FOURTH D I VI SI ON DOYLE, P. J.

, M I LLER and DI LLA RD, 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.

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Nov em ber 13, 2014



# I n th e Co u r t o f

A p p eals o f

G eo r g ia

A1 4 A1 23 1 . HEATH v . COLOR IM PRINTS USA, INC. et al

.

M I LLE R , J u d ge.

Ri ch ard P. Heat h s u ed Co l o r Im p ri n t s USA, In c., an d M i ch ael an d J o hn Say l o r

(co l l ect i v el y “ t h e Defen d an t s ”) s eek i n g to reco v er o ver $ 2 5,0 0 0 i n p as t d u e p ay m en t s

fo r acco un t i n g an d b o o k keep i n g s erv i ces th at Heat h al leg ed l y ren dered t o Co l o r

Im p ri n t s d / b/ a 1 St o p Creat iv e Pro m o t i o n al So l u t i o n s (“ Co l or Im p ri n t s ”). Th e p art i es

fi led c r oss- m otions f

or su m m ary ju d g m en t

, an d t h e tri al co u rt g ran ted th e Defen d an t s ’

m o ti o n as t o Heat h ’ s cl ai m

. H eat h ap p eal s , co n t en di ng t h at t h e t ri al c o u r t e r r e d in

g ran t i n g su m

m ary ju d g m en t t o t h e Defen d an ts

. Fo r th e reas on s t h at fo l l o w, we affi rm

t h e g ran t o f su m

m ary ju dg m en t t o M i ch ael an d Jo h n Say lo r an d rev ers e t h e g ran t o f

s u m m ary ju d g m en t t o Co lo r Im

p ri n ts

.“ On ap p eal fro m t he g ran t o f s u m m ary ju d g m en t t h i s Co u rt co n d u ct s a d e n o v o

rev i ew o f t h e ev i d en ce t o det erm i n e wh et h er t h ere i s a g en u in e i s s u e of m at eri al fact

an d wh et h er t h e u n d i s p u t ed fact s , v i ewed i n t h e l i g h t m o s t f a v o r a b l e t o t h e

n o n m o v i n g p art y , warran t ju d g m en t as a m at t er o f l aw.” (Ci t at i o n s an d pu n ct u at i o n

o m it t ed .) Ca mp b el l v

. T

h e La n d i n g

s As s n ., In c ., 2 8 9 Ga. 6 1 7

, 61 8 (7 1 3 SE2 d 8 6 0 )

(2 0 1 1).

So v iewed

, t h e l i m i t ed reco rd b efo re u s s h o ws t h at t h e Say l o rs are sh areh o l d ers

an d o ffi cers o f Co l o r Im

p ri n t s. In J an u ary 2 0 0 8

, Heat h beg an p erfo rm i n g s erv i ces fo r

Co l or Im p ri n t s

. Heat h cl ai m ed th at h e i s s ued i n vo i ce s t o Co l o r Im p ri n t s fo r

p ro fes s i on al s erv i ces fro m F e b r ua r y 2008 thr ough D e c e m

ber 2 0 0 9 an d Co l o r Im

p ri n t s

p ai d h i m $4 ,2 0 0 d u r i n g t h is p eri o d

. Th e Say l o rs n ev er en t ered i n t o a wri t t en

ag reem en t ob l i g at i n g t h em t o b e res p o n s i bl e fo r an y d eb t o f Co l o r Im p ri n t s t o Heat h.

In J u l y 2 0 1 2

, Heat h fi l ed a s u i t o n acco u n t, i n i t i al l y cl ai m i ng t h at t h e

Defen d an t s owed h i m $4 1 ,8 3 3 .7 7 fo r p ro fes s i o n al s erv i ces ren d e r ed

. Heat h

s u b s eq u en t l y am en ded h i s co m p l ai n t

, red u ci ng t h e am o u nt o f h i s s u i t on acco u n t to

$ 2 5 ,4 1 2

. 87. T he D e f

e nda nts a nsw e r e d a nd rai s ed d efen ses , i n cl u di n g frau d

, no p ri v i t y

o f c o n t ract

, t h e St at u t e o f Frau d s, an d p ay m en t o f $5 ,4 0 0 i n fu l l s at i s fact i o n o f

Heat h ’ s cl ai m s

. Th e Defen d an ts al s o co u n ter-cl ai m ed fo r ab u s i ve l i t i g at i o n , p u n i t i v e

2d am ag es an d at t o r n ey fees

. 1 W i t h o ut ex p l i ci t l y ad d res s i n g Heat h ’ s m o t i o n fo r

s u m m ary ju d g m en t , t h e t ri al co u rt g ran t ed s um m ary ju d g m en t t o t h e Defen d an t s as

t o Heat h ’ s cl ai m

fo r a s u i t o n acco u n t

.

1

. H e a t h co n t en d s t h at t h e t ri al co u rt erred i n g ran t i n g s u m m ary ju d g m en t t o

t h e D efen d an t s b as ed s o l el y o n h i s fai l u re t o fi l e a res p o ns i v e pl ead i n g t o t h e

Defen d an t s ’ m o t i o n

. 2 W e d is cern n o erro r.

A rev iew o f t h e t ri al co u rt ’ s o rd er m ak es cl ear t hat th e tri al c o u r t d i d n ot

au t o m at i cal l y g ran t s u m

m ary ju d g m en t t o t h e Defen d an t s b as ed o n Heat h ’ s fai l u re to

fi le a res p o n s e t o t h e D efen d an t s ’ m o t i o n fo r s u m m ary ju d g m en t

. Rat h er, t h e t r i al

c o u r t rev i ewed t h e p l ead i ng s an d reco rd an d det erm in ed t h at t h ere was n o g en u i n e

i s su e o f m at eri al fact

. Th e t ri al co u rt co rrect ly no t ed t h at Heat h

, b y fai l i n g t o res p o n d

t o t h e Defen d an t s ’ m o t i on fo r su m m ary j u d gm en t

, w a i v e d h i s ri g h t t o p res en t

1 Th e Defen d an t s ’ co u n t er-cl ai m s were no t ad d res s ed i n ei th er part i es ’ m o t i o n fo r s u m m ary ju d g m en t an d t h es e cl ai m s are n o t at i s s u e o n ap p eal

.

2 As an i n it i al m at t er, we n o t e t h at Heat h ’ s b ri ef s et s o u t n u m ero u s arg u m en t s rel at i n g t o t h e t ri al co u rt ’ s g ran t o f s u m m ary ju dg m en t d es p i t e a s i n gl e en u m erat ed

erro r, i n v i o l at i o n o f o u r Ru l es o f Co u rt

. Co u rt o f Ap p eal s ru l e 2 5 (a), (c). In s p i t e o f

Heat h ’ s v i o l at i o n , we w i l l ex erci s e o u r di s cret i o n t o co n s i der wh at w e b el i ev e are h i s

m ai n arg u m en t s , to t h e ex t en t t h at w e are ab l e t o d i s cern t h em

. See S ta g l v. As s u r a nce Co . o f Amer i ca , 2 4 5 Ga. Ap p . 8 , 9 (1 ) (5 3 9 SE2 d 1 7 3 ) (2 0 0 0).

3ev i d en ce i n o p p o s i t i o n

. La nd s b e r g v

. Po wel l

, 2 7 8 Ga. Ap p

. 1 3

, 15 (6 2 7 SE2 d 9 2 2 )

(2 0 0 6).

2

. Heat h co n t en d s th at t h e t ri a l c o u r t erred in g ran t i n g s u m m ary ju d g m en t to

t h e Defen d an t s becau s e t h ey ad m i t t ed t h ei r l i ab i l i t y a s a m at t er o f l aw b y fai l i n g to

t i m el y res p o n d t o h is req u es t fo r ad m i s si o n s.

Un d er OCGA § 9 -1 1 -3 6 (a) (2 ), req u es t s fo r ad m i s s i o n s are d eem ed ad m i t t ed

i f a p art y fai l s to res p o n d wi t h i n 3 0 d ay s. See G. H. Ba s s & Co

. v. F u l t o n Co u n t

y Bd

.

o f Ta x As s es s o r

s , 2 6 8 G a

. 32 7

, 3 3 0 -3 3 1 (2 ) (4 8 6 SE2 d 8 1 0 ) (1 9 9 7). Ho wev er, t h e

t ri al co u rt h as d i s cret i o n t o perm i t a p art y t o wi t h d raw ad m i s s i o n s i f t h e co u rt i s

s at i s fi ed “ (1 ) t hat wi t h d rawal o f t h e ad m i ss i o n s wi l l su b serv e o r ad v an c e t h e

p res en t at i o n o f t he m eri t s o f t h e act i o n an d (2 ) t h at t h ere i s n o s at i s fact o ry s h o wi n g

t h at wi t h d rawal wi l l p reju di ce t h e p art y w h o o b t ai n ed t he ad m is s i o n s

. ” (Ci t at i o n

o m it t ed .) Po r t er v

. U

r b a n Res i d

en t i a l Dev. Co rp

. , 2 9 4 Ga. A pp

. 8 2 8

, 82 9 (1 ) (6 7 0

SE2 d 4 6 4) (2 0 0 8).

“ Th e p art y s eek i n g t o wi t h d raw t h e ad m i s s i o ns h as t h e b u rd en o f es t ab l i s h i n g

t h e fi rs t p ro n g b y s h o w i n g t h a t t h e ad m i tt ed req u es t ei t h er can b e refu t ed by

ad m i s s i b l e ev i d en ce h av i n g a m o d i cu m of cred ib i l i ty o r i s i n cred i b l e o n i ts face, an d

t h e d en i al i s n ot o ffered so l el y fo r p u r p o s es o f d el ay .” (Ci t at i o n an d pu n ct u at i o n

4o m it t ed .) Po r t er , s u pra, 2 94 Ga. Ap p

. at 8 2 9 (1 ); s ee al s o In t er s o u t h Pr op er t i es

, In c.

v. Co n t ra ct o r Exch a n g e, In c. , 1 9 9 Ga. Ap p . 7 2 6

, 7 2 8 (1 ) (4 0 5 SE2 d 7 6 4 ) (1 9 9 1 ). If

t h e p art y s eek i n g t o wi t h draw t h e ad m i s s io n s s at i s fi es t h e fi rs t p ro n g , t h e b u rd en i s

o n t h e res p o nd e n t t o s at i s fy t h e s eco n d p ro n g , i

. e., t o sh o w t h at h e wo u l d b e

p reju d i ced b y t h e w it hd rawal

. In t er s o u t h Pr o p er t i es

, In c. , s u p ra, 1 9 9 G a. Ap p

. at 7 2 8

(1 ).

Here, H eat h s erv ed t h e Defen d an t s wi t h a req u es t fo r ad m i s s i o ns i n Decem b er

2 0 1 2

, s eek i n g ad m i ss i o n s t h at Heat h p erfo rm ed acco u n t i ng an d co ns u lt i n g wo rk fo r

Co l or Im p r i n t s fro m 2 0 05 t o 2 0 0 9 at t h e Defen dan t s ’ req u es t

, an d t h e Defen d an t s

accep t ed h is i n v o i ce s f

o r t hat wo rk

, ap p ro v ed t h e wo rk

, m ad e p eri o d ic p ay m en t s

t h ro u g h ou t Au g u st 2 00 9 , an d fai l ed t o res po n d t o H eat h ’ s at t em p t s t o co n t act t h em

aft er Decem

b er 20 0 9

. Si n ce t he Defen d an t s d i d n o t fi l e a t i m el y res p o n s e t o Heat h ’ s

req u es t s , t h ey were d eem ed ad m i t t ed b y o p erat i o n o f l aw. OCGA § 9 -1 1 -3 6 (a) (2 ).

(a) Th e Say l ors

.

Heat h arg u es t h at t he Say l o rs fai l ed t o refu t e h i s r e q u e s t fo r ad m i s s i o n s by

ad m i s s i b l e cred i b l e ev i d en ce. W e d i s ag ree.

Aft er He a t h fi led h is m ot i o n fo r s u m m ary ju dg m en t

, t h e Defen d an t s fi l ed a

m o ti o n to wi t h d raw t h ei r ad m i s s i o n s o n t h e b as i s t h at s et t l em en t neg ot iat i o n s h ad

5b een o n g o i n g a n d t h e p art i es h ad ag reed to ex t en d t h e di s co very p eri o d u n t i l

n eg ot i at i on s were co m

p l et e. Mi ch ael an d J o h n Say l o r al so s erv ed Heat h wi t h t h ei r

res p o n s es t o h i s req u es t fo r ad m i s s i o n s i n Ap ri l 2 0 1 3

. Co l o r Im p ri n t s , h owev er, fi l ed

n o s ep arat e res p o n s e. No n et h el es s , t h e t ri al co u rt fo u n d t h at al l o f t h e Defen d an t s h ad

,

i n t h ei r res p o n s es , refu t ed t h e a d m i s s i o ns t h at Heat h s ou g h t t o h av e ad m i t t ed an d

co n ti n u ed t h e m at t er t o al l o w Heat h t o fi l e a b ri ef o n t h e i ss u e o f p reju di ce.

Th e Say l o rs res p o n d ed t o an d den i ed Heat h ’ s req ues t ed ad m i s s i o n s

.

Sp eci fi cal l y , t h e Say l o rs d en i ed t h at t h ey i n d i v i d u al ly

o r jo i n t l y em p l o y ed Heat h t o

p erfo rm acco u nt i n g , tax

, an d co n s u l t in g s erv i ces fo r Co l o r Im p ri n ts fro m J u l y 2 0 0 7

t h ro u g h Decem

b er 2 0 0 9

. H eat h fi l ed n o b ri ef on t h e i s su e o f p reju d i ce an d has m ad e

n o s h o wi n g t hat h e wo u l d b e p reju d iced b y t h e wi th d rawal o f t h e ad m i s s i o n s

.

In t er so u t h Pr o per ti es

, In c. , s u pra, 1 9 9 Ga. Ap p

. at 7 2 8 (1 ) (res p on d en t h as b u rd en o f

s h o wi n g p reju d i ce); Br a nko vi c v. S n yd er , 2 5 9 Ga. Ap p

. 5 7 9

, 58 2 -5 8 3 (5 7 8 SE2 d 2 0 3 )

(2 0 0 3) (n o erro r in al l owi n g d efen d an t s to wi t h d raw ad m i s s i o n s wh ere th ey p res en t ed

r es p o n s es to t h e req u es t fo r ad m i s s i o n s an d wh ere d efen d an t s h ad al read y d e n i e d

l i ab i l i t y i n an swer). Acco rd i n g l y , t h e t ri al co u rt di d n o t ab u s e i t s di s cret i o n in

a l l o wi ng t h e Say lo rs t o wi t h d raw t h ei r ad m i s s io n s

. See B r a n ko vi c , s u pra, 2 5 9 Ga

.

Ap p . at 5 8 2 -5 8 3

.

6(b ) Co lo r Im p ri n t s.

Heat h al s o arg u es t h at Co l o r Im p ri n t s fai l ed t o fi l e a ti m el y res p o n s e t o Heat h ’ s

req u es t fo r ad m i ss i o n s , t hereb y ad m i t t i n g i t s l i ab i l i t y by o p erat i o n o f l aw. W e ag ree.

As s et fo rt h ab o v e, Co l o r Im p ri n t s , as t h e p art y s eek i n g t o wi t h d raw i t s

ad m i s s i o n s , had t h e b u rd en o f sh o wi n g t hat t h e ad m i s s io n s co u l d be refu t ed o r were

i n cred i b l e an d t h e d en i al was no t o ffered s o l el y t o d el ay

. Po r t er , s u p ra, 2 9 4 Ga. Ap p.

at 8 2 9 (1 ). Co lo r Im

p ri n t s n ev er res p o n ded t o Heat h’ s req u es t an d t h erefo re d i d n ot

m e e t t h i s b u rd en

. See In t er s ou t h Pr o p er t i es

, s up ra, 1 9 9 Ga. Ap p. at 72 8 (1 ) (p art y

wh o d i d n o t s p eci fi cal l y ad d res s i t em s i n r e q u e s t fo r ad m i s s io n s n o t en t i t l ed to

wi t h d raw ad m i s si o ns ). In l i g h t o f Co l o r Im p ri n t s ’ s fai l u re t o res po n d t o Hea t h ’s

req u es t s , t h e t ri al co u rt ab u s ed i t s d i s cret i on i n al l o wi n g Co l o r Im p ri n t s t o wi t h d raw

i t s ad m i s si o n s

.

3

. Fi n al l y , Heat h arg u es t h at t h e t ri al co u rt erred i n g ran t i n g s u m m ary ju d g m en t

t o t he Defen d an t s o n h i s s u i t o n acco u nt

.

“ A s u it on op en acco u nt i s av ai l ab l e as a s i m p l i fi ed pro ced u re to t h e p ro v i d er

o f g o o d s an d s erv ices wh ere t h e p ri ce o f s u ch go o d s o r s erv i ces h as b een ag reed u p o n

an d wh ere i t ap p ears t hat th e p l ai n ti ff h as f u l l y p e rfo rm ed i t s p art o f t h e ag reem en t

an d n o th i n g rem ai n s t o b e d o n e ex cep t fo r t h e o t h e r p art y t o m ak e pay m en t .”

7(Ci t at i o n s an d pu n ct u at i o n o m i t t ed .) Fi ve S t ar S t eel Co n s t., In c. v. Kl o ckn er Na ma s co

Co r p ., 2 4 0 Ga. Ap p

. 7 3 6

, 7 3 8 -7 3 9 (1 ) (c) (5 2 4 SE2 d 7 3 6 ) (1 9 9 9 ). “ A v eri fi ed an s wer

t o a cl ai m fo r o p en acco u n t t h at s et s ou t t h e d efen s es o f pay m en t

, s et -o ff, an d acco rd

an d s at i s fact i o n creat es a fact u al i s s u e.” Id . at 7 3 8 (1 ) (b ).

(a) Th e Say l ors

.

A rev i ew o f Heat h ’ s co m p l ai n t an d t h e at t ach ed i n v o i ces s h o ws t h at h e s eek s

p ay m en t fo r s erv i ces al l eg ed l y ren d ered t o Co l o r Im p ri n t s

. Th e Say l o rs are

s h areh o ld ers an d o ffi cers o f Co l o r Im p ri n t s

.

Un d er Geo rg i a’ s St at u t e o f Frau d s , p ro m i ses t o an s wer fo r th e d eb t o f an o t h er

m u st b e i n wri ti n g

. OCGA § 1 3 -5 -3 0

. Heat h ad m i t t ed t h at n ei t h er Say l o r ex ecu t ed a

wri t ten ag reem en t accep t in g res p o n s i b i l i t y fo r Co l o r Im p ri n t ’ s d eb t t o Heat h.

Acco rd in g ly

, t h e Say l o rs were en t i t l ed t o ju d g m en t as a m at t e r o f l aw an d t h e t ri al

co u rt d i d n o t err i n g ran t i n g t h ei r m ot i o n fo r s u m m ary ju d g m en t

.

(b ) Co lo r Im

p ri n t s.

As t o Co l or Im

p ri n ts

, h o wev er, t h ere ex i s t s an is s u e o f fact t h at precl u d es t h e

g ran t o f s u m

m ary ju d g m en t

. Sp eci f

i c a l ly

, i t i s cl ear fro m t h e reco rd t h at Heat h

p ro v id ed s o m e s erv i ces t o Co l o r Im p ri n t s. Nev ert h el es s , t h ere i s a q ues t i o n o f fact as

8t o ho w m

u ch o f t h e acco u n t, i f an y , rem ai ns t o b e pai d becau s e t h e ad m i s s i o n s d o n ot

i n cl u d e a fi n al am o u n t d u e an d o wi n g

.

No t ab l y , Heat h cl ai m s t h at h e i s o wed $ 2 5,4 1 2 .8 7 . Hi s o wn i n v o i ci n g s h o ws

t h at Co l o r Im

p ri n ts m ad e p ay m en t s o f $ 4 ,2 0 0

. Co lo r Im p ri nt s , i n i t s an s wer, cl ai m ed

t h at t h e Defen d an ts p a i d Heat h $ 5 ,4 0 0 i n fu l l s at i s fact i o n o f h i s cl ai m s

. Co l o r

Im p ri n t s ’ an s wer s et t i n g o u t t h e d efen s e of p ay m en t creat es a fact u al i s s u e as t o t h e

am ou n t o wed

. Fi ve S t a r S t eel

, s u p ra, 2 4 0 Ga. A p p

. at 7 3 8 (1 ) (b ). Acco rd in g l y , t h e

t ri al co u rt erred i n g ran ti n g s u m m ary ju d g m en t t o Co l o r Im

pri n t s

.

In s u m , th e t ri al co urt erred in al l o w i n g Co l o r Im p ri n ts t o w i t h d r a w i t s

ad m i s s i o n s wi t h o u t r e s p o n d i n g t o t he s am e, an d we rev ers e th e g ran t o f s u m m ary

ju d g m en t t o Co l o r Im

p ri n t s b ecau s e t h ere i s a gen u in e i ss u e o f m at eri al fact

rem ai n i n g . W e affi rm

t h e t ri al co u rt ’ s g ran t o f s u m m ary ju dg m en t t o t h e Say l o rs

.

Ju d g men t a f f i r m ed i n p a r t a n d r ever

s ed i n p a r t . Do

yl e, P. J., a n d Di l l a r d

, J.,

co n cu r

.

9