SECOND DI VI SI ON

A NDREWS, P. J.

, M C F A D DEN and RA

Y, JJ.

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

ph y sic a l ly r e ce iv ed i n our c le r k ’s offic 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 ls .us /r ule s /

Nov em ber 6, 2014



# I n th e Co u r t o f

A p p eals o f

G eo r g ia

A1 4A1 2 6 8

. RUM SEY v . GILLIS et al

.

A N D R E W S , Pres i d in g J u d g e.

Pet er Ru m s ey s u ed Ray an d Nan cy Gi l l i s fo r dam ag es f o r b r e a ch o f a

“ Leas e/ Pu rch as e Ag reem en t ” (t h e Ag reem en t ) b y wh i ch t h e Gi l l is es ag reed t o l eas e

an d t hen p urch as e Ru m s ey ’ s res i d en ce. W e co n si der Ru m s ey ’ s ap p eal fro m t h e t ri al

co u rt ’ s g ran t o f s um m ary ju d g m en t i n fav o r o f t h e Gi l l i s es on al l of h is cl ai m s

. Fo r

t h e fo l lo wi n g reas o ns , we affi rm i n p art an d rev ers e i n p art

.

In Ap ri l 2 0 1 1 t h e Gi l l i s es an d Ru m s ey en t ered i n t o t h e A g r eem en t

, wh i ch

p ro v id ed t h at t h e G i l li s es ag reed t o p u rch as e t h e res id en ce fro m Ru m s ey fo r t h e s u m

o f $ 5 5 0

, 0 0 0 .0 0 ; t h at th e cl o s i n g wo u l d o ccu r o n o r b efo re Ap ri l 3 0

, 20 1 4 ; t h at

,

co m m en ci n g in M ay 2 0 1 1 u nt i l t h e cl os i n g d at e, t h e Gi l l i s es wo u l d l eas e t h e

res i den ce fro m Ru m s ey p u rs uan t t o a l eas e at tach ed as an ex hi b i t t o t h e Ag reem en t ;an d t h at

, wh en th e Ag reem en t was en t ered i n to b y t h e p art i es

, t h e G i l li s es p ai d

earn es t m o n ey i n t h e am o u n t o f $ 1 0 ,0 0 0 .0 0 hel d b y Ru m s ey

. Th e Ag r e e m en t al s o

co n tai n ed a l i q u id at ed d am ag es cl au s e p ro v i d i ng t h at earn es t m o ney ret ai n ed i n t h e

ev en t o f defau l t co n st i t u t es l i q u i d at ed d am ag es i n f u l l set t lem en t o f al l cl ai m s

. Th e

Ag reem en t p ro v i d ed t h a t

, i f t h e l eas e was t erm i n at ed befo re t h e cl o si n g d at e by

d efau l t o f t h e Gi l l is es

, t h at was co n s i dered a d efau l t o f t he Ag r e e m e n t e n t i t l i n g

Ru m s ey to p u rs u e a v a i l a b l e rem ed i es

. Th e at t ach ed l eas e p ro vi d ed fo r p ay m en t o f

ren t i n t h e am o u n t o f $ 3 ,5 0 0.0 0 p er m o n t h fo r a l eas e t erm co m m en ci n g o n M ay 3,

2 0 1 1

, an d en d i n g on t h e cl o s i n g d at e o f t h e p u rch as e. Th e Gi l l i s es d i d n o t p u rch as e

t h e res i d en ce p u rs u an t t o t he Ag reem en t ; rat her, th e Gi l l i s es v acat ed t h e res i d en ce

an d ceas ed p ay i ng ren t i n No v em b er 2 0 1 1

, an d Ru m s ey ret ai n ed t h e $ 1 0 ,0 0 0 .0 0 in

earn es t m o n ey an d s ub s eq u en t l y s o l d t h e res i d en ce t o a t h i rd p art y

.

Aft er ret ai n i n g t he $ 1 0

, 0 0 0 .0 0 i n earn es t m o n ey p ai d b y t h e G i l li s es

, Ru m s ey

s u ed t h e Gi l l i ses i n D ec e m b e r 2 0 1 1 fo r b reach of t he Ag reem en t s eek i n g d am ag es

al l eg ed l y cau s ed b y t h e Gi l l i ses ’ fai l u re t o pu rch as e t h e res i d en ce an d p a y ren t d u e

u n d er t h e l eas e. Aft er Ru m s ey s o l d t h e res i d en ce i n M arch 2 0 12 t o a t h i rd p art y fo r

$ 4 3 7 ,0 0 0 .0 0

, he s ou g h t d am ag es fo r b reach o f t h e p u rch as e ag reem en t i n t h e am o u nt

o f $ 1 1 3,0 0 0 .0 0 (t h e d i fferen ce b et ween t h e t h i rd p ar t y s a l e s p ri ce an d t h e

2$ 5 5 0 ,0 0 0 .0 0 s al es p ri ce i n t h e Ag reem en t ). As t o d am ag es u n d er t h e l eas e ag reem en t

,

Ru m s ey s o u g h t u np ai d ren t fro m No v em b er 2 0 1 1 (wh en t h e Gi l l i s es v acat ed t h e

res i den ce an d ceas ed ren t p ay m en t s ) to t h e d at e h e s o l d t h e res id en ce t o a t h i rd p art y

i n M arch 2 0 1 2

, p l u s l at e f e e s an d i nt eres t as s o ci at ed wi t h t h e u n p ai d ren t fo r t h at

p eri o d

.

Th e Gi l l i s es an s wered an d co u n t ercl ai m ed ag ai n s t Ru m s ey

. In t hei r am en d ed

an s wer, t h e Gi l l i s es as s ert ed vari o u s d efen s es i n cl u di n g (1 ) th e d efen se t h at t h e

Ag reem en t was u n en fo rceab l e, an d (2 ) t h e al t ern at i v e d efen s e t hat

, i f an en fo rceab l e

Ag reem en t ex i s t ed

, i t co n t ai ned an en fo rceab l e l i q u i d at ed d a m a g es cl au s e u n d er

wh i ch Ru m s ey ret ai n ed t h e $ 1 0 ,0 0 0 .0 0 i n earn e s t m o n ey as d am ag es i n fu l l

s et t l em en t o f an y breach of t h e Ag reem en t

, an d th at th i s b arred Ru m s ey ’ s cl ai m s

. In

t wo co u n t ercl ai m s ag ai n s t R u m s ey

, t h e Gi ll i s es as s ert ed : (1 ) t h at

, becau s e t h e

Ag reem en t was u nen f

orceab l e, t h ey were en t i t l ed t o ret u rn o f t h e $ 1 0 ,0 0 0 .0 0 t h ey

p ai d as earn es t m o n ey

, an d (2 ) t h at

, d u ri n g t h e p eri od t h ey o ccu p ied th e res id en ce an d

p ai d ren t u n d er t h e leas e, th ey su ffered dam ag e as a res ul t of Ru m s ey ’ s b reach o f h i s

d u t y t o k eep t h e res i den ce i n g o o d rep ai r.

Th e G i l li s es m ov ed p u rs u an t t o OCGA § 9 -1 1 -5 6 fo r s u m m ary ju d g m en t o n al l

o f Ru m s ey ’ s d am ag e cl ai m s u n d er t h e Ag reem en t

. Th e s u m m ary ju d g m en t m o t i o n

3was b as ed on t h e s am e al t ern at i v e defen s e as s ert ed i n th e am en d ed an s wer – t h at al l

o f Ru m s ey ’ s cl ai m s were b arred b y an en fo rceab l e l i q u id at ed d am ag es cl au s e i n t h e

Ag reem en t . Acco rd i n g l y

, fo r p u rp o s es o f t h e m o t i o n

, t he Gi l l i s es co n ced ed t h at t h e

Ag reem en t was en fo rceab l e an d t h a t t h e y b r each ed it b y t erm i n at i n g t h e l eas e an d

refu si n g t o pu rch as e t h e r e s i d en ce. Th e Gi ll is es as s ert ed t h ey were en t i t l ed to

s u m m ary ju d g m en t b ecau s e, p u rs u an t t o t h e li q u id at ed d a m a g es cl au s e, Ru m s ey

ret ai n ed t h e $1 0 ,0 0 0 .0 0 i n earn es t m o n ey as d am ag es in fu ll s et t l em en t o f al l h i s

cl a i m s t hat t h ey b reach ed t h e Ag reem en t

. T h e t ri al co u rt g ran t ed th e m o t i o n ru l i n g

t h at t h e l i q u i d at ed d am ag es cl au s e was en fo rceab l e; th at Ru m sey ret ai n ed t h e earn es t

m o ney in fu l l s at i sfact i o n o f h i s cl ai m s t h at t h e Gi l l i s es b reach ed th e Ag reem en t ; an d

t h at t h is en t i t l ed t h e Gi l l i s es t o s u m m ary ju d g m en t o n al l o f Ru m s ey ’ s cl ai m s

.

1

. Ru m s ey cl ai m s t he tri al co urt err e d b y g ran t i n g s u m m ary ju d g m en t t o t h e

Gi l l i ses o n t h e b as i s t h at al l o f h i s cl ai m s were b arred b y t h e l i q u i d at ed d am ag es

cl au s e i n t h e Ag reem en t

.

To p rev ai l o n a m o t i on fo r s u m m ary ju dg m en t

, “ t he m o v i n g part y m u s t

d em o n s t rat e t hat t h ere i s n o g en u i n e i s s u e o f m at eri al fact an d th at th e un d i s p u t ed

fact s, v iewed i n t he l i g h t m o s t fav o rab le t o t h e n o nm o v in g p art y , warran t ju d g m en t

as a m at t er o f l aw.” La u ’s Co r p

. v. Ha s ki n s

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

4OCGA § 9 -1 1-5 6

. Ap p l y i ng t h i s s t an dard

, we fi n d t h a t t h e t ri al co urt co rrect l y

g ran t ed s u m

m ary ju d g m en t i n fav o r o f t h e Gi l l i s es o n Ru m s ey ’ s cl ai m s s e e k i n g to

co l l ect d am ag es fo r b reach o f t h e Ag reem en t in ex ces s o f t h e $ 1 0 ,0 0 0 .0 0 o f earn es t

m o ney t h at h e ret ai n ed

.

Un d er OC G A § 1 3-6 -7

, “ [i ] f t h e p art i es ag ree in t h ei r co n t ract wh at t h e

d am ag es fo r a b reach s h al l b e, t h ey are s ai d t o b e l i qu i d at ed an d

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

v i o l at es s o m e p ri n ci pl e o f l aw, t h e p art i es are b o u n d t h ereb y .” Th e Ag reem en t at

i s su e fo r p u rch as e o f t h e res i d en ce (fo r $ 5 5 0 ,0 0 0 .0 0 ), an d fo r th e bu y ers ’ l eas e o f t h e

res i den ce (u n t i l cl o s in g), req u i red t h e Gi l l i s es

, as b u y ers

, t o d ep o si t earn es t m o n ey

wi t h Ru m s ey

, as sel ler, i n th e am o u nt o f $ 10 ,0 0 0 .0 0. Th e Ag reem en t co n t ai n ed a

l i qu i dat ed d am ag es p ro v i s i o n wh i ch s t at ed :

If t h e [earn es t m o ney ] ch eck i s accep t ed an d d ep o s i t ed b y Sel l er i t sh al l

co n s t i t ut e l i q u i d at ed d a m a g e s i n fu l l s et t l em en t of al l cl ai m s o f Sel l er

ag ai ns t Bu y er. Su ch l i q u id at ed d am ag es are n o t a p en al t y an d are i n s tead

a reas o n abl e p re-es t im at e o f Sel l er’ s act u al d am ag es

, wh i ch d am ag es are

d i ffi cu l t t o as cert ai n

. No t h i n g h e r ei n s hal l p rev en t t h e Sel l er fro m

d ecl in i n g t h e t en d er o f t h e earn es t m o n ey

. . . .

Th e Ag reem en t i n i t s p r e-p ri n t ed fo rm set fo rt h co n d i t i o n s g o vern i n g ret u rn o f t h e

earn es t m o n ey t o t h e b u y er (e.g

., t e r m i n at i o n o f th e ag reem en t d ue t o fau l t o f t h e

5s el l er) o r d i s b urs em en t 1 o f t h e earn es t m o ney t o t he s el ler (e.g

. , t erm i nat i o n o f t h e

ag reem en t d u e t o f

a u l t o f b u y er). Th e p ri n t ed Ag reem en t al s o co n t ai n ed a

s u b s eq u en t l y -ad d ed h an dwri t t en s t ip u l at i o n co n cern i n g earn es t m o n ey wh i ch s t at es :

“ Earn es t m o n ey

i s n o n -refu n d ab l e i f p ro p ert y d oes n ot cl o s e.”

Ru m s ey co n ten d s t h at t h e h an d wri t t en st i p u l at i o n c o n tro l s

, ren d ers t h e

l i qu i dat ed d am ag es p ro v i s i on in ap p l i cab l e, an d s h o ws t hat t h e p art i es ag reed t h at

, i f

t h ere was n o cl os i ng o n t h e res i d en ce, h e was en ti t led t o ret ai n t h e earn es t m o n ey an d

s u e th e Gi l l i s es fo r b reach o f t he Ag reem e n t t o reco v er hi s act u al d am ag es

. “ In t h e

co n st ru ct i o n o f co n t r a c t s t h e re i s a ru l e th at a [h an d wri t t en ] p o rt i o n p rev ai l s o v er a

p ri n t ed p o rt i o n, wh ere t h e t w o can n o t b e reco n ci l ed .” S t a n l ey v. G r een f i el d

, 2 0 7 Ga.

3 9 0

, 3 9 0 (6 1 SE2 d 81 8 ) (1 9 5 0 ); Les t er v. Cr o o m s

, In c.

, 1 5 7 Ga. Ap p

. 3 7 7

, 3 7 9 (2 7 7

SE2 d 75 1 ) (1 9 81 ). Ap p l y i n g t h e ru les o f co n t r a c t co n s t ru ct i on

, we fi n d t h at t h e

h an dwri t t en s t i p u lat i o n can b e reco n ci l ed wi t h t h e l i q u i d at ed d am ag es p ro v i s i o n

.

[T] h e co n s t ru ct i o n o f co n t r act s in v o l v es th ree s t ep s

. A t l eas t

i n i t i al l y

, co ns t ru ct i o n i s a m at t er o f l aw fo r t h e co urt

. Fi rs t

, t h e t ri al co u rt

m u s t d eci de wh et her th e l an g u ag e i s cl ear an d u n am b ig u o u s

. If i t i s

, th e

1 Al t h ou g h t h e Ag reem en t co n t ai ned p ro vi s i o n s fo r t h e earn es t m o n ey t o b e

d i s b u rs ed t o t h e Sel l er by t h e “ Ho l d er” o f t h e earn es t m on ey

, it i s u n di sp u t ed t h at

Ru m s ey

, t h e s el l er, was al s o d es i g n at ed i n t h e Ag reem en t as ho l d er o f t h e earn es t

m o ney

. A cco rd i ng l y

, p ro v i s i o n s fo r d i s b u rs em en t fro m a s ep arat e h ol d er to th e s el l er

are i n ap p l i cab l e.

6co u rt s i m p l y en fo rces th e co n t ract acco rd in g t o i t s cl ear t erm s; th e

co n t ract al o n e i s l oo k ed t o fo r it s m ean i n g. N e x t

, i f t h e co n t ract i s

am b i g u o u s i n so m e res p ect

, th e co u rt m u s t ap p l y t h e r u l es of co n tract

co n s t ru ct io n t o res o l ve t h e am b i g u i t y

. Fi nal l y

, if t h e am b i g u i t y rem ai n s

aft er ap p l y i n g t h e ru l es o f co n s t ru ct i on

, t h e i ss u e o f wh at t h e am b i g uo u s

l an g uag e m ean s an d wh a t t h e p art i es i n t en d ed m u s t b e res o lv ed b y a

j u r y

. Becau s e t h e fi rs t t wo o f t h es e s t ep s i n v o l v e q u es t i o n s o f l aw, t h e

t ri al co u rt ’ s ap p li cat i o n o f t h em i s rev i ewed d e n o vo o n ap p eal

.

Ci t y o f Ba l d wi n v. W o o d a r d & Cu r r a n , In c.

, 2 9 3 Ga. 1 9

, 3 0 (7 4 3 SE2 d 3 8 1 ) (2 0 1 3 )

(p u n ct u at i o n an d ci t at io n om i t t ed ); Co p y S ys t ems o f S a va n n a h

, In c. v. Pa g e

, 1 9 7 Ga.

Ap p

. 43 5

, 4 3 6 (3 9 8 SE2 d 78 4 ) (1 9 9 0 ). Th e h an dwri tt en s t i p u l at i o n p ro v i d i n g t h at t h e

e a r n es t m o n ey hel d b y Ru m sey was n on -refu n d ab l e i f n o cl o s i n g occu rred

, i s n o t

i n co n s i s t en t wi t h Ru m s ey ’ s ret en t i o n o f t h e earn es t m o n ey p u rs u an t t o t h e li q u i d at ed

d am ag es p ro v i s i o n as fu l l s et tl em en t o f h i s cl ai m s ag ai n s t t h e Gi ll i s es fo r b reach i n g

t h e Ag reem en t an d fai l i ng t o cl o s e

. A c c o r d i n gl y

, we fi n d t hat t h e l an g u ag e o f t h e

Ag reem en t u n am

b ig uo u s l y s et s fo rt h a l i q u i d at ed d am ag es p ro v i s i o n. Al t h o u g h t h e

t ri al co u rt reach ed t h i s co n cl u s i o n b y a d ifferen t co n s t ru ct i o n o f th e Ag reem en t

, we

affi rm th e co u rt ’ s ru li n g u n d er t h e ri g h t fo r an y reas o n ru l e. Ci t y o f Ga in es vi l l e v.

Do d d , 2 7 5 Ga. 8 3 4 (5 7 3 SE2 d 3 6 9 ) (2 0 0 2).

Ru m s ey co n ten d s t h a t t h e t ri al co u rt erred b y fi nd i n g t h at t h e li q u i d at ed

d am ag es p ro vi s io n i n t h e A g reem en t was en fo rceab l e. “ [T] h e en fo rceab i l i t y o f a

7l i qu i dat ed -d am ag es pro v i si o n in a co n t ract is a q u es t i o n o f law fo r th e co u rt .” Li b er t y

Li f e In s

. Co

. v. Th o ma s B. Ha r t l ey Co n s tr

. Co

. , 2 5 8 Ga. 8 0 8

, 8 0 9 (3 7 5 SE2 d 2 2 2 )

( 1 9 8 9). “ A t erm fi x i n g u n reas o n ab l y l arg e l i qu i d at ed d am ag es i s u n en fo rceab l e o n

g r o u n d s o f p u b l ic p o l i cy as a p en al t y .” A F LAC, In c. v. W

i l li a ms

, 2 6 4 Ga. 3 5 1

, 3 5 4

(4 4 4 SE2 d 3 1 4 ) (1 99 4 ) (p u n ct u at i o n an d ci t at i o n o m i t t e d )

. I n S o u th ea s t er n La n d

Fu n d, In c. v. Rea l

Es t at 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 7 6 ), t h e

Su p rem e Co u rt es t ab l is h ed a t h ree-p art i n q u iry t o d et e r m i n e wh et h er a li q u i d at ed

d a m a g e s p r o vi s io n i n a real es t at e s al es co nt ract is en fo rceab l e, an d au t h ori zes t h e

s el l er t o ret ai n t h e earn es t m o n ey p ai d b y t h e b u y er i n t he ev en t o f a b reach o f

co n tract b y t h e b u y er, or wh et h er i t i s un en fo rceab l e as a p e n a l t y. Th e t h ree-p art

i n q u i ry

, w h i ch n eces s ari ly req ui res t h e res o l u t i o n o f q u es t io n s of fact

, d et erm i n es i f

t h e fo l lo wi n g fact o rs are p res en t :

Fi rs t

, t h e i n

ju ry cau s ed b y t he b reach m u s t b e d i ffi cu l t o r i m

p o s s i b l e o f

accu rat e es ti m at i o n ; seco n d

, t h e p art i es m u s t i n ten d t o p ro v id e fo r

d am ag es rat h er t h an fo r a p en al t y ; an d t h i rd

, t h e s u m s t i pu l at ed m u s t be

a reas o n ab l e p re-es t i m at e o f t he p ro b ab l e l o ss

.

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

u n d

, 23 7 Ga. at 2 3 0 ; L i b e r t y Li f e

, 2 5 8 Ga. at 8 0 9

. As t h e

m o van t s o n su m

m ary ju d g m en t, t h e Gi l l is es h ad th e b u rd en o f s h o wi ng t h at

, as t o t h e

t h ree fact o rs

, n o g en ui ne i s s u e o f m at eri al fact ex i s t s

. Li b er t y Li f e , 2 5 8 Ga. at 8 0 9

.

8As t o t h e fi rs t fact o r, t h e o rd i n ary m eas u re of d am ag es fo r b reach o f th i s k i n d

o f p u rch as e ag reem en t i s t h e d i fferen ce b et ween t h e ag reem en t s al es p ri ce an d t h e

m ark et v al u e o f t he res id en ce at t h e t i m e o f t he b re a c h

– a val u e wh i ch “ wo u l d b e

s u b ject to t h e v ary in g o p i n i o n s o f ex p ert s

, wh o w o u l d h av e t o reco n st ru ct a p as t

m ark et wh en m ak i ng t h e i r ev al u at i o n .” Id

. at 8 0 9

. T h e reco rd s h o ws t h at Ru m s ey

,

wh o was ex p eri en ced i n real es t at e t ran sact i o n s an d h ad p u rch as ed an d s o l d ab o u t 2 0

res i den ces i n 2 0 1 1

, an d h is real es t at e ag en t

, t es t i fi ed t h at t h e v al u e o f t h e res i d en ce

was s u bject t o d iffi cu l t-t o -p red i ct m ark et f l u ct u at i o n s

. As t o t h e s eco n d fact o r, t h e

Ag reem en t ex p l ici tly sta

te s tha t t h e part i es i n ten d ed fo r t h e $ 1 0,0 0 0 .0 0 earn es t m o n ey

t o rep res en t l i q u i d at ed d am ag es i n t h e ev en t o f a breach b y t h e bu y ers

, an d t hat i t was

n o t i n ten ded as a p en al t y

. Ca i nca r e, In c. v. El l is o n

, 2 7 2 Ga. Ap p

. 1 9 0

, 1 9 2 (6 1 2 SE2 d

4 7 ) (2 0 05 ); Or a n v. Ca n a d a Li f e As s u r

. Co

. , 1 9 4 Ga. Ap p

. 5 1 8

, 5 2 0 (3 9 0 SE2 d 8 7 9 )

(1 9 9 0). As t o t h e t h i rd fact or, $ 1 0 ,0 0 0 .0 0 o f earn es t m o n ey as l i q u i d at ed d am ag es

rep res en t s ab o u t t wo p ercen t o f t h e $ 5 5 0

, 0 0 0 .0 0 p u rch as e p ri ce of t h e res i d en ce. Th i s

p e r c e n t ag e o f t h e s al es p ri ce i s wel l w i t hi n o th er p ay m en t s o f earn es t m o n e y a s

l i qu i dat ed d am ag es fo u n d t o b e reas o n ab l e a s a m at t er of law. S wa n Ka n g

, In c. v.

Ka n g

, 2 4 3 Ga. Ap p

. 6 8 4, 6 8 6 (5 3 4 SE2 d 1 4 5) (2 0 0 0) (t wo percen t o f s al e s p ri ce);

9Li b er t

y Li f e

, 2 5 8 Ga. at 8 0 9 (t en p ercen t o f s al es pri ce); F u qu a Co n s tr

. Co

. v. Pi l l a r

Dev., In c.

, 2 9 3 Ga. Ap p

. 4 6 2

, 46 5 (6 6 7 SE2 d 6 3 3) (2 0 0 8 ) (t wo p ercen t of s al es p ri ce).

W e fi n d th at t he Gi l l i s es carri ed t h ei r b u rd en wi t h res p ect t o t h e t h r e e

S o u t h ea s t er n La n d fact o rs

, an d t h at t h e t ri al co u rt co rrect ly det erm in ed as a m at t er o f

l aw t h at t h e l i qu i d at ed dam ag es p ro v i s i o n i n t h e Ag reem en t was n o t a p e n a l t y an d

was en fo rceab l e. Si n ce t he l i q u i d at ed d am ag es p ro v i s i o n i n t h e A g reem en t was

en fo rceab l e, t h e $ 1 0

, 0 0 0 .0 0 i n earn es t m o n ey ret ai n ed b y Ru m s ey as li q u i d at ed

d am ag es was t h e m ax i m

u m am o u n t h e was en t i t l ed t o co l l ect ag ai n s t t h e Gi l l i s es fo r

d am ag es as a res u l t o f t h ei r b reach of t h e A g reem en t

. Fi ck l i n g & Wa l ker Co

. v.

Gi d den s Co n st r

. Co

. , 2 5 8 G a. 8 9 1

, 8 9 8 (3 7 6 SE2 d 6 5 5) (1 9 89 ). Acco rd i n g l y

, t h e t ri al

co u rt co rrect l y g ran t ed s u m m ary ju d g m en t in fav o r o f t h e Gi l l i s es o n al l of Ru m s ey ’ s

cl ai m s s eek i n g t o co l l ect act ual d am ag es (i n ex ces s o f t h e ag reed l i q u i d at ed dam ag es )

fo r b reach o f t h e Ag reem en t

. Id

.

Ru m s ey co n t en d s t h at

, ev en i f h i s cl ai m fo r act u al d am ag es fo r b reach o f t h e

ag reem en t t o p u rch as e t h e res i den ce was b arred b y t h e l i qu i d at ed d am ag es d efen s e,

h e was s ti l l en t i tl ed t o s ue th e Gi l l i s es fo r act ual d am ag es fo r b reach of th e s ep arat e

l eas e ag reem en t

. On t h e leas e cl ai m

, Ru m s ey s ou g h t t o co ll ect ren t h e cl ai m s was d u e

u n d er th e l eas e fro m t h e d at e t he Gi l l i s es al l eg ed l y b r e a ch ed b o t h t h e l eas e an d t h e

10Ag reem en t b y v acat i ng th e res i d en ce i n No v em ber 2 0 11

, u n t i l t h e dat e h e s o l d t h e

res i den ce t o a th i rd p art y i n M arch 2 0 1 2. Th e Ag reem en t refers t o t h e at t ach ed l eas e

“ m ad e a p art o f t h i s Ag reem en t ,” an d fu rt h er p ro v i d es t h at :

Pri o r t o p u rch as i n g t h e [res i d en ce]

, t h e Bu y er (referred t o as ‘ Ten an t ’

wh ere t h e co nt ex t wo u l d s o i n di cat e) wi l l b e l eas i n g t h e [res i den ce] i n

acco rd an ce wi t h t h e t erm s an d co n d i t i o n s of a s ep arat e L eas e A g reem en t

(‘ Leas e’ ) b et w een t he p art i es at t ach ed h eret o as an ex h i b i t

. In t h e ev en t

t h e L eas e is t er m i n a t e d b y Sel l er d ue t o a d efau l t o f t he Ten an t

t h ereu n d er, Bu yer s h al l al so b e d eem ed t o b e i n d efau l t o f t h i s

Ag reem en t an d Sel l er m ay p u rs u e al l o f i t s rem ed i es

. . . .

Th e l ea s e p r o v i d e s t h at t he l eas e t erm co m m en ces o n M ay 3, 2 0 1 1

, “ an d s h al l en d

at th e cl o s i n g o f th e p u rch as e o f t h e [res i d en ce] b y Ten an t pu rs u an t t o [t h e]

Ag reem en t b et ween t h e p art ies

. . . .” T h u s

, t h e Ag reem en t an d t h e at t ach ed l e as e

m ak e cl ear t hat

, wh en t h e Gi ll i s es v acat ed t h e res id en ce, t hi s co n s t i tu t ed n o t o n l y a

b reach of t he l eas e bu t a b reach o f th e en t i re Ag reem en t

, an d th at t h e part ies d i d n ot

i n t en d fo r t h e res i d en ce to be l eas ed ap art fro m t h e b u y er/ t en an t ’ s ag reem en t to

p u rch as e t h e res i den ce. Ru m s ey an d h is real es t at e ag en t co n f i r m ed t h i s

u n d ers t an d i n g i n d ep o s it i o n t es t i m o n y t h at th e Gi l l i s es ’ b reach o f t h e leas e was

co n si d ered a b reach of t h e en t i re Ag reem e n t

, wh i ch en t i t l ed Ru m s ey t o ret ai n t h e

$ 1 0 ,0 0 0 .0 0 i n earn es t m on ey

. Acco rd i n g l y

, t h e t ri al co u rt co rrect l y r u l ed t h at

11Ru m s ey ’ s ret en t io n o f t he $ 1 0,0 0 0 .0 0 earn es t m on ey ex t i n gu i s hed h i s cl ai m fo r ren t

al l eg ed l y d u e aft er t h e Gi l l i s es b reach ed t h e Ag reem en t b y v acat i n g t h e res i d en ce. 2

W e fi n d n o m eri t t o Ru m s ey ’ s c lai m t h at t h e Gi l l i s es wai v ed t h ei r li q u i d at ed

d am ag es d efen s e b ecau s e i t was n o t rai s ed i n th ei r i n it i al an swer t o h i s co m pl ai n t

. See

OCGA § 9 -1 1 -8 (c) (p l ead i n g affi rm at i v e d efen s es ). Th e Gi l l i s es rai s ed t h i s d efen s e

fo r t h e fi rs t t i m e i n t hei r m ot i o n fo r s u m m ary ju d g m en t

, an d t h ereaft er i n an am en d ed

an s wer. A s s um i ng t h i s was t h e as s ert i o n o f an affi rm at i v e d efen s e, i t w as t i m el y

rai s ed fo r t h e fi rs t t i m e i n th e m o t i o n fo r su m m ary ju d g m en t

. Go b er v. Ho s p i t a l Au t h.

o f Gwi n n et t Co u n ty

, 1 91 Ga. A p p

. 4 9 8

, 4 9 8 -4 9 9 (3 82 SE2 d 1 0 6) (1 9 89 ); Br o wn v.

Mo s el ey

, 1 7 5 Ga. Ap p

. 2 82

, 2 8 3 (3 3 3 SE2 d 1 6 2 ) (1 98 5 ); Ha rd y v. Ga

. Ba

p ti st Hea l th

Ca r e S ys t ems , In c. , 2 39 Ga. Ap p . 5 9 6

, 5 9 7 (5 21 SE2 d 6 3 2) (1 99 9 ).

W i t h o u t ci t at i o n t o th e reco rd o r t o su p po rt i n g au t h o ri t y

, Ru m s ey co n t en d s t h e

t r i a l c o u rt erred b y ru li n g t h at h e was p ro h i b i t ed fro m t en d eri ng t h e $ 1 0,0 0 0 .0 0 in

2 W e n o te t hat th e l eas e al s o g av e Ru m s ey (as l an dl o rd ) t h e ri g h t t o s eek o t h er

d am ag es

, fo r ex am

p l e, t h e co s t o f rep ai ri n g d am ag e t o t h e res i d en ce (o t h er t h an

n o rm al wear an d t ear) cau s ed b y act i o n s or n eg l ect o f t h e t en an t

, t en an t ’ s h o u s eh o l d,

o r t h ei r i n v i t ees

, wh i l e t he t en an t o ccu p ied t he res id en ce. Ru m sey d i d n ot seek t h o s e

k i n d s of d am ag es

, an d w e ren d er n o o p i n io n o n wh e t h e r t h e li q u i d at ed d am ag es

d efen s e wo u l d ap p l y t o t h o s e d am ag es

.

12earn es t m o n ey t o t h e Gi l l i s es o n ce t h ey as s ert ed t h e l i qu i dat ed d am ag es d efen s e. Th i s

cl ai m o f erro r i s d eem ed ab an d o n ed . Co urt o f Ap p eal s Ru l e 2 5 (c) (2 ).

2

. Ru m sey co n t en ds th at t h e t ri al co u rt erred b y ru l in g th at t h e Gi l l is es ’

l i qu i dat ed d am ag es d efen s e d i d n o t b ar t h ei r co u n t ercl ai m s

.

As s et fo rt h ab ov e, th e Gi l l i s es b ro ug h t t wo co u n t ercl ai m s ag ai ns t Ru m s ey

as s ert i n g : (1 ) t h at , b ecau s e t h e Ag reem en t was u n en fo rceab l e, t h ey were en t i t l ed t o

ret u rn o f t h e $ 10 ,0 0 0 .0 0 t h ey p ai d as earn es t m o n ey

, an d (2 ) t h at , d u ri n g t h e p eri o d

t h e y l e a s ed t h e res i d en ce u n d er t h e Ag reem en t

, t h ey s uffered d am ag e as a res u l t o f

Ru m s ey ’ s b reach o f h i s d ut y t o k eep t he res i den ce in g o o d r e p a i r

. I n t h e o rd er

g ran t i n g s u m

m ary ju d g m e nt i n fav o r o f th e G i l li s es on t h ei r l i q u i dat ed d am ag es

d efen s e, th e tri al co u rt ad d ed t h e fo l l o wi n g st at em en t: “ As no m o ti o n reg ard i n g [t h e

Gi l l i ses ’ ] co u nt ercl ai m s f o r d am ag es h as b een fi led

, t h e s am e sh al l rem ai n fo r

res o l ut i o n b y

a ju ry .”

To t h e ex t en t t h i s s t at em en t co u l d b e i n t e rp ret ed as a ru l i ng th at t h e Gi l l i s es

rem ai n en t i t led as a m a t t e r o f l aw t o p u rs u e t h ei r co u n t ercl ai m fo r ret u rn o f t h e

$ 1 0 ,0 0 0 .0 0 earn es t m o n e y f ro m Ru m s ey

, we rev ers e. Th e G i l li s es m o v ed fo r an d

o b t ai n ed an o rd er gran t i n g s u m m ary ju d g m en t i n t h ei r fav o r o n t h ei r li q u i d at ed

d am ag es d efen s e. In t h e o rd er, t h e t ri al co u rt ru l ed th at t h e Ag reem en t b et w een t h e

13p art i es co n t ai ned an en fo rceab l e pro v i si o n u n d er wh i ch R u m s e y ret ai n ed t h e

$ 1 0 ,0 0 0 .0 0 i n earn es t m o n ey as l i q u i d at ed d am ag es

, an d t h at t h is b arred h i s cl ai m s

s eek i n g t o co l l ect act u al d am ag es i n ex ces s o f t h e ag reed d am ag es

. Al t h ou g h t h e t ri al

co u rt ’ s ord er d id n o t di sp o se o f t h e Gi l l i s es ’ p en d in g co u n tercl ai m s

, an d t h e co u rt d id

n o t di rect en t ry of fi n al ju d g m en t p u rs u an t t o OCGA § 9 -1 1 -5 4 (b ), Ru m s ey d i rect l y

ap p eal ed fro m t h e co u rt ’ s ru l i ng p u rs u an t t o OCGA § 9 -1 1-5 6 (h ). Th i s Co u rt ’ s ru l i n g

o n ap peal affi rm i n g t h e t r i al co u rt i s b in d in g o n al l s u b s eq u en t p ro ceed i n g s i n t h e

cas e i n t h e t ri al co u rt

, an d n eces s ari l y p recl ud es t he Gi ll i ses ’ co u n t ercl ai m fo r ret u rn

o f t h e $ 1 0 ,0 0 0

. 0 0 earn es t m o n ey

. OCGA § 9-1 1 -6 0 (h ). As to t h e Gi l l is es ’

co u nt ercl ai m al l eg i n g d am ag es cau s ed b y Ru m sey ’s b r each o f t h e d u t y to k eep t h e

res i den ce i n g o o d rep ai r, t h is cl ai m co ncern s fi x ed d am ag es w h i ch th e Gi l l i s es cl ai m

o ccu rred b efo re t h ey vacat ed t h e res i d en ce an d ceas ed pay i n g ren t

. W e co n cl u d e t h at

t h es e d am ag es were n o t wi t h i n t he co n t em p lat i o n o f t h e l i q ui d at ed d am ag es

p ro v is i o n

, an d t h at t h e co u n t ercl ai m fo r t h es e d am ag es i s n o t p recl u d ed b y ru l i n g s in

t h e t ri al co urt an d t h i s Co u rt o n t h e l i q u id at ed d am ag es d efen se.

Ju d g men t af fi r med i n p a r t a n d r ever s ed i n p a rt

. M

c Fa d d en a n d Ra

y, JJ.,

co n cu r

.

14