t y

rem ai n s warran ti n g s ub m i t t i n g a fact u al i s su e t o th e j u r y

. ” (Ci t at i o n s o m i t t ed .)

Ro s wel l Pr o

p er t i es

, I n c

. v

. S a l l e

, 2 0 8 Ga. Ap p

. 2 0 2

, 2 0 5 (2 ) (c) (4 3 0 SE2 d 4 0 4 )

(1 9 9 3), d i s ap p ro v ed of o n o t h er g ro u n d s b y Go ld en Pea n ut Co

. v. B a s s

, 2 4 9 Ga. Ap p.

2 2 4 , 2 3 4 (2 ) (5 4 7 SE2 d 6 37 ) (2 0 0 1 ).

1 0 See S o u t h ea s t er n La n d Fu n d

, In c. v. Rea l Es t a te W

o rl d

, In c.

, 2 3 7 Ga. at 2 3 1

(acco rd ); Ca i n ca r e, In c. v. El l i s o n

, 2 7 2 Ga

. Ap p. 1 9 0

, 1 9 5 (6 1 2 SE2 d 4 7 ) (2 0 0 5 )

(acco rd ).

19an y o v erd u e ren t w o ul d b ear in t eres t fro m t h e du e d at e u nt i l pai d an d t h at th e t en an t

wo u l d p ay i n ad di t i o n t o i nt eres t a s erv i ce ch arg e o f $ 1 0 p er d ay

, we co n cl u d ed t h at

t h e l an d l o rd h ad s ho wn th at t he i n ju ry t h at wo u l d b e cau s ed b y lat e p ay m en t s

, t h at i s

,

h av in g to b o rro w o p erat in g fu n d s at t he t h en -m ark et rat e, wo ul d b e d i ffi cu l t o r

i m p o s s ib l e t o accu rat el y es t i m at e “ i n a m ark et o f f l u ct u at in g i n t eres t rat es o v er a

fi ve-y ear p eri o d ,” t h e p eri o d o f t h e l eas e.).

W i t h reg ard t o th e s eco n d fact o r, t h e p art ies ’ i n t en t t o pro v i d e f o r d am ag es

v ers u s a p en al t y

, “ we as cert ai n t h e i nt en t o f t h e p a r t i es b y fi rs t l o o k i n g t o t h e

l an g u ag e o f t he co n tract

. Al t h o u g h t h e wo rd s u s ed b y t h e p art i es are n o t co n cl u s i ve,

t h ey are a s i g n i fi can t fact o r i n d et erm i n i n g t he p art i es ’ i n t en t.” (Ci t at i o n an d

p u n ct u at i o n o m i t t ed .) JR Rea l Es t a te Dev., LLC v. Ch eel ey In v., L.P.

, 3 09 Ga. Ap p.

2 5 0

, 2 53 (2 ) (b ) (7 0 9 SE2 d 5 7 7 ) (2 0 1 1 ). In t h i s cas e, we co n cl u d e fro m t h e wo rd s

u s e d b y th e p art i es t h at t h ey co u l d h av e i n t en ded Parag rap h 2 7 ei t her as li q u i d at ed

d am ag es o r as a p en al t y

. Becau s e W es t i s ap p eal i n g th e d en i al o f i ts m o t i o n fo r

s u m m ary ju d g m en t

, we m

u s t co n s t ru e al l reas o n a b l e i n feren ces i n fav o r o f NW

Park way . Id . at 2 5 4 (2 ) (b ).

A s t o t h e t hi rd fact o r, W es t co n t en d s t h at t h e l at e ch arg e, “ a on e-t i m e ” 1 0

p ercen t ch arg e, can n o t b e d eem ed a reas o n ab l e p re-es t i m at e o f t h e p ro b ab l e l o ss

20b ecau s e i t i s n o t “ a d ju s ted t o th e l en gt h of t he t ard in es s ” o f t h e p ay m en t

. It m ak es

s en s e th at

, wh ere a co n t ract u al o b l i g at io n is t h e p ay m en t o f m o n ey b y a s p eci fi ed

d at e, l i q u i d at ed dam ag es fo r lat e p ay m en t m ay refl ect t h e ti m e-v al u e o f m o n ey

. See

Oa mi v. Del

k In t er ch a n ge, Lt d

. , 1 9 3 Ga. Ap p

. at 6 4 2 (A $ 1 0 s u rch arg e fo r each d ay

o f t h e t en an t ’ s fai lu re t o p ay ren t was “ ad ju s t ed t o t h e l en g t h of t ard i n e s s ” a n d was

a reas o n ab l e p re-es t i m at e o f t h e p ro b ab l e l os s .). Bu t l iq u i d at ed d a m a g es m ay al s o

refl ect an an t i ci p at ed i n creas e to an o b l i g ee’ s t ran s act i on co st s

. See Kr up p R ea l t y Co

.

v. Jo el , 1 6 8 G a. Ap p

. 48 0

, 4 8 1 (1 ) (3 0 9 SE2 d 64 1 ) (1 9 8 3 ) (W h ere a l eas e p ro v i d ed

fo r a $ 5 0 ch arg e as “ ad d i t i o n al ren t” ei th er wh en a ren t ch eck was ret u rn ed fro m t h e

l es s ee’ s b an k wi t h o u t p ay m en t

, wh i ch wo u l d cau s e t h e ag en t /o wn er “ ad d i t i o n al

ex p en s es fo r b oo k k eep i n g an d cl eri cal s erv i ces

, ” o r wh en th e ren t du e o n th e fi rs t o f

t h e m o n t h was recei v ed aft er t h e fi ft h

, wh i ch wo u l d req u i re “ ad d i t io n al s erv i ces ” o f

t h e ag en t/ o wn er, t h e t ri al co urt erred i n fi nd i n g t h e ch arg e was u s uri o u s.).

Bas ed o n t h e fo reg oi n g

, we co ncl u d e t h at W es t fai l ed t o s h o w th at t h e l at e

ch arg e i s a p en al ty as a m at ter o f law. Acco rd in gl y, t h e t r i a l co u rt d i d n o t err in

d en y i n g W es t ’ s m o ti o n fo r p art i al s u m m ary ju d g m en t i n t hi s reg ard

.

214

. Bas ed o n t h i s Co urt ’ s h o l d i n g i n Cas e No

. A1 0 A1 78 1

, t h e tri al co u rt g ran t ed

NW Park way ’ s m o t i o n fo r s u m m ary ju d g m en t o n i t s Co un t 1

, as t o l i ab il i t y o n l y

,

co n cl u d in g as a m at t er o f l a w t h a t We s t b reach ed t h e l eas e b y fai l i n g t o rep ai r o r

rep l ace t h e ro o fs

. W es t ap p eal s t h e g ran t o f NW Park w ay ’ s m ot i o n

. As NW Park way

co n ten d s, h o wev er, t h i s i s s ue was res o l v ed i n t h e fi rs t ap p eal

.

In t h at d eci s i on

, we n o t ed t hat

, al t h o u g h th e t ri al co u rt ’ s d ecl arat o ry ju d g m en t

s t at ed t h at i t w as n o t “ i nt en d ed t o res o l v e wh et h er W es t b reach ed t h e l eas e ag reem en t

at i ss u e, o r w h at d am ag es

, i f an y

, can b e reco v ere d f o r a n y s u ch b reach [,]

[n ]e v ert h el es s

, t he l eg al co n cl u s i o n s reach ed b y t h e tri al co u rt affect ed NW

Park way ’ s ri g h t s t o reco v er u n d er th e l eas e.” NW Pa r kwa y, LLC v. Lems er

, 3 0 9 Ga.

Ap p

. at 1 7 5 (1 ). In t h at d eci s io n

, we d et erm i n ed t h at W es t w a s o b l i g at ed u n d er

Sp eci al St i p u lat i o n 3 of t he leas e t o rep l ace t h e ro of a nd t h at W es t “ fai l [ed ] t o co m p l y

wi t h th e t h i rd s p eci al st i p u l at i o n

, i .e., fai l [ed ] to rep ai r t h e ro o f[.] ” NW Pa r kwa y, LLC

v. Lem s e r

, 3 0 9 G a. Ap p

. at 1 7 7 (2 ), 1 7 8 (3 ). Becau se t h es e ru l i n g s were b i n d i n g in

al l s u b s eq u en t p ro ceed i n g s i n t h i s cas e i n t h e l o wer co u rt

, s ee Di v i s io n 1, s u p ra, t h e

t ri al co u rt d i d n o t err i n g ran t i n g NW Park way ’ s m o t io n fo r s u m m ary ju d g m en t as to

l i ab i l i t y on i t s Co u n t 1

.

225

. Th e t ri al co u rt d en i ed W es t ’ s m o t io n fo r s u m m ary ju dg m en t o n NW

Park way ’ s Co u n t 3

, at t o rn ey fees u n d er OCGA § 1 3 -6 -1 1

. W es t ap p eal s t h e d en i al

o f i t s m o t i o n

, co n t en d i n g t h at

, b efo re t he fi rs t ap p eal

, t h ere was a g en u i n e co n t ro v ers y

ab o ut wh et h er i t was o b l i gat ed u n d er th e l eas e t o rep l ace t he ro of an d t h at i t s t en d er

o f t h e ro o f rep l ac e m e n t f u n d s i n t o t h e co u rt reg is try precl u d es a cl ai m o f b ad -fai th

p erfo rm an ce.

An award o f at t o rn ey fees an d ot h er ex p en s es o f l it i gat i on i s au t h o ri zed

p u rs u an t t o OCGA § 1 3 -6 -1 1

, wh ere (1 ) th e pl ai n t i ff s p eci al l y p l ead s an d pray s fo r

s u ch an award

, an d (2 ) t he fi n d er o f fact fi n d s th at th e d efen d an t act ed i n b ad fai t h in

t h e u n d erl y i n g t ran s act i o n o r t h at

, aft er t h e t ran s act i o n o n wh i ch t h e cau s e o f act i o n

i s p red i cat ed

, th e d efen d an t was s t ub b o r n l y l i ti g i o u s o r cau s ed t h e p l ai n t i ff

u n n eces sary t ro u b l e an d ex p en s e. “ Qu es t io n s co n cern i n g b ad fai t h un d er t h is s t at u t e

are g en eral l y fo r t h e ju ry t o d eci d e, an d t h e t ri al co u rt m ay g ran t ju d g m en t as a m at t er

o f l aw o n s u ch i s s u es o nl y in t h e rare cas e wh ere t h ere i s ab s ol u t el y n o ev i d en ce to

s u p p ort th e award o f e x p en ses o f l i t i g at i o n .” (Ci tat i o n an d p u n ct uat i o n o m i t t ed .)

Geo rg i a Der ma t o l o g ic S

u r ger y Cen t e r s

, P.C. v. Ph a r i s

, 3 23 Ga. Ap p

. 1 8 1, 1 8 4 (3 )

(7 4 6 SE2 d 6 7 8 ) (2 0 1 3 ). See Hewi t t As s o cs

., LLC v. Ro l l i n s

, In c.

, 3 0 8 Ga. Ap p

. 8 4 8,

8 5 3 (3 ) (7 0 8 SE2 d 6 97 ) (2 0 1 1 ) (acco rd ).

23Th i s i s n o t s u ch a rare cas e wh ere t h ere is ab s o l u t el y n o ev i d en ce t o s up p o rt t h e

award o f ex p en ses o f l i t i g at i o n

. Fo r e xam p l e, ho wev er w i l li n g W es t m i g h t h av e

b eco m e lat er i n t h e l i t i g a t i o n to p ay t h e am o u n t fo r t h e ro o f rep l acem en t i n t o t h e

reg i s try o f t h e co u rt

, a ju ry co ul d fi n d t hat W es t act ed i n b ad fai th wh en i t as s ert ed

t h a t i t w a s NW Park w ay ’ s s o l e res p o n si b i l i t y t o rep l ace t h e ro o f wh il e at t h e s am e

t i m e d en y i n g N W Park w ay acce s s t o t h e p ro p ert y t o d o s o u nt i l NW Park way

o b t ai n ed a TRO. T h e t ri al co u rt d i d n o t err i n d en y i ng W e s t ’s m o t io n fo r p art i al

s u m m ary ju d g m en t as t o NW P a r k w ay ’ s Co u n t 3. Geo r g i a Der ma t o l o g i c S

u r g er y

Cen ter s, P.C. v. P h a r i s

, 3 2 3 Ga. Ap p

. at 1 84 (3 ); Hewi tt As s o cs

., LLC v. Ro ll i n s

, In c.

,

3 0 8 Ga. Ap p . at 8 53 (3 ).

6

. T h e t r i a l co u rt d en i ed NW Park way ’ s m o t i o n fo r s u m m ary ju d g m en t o n

W es t ’ s Co u n t 1

, frau d an d d ecep t io n

. Sp eci f i c a l l y

, W es t al l eg ed t h at N W Park way

d raft ed t h e l eas e t o i n cl u d e an ack n o w l e d g m en t b y th e o ri g i nal l es s ee, W o rl d wi de,

t h at t h e prem i s es were i n g o od o rd er an d rep ai r at t h e b eg i nn i n g o f t h e l eas e wi th

k n o wl ed g e t h at th e ro o fs were i n fact n ot i n g o od rep ai r an d wi t h t h e i n t en t i o n t h at

W es t rel y o n t h e rep res en t at i o n i n ag reei n g t o as s u m e t h e ro l e of t en an t as part o f i t s

acq u is i t io n o f W o rl d w i d e. NW Park way ap p eal s th e d en i al of i t s m o t io n

. Un d er t h e

24ci rcu m s t an ces p res en t ed h ere, we co n cl u d e t h at th e t ri al co urt erred i n d en y i n g NW

Park way ’ s m o ti o n fo r p art i al s u m m ary ju d g m en t o n W es t ’ s frau d cl ai m

.

Un d er Geo rg ia l aw,

[t ] h e fi v e el em en t s o f a frau d cl ai m are: (1 ) fal s e rep res en t at io n m ad e b y

d efen d an t ; (2 ) s ci en t er; (3 ) i n t en t io n t o i n d u ce p l ai n t i ff t o act o r refrai n

fro m act i n g i n rel ian ce b y p l ai n t iff; (4 ) ju s t i fi ab l e rel ian ce by p l ai n t iff;

an d (5 ) d am ag e t o p l ai n t i ff.

. . . [A] p l ai n t i ff as s ert in g a frau d cl ai m m u s t

s h o w n o t o n l y t h at [i t ] rel i ed o n s o m e m i s rep res en tat i o n

, b ut al s o t hat

[i ts ] rel i an ce was reas o n ab l e.

(Ci t at i o n s an d p u n ct uat i o n o m i t t ed .) Al vea r v. S a n d y S p r i n g s To yo t a

, I n c

. , 3 3 2 Ga.

Ap p

. 7 9 8

, 8 0 0 -8 0 1 (1 ) (7 7 5 SE2 d 1 7 2 ) (2 0 1 5 ). See al s o OCGA § 5 1 -6 -2 (a) (“ W i l lfu l

m i s rep res en t at i o n o f a m at eri al fact

, m ad e t o i n d u ce an o t h er t o act

, u p o n wh i ch s u ch

p ers o n act s t o h i s i n

j ury

, w i l l g i v e h i m a ri g h t o f act i o n

. M ere co n ceal m en t of a

m at eri al fact

, un l es s d o n e i n s u ch a m an ner as to d ecei v e an d m i s l ead

, wi l l n ot

s u p p ort an act i o n

. ”). “ Co n ceal m en t o f m at eri al fact s m ay am o u n t t o frau d wh en

. . .

t h e co n ceal m en t i s o f i nt ri ns i c q u al i t i es of t he art i cl e [at i s s ue] wh i ch t he o t h er p art y

,

b y t h e ex erci s e o f o rd i n ary p ru d en ce an d cau t i on

, c o u l d n o t d is co v er; an d

m i s rep res en t at i o n m ay be p erp et u at ed b y act s as wel l as wo rd s

, an d b y art i fi ces

25d es i g n ed t o m i s l ead .” (Ci t at i o n o m i t t ed .) B at ey v. S t o n e

, 1 2 7 Ga. Ap p

. 8 1

, 8 2 (1 9 2

SE2 d 5 2 8) (1 9 7 2).

Acco rd i ng t o W es t ’ s o wn ch aract eri zat i o n o f t h e fact s

, “ [t ] h e l eas e at i s s u e in

t h i s l aws ui t was no t n eg o t i at ed i n an arm s -l en g t h t ran s act i o n ” b et ween NW Park way

an d W o r l d w i d e. Acco rd i ng t o t h e W es t ex ecu t i v e wh o l ed W es t ’ s du e d i l i g en ce

p ro ces s rel at i n g t o t h e acq u i s it i o n o f W o rl d wi de, Fran k Han n a was “ ul t i m at el y ” t h e

o wn er o f b o th N W Park way

, t h e l es s o r, an d (al o n g wi t h Ty e Han n a) W o rl d wi d e, t h e

o ri g i nal les s ee. In 2 0 0 4

, wh en W o rl d wi d e ex ecu t ed t h e l eas e at i s s ue i n t h i s cas e, i t

h ad al read y been o ccu p y i n g th e p ro p ert y fo r t w o y ears

. W es t ’ s ex ecu ti v e d ep o s ed

t h at

, “ [b ] ecau s e W o rl d wi de was co n d u ct i n g i t s b u s i nes s o perat io n s in t h e Bu i l d i n g,

W es t h ad n o reas o n t o s u s p ect t h at an y d efect i v e co nd i t i o ns ex i s t ed i n t h e Bu i l d i n g.

W es t c o n d u c t e d i t s reg ul ar du e d i l i g en ce rel at ed t o t h e t ran s act i o n, b u t

. . . n ev er

t o u red t h e faci l i ty d uri ng a rai n fal l t o d et erm i n e wh et her t h e ro o f h ad l eak i n g i s s u es .”

Bu t W o rl d wi d e’ s faci l i t i es m an ag er, wh o co n t i n u ed i n t h at ro l e aft er W es t acq u i red

W o rl d wi d e, d ep o s ed t h at “ [p ] ri o r t o t h e acq u i s i t i o n o f W o rl d w i d e i n 2 0 0 4,

W o rl d wi d e’ s l ead ers h i p was aware o f t h e s i gn i fi can t pro b l em s affect i n g t h e l o w ro o f

o f t h e Bu i l d i n g .” Sp eci fi cal l y

, p art o f t h e ro o f was rep l aced i n J u l y 2 00 2 , an d t h ere

26were a n u m

b er of l eak s

, s o m e “ s i g n i fi can t

, ” i n 2 0 0 2 an d 2 0 0 3, req u i ri n g m u l t i p l e

rep ai rs

.

Al t h o u g h

, as t h e t ri al co u rt n o t ed

, reas o n ab l e rel i an ce an d d u e di l i g en ce are

o rd i n ari ly qu es t i o n s fo r th e ju ry

, 1 1 “ [t ] h e l aw d o es no t affo rd rel i ef to on e wh o s u ffers

b y n o t us i n g t h e o rd i n ary m ean s o f i n fo rm at i o n

, wh et h er t h e n eg l ect i s d u e to

i n d i fferen ce o r cred u l i t y

. ” (Ci t at i o n s an d p un ct u at io n o m i tt ed .) Mi l l er v. Cl a b b y

, 1 7 8

Ga. Ap p

. 8 2 1

, 8 2 3 (3 44 SE2 d 7 51 ) (1 9 8 6 ). W h en t h e m ean s o f k n o wl ed g e are at h an d

an d eq u a l l y av ai lab l e t o b o th p art i es

, s u ch as i n sp ect io n o f real p ro p ert y t o b e

p u rch as ed

, i f o n e p art y d o es no t av ai l i t s el f o f t h e m ean s o f d i s co v ery

, it wi l l n o t b e

h eard to s ay l at er t hat i t was d ecei v ed b y t h e o th er p art y ’ s rep res en t at i o n s o r l ack

t h ereo f. Id

. W h ere a s o p h i st i cat ed co m p an y i s i n th e p ro c e s s o f a cq u iri n g an o t h er

co m p an y an d as s u m i ng th at co m p an y ’ s ob l i g at io n s u n d er a 2 0 -y ear t ri pl e-n et l eas e;

u n d er t h e l eas e t h e acq u i ri n g co m p an y wi l l b e r es po n s i b l e fo r m ai n t en an ce an d

al m o s t al l o t her ex p en ses of t h e s u b ject p ro pert y ; t h e acq u iri n g co m p an y k n o ws t h at

t h e l eas e was n o t n eg o t i at ed i n an arm s -l en g t h t ran s act i o n ; an d

, t h e l eas e i n cl u d es an

ack n owl ed gm en t t h at t he pro p ert y i s i n g oo d rep ai r, cert ai n l y un d er s u ch

1 1 See No r th wes t Pl a z a

, LLC (MI) v. No r t h ea s t En ter p r i s es

, In c.

, 3 0 5 Ga. Ap p.

1 8 2

, 1 91 (3 ) (a) (6 9 9 SE2 d 4 1 0 ) (2 0 10 ); Mi l l er v. Cl a b by

, 8 2 1

, 8 2 3 (3 4 4 SE2 d 7 5 1 )

(1 9 8 6).

27ci rcu m s t an ces t h e co m p an y i s o n n o t i ce o f t he n eed t o ex erci s e a s i g n i fi can t d eg ree

o f d i l i g en ce i n i n s pect i n g t h e p rem i s es

. NW Park way ’ s ex ecu t i v e d ep o sed t h at W es t

h ad t h e o p p o rt u n i t y t o in s pect t h e pro p ert y an d h as i d e n t i f ied ev id en ce t h at ro o f

p ro b lem s were k n o wn t o W es t ’ s em p l o y ees b efo r e t h e ex ecu t i o n o f t h e l eas e. In

reb u t t al

, W es t h as no t id en t i fi ed an y ev i d en ce t h at NW Park way p re v e n t e d i t fro m

co n du ct in g an y i n s p ect i o n i t d es i red

, n o r an y ev i d en ce t h a t i t wo u l d n o t h av e

d i s co v ered t h e co n di t i o n o f t h e ro o f b y i n s p ect in g t h em

.

Gi v en t h es e fact s

, we co n cl u de th at t h e t ri al co u r t erred i n d en y i n g NW

Park way ’ s m o t i on fo r part i al s u m m a r y j u d gm en t o n W es t ’ s Co u n t 1

. Fo wl er v.

Over b y

, 2 2 3 Ga. Ap p

. 80 3

, 8 0 5 -8 0 6 (1 ) (4 7 8 SE2 d 9 1 9 ) (1 9 96 ) (Th e s el l er o f a p arcel

o f real p ro p ert y was en t i tl ed to ju d g m en t o n t h e b u y er’ s frau d cl ai m o n t h e b as i s t h at

t h e b u y er fai l ed as m at t er o f l aw t o ex erci s e d u e d i l i g en ce t o d i s c o v e r t h at t h e

p ro p ert y h ad b een u s ed as a d u m p ; aft er o b s erv i n g s o m e tras h st rewn on a p o rt i o n o f

t h e p ro pert y

, t h e b u y er “ was cert ai n l y p ut o n no t i ce o f t he p o s s i b il i ty ” t h at t h ere was

o t h er d eb ri s o n t h e res t o f t h e p ro p ert y

. “ Du e d i l ig en ce i n s u ch a cas e wo u l d req u i re

a cl o ser in s p ect i o n t h an s h e m ad e o f t h e p ro p ert y ,” an d th ere was n o ev i d en ce t h at s h e

was p rev en t ed fro m

i n sp ect i n g p ro p ert y p ri o r t o p u rch as e.) (ci t at i o n s o m i t t ed ); Ben

Fa r m er Rea l t

y Co

. v. W

o o d a r d

, 2 1 2 Ga. Ap p. 7 4

, 7 7 -7 8 (4 4 1 SE2 d 42 1 ) (1 9 9 4 ) (Th e

28s el l er o f a h o u s e was en t i t l ed t o ju d g m en t o n t he p u rch as er’ s frau d cl ai m o n t h e b as i s

t h at t h e p u rch a s e r f

a i l ed as m at t er o f l aw t o ex erci s e d u e d il i g en ce t o di s co v er fi re

d am ag e i n t he at ti c o f th e ho m e wh ere s h e k n ew th e h o u s e w a s i n d i l a p i d at ed

co n di t i o n

, sh e ag reed t o p u r ch as e h o u se in it s “ as is ” co nd i t io n

, s u ch th at s h e was

o b v i o u s l y o n n o t i ce t o ex erci s e h ei g h t en ed d eg ree o f d i li g en ce i n i n s p ect i n g h o u s e,

t h e s e l l er d i d n o t p rev en t h er fro m i n s p ect i n g t h e at t i c, an d t h e p u rch as er fai l ed to

i n s p ect t he at t ic.); M

et mo r Fi n a n ci al

, In c. v. Jen ki n s

, 1 9 9 Ga. A p p

. 8 85

, 8 8 6 (4 0 6

SE2 d 2 8 8 ) (1 9 91 ) (A l en d er co u l d n o t be h el d l i ab le i n frau d t o a b u y er o f a ho u s e fo r

m i s rep res en t at i o n s ab o u t t he co n d i t i o n o f t h e h o u s e

, w h ere ev en a cu rs o ry v i s u al

i n s p ect i on o f p ro p ert y wo u l d h av e rev eal ed th e co n s tru ct i on d efi ci en ci es t o t h e b u y er

an d t h erefo re t h ere co ul d b e n o ju s t i fi ab le rel i an ce o n an y m is rep res en tat i on s .).

7

. T h e t r i al co u rt d en i ed NW Park way ’ s m o t i o n fo r s u m m ary ju d g m en t o n

W es t ’ s Co u n t 4

, gr o s s n e g l i g e nce i n NW Park w ay ’ s s el ect i o n o f a v en d o r t o rep ai r

t h e ro ofs an d in i t s fai l u re t o en s u re t h e ro o fs were i n st al l ed p ro p erl y

. NW Park way

ap p eal s t h e d en i al o f i ts m o t i o n

.

“ Gro s s n eg l i gen ce” i s d efi n ed as t h e ab s en ce o f s l ig h t d il i g en ce, t hat i s

,

t h at d eg ree o f care wh i ch ev ery m an o f co m m o n s en se, h o w e v e r

i n at t en t i v e h e m ay b e, ex erci s es u n d er t h e s am e o r s i m i l ar

29ci rcu m s t an ces

. As ap p l i ed t o t h e p r e s e r v a t i o n o f p ro pert y

, t h e t erm

“ s l i g h t d i l i g en ce” m ean s t h at care wh i ch ev ery m an o f co m

m o n sen s e,

h o wev er i n at t en t i v e h e m ay b e, t ak es o f h i s o wn p ro p ert y

.

OCGA § 5 1-1 -4

. In o t h er wo rd s, t o act wi t h g ro ss n eg l i g en ce i s t o l ack “ t h e d i l i g en ce

t h at ev en carel es s m en are accu s t o m ed to ex erci s e.” (Ci t a t i o n a n d pu n ct u at i o n

o m it t ed .) Jo h n s o n v. O m o n d i

, 2 9 4 Ga. 7 4

, 7 8 (7 51 SE2 d 28 8 ) (2 01 3 ). “ W h i l e

q u es ti o n s o f g ro s s n eg li g en ce an d s l i g h t d i l i g en ce are u s u al l y to b e d et erm i n ed b y a

fact fi n d er, co urt s m ay res o l v e t h em as m at ters o f l aw i n p l ai n an d i n d i s p u t ab l e cas es .”

(Ci t at i o n s o m i t t ed .) Id

.

In t h i s cas e, W es t h as n o t i d en t i fi ed an y ev i d en ce t h at NW P a r k wa y was

i n d i fferen t t o wh et h er t h e ro o fi n g v en d o r i t s e l e c t e d wo u l d d o a g o o d j o b o r t h at i t

o t h erwi s e act ed wi t h o u t ev en s l i g h t care wh en ch o o s i n g t he r o o f i n g co n t ract o r. In

ad d it i o n W es t h as n o t id en t i fi ed an y ev i d en ce t hat NW Park way act ed w i t ho u t ev en

s l ig h t care wi t h reg ar d t o t h e q u al i t y o f wo rk o f i t s ch o s en co n t ract or. W es t s i m p l y

s t at es , “ [t ] h e q u es t i on of wh et her NW Park way was g ro ss ly

n eg l i g en t i s . . . p l ai n l y

fo r t he ju ry .” To o p p o s e a m ot i o n fo r s u m m ary ju d g m en t

, m o re i s req u i red t h an a b al d

30s t at em en t t h at an i s s u e i s g en e r a l l y f o r t h e j u ry

. 1 2 Acco rd i n g l y

, NW Park way i s

e n t i t l ed t o ju d g m en t as t o W es t ’ s Co un t 4

, an d t h e t ri al co urt erred i n d en y i n g N W

Park way ’ s m o ti o n fo r p art i al s u m m ary ju d g m en t i n t hi s reg ard

.

Ju d g men t a f f i r med i n p a r t a n d rever sed i n p a r t

. Ph ip

p s

, P. J., co n cu r

s

.

Di l l a r d

, Ra y an d McMi l l i a n

, JJ., co n cu r i n j u dg men t o nl y. Ba r n es

, P .J., a n d

McFa d den , J., co n cu r i n p a r t a n d d i s s en t i n p a r t.

1 2 W h ere a res p o n d en t wh o wi l l n o t b ear t h e b u rd en o f p ro o f at t ri al m o v es fo r

s u m m ary ju d gm en t an d “ p o i nt s o u t b y referen ce t o t h e e v i den ce i n t h e reco rd t h at

t h ere i s an ab s en ce o f ev i den ce t o s u p p o rt an y es s en t i al el em en t o f t h e [cl a i m an t ’ s ]

cas e[,] ” t h e cl ai m an t “ can n ot res t o n i t s pl ead i n gs

, bu t rat h er m u s t p oi n t t o s p e ci fi c

ev i d en ce g iv i n g ri s e t o a t ri ab l e i s s u e.” (Ci t at i o n s an d p u nct u at i o n o m i t t ed .) Co wa r t

v. W i d en er , 2 8 7 Ga. at 6 2 3 -6 2 4 (1 ) (a).

31A1 5 A1 8 3 0

. W EST ASSET M ANAGEM ENT, INC. v

. NW

PARKW AY, LLC.

M C F A D D E N , J u d g e, co n cu rri n g i n p art an d d i s s en t i n g i n p art

.

Becau s e o u r p ri o r o p in i o n d o es n o t res o l v e t h e i s s u e o f W es t ’ s d efau l t

, I

res p ect fu l l y d is s en t i n part

. In t h e p ri o r ap pearan ce o f t h i s cas e we rev ers ed t h e t ri al

co u rt ’ s g r a n t o f s um m ary j u d gm en t i n fav o r o f W es t. Th e t ri al co u rt h ad hel d as a

m at t er of l aw t h at

, reg ard l es s o f th e c o n d i t i o n o f t h e ro o fs

, W es t had n o d u t y to

rep l ace t h em

. Th e t ri al co u rt d i d n o t reach

, am o n g o t h er t h i n g s, W es t ’ s t en d er d efen s e

o r W es t ’ s co n t en t i o n t h at t h e ro o fs co u l d hav e b een rep ai red rat her t h an rep l aced

. So

we d i d n o t reach t ho s e i s s ues ei t h er

– n o r co ul d w e h av e. It fo l l o w s t h at t h e l an g u ag e

i n o u r earl i er o p i n i o n t o t h e effect t h at W es t’ s fai l u re to rep ai r t h e ro o fs co ns t i t u t ed

d efau l t an d b arred i t fro m ex erci s i n g t h e t erm i n at i o n cl au s e i s n o t t h e l aw o f t h e cas e.

Co n seq u en tly

, I c onc ur in D ivi s i o n 2 (affi rm i n g t h e g ran t o f s u m m ary ju d g m en t

t o W es t o n NW Park way ’ s cl ai m fo r ren t aft er Decem b er 2 01 2 ), D i v i s i o n 3 (affi rm i n g

t h e d en i al o f s u m

m a r y j u d g m en t t o W es t o n NW Park way ’ s cl ai m fo r l at e fees ),

Di v is i o n 5 (affi rm i ng t h e d en i al o f s u m m ary ju d g m en t t o W es t o n N W P a r k way ’ s

cl ai m fo r OCGA § 1 3 -6 -1 1 at t o rn ey f e e s ), Di v i s i o n 6 (rev ers in g t h e d en i al o f

s u m m ary ju d g m en t t o NW Park way o n W es t ’ s frau d cl ai m ), an d Di v i s io n 7 (rev ers i n gt h e d en i al o f s u m m ary j u d gm en t t o NW Park w ay on W es t ’ s g ro s s n eg l i g en ce cl ai m ).

Bu t I res p ect fu l l y d i s s en t fro m Di v is i o n 1 (rev ers i ng t h e d en i al o f s u m m ary ju d g m en t

t o NW Park way on i t s cl ai m f o r b reach an d an t i ci p at ory b reach o f t h e leas e) an d

Di v is i o n 4 (affi rm i n g t he g ran t o f s u m m ary ju dg m en t to NW Park w ay o n i t s cl ai m fo r

ro o f-rel at ed ex p en ses ).

1

. La w o f t he ca se

.

Becau s e th ere h as b een an earl i er ap p eal i n t h i s cas e, NW Pa r kwa y, LLC v.

Lems er

, 30 9 Ga. Ap p. 1 72 (7 0 9 SE2 d 8 5 8 ) (2 0 1 1), o u r an al y s is b eg i n s wi t h t h e l aw

o f th e cas e ru le. See OCGA § 9 -1 1 -6 0 (h ). Co nt rary t o t h e m ajo ri t y

, I wo u ld h o l d t h at

i t i s no t ap p l icab l e. “ Th e ‘ law o f t h e cas e’ h as b een d efi n ed as a co n t ro ll i n g leg al ru l e

es t ab l i s h ed b y a p rev io u s d eci s i o n b et ween t he s am e p art i es i n t h e s a m e cas e.”

Mo d er n Ro o f i n g & Met a l W

o r ks v. Owen

, 1 74 Ga. Ap p

. 8 7 5

, 87 5 (1 ) (3 3 2 SE2 d 1 4 )

(1 9 8 5) (ci t at i o n a n d p u nct u at i o n o m i t t ed ). Acco rd i n gl y

, t h e l aw o f t he cas e ru l e

ap p li es “ o n l y wh en t h e sam e i ss u e h as b een act ual l y li t ig at ed an d deci d ed .” S t a t e v.

Mi z el l , 2 8 8 Ga. 4 7 4 , 4 78 (3 ) (7 0 5 SE2 d 1 5 4 ) (2 0 10 ) (ci t at i o n s o m it t ed ).

W es t fi led t h e m ot io n fo r s u m m ar y j u d g m e n t t h at we rev i ewed i n t h e fi rs t

a p p e a ran ce o f t h is cas e, NW Pa r kwa y

, 2 0 9 Ga. Ap p

. at 1 7 2

. It so u g h t s u m m a r y

ju d g m en t o n i t s co u n t ercl ai m fo r a d e c l a rat o ry ju d g m en t s eek i n g th e res o l u t i o n o f

2“ q u es t i on s o f l a w ” reg ard i n g t h e t erm s o f t h e leas e. To th e ex t en t t h at i t t u rn ed o n

i n t erp ret at io n o f t he l eas e, t h e m at t er was a q u es t i o n o f l a w

, n o t fact

. See O CGA §

1 3 -2 -1 (“ Th e co n s t ru ct i o n o f a co n t ract i s a q ues t i o n o f law fo r t h e co u rt .”); Ro s wel l

Fes t i va l

, L.L.L.P. v. At h en s In t l

. , 2 5 9 Ga. Ap p

. 4 4 5

, 4 47 (1 ) (5 7 6 SE2 d 9 0 8 ) (2 0 0 3 )

(“ Th e co n s t ru ct i o n o f th e p ro v i s i o n s o f a l eas e, as wi th o t h er wri t t en co n t ract s, i s

g en eral l y a m at t er o f l aw fo r t h e t ri al co urt t o d et erm i ne.”).

In Sep t em

b er 2 0 0 9

, t h e t ri al co u rt g ran t ed W es t ’ s m o ti o n

, fi n d i n g t h at u n d er

t h e l eas e, W es t h ad n o o b l i gat i o n t o rep l ace t h e ro o fs

, an d t hat ev en i f W es t d i d h av e

s u ch an o b l i g at i o n

, NW Park w a y wai v ed it s ri g h t s u n d er t he l eas e b y accep t i n g

s u b s eq u en t ren t pay m en ts fro m W es t

. NW P a r kwa y

, 3 09 Ga. Ap p

. at 17 4 -1 7 5

. Bu t as

t h e t ri al co u rt ack n o wl ed g ed i n t h e ru l i n g n o w befo re us

, th at Sep t em b er 20 0 9 o rd er

“ d i d n o t ad

ju d icat e an y fact s co n cern in g n eces s i t y o f rep l acem en t

. . . .”

W e rev e r s e d t h at 2 0 0 9 o p i n io n

, h ol d i n g t h at t h e t ri al co u rt erred i n b o th

ru l i n gs

. Ou r o pi n i o n m ak es cl ear t h at we were co n s i d eri n g q u es t i o n s of l aw. W e

wro te, as t o i n t erp ret at io n o f th e l eas e, “ NW Park way arg u es t h at t h e t ri al co u rt erred

b y r u l i n g t h at W es t

, a s a ma tt er o f l a w, h ad no o b l i gat i o n t o rep ai r t h e p ro p e r t y’s

ro o f.” NW Pa r

kwa y

, 3 0 9 Ga. A p p

. at 1 7 5 (2 ) (em p has i s s u p p l i ed ). An d o n t h e wai v er

i s su e, we wro t e t h at ord in ari l y

, t h e q u es t i o n o f wai v er i s fo r ju ry res o l u ti o n

, b u t n ot

3i n t he m at t er b efo re u s . Id . at 1 7 8 (3 ). In s t ead

, we h el d t h at , as a m at t er o f l aw, NW

Park way ’ s accep t an ce o f ren t d i d n ot wai v e i t s ri g h t t o reject W es t ’ s at t em p t to

t erm i n at e t h e l eas e at t h e fi v e-y ear m ark . Id

. at 1 7 7-1 7 8 (3 ).

Th e l an g u ag e b y wh i ch t h e m ajo ri t y fi n d s us t o b e co n s t rai n ed co m es n ear t h e

en d o f o u r an al y s i s

. Hav i n g h el d t h at t h e g ran t o f su m m ary ju d g m en t t o W es t o n t h at

i s su e co u l d n o t b e s u s t ai n ed on ei t h er o f t h e gro u nd s s et ou t in t h e t ri al co u rt ’ s 2 0 0 9

o p i n i o n an d v i ewi n g t h e ev i d en ce i n t h e l ig h t m o s t fav o rab l e t o NW Park way as t h e

n o n m o v an t , we wen t o n t o wri t e t h at W es t’ s “ fai l u re t o rep ai r t he ro o f[] co ns t i t u t ed

a d e fau l t ” t h at wo u l d prev en t i t fro m t im el y co m p l y in g wi th t h e earl y t erm i n a t i o n

cl au s e. Id

. at 1 78 (3 ). Read in l ig h t o f t h e s co p e o f th e i s su es p ro p erl y b efo re u s

, t h at

l an g u ag e i s co rrect l y u nd ers t oo d t o m ean t h at th e l eas e co u l d s ti l l b e i n effect an d t h at

NW Park w a y’ s accep t an ce o f ren t was n ot i n co n s is t en t wi t h i t s in ten t t o i n s i s t o n

W es t ’ s co m

p l i an ce wi th t h e co n d i t i o n s p reced en t fo r earl y t erm i n at i o n

.

Th e o p i n i o n co n t ai n ed n o an al y s i s of wh et her g en u i n e i s s u es o f m at eri al fact

ex i s t ed o n th e i s s u e o f d efau l t. Th at i s s u e was n o t b efo re u s

. “ [A] rev i ew o f t h e act u al

h o l d i n g rev eal s t h at t h e

. . . co u rt n ev er res o lv ed t h e is s u e w h et h er” W es t was in

d efau l t

. Hi cks v. McGee

, 2 8 9 Ga. 5 7 3

, 5 7 8 (2 ) (7 1 3 SE2 d 8 4 1 ) (2 0 1 1). Co n s eq u en t l y

,

t h e l aw o f t h e cas e ru l e do es n o t ap p l y t o r e s o l v e t h e i ss u e o f wh et h er W es t was in

4d efau l t

. Co m p are Ch o a t e Co n st r

. Co

. v. Au t o -Own er s In s

. Co

. , 33 5 Ga. A p p

. 3 3 1

(7 7 9 SE2 d 4 6 5 ) (2 01 5 ) (p ri o r ap p el l at e h o l d in g reg ard i n g ex is ten ce o f g en u in e i s s u es

o f m at eri al fact

, wh ich p recl u d ed s u m m ary j u d gm en t t o on e p art y

, w as law of t h e cas e

i n s u b s eq u en t ap p eal o f d en i al o f s u m m ary ju d gm en t t o an o t h er p art y ).

I t herefo re t u rn t o t h e t ri al co u rt ’ s g ran t o f s u m m ary ju d g m en t t o NW Park way

o n it s cl ai m fo r ro o f-rel at ed ex p en s es

, t h e ru l i ng at is s u e i n t h e m ajo ri t y ’ s Di v i s i o n

4

, an d to t h e t ri a l co urt ’ s d en i al o f b o t h p art i es ’ m o t i o n s fo r s um m ary ju d g m en t o n

NW Park way ’ s cl ai m fo r b reach an d an t i ci pat o r y b reach o f t h e l eas e, t h e ru l i n g at

i s su e i n t h e m ajo ri t y ’ s Di v i s i o n 1

.

2

. Ro o f -r el at ed exp en ses

.

In i t s D i v i s i on 4

, t h e m ajo ri t y affi rm s t he t ri al co u rt ’ s g ran t o f s u m m ary

ju d g m en t t o NW Park w ay as t o l i a b i l i t y o n i t s cl ai m fo r ro o f-rel at ed ex p en s es

. Th e

m ajo ri ty h o l d s t h at th e i s s u e o f wh et h er W es t b reach ed t he l eas e by fai l in g t o rep ai r

o r rep l ace t h e ro o fs was r e s o l v ed i n t h e fi rs t ap p eal

. As d et ai l ed ab o v e, o u r p ri o r

o p i n i o n d i d n o t res o lv e t h e i ss ue o f wh et h er W es t b reach ed t h e leas e. It s i m p l y h el d

t h a t

, u n d er t h e t erm s o f t h e l eas e, W es t was o b l i g at ed

– wh en n eces s ary

– t o r e p a i r

an d rep l ace t h e ro of. A n d in t h e o p i n i o n n o w b efo re u s

, t h e t ri al co u rt ack n o wl ed g ed

t h at q ues ti o n s o f fact rem ai n ed as t o “ wh et h er, an d t o w h at ex ten t t h e t wo ro o fs co u ld

5h av e been rep ai red rat h er t h an rep l aced o r.

. . wh et h er t h e lo wer ro o f was d efect i v el y

co n st ru ct ed or wo ul d h av e l as t ed t o t h e co n cl u s i o n o f W es t ’ s ten an cy .” Acco rd i n g l y

,

I wo u ld rev ers e t h e t ri al co u rt ’ s g ran t o f s u m m ary ju d gm en t o n t h i s i s s u e.

3

. Br ea ch a n d a n ti ci

p a t o r y b r ea ch

.

Th e t ri al co u rt d en i ed t h e p art i es ’ cro s s m o t i o n s fo r s u m m ary ju d g m en t o n NW

Park way ’ s cl ai m fo r b reach an d an t i ci p at o ry b reach of t h e leas e, i d en ti fy i n g d i s p u t ed

i s su es o f m at eri al fact

. In Di v i s i o n 1

, t h e m ajo ri t y accu rat el y s u m m ari zes t h e fact

i s su es i d en t i fi ed i n t h e t ri al co u rt ’ s ru l i n g

.

[Th at ] ru l i n g was s u p p o rt ed b y t h e co u rt ’ s d et erm i n at i o n t h at m at eri al

q u es t i o n s o f fact rem ai n reg ard i n g wh et h er W es t s at i s fi ed t h e co n di t i o n s

f o r t erm i n at i n g th e l eas e at t h e en d o f t h e fi rs t fi v e-y ear i n t erv a l

. I n

p art i cu l ar, t h e t ri al co u rt d et erm i n ed t h at t h ere i s a j u ry q ues t i o n s

reg ard i n g W es t ’ s t en der d efen s e, t h at is

, t h at W es t ’ s t en d er o f t h e ro o frel at ed ex pen s es

, by m o v i n g t o dep o s i t $ 38 4

, 2 2 6 i n t o t h e reg i s t ry o f th e

co u rt

, was s u ffi ci en t to d efeat NW Park way ’ s cl ai m t h at W es t b reach ed

t h e l eas e b y fai l i n g t o rep l ace t h e ro o f. An al t ern at i v e b as i s fo r t h e d en i al

o f s u m m ary ju d g m en t o n NW Park way ’ s Co u n t 2 as t h e co u rt ’ s

d et erm i nat i o n t h at m at eri al q u es t i o n s o f fact rem ai n reg ard i n g wh et h er

a s urren d er t o o k p l ace as o f J an u ary 2 0 1 0, t h at i s, wh et her NW Park way

t o o k act i o n s i n co m

pat i b l e wi t h t h e co n t in u ed ex i s ten ce o f W es t ’ s

l eas eh o l d aft er t hat d at e.

6No t w i t hs t a n d i ng al l o f t hat

, t h e m ajo ri t y fi n d s u s co n s t rai n ed t o rev ers e b y t h e

l an g u ag e o f ou r p ri o r o p i n io n

. I wo u l d affi rm

. W h et h er W es t b reach ed i t s o bl i g at i o n

t o rep ai r o r rep l ace t h e ro o f is a q u es t i o n of fact

. An d as det ai led ab o v e, t h at l an g u ag e

i s no t t h e l aw o f th e cas e an d we are n o t bo u n d b y i t. Ev en i f W es t b reach ed t h e l eas e,

wh et h er i t s t en d er was s u ffi ci en t t o cu re t h e b reach , p rev en t d efau l t

, an d al l o w i t t o

i n v o k e i t s r i g h t t o earl y t erm i n at i o n d ep en ds

– as t h e t ri al co u rt h el d

– o n d i s p u t ed

q u es ti o n s o f fact

.

I am au t h ori zed t o s t at e t h at Pres i d i ng J u d g e Barn es jo i n s m e in co n cu rri n g in

p art an d d i ss en t in g i n p art

.

7