FI FTH DI VI SI ON M CFA DDEN, P. J. , M CM I LLI A N and GOSS, 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 l s .us /r ule s
M ay 1, 2019



# I n th e Co u r t o f

A p p eals o f

G eo r g ia

A1 9 A0 72 4 , A1 9 A0 7 2 5. SIARAH ATLANTA HW Y , LLC v
. NEW ERA VENTURES, LLC; an d v i ce v ers a.

M C F A D D E N , Pres id i n g J u d g e.
Th es e ap p eal s ari s e fro m a di s p u t e o v er a co m m e r c i a l l eas e co n t ai n i n g an

o p t i o n to p u rch as e. Th e p art i es fi l ed cro s s -m o t i o n s fo r s u m m ary ju d g m en t , an d t h e
l an d l o rd fi l ed a m o ti o n f o r rel eas e o f fu n d s p ai d i nt o th e reg i s t ry o f t h e co u rt

. Th e

t ri al co u rt ru l ed t h at N ew Er a Ven t u res , L L C, th e ten an t , i s en ti t l ed t o s p eci fi c

p erfo rm an ce of t h e o pt i o n -t o -p u rch as e p ro v i si o n of t h e leas e an d th at Si arah At l an t a Hwy , LLC, t h e l an d l o rd , i s en ti t l ed t o t h e fu n ds p ai d in t o t h e reg i s t ry o f t h e co u rt

. Th e

p art i es fi l ed t h es e ap p eal s

. In Cas e No

. A1 9 A0 72 4 , Si arah arg u es t h at t h e t ri al co u rt erred b y fi n di n g t h at

New Era p ro p erl y ex erci s ed th e o p t i on t o p u rch as e an d b y fai li n g to fi n d t h at Si arahh ad v al id l y t erm i nat ed t he l eas e. W e h o l d t h at New Era’ s no t i ce o f i t s ex erci s e o f t h e

o p t i o n was effect i v e an d t h at Si arah d i d n o t t erm i nat e t h e l eas e. In Cas e No

. A 1 9 A0 7 2 5 , New Era arg u es t h at t h e t ri al co u rt erred b y rel eas i n g t o Si arah fu n d s
New E ra h ad p ai d i n t o t h e co urt reg i s t ry fo r ren t an d o t h er ch arg es

. W e h ol d t h at t h e

t ri al co u rt d i d n o t err by award i n g Si arah fu n d s as ren t , b ut w e v acat e t he o rd er i n p art

an d rem an d fo r t h e tri al co u rt to ad d res s wh et h er t h e am o u nt sh o ul d b e red u ced b y an
award o f b reach -o f-co n tract d am ag es to New Era. W e al s o v acat e t h e p art o f t h e t ri al

co u rt ’ s o rd er award i n g at t o rn ey fees an d rem an d b ecau s e, i n an ap p aren t o v ers i g h t ,
t h e co u rt l eft b l an k t h e am o u nt o f at t o rn ey fees award ed t o New Era.

1

. Fa ct s a n d p r o ced

ur a l p o s t u r e
. Th e fact s are un d i s p u t ed

. Si ar a h o w n s a p arcel o f co m m erci al p ro p ert y in

Fo rs yt h C o u n t y
. On M ay 1 , 20 1 5 , Si arah an d New Era en t ered a co m m erci al l eas e

co n tract un d er wh i ch New Era l eas ed a p o rt i o n o f t h e pro p ert y fo r an i n i t i al t erm o f

t en y ears

. Th e co n t ract g ran ted Si arah t h e ri gh t t o t erm i n at e th e l eas e “ fo r an y reas o n
wh at s o ev er, b y p ro v i d in g [New Era] wi t h t h i rt y (3 0 ) d ay s wri tt en n o t i ce.” In

ex ch an g e fo r a p ay m en t o f $ 1 7 5 , 0 0 0 , t h e co n t ract g ran t ed N ew Era t h e o p t i o n to

p u rch as e t h e p ro p ert y . It p ro v i d ed :

23 1
. Op t io n t o Pur cha s e.

3 1.1

. Pu r ch a s e Op t i o n
. PROVIDED TENANT IS NO T I N DEFAULT AND HAS LEASED THE PROPERTY CONTINUOUSLY F R O M THE DATE HEREOF UNTIL SUCH DATE, LANDLO R D GRANTS TO TENANT, AFTER NINE (9 ) MONTHS FROM THE COM M ENCEM ENT DATE HEREOF, A ND EXPIRING Fo rt y -ei g h t (4 8 ) M ONTHS FROM THE COM M E NCEM ENT DATE H EREOF, ONLY (t h e “ Op t i o n Peri o d ”), T HE O PTION TO PURCHASE FROM LANDLORD THE REAL ESTATE OF W HI CH THE PREMI SES IS P A R T A N D W H IC H IS M O R E PARTI CULARLY DESCRI B E D ON EXHI BI T B

. TENANT M AY EXERCISE THE OPTION BY PR OVIDING W RITTEN NOTICE TO LANDLORD AT LEAST NINETY (9 0) DAYS PRIOR T O THE D A T E OF CLOSING (t he

“ Op t i on Ev en t ”).

(Em p h as i s i n o ri g i n al .)

In acco rd an ce w i t h t h e co n t ract , New Era p ai d Si arah $ 1 7 5 ,0 0 0 fo r t h e o p t i o n

t o p u rch as e t h e p ro p ert y
. On J an u ary 2 7 , 20 1 7 , N ew Era s en t Si arah n o t i c e t h a t i t

wo u l d e x e r c i s e t he o p t i on

. Th at s am e day , Si arah s en t New Era n ot ice t h at i t was

t erm i n at i n g t he l eas e an d d em an d i n g p o s s es si on wi t h i n 3 0 d ay s

. In Ap ri l 2 0 1 7 , Si arah fi l ed a p et i t i o n fo r a wri t of p o s s es s io n ag ai n s t New Era

i n t h e M ag i s t rat e Co u rt o f Fo rs y t h C o u n t y
. New Era fi l ed a co u n t ercl ai m , al l eg i n g

3b reach of co n t ract an d s eek i n g s p eci fi c p erfo rm an ce of t h e op t io n -t o -p u r c h as e

p ro v is i o n o f t he l eas e co n tract

. T h e m ag i st rat e co urt t ran sferred t h e cas e t o t h e
S u p e ri o r Co u rt o f Fo rs y th Co un t y
. Th en Si arah su cces s fu ll y m o v ed t o t ran s fer t h e

cas e t o Gwi n n et t Co un ty b ecau s e o f a ch oi ce-o f-v en u e p ro v i s i o n i n t h e l eas e. Si arah

al s o am en d ed i t s co m

p lai n t t o as s ert cl ai m s fo r breach o f co n t ract an d s l an d er o f t i t l e.
Th e p art i es fi l ed cro ss -m o t i o n s fo r s u m m ary ju d g m en t , an d Si arah m o v ed fo r
rel eas e o f t h e fu n d s New Era h ad p ai d i n t o t h e reg i st ry o f t h e co urt fo r ren t an d o t h er
ch arg es

. T h e tri al co u rt ru l ed th at New Era w as en t i t l ed t o s peci fi c p erfo rm an ce o f t h e

o p t i o n -t o -p u rch as e p ro v i s io n an d t h at Si arah was en t i t l ed t o t h e fu n d s p ai d i n t o t h e

co u rt reg i s t ry . Th es e ap peal s fo l l o wed

.

“ Su m m ary ju dg m en t i s ap p ro p ri at e w h en 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 t h e m o v an t i s en t i tl ed t o ju d g m en t as a m at ter o f l aw. W e ap p l y a d e n o v o

s t an d ard o f ap p el l at e rev i ew an d v iew t h e ev i d en ce, an d al l reas o n ab l e co n cl u s i on s

an d in feren ces d rawn fro m i t , i n t h e l i g h t m os t fav o rab l e t o t h e n o n m o v an t .” Lo g i s ti cs
In t l

. v. Ra co /

M el av e r , 2 5 7 G a. Ap p

. 8 7 9 , 8 8 0 (1 ) (5 72 SE2 d 3 88 ) (2 0 0 2 ) (ci t at i on s

an d p u n ct u at i o n o m i t t ed ).

4Cas e No . A1 9 A 0 7 2 4

.

2

. New Er a exer ci s ed

t he o p t i o n t o p u r ch a s e
. Si arah arg u es t h at b ecau s e i t t e r m i n at ed t h e l eas e, i t t erm i n at ed t h e o p t i o n

p ro v is i o n i n cl u d ed i n t he l eas e, an d New Era co u l d no t ex erci s e t h e o p t i o n

. W e
d i s ag ree.
Si arah s en t i t s l eas e t erm i n at i o n l et t er on J an u ary 2 7 , 2 0 1 7

. Th u s t erm i n at i o n

wo u l d h av e b een effect i v e on Feb ru ary 2 6 , 2 01 7 , aft er t he 3 0 -d ay , co n t ract u al n o t i ce

p eri o d h ad en d ed

. See Al exa n d er v. St ei n i n g , 1 9 7 Ga. Ap p. 32 8 , 3 3 2 (II) (3 9 8 SE2 d

3 9 0 ) (1 9 9 0 ) (n o t i ce of t erm i nat i o n b ecam e effect i v e aft er s t atutor i l y m an d at ed 6 0 -d ay

n o t i ce p eri o d h ad ex p i red ). Cf. Lo g i s t ics In t l

. , 25 7 Ga. Ap p. at 8 80 (1 ) (a). Bu t New

Era ex erci s ed t he op t i o n t o p u rch as e o n J an u ary 2 7 , 2 0 17 , b e f o r e t h e at t em

p t ed

t erm i n at i o n b ecam e effect i v e, b y n o t i fy i n g Si arah o f i ts i n t en t t o p urch as e.
Si arah arg u es t h a t i n o rd er t o v al i d l y ex erci s e t h e o p t i on , New Era h ad to

act u al l y p u rch as e t h e p ro p ert y o n o r b efo re J an u ary 3 1 , 2 01 7

. W e d i s ag ree. As n o t ed

ab o ve, on J an u ary 2 7 , 2 0 1 7 , wi t h i n t h e co n t ract u al ly d efi ned o pt i o n p eri o d , New Era

s en t wri t t en n o t ice t o Si arah t h at i t was ex erci si n g t h e o pt i o n , an d i t s ch e d u l e d a
cl o s i ng fo r M ay 1 2 , 2 0 17 , m o re t h an 9 0 day s l at er. Th es e act i o n s co m pl i ed wi t h t h e

req u i rem en t s as s et o u t i n th e l eas e co n t ract an d w ere effect i ve t o ex erci s e th e o p t i o n.

5Co n t rary t o Si arah ’ s arg u m en t , n o t h i n g in th e co nt ract req u ires t h e cl o s i n g o f t h e s al e

t o o ccu r wi t h i n t h e o p ti o n p eri od

. To t he ex ten t t hat Si arah arg u es New E ra was req ui red t o t en d er t h e p u rch as e

p ri ce t o ex erci s e t h e o p ti o n, we d i s ag ree b ecau s e [a] n o p t io n t o p urch as e ca n b e ex erci s ed wi t h o u t t he pay m en t o f th e p u rch as e p ri ce, o r th e t en d er t h ereo f, u n l es s t h e o p t i o n co n t ract p ro v i d es fo r s u ch p ay m en t as a co n d i t i o n p reced en t t o t h e ex erci s e o f t h e o p t i o n

. On t h e s al e o f l an d , in t h e ab s en ce of ex p res s ag reem en t , th e p ay m en t o f
t h e p u rch as e m o n ey an d t h e d el i v ery o f t he ti t l e deed are co n cu rren t act s

.

Pr i t ch et t v. D o d

d , 1 1 2 Ga. Ap p

. 4 5 3 , 4 54 (2 ) (1 4 5 SE2 d 6 1 0 ) (1 9 6 5 ) (ci t at i o n s an d

p u n ct u at i o n o m it t ed ). Th e p art i es ’ co n t ract d o es n o t p ro v i d e fo r s uch p ay m en t

. S i a r a h a rg u es t h at , ev en i f N ew Era was n o t req u i red to t en d er t h e p u rch as e

p ri ce i n o rd er t o ex erci s e t h e o p t i o n , i t wa s r e q u i red t o t en d er t he p u rch as e p ri ce in

o rd er t o s u e fo r s p eci fi c p erfo rm an ce. “ Geo rg i a l aw ex p li ci t l y req u i res t en d er o f t h e

co n tract s al es p ri ce t o o b t ai n s p eci fi c p erfo rm an ce.” Pea ch es La n d Tr u s t v. Lu mp ki n
Co u n t y Sch o o l Bd

. , 2 8 6 Ga. Ap p

. 1 0 3 , 1 0 6 (2 ) (6 4 8 SE2 d 46 4 ) (2 00 7 ). See Bu r n s v.
Reves , 2 1 7 Ga. Ap p

. 3 1 6 , 3 1 7 (1 ) (4 5 7 SE2 d 1 78 ) (1 9 9 5 ) (“ (B)efo re eq u i t y wi l l

d ecree s p eci fi c p erfo rm an ce o f a co n t ract fo r t h e s al e o f lan d , th ere m u s t b e an

6ab s o lu t e an d u n c o n d i t i o n al t en d er o f t h e p u rch as e-p ri ce. A n offer t o p ay t h e

p u rch as e-p ri ce o n d el iv ery of a p ro perl y ex ecu t ed d eed i s no t an u n co nd i t i o n al

t en d er.”) (ci t at i o n s an d p u n ct u at i o n o m i tt ed ).

Ho wev er, “ t h e l aw d o es n o t req u i re act u al t en d er as a co n d i t i o n p reced en t to

en t i t l em en t t o s p eci fi c p erfo rm an ce wh ere reject i o n i s d eem ed li k el y .” B urn s , 2 1 7 Ga. Ap p

. at 3 1 7 (1 ) (ci t at i o n o m i tt ed ). Th e u n di s p u t ed fact s s h o w t h at Si arah ’ s reject i o n

o f t h e t en d er wo u l d h av e b een l i k el y
. On Feb ru ary 1 7 , 2 0 1 7, co u n sel fo r Si arah wro t e
New Era t h at i t s n o ti ce o f ex erci s i n g t h e o p t i o n was i n s u ffi ci en t u n d er th e l eas e

co n tract an d t h at t h e o p t i o n h ad ex p i red on J an u ary 3 1 , 2 0 1 7. On Feb ru ary 2 0 , 2 0 1 7,

co u ns el f o r New Era res p o nd ed t h at i t s n o t i ce was s u ffi ci en t an d th at i t was read y , wi l l i ng , an d ab l e t o p erfo rm

. New Era arran g ed fi n an ci n g f o r t h e p u rch as e, an d o n
Feb ru ary 2 8 , 2 0 1 7 , co u n s el fo r New Era wro t e t o co u n s el fo r Si arah , i n fo rm i n g h i m

o f t h e dat e, t i m e, an d l o cat i o n o f t h e s ch ed u l ed cl os i n g an d s t a t i n g : “ If I d o n ot
recei v e co nfi rm at io n fro m y o u o n b eh a l f o f Lan d lo rd b y Fri day , M arch 3 , 2 0 1 7 at

5 : 0 0 p

. m

. of Lan d l o rd ’ s in t en t t o co n v ey t h e p ro p ert y t o Ten an t p u rs u an t t o t h e
Pu rch as e Op t i o n , i t wi l l b e u n d ers t oo d t h at Lan d l o rd do es n o t i n t en d t o accep t t en d er

o f t h e p u rch as e p ri ce b y m y cl i en t at cl o si n g .” Si arah ’ s co u n s el res p on d ed , rei t erat i n g
i t s p o si t i o n t h at t h e o p t i o n h ad t er m i n a t e d , t h e l eas e h ad term i n at ed , an d New Era

7n eed ed t o v acat e t h e p rem i s es

. “ Th i s was a wai v er o f ten d er, an d u nd er t h e l aw

rel i ev ed [New Era] o f an y o bl i g at i on t o t en der.” S hep ar d v. Get t

ys , 2 0 6 G a. 3 9 2 , 3 9 5 (5 7 SE2 d 2 7 2) (1 9 5 0 ) (ci t at i o n o m i t t ed ). “ T o t h e ex ten t th at [New Era] d i d n o t m ak e

a fo rm al t en d er o f t he pu rch as e m o n ey , [Si arah ’ s ] en t i t l em en t t o t h e t en d er was
wai v ed as i t was cl ear t h at it w o u l d h av e b een refu sed .” Fo x Ru n P r o p er t i es , LLC v.
Mu r r a y , 2 8 8 Ga. Ap p . 5 6 8 , 5 7 3 (2 ) (b ) (6 5 4 SE2 d 6 7 6 ) (2 0 07 ) (ci t at i on o m i t t ed ).

Fo r t h es e reas o n s , th e tri al co u rt di d n o t err b y g ran t in g s u m m ary ju d g m en t to

New Era o n i t s cl ai m fo r sp eci fi c p erfo rm an ce o f t h e o p t i o n -t o -p u rch as e p ro v i s i o n in

t h e l eas e co n t ract

. 3

. Th e a t t emp t ed

l ea se t er mi n at i o n wa s i n ef fect i ve
. On ce N ew Era ex erci s ed t h e o p t i o n o n J an u ary 2 7 , 2 01 7 , b efo re Si arah ’ s n o t i ce

o f t erm i n at i o n t oo k effect o n Feb ru ary 2 6 , 20 1 7 , New Era’ s p os i t i o n c h an g ed fro m

t h at o f a t en an t t o a p u rch as er i n p o s s es s i o n . “ T h e effect o f s u ch n ot i ce [o f ex erci s e

o f th e o pt i o n was ] t o m et am o rp h o s e t h e op t i on , o pt i o n o r an d o p ti o n ee in t o a co n t ract

o f s al e, ven d o r an d v en d ee.” Ja cks o n v. S ou t h er n Pa n & S

h o r i n g Co ., 2 6 0 Ga. 1 5 0,

1 5 1 (2 ) (3 9 0 SE2 d 3 93 ) (1 9 9 0 ) (ci t at io n s an d p un ct u at i o n o m it ted ). New Era,

h av i ng av ai l ed [i t ] s el f o f [t h e] o p t i o n to p u rch as e, an d hav i n g o ffered t o p erfo rm t h e co ven an ts res t i n g up o n [i t] u n d er t h e co n t ract , w as

8t h ereaft er i n p o s ses s i o n o f t h e pr e m i s es as o n e u n der a co n t ract o f

p u rch as e an d n o t a s a t en an t , an d co u l d n o t b e di s p os s es s ed aft er th e
ex p i rat i o n of t he p eri o d o ri g i n al l y d es i g n at ed as t he p eri od of t e n an cy
as a t en an t h ol di n g o v er.

McLe a n v

. N

e a l , 2 9 Ga. Ap p

. 9 , 1 0 (1 1 3 SE 6 3 ) (1 9 2 2 ). As t h ere was n o l o n g er a
l an d l o rd -t en an t rel at i o n sh i p , t h ere was n o t en an cy fo r Si arah t o t erm i nat e.
Cas e No . A1 9 A 0 7 2 5

. 4

. Th e t r i a l c o u r t d i d n o t er r b y a wa r d i n g S i a r a h r en t , b u t t he co u rt d i d n ot

a d d r es s New Er a ’s cl a im fo r b r ea ch -o f -co n t r a ct d

a ma g es a nd i t

s o rd er mu s t b e

va ca ted an d

r ema n ded

.

“ W h en , i n an act i on fo r ren t , t i t l e i s s h o w n i n t h e p lai n t i ff an d o ccu p at i o n by

t h e d efen d an t i s p ro v ed , an ob l i g at io n t o p ay ren t i s g en eral l y i m p li ed .” OCGA §

4 4 -7 -5

. Here, i t i s u n d i s p u t ed t h at , at l eas t u n t i l t he cl o s in g o f th e p u rch as e p u rs u an t

t o th e o p t i o n , Si arah o wn s t h e p ro p ert y an d New Era occu p i es i t

. So t h e t ri al co u rt d id

n o t err i n ru l i n g t h at Si arah i s en t i t l ed t o at l eas t s om e of th e fu n d s New Era h as p ai d

i n t o t h e co u rt reg i s t ry fo r ren t an d o t h er ch arg es

. Bu t i t do es n ot ap p ear t h at t h e t ri al

co u rt co n s i d ered N ew E r a ’s b reach -o f-co n t ract co u n t ercl ai m wh en co n s id eri n g t h e

am ou n t o f th e fu n ds t o b e rel eas ed

. Th e co u rt m us t co n si d er th e b reach -o f-co n t r a c t

co u nt ercl ai m

b ecau se 9[s ] p eci fi c p erfo rm an ce at t h e en d o f a p ro t ract ed l i t i g at i o n u nd er

co m p ul s i o n is p r a c tic a ll y n ev er fu l l p erfo rm an ce o f t h e co n tract ; i n st ead , t h ere h as b een an ex t en s iv e an d i n ju ri o u s p art i al b reach

. In s u ch a cas e, t h e co u rt s h o u ld d ecree t h e p a ym e n t o f d am ag es fo r th e part ial b reach
t h at h as a l r ead y o ccu rred , ev en t h o u gh o b ed ien ce of t h e d ecree wi l l p rev en t t he co m

m i ss io n o f fu rt h er b reach es

A& D As p h a l t Co

. v. Ca r r o ll & Ca r r o l l o f Ma co n , 2 4 7 Ga. Ap p

. 7 7 , 8 0 (5 4 3 SE2 d

3 9 7 ) (2 00 0 ) (ci t at i o n an d p un ct u at i o n o m i tt ed ). Sh o u ld t h e t ri al co u rt det erm i n e t h at

New Era i s en t i t l e d t o b reach -o f-co n t ract d am ag es , an y award co u l d red u ce t h e

am ou n t o f fu n d s fro m t h e co u rt reg i s t ry t o b e award ed t o Si arah

. So we v acat e t h i s

p art o f t h e t ri al co u rt ’ s o rd er an d rem an d fo r pro ceed i n gs n o t i n co n s i s t en t wi t h t h i s

o p i n i o n

. 5

. Th e co u r t ’s o rd

er l ea ves t h e a mo u n t o

f a t t o r ney f

ees b la n k

. Al t h ou g h th e t ri al co u rt fo u n d t h at New Era was en t i t l ed t o at t o rn ey fees , i n t h e

o rd er i t l eft t h e am o u n t b l an k , s t at i n g : “ Th e Co u rt award s New E ra at t o rn ey ’ s fees in

t h e am o u n t o f $

_

_ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ .” So we v acat e t h i s p art o f t h e tri al co urt ’ s

o rd er an d rem an d fo r p ro ceed i ng s n o t i n co n s i s t en t wi t h t h i s o pi n i o n

.

10Ju d

g men t a ff i r m ed i n Ca s e No

. A1 9

A07 2 4

. Ju d g men t a f f i r med i n p a r t, va ca t ed

i n p a r t , a n d ca se r ema n d

ed i n Ca se N

o

. A1 9 A 0 7 2 5

. McMi l l i a n a nd G o s s , JJ.,

co n cu r
.

11