THI RD DI VI SI ON BA RN ES , P. J ., BOGG S and BRAN CH, JJ. NOTICE: Motions for reconsideratio n m ust be physically

received

in our clerk’s office with in ten days of the date

of decisi on to be deeme d timely filed. http://ww w.gaappeals.us/rules/ July 1 5, 2014


# In the Court of Appeals of Geo rgia A14A0245 . THOMPSON v. LOVETT. B RANCH , Judge. Ru ssell Eric T homps on appeal s entr y of summary judgment agains t him i n a suit on a note. We hold that the tria l court erred i n concluding that the st atut e of

frauds and the st atut ory requirement of unanimous ac tion bypersonal represent atives of an esta te b ar T ho mp son ’s d efen ses , and w e th eref ore rev erse . Sum mary judgment i s proper when there is no genuine issue of material f act and the movant

is entitl ed to j udgment as a matt er of law. OC GA § 9 -11 -56 (c). W e review a grant

or deni al of

sum ma ry ju dgm ent d e no vo a nd c ons true th e evid ence in the light most favorable to the n on mo van t. Hom e Builders Assn. of Savannah v. Ch atha m C oun ty , 276 Ga. 24 3, 245 (1) (577 SE2d 564) (200 3).1 Some ti me befo re his death , Tho mp son ’s fath er told Th om pso n tha t he d id not

have to cont inue maki ng paym ents under the note, and Thompson cease d making pay me nts in Au gus t 200 3. N either party place s any relev ance on th is eve nt. 2 Construed in favor of

Thompson, the recor d shows that , on February 15, 2003, Thompson purchased his f ather ’s re sidentialpropert y in Loganvi lle . The transa cti on is evidenc ed by a warr anty dee d, a $250, 000 promiss ory note , and a relate d de ed to
secure deb t/sec urit y ag reem ent . T he promiss ory note provide s that , begi nning on March 15, 2003, Thompson w ould pay his father 107 monthly i nstal lments of interest in the amount

of $833.33, foll owed by a ball oon payment of $250, 833.33 on Feb ruary 15, 2 012 . Sinc e the p urch ase, T hom pso n ha s resid ed at th e pro perty , main tained it, and paid the insur ance and t axes. Thompson’s si ster , Carrie Laann Thompson Lo vett, ow ns a nd resi des on the adj oin ing pro per ty a lon g w ith h er ch ildr en. Thom pson’s f

atherdied on March 12, 2004. 1 Pursuant to his will , Thompson and Lovett

were named as co-exe cutor s, and they were eac h d evised the r emainder (i. e. all pro perty othe r than pers ona l effec ts and certain item ized p rop erty not rel evant to this ca se) o f their fathe r’s esta te “eq ually , share -and -sha re alik e, in fee simple, per stirp es.” Shortl y aft er their father’s death, accor ding to Thompson, the parties entered into an oral agreed that Tho mpso n described as follow s:3

Ms. Lo vett a nd I agre ed that inst ead of maki ng monthly mort gage pay me nts und er

th e P ro mi ss ory No te to my f athe r’ s E st at e, fo r wh ic h we were co -e xe cu to rs , we wo ul d wa it untilMs. Lov ett’ s c hi ldre n ha d grown up and movedout of

her h ome, and the n sel l the Pr operty . . . . Ms. Lo vett an d I ag re edth at we would equal ly spl it t he proceeds of the sa le. Lo vet t de nie s th at sh e en tere d in to th is o ral a gre em ent . O n Ma rch 20, 2012, eight years aft er the parties made the al leged oral agre em ent, Lovett , as execut or of the estate and a cti ng throughcounsel, se nt a let ter to her brothe r demanding t hat he pay to the estate the remai ning bal ance due on th e note, wh ich am oun ted to $33 4,99 9.60 . She als o i niti ated proceedi ngs to r emove Thompson as co- execut or, and he lat er re signed pur suant to a consent order. One year after the demandletter, L ove tt, as ex ecutr ix of h er fath er’s es tate, filed suit o n the note on behalf of the estate and c lai med that the debt due had increasedto $349, 165.95 pl us $49,374. 89 in attorney fees. In his answer, Tho mpso n de nied Lovett’s claims and raisedseveral defe nses . Lov ett then moved for summary judgment, which, f ollowi ng a he arin g, th e tria l co urt g ran ted . Thompson adm its thatbut for the alleged oral agreemen t between the parties, he would be obli gated to pay the ba lance on the note. He rai ses severalarguments as to why the alleged oral agreement raises an issue of fa ct as to hi s li abil ity unde r the4

note. Lovett coun ters th at Thompson’s defens es ar e inval idat ed by the t erms of t he
no te its elf a nd by the statu te o f fra ud s. The one-page promissory note contai ns an acceler ation cl ause which provides thatif Thomp son fai ls t o pay any ins tal lment when due or fai ls t o comply with any term of the deed to s ecure debt and s ecuri ty deed, the entire unp aid p rincip al sum with all accruedinterest shall become due an d payable at the option o f the note holder. The note then pro vide s: Itis furt her agree d that fai lure of the Holder t o exerc ise t his r ight of accel erating the m aturity of th e deb t, or indulgence gran ted fro m tim e to time, shallin no ev ent be c onsider ed a waive r of suc h right of acc eler atio n o r est op the Ho lde r fro m e xer cisin g su ch r igh t. The note also pro vide s for in terest a nd a ttorn ey fe es if th e no te has to be accel erat ed. The tria l co urt c onc luded, in part, t hat because Georgia l aw requires that modific ati ons of “[a ]ny cont ract requi red t o be in w rit ing by the statute of frauds” must also be in writi ng, and because the al leged agreement purport ed to be an oral modific ati on of su ch a c ontr act, the factu al issu e raise d reg ardin g the all eged agree ment was immaterialbecause any such agr eementwould be in effec tual. Thompson contends that t he alleged ora l agreement cr eates a genui ne issue of material factwith resp ect to both the enfo rceab ility of the n ote an d his defe nse o f esto ppe l.5

Thompson claim s that the trial court erred because the alleged agreement w as a resc issi on, not a mo difica ti on, and be cause exceptions to the statute of frauds are app licable in this case. We find that the trial co urt err ed in con clud ing th at the s tatute of frauds and the requi rement of unanimous action by personalrepresent atives of an estat e undermine the materi alit y of this fa ctual i ssue to thi s dispute. 1. Georgia’s statute of f rauds require s that“[a] ny contr act f or sal e of lands, or any intere st in, or concerning lands” and “[a]ny agreement t hat is not to be performed with in one year

from the making thereof” be r educed to w riting and sign ed if it is to be binding. OC GA § 13-5-3 0 (5). Thus the origina l promis sory not e held by t he parties’ father’ s e st at e wa s req uire d to be i n w ritin g. S ee, e .g., Sierra Assoc., Ltd. v. Continent

alIllino is Na t. Bank & Trust Co. of Chicago , 169 Ga. App. 784, 789 (2) (a) (31 5 SE2d 250) (1984) (because “all eged ver bal cont ract [conce rning e xtensi on or renewal of promissory note] was not t o be perfo rme d w ithin o ne y ear, it ca me with in the Stat ute of Frauds”) (ci tat ions omit ted) . And ge neral ly, pa role a gree me nts to mod ify a contr act r equir ed to be in writing by the stat ute of frauds are inef

fecti ve. See Brooks v. Gwinnett Community Bank, 311 Ga. App. 806, 807 (717 SE2d 647) (201 1). Nev ertheless, “pa rties to a con tract m ay re scind it by m utua l agre em ent a n d
resc issi on of a wri tte n contr act ne ed n ot be in writing. ” Cornell Indus. v. Colonial6

Bank , 162 Ga . Ap p. 82 2, 82 3 (1 ) (29 3 S E2 d 37 0) (1 982 ) (citatio n omitted); see Works iteRxv. DrTango , 2 86 Ga. App. 284, 285 ( 648 SE2 d 775) (2 007). In Works iteRx , this Court foundthat an aff idavi t fi led by the defe nda nt to a con tract su it claiming that

the par tie s had pre viousl y made an or al agreem ent to rescin d the ir contract wa s sufficien t to rais e an is sue o f ma te rial fac t p recluding an awar d of
summ ary ju dgme nt t o the other party. Id.; see al so C. Brown Trucking Co. v. Hen derson , 305 Ga. App. 873, 874 (1) ( 700 SE2d 882) (2010) ( rever sing a gr ant of
summ ary judgm ent where a p arty’s verifi ed answer raiseda factualissue as t o whether the parties had orally rescinded the contract). Sim ilarly here, Thompson has averred that an oralagree ment between hi m and his sist er ef

fectivel y resc inded the entire transa cti on under which he was purchas ing the home, which is suffi cient to cr eate an iss ue of fact a s to res cissio n. C ons trued in his favo r, the alle ged oral agreement unwinds the entir e transac tion between Thom pson’s fathe r to Tho mpson. The brother and siste r all egedly agreed that Thompson cou ld cea se pa ym ents o n the note and thatThompson would lat er se ll t he pro perty and split the pr oceeds with his sis ter. The same result would have occurred if Thomp son had deeded the p rop erty back to the est ate at the ti me of the alle ged oral agree ment to res cind ; that is, th e estate wo uld have owned the property and the brother7

and sist er coul d then, acting as co- execut ors and t he sole be nefi ciaries of

the propert

y, sell the house and split the proceeds. Also, a part

y “may consent

to re scis sion bythe other party ei ther impli edly or by conduct.” NationwideMut. Ins . Co. v . McCollum , 179 Ga. App. 500, 502 (1) ( 347 SE2d 231) (1986) (ci tat ion and punct uati on omitt ed). In McCollum , this Court found thatan insura n ce customer’s con duct in dem anding and accepting the return of a prev ious ly tender ed premium for certain covera ge manife sted an inte nt to r esci nd the contract forthat covera ge, even though there was no expli cit agree ment to r esci nd. Id. Here, Lovett ’s fa ilur e to r equest repaym ent o n the note or o bject in any ma nne r to over eight

years of kno wn inactio n by Th om pso n is co nsiste nt w ith T hom pso n’s c laim of an agre ement t o resc ind the or iginal t ransacti on. Lovett cl aims that t he alleged agree ment should be considered a modific ation and not a re scissi on, and that prec eden ts involving resc issi ons ther efore do not appl y to take the a lle ged agre ement ou t of th e statu te of fr aud s. Bu t as sh ow n ab ove , con strue d in T hom son ’s fav or, th e agr eem ent wa s a re scis sio n an d su mm ary jud gm ent is th eref ore pre clu ded . Thompson also argues t hat even if the a greement were seen as a modifi cati on, an except ion to the stat ute o f fr auds appl ies. See OCGA § 13-5-31 (3) (s tat ute of frauds inapplicable “[w]here there has been su ch part performance of the contractas8

would render

it a fraud of the party refusing to com ply if the court did n ot co mp el a performan ce”). Because we find that t he alleged ora l agreement, i f construedin favor of T hom pso n, is a re scissio n, w e nee d no t reach this ar gum ent. For the above reason s, the trialcourt erred in finding, as one basis for sum mary judg me nt, that the agreement was a modificati on that hadto be in w riting in or der to be enforced. A m aterial i ssue of fact remains, ther efor e, as t o whether the parti es enter ed int o an oralagree ment to r esci nd the transa cti on. 2. In g rantin g su mm ary ju dgm ent, th e t ria l court al so held t hat “t here i s no evidence that

the parti es acted una nim ous ly as C o-E xecu tors to extin guis h the deb t, as req uire d b y la w.” Georgia law allows heirs to make their own agreement s regarding pro perty dev ised u nde r a w ill: [A]g reem ents among the heirs at law to dis tribu te or d ivide pro perty devised under a w ill, in lieu of that manner prov ided by the w ill, are valid and enforce able. Such agree ments have as thei r consi deration the ter minati on of fam ily co ntro vers ies, an d are uph eld alb eit perhaps restin g on grounds which wo uld not have been sati sfac tory i f the transact ion had occurredbetween mer e str angers . They par take o f the n ature of fam ily arran gem ents and are, in es sence, solely contr actua l and gover ned by rule s ap plic abl e to all co ntra cts.2 “‘Pers on al represent ative’ means any administrator, adminis trator with the wil l

annexed, cou nty adm inistrator, or executor.” OC GA § 53-1-2 (1 2). 9 West v. Down er , 218 Ga. 235, 241 (5) (127 SE2d 359) (1962) (ci tat ions and punctuation omitt ed); see al so OCGA § 5 3- 7-45 (“Perso nal representatives are authorizedto comp romise, adjust, arbitrate, assi gn, sue or defe nd, abandon, or otherwise deal with or set tle debt s or clai ms in favor of or ag ainst the estate.”). 2 Ge org ia law also provides, however, that i f an es tat e has “m ore than one personal rep rese nta tive ,” “un less th e w ill provides otherwise[ ,] [ t]he per sonal represent atives must act by their unan imous action[.]” OCG A § 5 3-7-5 (a). The tri al cour

t correct ly st ated t

he law, but it incorrectly found that the alleged agre em ent, if it

happened, did not consti tute “unan i mous” act ion by Thompson and Lo vett in compromising a debt in favor of t heir fat her’s est ate. At the time of the allegedoral agreement, Tho mpso n and L ovett were the so le co- exec utor s of th eir father’s estate and t

he sole benefi ciaries of

the r emainder

of the estate, including the promissory note ; they we re als o the onl y partie s to th e alleg ed o ral ag reem ent. Contrary to the trial court ’s stat ement that “there is no evidence that the partie s acted unanimousl y” in ag reein g to c ance l Thom pso n’s d ebt in favo r of an altern ate
arran gem ent, the facts construed in Tho mpso n’s favor s how a unanimous de cisi on by10

the partie s to d o jus t that. T hus , ju st as the stat ute of frauds does not pr eclude the pos sibility of

judgment in Thompson’s favor , so t he requi rement of

unanimous ac tion cannotbe i nv ok ed t o ju stify sum ma ry ju dg me nt in fav or o f Lo vet t, a s long as t he fact ual issu e co nce rnin g th e alle ged ora l ag reem ent rem ain s un reso lve d. 3. Thompson also cont ends that the all eged ora l agr eement c reat es a genuine issue of material f

actwith respect

to the exis tence of est oppel. Because we find that the tria l court er

red in failin g to add ress T hom pso n’s a ffirm ative d efen se of estop pel, and that there are genuine i ssues of materi al fact regar ding wh ether estop pel ex ists in this cas e, w e ag ree. In order to make out a c lai m or defenseof estop pel, th e par ty claiming est oppel “must show that

(1) the promisor

made cert ain pr omises; (2) the promisor should have expectedthat the party would rely o n the prom ises; and (3) th e par ty relied on those promises to its det rim ent .” F & W Agriservic es v. UAP/

Ga. Ag. Che m. , 250 Ga. App. 238, 241 (2) ( 549 SE2d 746) (2001) ( footnot e omitt ed) (ci ting OC GA § 13-3-44 (a)). See also 20/20 Vision Ctr. v. Scott Hudgens Companies , 25 6 G a. 12 9, 1 35 (7) , n. 7 (345 SE2d 330) (1986) (estoppel c an be applied even when facts support ing estoppel
are insufficient to constitute parti al performance o f a contract thereby taking the case out of the Stat

ute of Frauds) . In F

& W Ag riservices , this Court deter mined that the11

tria l court had erred in finding that the appellant’s estop pel d efen se w as “w ithou t me rit
as a matter of law.” Id . at 242 (2). The Court inst ead determined that factualissues remained with respect

to whetherthe appellee had i n fact made the al leged promise, whether the p rom isor s hou ld have expectedrel iance on that promise, and whether

the appell anthad in f

act r easonably rel ied on that promise. Id. Similarly, on the record before us, fact

ual issues remain as to whethe r Lovett repre sente d to Thompson that he
cou ld con tinue to res id e on th e property without payment and without

fear of enforc ementof the n ote, and as to whether Thompson reasonably relied on that
re pr esent ati on to his detriment (i. e. by exposing himself to additionalliabi lit y, such
as a ttor ney fees ass oci ated wi th L ov ett’s attem pt to col lect o n th e no te). L ove tt argues that the terms of the no te preclude application of estoppel as a defense. But the only appli cable term of the note is quoted above, and i t only provides thatany failure by L ove tt to exer cise h er righ t to acc elerate the n ote or any indulgence grantedby her sha ll not

constitute “a waiver

of such right of

accel eration or e stop t

he Holder from exer cising such righ t.” He re, Th om pso n is n ot claim ing th at Lo vett fail ed to exercise her ri ght to a ccel erat e the not e or that she grant ed him an i ndulgence ; he cl ai ms that sh e agr eed to resc ind his obligation unde r the note. The quoted ter m does12

not prohibi t re scis sion of the not e, and it i s ther efore inappl icabl e to the facts a s con stru ed i n T ho mp son ’s fa vo r. 4. Final ly, because we have found that the t rialcourt err ed by granting su mm ary judg me nt, we need not a ddress Thompson’s remai ning asser tio ns that Lovett fail ed to pierce or address Th omp son’s affirmative defenses. For the reasons set forth above, w e reverse the trial court’s grant of summ ary jud gm ent to L ov ett an d re ma nd for fur the r pr oce edi ng s. Judgment re verse d. Barnes, P. J., and Boggs, J. , conc ur .