Case Name: AVERY v. KEY CAPITAL CORPORATION (two cases)
Court: Court of Appeals of Georgia
Jurisdiction: Georgia
Decision Date: 1988-03-18
Citations: 186 Ga. App. 712
Docket Number: 75316, 75317
Parties: AVERY v. KEY CAPITAL CORPORATION (two cases).
Judges: Banke, P. J., Pope, Benham and Beasley, JJ., concur. Birdsong, C. J., Deen, P. J., Carley and Sognier, JJ., concur in part and dissent in part.
Reporter: Georgia Appeals Reports
Volume: 186
Pages: 712–715

Head Matter:
75316, 75317.
AVERY v. KEY CAPITAL CORPORATION (two cases).
(368 SE2d 364)

Opinion:
McMurray, Presiding Judge.
In Case No. 57317 plaintiff Avery's complaint sought damages for fraud and breach of contract from defendants Key Capital Corporation (Key) and Spreen Leasing, Inc. (Spreen). Avery's complaint alleges that Key and Spreen jointly leased to her a 1983 Mercedes Benz having falsely represented that the automobile was a 1984 model. Case No. 75316 is a foreclosure of personal property action filed by Key against Avery, predicated on Avery's failure to make certain rental payments on the automobile.
These appeals arise from the grant of a motion for summary judgment in favor of Key and against Avery in each case. The state court also ordered that Key be removed as a party defendant in Case No. 75317. Held:
1. Avery and Spreen were parties to the lease contract. The lease contract was embodied in a form which was provided to Spreen by Key. The lease contract authorized Spreen to assign the lease to Key.
Spreen assigned its interest in the contract to Key. Key, as the assignee of a non-negotiable chose in action, takes the same subject to the equities existing between the assignor and the debtor at the time of assignment. Mutual Investment Corp. v. Friedman, 83 Ga. App. 544, 547 (1 (b)) (64 SE2d 298); American Security Van Lines v. Amoco Oil Co., 133 Ga. App. 368, 371 (210 SE2d 832).
Key relies upon two contractual provisions to sustain the state court's grant of summary judgment in its favor. One of these is contained within the contract by which the automobile lease was assigned by Spreen to Key. While the lease agreement explicitly antici pates assignment by Spreen to Key, the assignment contract is irrelevant. Avery was not a party to the assignment contract, nor are its terms incorporated into the lease agreement.
The remaining contractual provision at issue is the language emphasized in the following excerpt from the lease agreement: "Warranties. The Vehicle shall have the benefit of the manufacturer's new car warranties or guarantees that apply to the Vehicle or its accessories. Dealer and [Key] make no other warranties, express or implied, regarding the Vehicle, including warranties of MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. I [Avery] understand and agree that all complaints or claims that I have regarding the Vehicle, its accessories, or its operation will be asserted by me only against the manufacturer or its authorized dealers." (Emphasis supplied.)
Key argues that the emphasized language precludes any contract action against it by Avery. Undoubtedly a lease may permit a lessor to assign the lease and provide that the assignee take free from all defenses or claims which the lessee might have. See Short v. Gen. Elec. Credit Corp., 113 Ga. App. 476 (148 SE2d 450); and Dalton American Truck Stop v. ADBE Distrib. Co., 136 Ga. App. 606 (222 SE2d 61); Chattahoochee Holdings v. Marshall, 146 Ga. App. 658, 660 (1) (247 SE2d 167). However, in the cases sub judice such does not appear to be the intent of the language at issue. The language at issue plainly addresses warranty matters relating to the "Vehicle" identified in the lease. Avery's complaint and claims are not "regarding the Vehicle," but that she never received possession of the 1984 "Vehicle" identified and described in the lease.
Therefore, Key is subject to the equities existing between Spreen and Avery at the time of the assignment. Mut. Investment Corp. v. Friedman, 83 Ga. App. 544, 547 (1 (b)), supra; American Security Van Lines v. Amoco Oil Co., 133 Ga. App. 368, 371, supra. Genuine issues of material fact remain concerning the relative merits of the claims and counterclaims of Avery and Key. The state court erred in granting summary judgments in favor of Key and against Avery, and in removing Key as a party defendant in Case No. 75317.
2. Avery's fifth enumeration of error complains that Rule 3.2 of the Uniform Rules for the State Court was misapplied. Avery moved pursuant to Rules 4.7 and 4.8 of the Uniform Rules to reschedule these cases before the proper state court judge. However, the record fails to reveal any ruling upon this motion nor does the record conclusively support Avery's position on this matter. This enumeration of error is without merit.
Judgments reversed.
Banke, P. J., Pope, Benham and Beasley, JJ., concur. Birdsong, C. J., Deen, P. J., Carley and Sognier, JJ., concur in part and dissent in part.