Court Opinion

ID: 2753024
Source: CourtListenerOpinion
Date Created: 2014-11-19 17:06:58.951891+00
Date Added: 2024-06-11T10:18:30.786769
License: Public Domain

FOURTH DIVISION
                                DOYLE, P. J.,
                           MILLER and DILLARD, JJ.

                   NOTICE: Motions for reconsideration must be
                   physically received in our clerk’s office within ten
                   days of the date of decision to be deemed timely filed.
                              http://www.gaappeals.us/rules/

                                                                 November 17, 2014

In the Court of Appeals of Georgia
 A14A1015. KAHN et al. v. BRITT, JR. et al.
 A14A1016. NEIMARK v. KAHN et al.
 A14A1017. BRITT, JR. et al. v. KAHN et al.

      MILLER, Judge.

      These consolidated appeals arise out of the transfer of assets from Roger F.

Kahn to RK Trust, of which Kahn is the lifetime beneficiary. Kahn’s judgment

creditors filed suit against Kahn and RK Trust, alleging, in part, that the asset

transfers constituted a fraudulent conveyance. RK Trust settled the suit and sold a

cattle ranch to fund the settlement. Thereafter, Kahn, in his individual capacity, and

RK Trust’s trustees (collectively, the “Kahn Plantiffs”) sued Daniel Lamar Britt, Jr.,

Britt & Associates, Cort A. Neimark, and Myles Eastwood, the attorneys who

represented RK Trust in the settlement, and William W. Gwaltney, another attorney
and a former co-trustee, claiming professional negligence, breach of fiduciary duty,

simple negligence, conversion, trespass, wrongful eviction, and aiding and abetting.1

      The parties filed cross-motions for summary judgment. The trial court granted

summary judgment to the defendants in part and denied it in part, ruling that there

were genuine issues of material fact as to the negligence and breach of fiduciary duty

claims against Britt and Neimark and the conversion claim against Britt & Associates.

These cross-appeals ensued.

      In Case No. A14A1015, the Kahn Plaintiffs contend that the trial court erred

in granting summary judgment to the defendants on their negligence claims against

Britt and Neimark regarding the appointment of Gwaltney as a temporary co-trustee;

the breach of fiduciary duty and negligence claims against Eastwood; the breach of

fiduciary duty claims against Gwaltney; and Kahn’s individual claims against

Neimark; the claims regarding conversion, trespass and wrongful eviction, and aiding

and abetting; and the claims for punitive damages and attorney fees. The Kahn

Plaintiffs further contend that the trial court erred in denying their partial motion for

summary judgment on claims that Gwaltney breached his fiduciary duty to RK Trust

      1
      James Union was also named as a defendant in the suit, but the claim against
him was stayed because he filed for bankruptcy. Union is not a party to these appeals.

                                           2
and that Britt and Neimark committed legal malpractice and breached their fiduciary

duties to the trust.

       In Case No. A14A1016, Neimark contends that the trial court erred in denying

his motion for summary judgment on claims of professional and simple negligence

and breach of fiduciary duty arising out of his role in the asset transfer.

       In Case No. A14A1017, Britt and Britt & Associates contend that the trial court

erred in denying their motion for summary judgment on negligence and breach of

fiduciary duty claims against Britt and the conversion claim against Britt &

Associates.

       For the reasons that follow, we affirm in part and reverse in part the trial

court’s judgment in Case No. A14A1015. We affirm the trial court’s denial of

Neimark’s motion for summary judgment in Case No. A14A1016 and affirm the trial

court’s denial of the motion for summary judgment filed by Britt and Britt &

Associates in Case No. A14A1017.

       The evidence shows that Kahn’s mother set up RK Trust in 1979, designating

Kahn as the primary lifetime beneficiary and as one of the two trustees. The RK Trust

contained a spendthrift provision that protected the income and corpus of the trust

                                           3
from the claims of creditors, but provided the trustees with the discretion to make

payments to the beneficiaries’ creditors.

      From 1998 to 2002, Kahn received approximately $36 million from RK Trust.

Of that amount, only about $4.8 million constituted required beneficiary distributions,

while the rest of the distributions were, according to Kahn, loans authorized by him

and co-trustee Elliot Cohen. Kahn used these loans to purchase a cattle ranch in

Bartow County (the “Cattle Ranch”) and to twice run for political office. The Cattle

Ranch was held by Kahn Cattle Company, LLC, of which Kahn was the sole member.

      Around 2002, Cohen informed Kahn that the lack of documentation for the

loans would subject Kahn to significant estate tax liability. Upon Cohen’s suggestion,

Kahn executed approximately 20 unsecured and backdated promissory notes in favor

of RK Trust. The promissory notes either had one-year terms or were payable on

demand.

      By 2004, the promissory notes had not been paid off, and Cohen devised a plan

to transfer all of Kahn’s personal assets to RK Trust to partially satisfy Kahn’s debts

to RK Trust. Kahn did not approve the plan and no transfers were made at this time.

      In June 2005, Kahn’s niece, Cathy McSweeney, and her children (the

“McSweeney Children”) filed suit against Kahn for fraud, civil conspiracy, breach of

                                            4
fiduciary duty, unjust enrichment, and conversion in connection with his acquisition

of McSweeney’s interest in a land investment. See McSweeney v. Kahn, 347 Fed.

Appx. 437, 439 (11th Cir. 2009) (“McSweeney”). By September 2006, Cohen had

resigned as co-trustee of RK Trust, and James Union was appointed to succeed him.

      In December 2006, Kahn contacted Britt seeking legal representation for RK

Trust because the McSweeney plaintiffs were investigating Kahn’s debt to RK Trust.

Britt understood that Kahn wanted to protect the trust’s assets and Kahn’s assets from

the McSweeney plaintiffs. Britt proposed several options to Kahn and Union, and

Kahn ultimately agreed that the trust should call the promissory notes due and

demand the transfer of his assets to satisfy his indebtedness .

      Thereafter, to avoid the appearance of self-dealing, Kahn appointed Gwaltney

co-trustee in his place on an interim basis while McSweeney was pending. Around

this time, Neimark was also hired to represent RK Trust. Union and Gwaltney, as co-

trustees, then informed Kahn that RK Trust was calling his loans due and asked that

he make arrangements to satisfy his debt by payment or by transferring his assets.

      On April 4, 2007, Kahn and the co-trustees executed a repayment agreement,

which acknowledged that Kahn owed RK Trust $36,800,560 and listed some of

Kahn’s assets that were to be conveyed to RK Trust in satisfaction of the promissory

                                          5
notes. Among the assets that would be transferred was the Kahn Cattle Company. The

parties stipulated that the cattle company had land holdings worth $18.8 million,

however there is no evidence that anyone had the land appraised. To effectuate the

asset transfers, Neimark prepared a blanket assignment dated April 4, 2007, and Kahn

assigned his interest in Kahn Cattle Company to RK Trust.

      In August 2008, the jury returned a verdict in McSweeney, finding Kahn liable

to the McSweeney Children in the amount of $3,527,605. See McSweeney, supra, 347

Fed. Appx. at 439-440.2 When the judgment remained unpaid, the McSweeney

Children filed an action in federal court (“Schleta”) against Kahn, the Kahn Cattle

Company, and Gwaltney and Union, as co-trustees of RK Trust, claiming that they

fraudulently transferred assets into the trust in order to prevent the plaintiffs from

collecting on their judgment. Gwaltney and Union hired Eastwood as additional

counsel to assist Britt in the defense of RK Trust, and Neimark, although not counsel

of record in Schleta, was apprised of the proceedings in that case.

      In August 2010, the Schelta parties participated in a court-ordered mediation,

resulting in a proposed settlement. In exchange for a release of all claims against RK

      2
       Kahn appealed this decision to the Eleventh Circuit Court of Appeals, which
affirmed the jury’s verdict. Id. at 440.

                                          6
Trust and the trustees, as well as Kahn and Kahn’s children and grandchildren, RK

Trust agreed to pay the Schleta plaintiffs $4 million plus potential late payment fees,

with the settlement payment to be funded by the auction of part or all of the Cattle

Ranch.

      Following a hearing on the settlement agreement and after receiving testimony

as to the value of the Cattle Ranch and the proposed auction, the federal district court

approved the settlement over Kahn’s objections in October 2010. Because of his

objections to the manner in which the sale of the Cattle Ranch was to be conducted,

Kahn was not a signatory to the agreement, although all claims against him were

released by the Schleta plaintiffs. The auction of the Cattle Ranch took place on

October 27, 2010. The Cattle Ranch and Kahn Cattle Company’s personal property

located on the ranch, including fixtures, farm equipment, vehicles, and farm

inventory, were sold for $6.5 million. Thereafter, RK Trust paid the Schleta plaintiffs

and netted $1.219 million from the sale of the ranch. Gwaltney and Union

subsequently resigned as trustees and filed a final accounting of the trust. Shortly

thereafter, Kahn and the new trustees of RK Trust initiated this suit.

                                 Case No. A14A1015

                                           7
      On appeal from the grant or denial of a motion for summary judgment, we

conduct a de novo review of the law and evidence, viewing the evidence in the light

most favorable to the nonmovant, to determine whether a genuine issue of material

fact exists and whether the moving party was entitled to judgment as a matter of law.

(Citation omitted.) Golden Atlanta Site Dev. v. Nahai, 299 Ga. App. 646, 649 (2) (683

SE2d 166) (2009). With these principles in mind, we turn to the Kahn Plaintiffs’

contentions.

      1. The Kahn Plaintiffs contend that the trial court erred in granting summary

judgment to Britt and Neimark on professional and simple negligence claims relating

to Gwaltney’s initial appointment as temporary co-trustee, because the trust

instrument did not allow such appointments. We disagree.

      “In construing trusts as well as other instruments the appellate courts must

interpret the language to effectuate the intent of the settlor within the guidelines of

the law.” (Citation and punctuation omitted.) Ferst v. Ferst, 208 Ga. App. 846, 847

(432 SE2d 227) (1993). Here, Section 2.1 of the RK Trust instrument provides that

each co-trustee shall, while serving as trustee, “have the power to designate successor

Trustees (other than the Grantor) with respect to his trusteeship.” Consequently, the

trust instrument allowed Kahn, as a co-trustee, to designate Gwaltney as his successor

                                          8
trustee, and nothing precluded Kahn from doing so on a temporary basis. Therefore,

the trial court did not err in granting summary judgment to Britt and Neimark as to

the Kahn Plaintiffs’ claims related to Gwaltney’s temporary appointment.

      2. The Kahn Plaintiffs also contend that Eastwood breached his fiduciary duty

to Kahn and RK Trust and committed professional negligence by failing to inquire

into Gwaltney’s authority to act as co-trustee, failing to notify Kahn of the terms of

the Schleta settlement agreement or the terms of the sale, and authorizing the sale of

the Cattle Ranch below fair market value. We disagree.

      (a) Since we conclude below in Division 3 (c) that Kahn ratified Gwaltney’s

authority to act as co-trustee in his place following McSweeney, there was no harm

in Eastwood’s purported failure to inquire into Gwaltney’s authority. Accordingly,

these claims based on Eastwood’s omissions fail.

      (b) As for Eastwood’s failure to notify Kahn of the terms of the settlement

agreement, the evidence belies this claim. The undisputed evidence shows that

Kahn’s personal attorney was involved in the settlement negotiations and was aware

of the settlement terms. It is well settled that notice to an attorney is notice to the

client employing him, and that knowledge of an attorney is knowledge of his client.

See Roylston v. Bank of America, N.A., 290 Ga. App. 556, 560 (1) (b) (660 SE2d 412)

                                          9
(2008). Moreover, Kahn made specific objections to the settlement agreement before

the same was approved by the federal district court. Consequently, Kahn was aware

of the settlement terms, and Eastwood was entitled to summary judgment on this

claim.

         (c) With respect to the sale of the Cattle Ranch, the undisputed evidence shows

that Kahn did not object to the sale of the Cattle Ranch as part of the Schleta

settlement. Instead, Kahn objected only to the manner in which the ranch was sold.3

         Gwaltney hired the company that marketed the property and conducted the

auction. At the auction, a bid of $5.5 million was received, but the trustees –

Gwaltney and Union – did not feel comfortable accepting this amount. When neither

Kahn nor Eastwood could be reached for further direction, the trustees negotiated

with the bidder to sell the ranch and Kahn Cattle Company’s personal property for

$6.5 million. Eastwood testified that he was not present at the auction, and there is

no evidence to show that he otherwise participated in negotiating the sale of the

         3
        Kahn objected to certain terms of the Schelta settlement agreement, including
terms regarding late payment fees, the period of time in which to sell the property, RK
Trust’s obligation to accept increasingly low offers for the property, and the
requirement that RK Trust deed the property to the Schleta plaintiffs in the event the
property could not be sold. Kahn argued that these terms were unfavorable to him and
the remainder beneficiaries because the value of the property was at least $8 million.

                                           10
Cattle Ranch. Consequently, Eastwood was entitled to summary judgment on claims

that he breached a fiduciary duty or committed professional negligence in the sale of

the ranch.

         3. The Kahn Plaintiffs also contend that the trial court erred in granting

summary judgment to Gwaltney on the claims that Gwaltney breached his fiduciary

duty to Kahn and RK Trust. We agree in part.

         “A violation by the trustee of any duty that the trustee owes the beneficiary

shall be a breach of trust.” OCGA § 53-12-300. Establishing a claim for breach of

fiduciary duty requires proof of three elements: (1) the existence of a fiduciary duty;

(2) breach of that duty; and (3) damage proximately caused by the breach. Nalley v.

Langdale, 319 Ga. App. 354, 364 (2) (734 SE2d 908) (2012) (physical precedent

only).

         (a) Verifying Promissory Notes.

         The Kahn Plaintiffs assert that Gwaltney breached his duty to RK Trust

because he failed to investigate the legitimacy of the promissory notes executed by

Kahn. There was no dispute that Kahn executed the notes, that he did so in order to

document the $36 million in loans that he received from the trust, and that these notes

remained outstanding at the time of Gwaltney’s appointment. Since there was no

                                           11
dispute that Kahn owed money to RK Trust, it cannot be said that Gwaltney breached

his fiduciary duty to the trust by failing to determine the legitimacy of the notes.

      (b) Asset Transfer.

      The Kahn Plaintiffs also assert that Gwaltney breached his fiduciary duty

because he “rubber-stamped” Britt’s and Neimark’s decision to transfer Kahn’s assets

to RK Trust to satisfy his indebtedness during the pendency of McSweeney. The Kahn

Plaintiffs also contend that the trial court erred in concluding that Gwaltney was

shielded from liability for his participation in the asset transfer by virtue of the trust

instrument.

      In granting summary judgment to Gwaltney on the fiduciary duty claim, the

trial court ruled that Gwaltney was entitled to rely on Section 8.5 of the trust

instrument, which limited a trustee’s liability to instances of “wilfull default,

wrongdoing, or gross negligence, but not for honest errors of judgment,” because

there was “no evidence giving rise to even an inference that Gwaltney acted in

anything other than good faith[.]”

      “[G]ross negligence has been defined as equivalent to the failure to exercise

even a slight degree of care or lack of the diligence that even careless men are

accustomed to exercise.” (Citations and punctuation omitted.) Heard v. City of Villa

                                           12
Rica, 306 Ga. App. 291, 294 (1) (701 SE2d 915) (2010). Generally, it is for the jury

to decide whether the evidence supports a finding of gross negligence. Currid v.

DeKalb State Court Probation Dept., 274 Ga. App. 704, 709 (2) (a) (618 SE2d 621)

(2005).

      In this case, the evidence shows that, prior to assuming the trustee appointment,

Gwaltney reviewed the trust instrument and the balance sheets for RK Trust and

Kahn, but he did not independently verify whether the balance sheets were correct.

When Kahn transferred his assets to RK Trust, Gwaltney did not substantiate the

value of Kahn’s assets prior to the asset transfer, and the asset transfers were poorly

documented. Since an expert witness testified that Gwaltney had an independent duty

as a trustee to verify, document, and substantiate the transfers being made, including

appraising the value of the property, there is a question of fact as to whether

Gwaltney exercised even a slight degree of care in conducting the asset transfers, and

the trial court erred in concluding that Gwaltney was entitled to protection under

Section 8.5 of the trust instrument.

      Nevertheless, we may affirm the trial court’s grant of summary judgment if it

is right for any reason, whether stated or unstated, so long as the legal basis was fairly

presented in the court below. See Ga.-Pacific, LLC v. Fields, 293 Ga. 499, 504 (2)

                                           13
(748 SE2d 407) (2013); Bailey v. Hall, 267 Ga. App. 222, 223, n.1 (599 SE2d 226)

(2004). In this case, Gwaltney argued below that the document appointing him as

interim trustee also shielded him from liability. That document provides, in pertinent

part, that RK Trust and its beneficiaries, including Kahn, waived and released

Gwaltney from “any claim or other liability . . . from any act or failure to act with

regard to payment, collection, satisfaction, or security for those notes or obligations

payable to the RK Trust previously approved by prior trustees.” (Emphasis supplied.)4

Pursuant to the delegation instrument, Kahn waived any claim against Gwaltney for

acts relating to the asset transfer to RK Trust. See Heiman, supra, 300 Ga. App. at

881-882 (1). Accordingly, the trial court did not err in granting summary judgment

to Gwaltney on claims related to the asset transfer.

      (c) Remaining as co-trustee beyond term of appointment.

      4
        While former OCGA § 53-12-194 (a) provided that “[n]o provision in a trust
instrument is effective to relieve the trustee of liability for breach of trust committed
in bad faith or intentionally or with reckless indifference to the interest of the
beneficiary[,]” the document delegating Gwaltney as co-trustee is not a trust
instrument. See Heiman v. Mayfield, 300 Ga. App. 879, 881-882 (1) (686 SE2d 284)
(2009) (release and indemnification agreement between former trustee and
beneficiary was not a trust instrument because it was executed long after creation of
trust and reflected only the intentions of the beneficiaries and former trustee).

                                           14
      The Kahn Plaintiffs next argue that Gwaltney breached his fiduciary duty by

remaining as co-trustee beyond the term of his interim appointment, which was to last

through the pendency of McSweeney. Gwaltney responds that Kahn accepted the

benefits of Gwaltney’s service through the receipt of trust distributions and

represented that Gwaltney was a trustee in court documents, thus ratifying Gwaltney

remaining as a co-trustee past his interim term.

      It is undisputed that Kahn temporarily delegated his authority to Gwaltney to

serve as trustee and that the term of the delegation was for the pendency of

McSweeney. It is also undisputed that a document making Gwaltney a permanent

trustee was prepared but never signed by Kahn. Nevertheless, there is uncontroverted

evidence that Kahn asked Gwaltney to remain as co-trustee and Kahn continued to

treat Gwaltney as a co-trustee thereafter. Additionally, following McSweeney, and

during the pendency of Schleta, Kahn specifically requested and accepted

distributions from RK Trust that were authorized by Gwaltney. Although Kahn

objected to the terms of the Schleta settlement reached by Gwaltney and asked that

Gwaltney resign as co-trustee,5 Kahn never claimed that Gwaltney was acting without

      5
       Kahn asked Gwaltney to resign when Gwaltney refused to dismiss Britt as
counsel for RK Trust.

                                         15
authority. Moreover, even after the sale of the farm, Kahn requested that Gwaltney

distribute some of the sale proceeds for his benefit. In sum, there is no evidence that

Kahn ever repudiated Gwaltney’s authority to act as co-trustee following McSweeney.

       If, after knowledge of what the agent has done, the principal makes no

objection within a reasonable time, a ratification results by operation of law. A & S

Group, Inc. v. Murray, 291 Ga. App. 331, 334 (1) (661 SE2d 701) (2008). Likewise,

a beneficiary may also ratify a trustee’s unauthorized act constituting a breach of

trust, and such ratification bars the beneficiary from subsequently repudiating the

breach and attempting to hold the trustee liable. See Nalley, supra, 319 Ga. App. at

366 (2). Although the question of whether an unreasonable period of time has passed

so as to result in ratification is usually an issue for the jury, where there is no

evidence showing that a party’s actions did not constitute ratification, such a

determination can be made as a matter of law. See Hendrix v. First Bank of Savannah,

195 Ga. App. 510, 512 (394 SE2d 134) (1990). In this case, since Kahn continued to

represent Gwaltney as a co-trustee and accepted the benefits of Gwaltney’s role as co-

trustee, Kahn ratified any breach by Gwaltney when he remained as co-trustee beyond

the designated term. Consequently, Gwaltney was entitled to summary judgment on

this issue.

                                          16
       (d) Retaining and failing to supervise Britt and Eastwood during the Schleta

litigation.

       The Kahn Plaintiffs also argue that the trial court erred in concluding that

Gwaltney did not breach his fiduciary duty by hiring Britt and Eastwood to represent

RK Trust in the Schleta action. We agree.

       As a preliminary matter, the Kahn Plaintiffs argued below only that Gwaltney

breached his fiduciary duty by hiring Britt. Consequently, they may not now argue

that Gwaltney breached his fiduciary duty by hiring Eastwood. See Locke’s Graphic

& Vinyl Signs v. Citicorp Vendor Finance, 285 Ga. App. 826, 828 (2) (a) (648 SE2d

156) (2007) (“An argument not raised in the trial court is waived and cannot be raised

for the first time on appeal.”) (footnote omitted).

       As to the hiring of Britt, there is evidence that Kahn transferred his assets to

RK Trust pursuant to Britt’s advice, and this asset transfer gave rise to the Schleta

suit, as the Schleta plaintiffs alleged that the asset transfers constituted a fraudulent

conveyance.         Contrary to the trial court’s holding that the Kahn Plaintiffs could

not establish proximate cause because Eastwood also served as counsel in Schleta,

the evidence shows that Britt was actively involved in developing the defense

strategy. In light of this evidence, there is a question of fact as to whether Gwaltney’s

                                           17
hiring of Britt to represent RK Trust in Schelta was a breach of his fiduciary duty and

whether any breach caused RK Trust to suffer damages. Accordingly, the trial court

erred in granting summary judgment to Gwaltney on this claim.

      (e) Auction of the Cattle Ranch.

      The Kahn Plaintiffs next argue that there are questions of fact regarding

whether Gwaltney breached his fiduciary duty by selling the property in the manner

he did. Again, we agree.

      A trustee has a duty to sell a trust’s property for the highest price possible. See

Bloodworth v. Bloodworth, 260 Ga. App. 466, 471 (1) (579 SE2d 858) (2003). The

issue is whether Gwaltney proximately caused the cattle ranch to be sold for less than

the highest price possible. As a general rule, a determination as to proximate cause

is a jury issue, but in plain and undisputed cases the issue is one of law for the court.

McAuley v. Wills, 251 Ga. 3, 7 (5) (303 SE2d 258) (1983). This is not a plain and

undisputed case.

      Although Kahn ratified Gwaltney remaining as co-trustee, he objected to the

manner in which the Cattle Ranch was sold, and there is evidence that Gwaltney may

have breached his duty in this respect. Notably, Gwaltney believed that a quick sale

                                           18
would force the trust to sell at a lower price, but nonetheless authorized the auction,

which was advertised for only seven weeks. Additionally, Gwaltney failed to appraise

the property prior to the sale. Although Gwaltney rejected a prior offer because he

believed the property was worth more than $6.45 million, and the property’s fair

market value was at least $8 million, the property sold at auction for only $6.5

million. Moreover, as discussed below, the price received at auction, after paying two

commissions, was actually lower than the price RK Trust would have received had

it accepted a pre-auction offer to sell the Cattle Ranch for $6.45 million.

      Under these circumstances, there is a question of fact as to whether Gwaltney

breached his fiduciary duty in authorizing the sale of the Cattle Ranch in the manner

in which he did, resulting in the ranch being sold for less than fair market value. Cf.

Cartersville Developers, LLC v. Ga. Bank & Trust, 292 Ga. App. 375, 377 (664 SE2d

783) (2008) (“True market value is the price that the property will bring when it is

offered for sale by one who is not obligated, but has the desire to sell it, and is bought

by one who wishes to buy it, but is not under a necessity to do so.”) (citation and

punctuation omitted). Consequently, the trial court erred in granting summary

judgment to Gwaltney on fiduciary duty claims related to the sale of the Cattle Ranch.

      (f) Brock commission.

                                           19
      The evidence shows that prior to June 2010, agent Gary Brock had approached

the Rollins Family about purchasing the Cattle Ranch. In June 2010, Brock

approached Gwaltney with an offer to buy the ranch on behalf of the Rollins family,

operating through LOR, Inc. Around this time, Gwaltney discovered that the Rollins

family had been looking at the property for several years. When the parties were

unable to reach an agreement on the sale price, Gwaltney decided to proceed with the

auction instead and invited Brock to participate. At auction, the Rollins Family,

operating as LOR Apple Valley, LLC and represented by Thorne Winter, bought the

Cattle Ranch.

      After the auction, but prior to closing, Gwaltney became aware that Brock was

claiming that he was entitled to a commission on the sale of the Cattle Ranch.

Gwaltney testified that he had not previously considered whether Brock would be

entitled to a commission. Gwaltney proceeded with the closing of the sale after Britt

advised him that Brock was not entitled to a commission, Gwaltney placed the

disputed funds into the court’s registry, and Gwaltney eventually settled Brock’s

claim of $320,000 for $270,000.

      In this case, although a different entity (LOR Apple Valley, LLC) bought the

Cattle Ranch than the entity that previously submitted an offer through Brock (LOR,

                                         20
Inc.), both entities were controlled by the Rollins family. Kahn testified that Brock

had an exclusive contract to sell the property to the Rollins family and Gwaltney

proceeded to the auction without ensuring that Brock’s exclusive contract was

cancelled. Additionally, Gwaltney admitted that he did not investigate whether Brock

would be entitled to a commission prior to proceeding with the auction. Since a

trustee has a duty to act in the utmost good faith in protecting and maximizing the

assets of the estate, see Jonas v. Jonas, 280 Ga. App. 155, 160 (3) (b) (633 S2d 544)

(2006) and RK Trust had to pay commissions to both the auction company and to

Brock, there is a question of fact as to whether Gwaltney breached his fiduciary trust

with respect to his handling of Brock’s commission. See Lee v. SunTrust Bank, 314

Ga. App. 63 (722 SE2d 884) (2012) (to defeat a summary judgment motion, the

nonmoving party need not present conclusive proof but must only produce or point

to specific evidence, even slight, giving rise to a triable issue of material fact).

Therefore, the trial court erred in granting summary judgment to Gwaltney on the

issue of Brock’s commission.

      4. The Kahn Plaintiffs next contend that the trial court erred in granting

summary judgment to Neimark on all claims brought by Kahn individually, because

                                         21
there is a genuine issue of fact as to whether Neimark represented Kahn personally

in connection with the asset transfer. We agree.

             Generally, a plaintiff must demonstrate the existence of an
      attorney-client relationship before he may recover in a legal malpractice
      suit. This is essential in establishing the element of duty that is
      necessary to every lawsuit based upon a theory of negligence. The basic
      question in regard to the formation of the attorney-client relationship is
      whether the evidence sufficiently established that advice or assistance
      of the attorney is both sought and received in matters pertinent to his
      profession.

(Citations and punctuation omitted; emphasis supplied.) Rhone v. Bolden, 270 Ga.

App. 712, 716 (4) (a) (608 SE2d 22) (2004).

      Here, the undisputed evidence shows that Neimark was hired to represent RK

Trust and assist with the transfer of assets from Kahn to the trust. Kahn testified that

Neimark advised him that the asset transfer was for Kahn’s own protection as well as

the protection of RK Trust. Consequently, there is an issue of fact as to the existence

of an individual attorney-client relationship between Kahn and Neimark.

      Moreover, even if no express attorney-client relationship existed, “an attorney

may be liable for negligence under the theory of voluntary agent when the attorney

gratuitously undertakes to perform a legal service (or, in this case, give legal advice)

                                          22
to another with the other’s approval.” (Citation omitted.) Rogers v. Hurt, Richardson,

Garner, Todd & Cadenhead, 203 Ga. App. 412, 415 (2) (417 SE2d 29) (1992). Thus,

      liability for professional acts extends not only to the actual client but
      also to third parties who rely upon the professional’s advice in situations
      where the professional was manifestly aware of the use to which the
      information was to be put and intended that it be so used. This liability
      is limited to a foreseeable person or limited class of persons for whom
      the information was intended, either directly or indirectly.

(Citation and punctuation omitted.) Id. at 416 (2). In this case, given Neimark’s role

in the asset transfers from Kahn to RK Trust, it can hardly be said that Kahn was not

a foreseeable person who would rely upon Neimark’s advice. Id. (holding that the

plaintiffs had standing to sue for damages allegedly sustained as a result of corporate

attorney’s advice to transfer assets from the corporation to the plaintiffs).

      Neimark argues that Kahn cannot establish damages because the Schleta

plaintiffs would have been able to force the sale of the Cattle Ranch even absent the

transfer of the property to RK Trust. The evidence, however, shows that Schleta was

filed by the victorious McSweeney plaintiffs not only to recover the unpaid judgment

of approximately $3.5 million owed by Kahn, but also to challenge the alleged

fraudulent conveyance of assets from Kahn to RK Trust. If Kahn can show, as he

alleges, that he was sued as a result of following Neimark’s legal advice, then the cost

                                          23
of defending the fraud claims brought by the Schleta plaintiffs would be an element

of Kahn’s damages. See Rogers, supra, 203 Ga. App. at 416 (2). Consequently,

Neimark was not entitled to summary judgment on claims brought by Kahn

individually.

      5. The Kahn Plaintiffs also contend that the trial court erred in granting

summary judgment to the defendants on their claims that the defendants aided and

abetted each other in their respective breaches of duty to RK Trust when proceeding

with the Schleta settlement and selling the Cattle Ranch at auction. We disagree.

             In Georgia, the tort of aiding and abetting a breach of fiduciary
      duty requires proof of the following elements: (1) through improper
      action or wrongful conduct and without privilege, the defendant acted
      to procure a breach of the primary wrongdoer’s fiduciary duty to the
      plaintiff; (2) with knowledge that the primary wrongdoer owed the
      plaintiff a fiduciary duty, the defendant acted purposely and with malice
      and the intent to injure; (3) the defendant’s wrongful conduct procured
      a breach of the primary wrongdoer’s fiduciary duty; and (4) the
      defendant’s tortious conduct proximately caused damage to the plaintiff.

(Footnote omitted; emphasis supplied.) White v. Shamrock Bldg. Sys., Inc., 294 Ga.

App. 340, 343 (1) (669 SE2d 168) (2008). An act is done with “malice” if it is an

unauthorized interference or an interference without legal justification or excuse. See

Insight Tech., Inc. v. FreightCheck, LLC, 280 Ga. App. 19, 25 (1) (a), n.13 (633 SE2d

373) (2006).

                                          24
      The tort of aiding and abetting requires proof of virtually the same elements as

the tort of tortious interference with business relations. See White, supra, 294 Ga.

App. at 345 (3).

      [I]n order to be liable for tortious interference, one must be a stranger to
      both the contract at issue and the business relationship giving rise to and
      underpinning the contract. In other words, all part[ies] to an interwoven
      contractual arrangement are not liable for tortious interference with any
      of the contracts or business relationships.

(Citations omitted.) Atlanta Mkt. Center Mgmt. Co. v. McLane, 269 Ga. 604, 610 (2)

(503 SE2d 278) (1998). Moreover, a person has acted “without privilege” with regard

to tortious interference when he is a stranger to the business relationship at issue. See

Cox v. City of Atlanta, 266 Ga. App. 329, 332 (1) (596 SE2d 785) (2004).

      Here, during the relevant period, Neimark, Britt, and Eastwood served as RK

Trust’s attorneys and Gwaltney served as a co-trustee. As discussed above in Division

3 (c), Kahn ratified Gwaltney’s service as co-trustee beyond his designated term.

During the course of Schleta, Neimark, Britt, and Eastwood all took direction from

Gwaltney and Union. Consequently, regardless of whether the individual defendants

committed any tort with respect to the trust when proceeding with the Schleta

settlement or in selling the Cattle Ranch, the defendants cannot be said to have acted

“without privilege” because they were not strangers to RK Trust. See Cox, supra, 266

                                           25
Ga. App. at 333 (1) (since the defendants were not strangers to the business

relationship at issue, they were entitled to summary judgment on tortious interference

claim); Atlanta Mkt. Center Mgmt., supra, 269 Ga. at 610 (2) (affirming grant of

summary judgment on tortious interference claim against person involved in

“business relationship giving rise to and underpinning the contract”). Since the tort

of aiding and abetting requires that a defendant act “without privilege,” and this was

not the case here, the trial court properly granted summary judgment to the defendants

on this count.

      6. Kahn contends that the trial court erred in granting summary judgment to

Gwaltney, Britt, Eastwood, and Britt & Associates on his claim for conversion. We

agree, in part.

             [C]onversion consists of an unauthorized assumption and exercise
      of the right of ownership over personal property belonging to another,
      in hostility to his rights; an act of dominion over the personal property
      of another inconsistent with his rights; or an unauthorized appropriation.

(Citations and punctuation omitted.) Williams v. Nat. Auto Sales, Inc., 287 Ga. App.

283, 285 (1) (651 SE2d 194) (2007). Where a defendant comes into possession of

property lawfully, the plaintiff can establish conversion by showing that the defendant

refused to return the plaintiff’s property after the plaintiff demanded its return. Id.

                                          26
Where a defendant comes into the possession of the property unlawfully, the plaintiff

can establish conversion by showing that the defendant disposed of the property

without authority and retained the proceeds. Id. at 286 (1).

      (a) Kahn’s personal property.

      Viewing the evidence in Kahn’s favor, the evidence shows that after the

auction, Kahn’s assistant attempted to remove some of Kahn’s property, but

Eastwood prevented her from taking all of it. Gwaltney testified that he and Union

subsequently placed personal items they believed belonged to Kahn in a storage unit

and gave the keys to the unit to Kahn’s attorney. Kahn submitted evidence that, after

visiting the storage unit, it was determined that some of his personal items from the

Cattle Ranch were still missing.

      Given that Eastwood exercised control over Kahn’s property by preventing

Kahn’s assistant from removing it and Gwaltney admitted to packing up Kahn’s

items, there is a genuine issue of material fact as to whether Gwaltney and Eastwood

possessed Kahn’s personal items that are missing. Consequently, Gwaltney and

Eastwood were not entitled to summary judgment on Kahn’s conversion claim with

regard to Kahn’s personal property.

                                         27
      As to Britt, there is no evidence that Britt possessed or exercised control over

Kahn’s personal property, and thus he was entitled to summary judgment on the

conversion claim.

      (b) The Cattle Ranch.

      The Kahn Plaintiffs assert that, since Gwaltney was no longer a valid trustee

at the time, the sale of the Cattle Ranch was unauthorized and amounted to

conversion. To the extent the Kahn Plaintiffs seek the recovery of real property, that

claim must fail because an action for conversion will not lie to recover real property.

See Levenson v. Word, 294 Ga. App. 104, 105 (1), n.2 (668 SE2d 763) (2008).

      As for the personal property on the Cattle Ranch belonging to Kahn Cattle

Company, such as farm equipment, vehicles, and farm inventory, the Kahn Plaintiffs

did not raise this claim below. Therefore, they are precluded from raising this claim

on appeal. See Locke’s Graphic & Vinyl Signs, supra, 285 Ga. App. at 828 (2) (a).

      7. Kahn contends that the trial court erred in granting summary judgment to

Gwaltney, Britt, and Eastwood on his claim for trespass and wrongful eviction for

entering the Cattle Ranch and excluding him from the property. Specifically, Kahn

argues that the trial court erred in concluding the evidence did not support a landlord-

tenant relationship even though RK Trust allowed Kahn to stay at the Cattle Ranch,

                                          28
because Kahn stayed at the property for no more than ten days in 2010, he maintained

a separate residence, and he did not have a lease agreement. We agree that factual

questions remain as to this issue.

      Under OCGA § 44-7-1 (a), a landlord-tenant relationship is created when “the

owner of real estate grants to another person, who accepts such grant, the right simply

to possess and enjoy the use of such real estate either for a fixed time or at the will

of the grantor.” (Emphasis supplied.) There is no dispute that Kahn had been allowed

to stay at the Cattle Ranch periodically without having to pay rent and without a

formal lease agreement and kept personal property there. Although the defendants

argue that Kahn’s failure to pay rent precluded the existence of a landlord-tenant

relationship, “neither a written lease agreement nor the payment of rent is required

for a landlord-tenant relationship to exist.” (Footnote omitted.) McCullough v. Reyes,

287 Ga. App. 483, 486 (1) (651 SE2d 810) (2007); see also May v. May, 165 Ga.

App. 461, 462 (1) (300 SE2d 215) (1983) (“The payment of rent is not essential to the

creation of a tenancy at will.”) (citation and punctuation omitted). Therefore, a

genuine issue of material fact remains as to whether Kahn was a tenant at will of RK

Trust and, as a result, whether the defendants were liable for not following the

dispossessory procedures. See Ikomoni v. Executive Asset Mgmt., LLC, 309 Ga. App.

                                          29
81, 84 (2) (709 SE2d 282) (2011) (“If the landlord evicts a tenant without filing a

dispossessory action and obtaining a writ of possession, or without following the

dispossessory procedures for handling the tenant’s personal property, the landlord can

be held liable for wrongful eviction and trespass.”). Consequently, the trial court

erred in granting summary judgment to Gwaltney, Britt, and Eastwood on Kahn’s

wrongful eviction and trespass claim.

      8. The Kahn Plaintiffs next contend that the trial court erred in granting

summary judgment to the defendants on their claims for punitive damages and

attorney fees. We agree in part.

      OCGA § 13-6-11 authorizes a jury to award plaintiffs the expenses of litigation

“where the defendant has acted in bad faith, has been stubbornly litigious, or has

caused the plaintiff[s] unnecessary trouble and expense[.]” Ordinarily, it is for the

jury to determine the existence of bad faith or stubborn litigiousness, and “only in the

rare case where there was absolutely no evidence to support the award of expenses

of litigation would the trial court be authorized to grant summary adjudication on

such issues.” (Punctuation and footnote omitted.) Brito v. Gomez Law Group, LLC,

289 Ga. App. 625, 628 (2) (658 SE2d 178) (2008).

                                          30
      To support an award of punitive damages, there must be clear and convincing

evidence that the defendant’s actions showed “willful misconduct, malice, fraud,

wantonness, oppression, or that entire want of care which would raise the

presumption of conscious indifference to consequences.” OCGA § 51-12-5.1 (b). “A

breach of fiduciary duties is sufficient to support an award of punitive damages.

Whether punitive damages should be awarded for a breach of fiduciary duties is

ordinarily a question for the jury.” (Citation omitted.) Home Ins. Co. v. Wynn, 229 Ga.

App. 220, 223 (2) (493 SE2d 622) (1997). Conversion and wrongful eviction and

trespass can also support an award of punitive damages. See Felker v. Chipley, 246

Ga. App. 296, 298 (2) (540 SE2d 285) (2000) (conversion); Swift Loan & Finance

Co. v. Duncan, 195 Ga. App. 556, 557-558 (2), (5) (394 SE2d 356) (1990) (trespass

based on wrongful eviction); Real Estate Loan Co. v. Pugh, 47 Ga. App. 443 (1) (170

SE 698) (1933) (wrongful eviction).

      As set forth above, we have held that genuine issues of material fact remain as

to some of the breach of fiduciary claims made against Gwaltney; the conversion

claims asserted against Neimark, Gwaltney, Eastwood, and Britt & Associates; and

the wrongful eviction and trespass claims against Gwaltney, Britt, and Eastwood.

Since the trial court erred in granting summary judgment on several of the Kahn

                                          31
Plaintiff’s substantive claims, the trial court likewise erred in granting summary

judgment on their derivative claims for attorney fees and punitive damages. See

Racette v. Bank of America, N.A., 318 Ga. App. 171, 181 (6) (733 SE2d 457) (2012).

      9. The Kahn Plaintiffs also contend that the trial court erred in failing to grant

their motion for partial summary judgment because the undisputed facts show that

Gwaltney breached a fiduciary duty by remaining as co-trustee following the

conclusion of McSweeney; Britt and Neimark were negligent for taking direction from

Gwaltney after his trustee term expired; and Britt, Neimark, and Eastwood breached

their fiduciary duties to RK Trust by taking direction from Gwaltney. We disagree.

      As noted above in Division 3 (c), Gwaltney was entitled to summary judgment

on the Kahn Plaintiffs’ claim that he breached his fiduciary duty by remaining as co-

trustee because such actions were ratified. For similar reasons, Britt and Neimark are

entitled to summary judgment on claims that they were negligent for taking direction

from Gwaltney. Accordingly, the Kahn Plaintiffs were not entitled to summary

judgment on these claims.

      Likewise, the Kahn Plaintiffs were not entitled to summary judgment on claims

against Gwaltney for hiring of Britt to handle the Schelta suit, the auction of the

Cattle Ranch, and the handling of Brock’s commission because, as discussed above

                                          32
in Division 3, genuine issues of material fact remain. Moreover, for the reasons stated

below, there are questions of fact as to whether Britt and Neimark committed legal

malpractice or breached their fiduciary duties to RK Trust. Therefore, we affirm the

trial court’s denial of summary judgment to the Kahn Plaintiffs.

                                Case No. A14A1016

      10. Neimark contends that the trial court erred in denying his motion for

summary judgment on the Kahn Plaintiffs’ claims for negligence, professional

negligence, and breach of fiduciary duty relating to Neimark’s role in the transfer of

Kahn’s assets to RK Trust. Specifically, Neimark argues that RK Trust failed to

establish proximate cause because the RK Trust’s spendthrift provision was subject

to attack based on improper distributions to Kahn predating Neimark’s involvement

with RK Trust.6 We disagree.

             To prevail on a legal malpractice claim, a client must prove that
      (1) he employed the defendant attorney; (2) the attorney failed to
      exercise ordinary care, skill, and diligence; and (3) this failure was the
      proximate cause of damages to the client. To establish proximate cause,
      the client must show that but for the attorney’s error, the outcome would

      6
        Neimark provides no argument nor citation to authority as to whether his
actions were negligent, and therefore he has abandoned such argument for purposes
of this appeal. See Court of Appeals Rule 25 (c) (2). Neimark’s arguments with
respect to duties owed to Kahn personally have been decided in Kahn’s favor in
Division 4 above.

                                          33
      have been different . . . . The defendant attorney is entitled to summary
      judgment if he shows that there is an absence of proof adduced by the
      client on the issue of proximate cause.

(Footnote omitted.) Millsaps v. Kaufold, 288 Ga. App. 44, 44-45 (653 SE2d 344)

(2007). It is well settled that proximate cause is generally an issue for the jury, and

there may be more than one proximate cause of an injury. Keith v. Beard, 219 Ga.

App. 190, 193 (464 SE2d 633) (1995).

      The evidence shows that from 1998 to 2002, Kahn made more than $31 million

in unauthorized trust distributions to himself. Neimark argues that, regardless of any

action on his part, the McSweeney plaintiffs would have been able to defeat the

spendthrift provision of RK Trust because of the improper distributions to Kahn. In

support of his argument, Neimark relies upon Restatement (Third) of Trusts § 58,

cmt. b (1) (2003), which pertinently provides:

      [a]n intended spendthrift restraint is also invalid with respect to a
      nonsettlor’s interests in trust property over which the beneficiary has the
      equivalent of ownership, entitling the beneficiary to demand immediate
      distribution of the property. Thus, if an income beneficiary also holds a
      presently exercisable general power of appointment (that is, a power
      currently to compel distribution of trust property to the power holder),
      a spendthrift restraint will not prevent the beneficiary’s creditors or
      transferees from reaching the property that is subject to the power.

(emphasis added).

                                          34
      In this case, however, by the time Schleta was filed, Kahn no longer had the

power to compel distribution of the trust property since he had delegated his

appointment to Gwaltney. Therefore, Neimark’s reliance upon the Restatement is

unavailing. Moreover, although Schleta was filed primarily to recover the unpaid

McSweeney judgment of approximately $3.5 million owed by Kahn, the Schleta

plaintiffs also sought treble damages for the fraudulent conveyance of assets and

RICO violations based on such transfers. Neimark helped execute the asset transfers,

which experts testified was done poorly. Since the Schleta settlement was

approximately $4 million, more than Kahn’s personal obligation under McSweeney,

and RK Trust incurred damages by having to litigate Schleta, there is a genuine issue

of material fact as to whether Neimark’s actions proximately caused injuries to RK

Trust. Therefore, the trial court properly denied Neimark’s motion for summary

judgment on RK Trust’s claims for negligence, professional negligence, and breach

of fiduciary duty. Since these claims survived summary judgment, the trial court also

erred in granting Neimark summary judgment on the Kahn Plaintiffs’ related claims

for attorney fees and punitive damages. See Racette, supra, 318 Ga. App. at 181 (6).

                               Case No. A14A1017

                                         35
      11. Britt and his law firm, Britt & Associates, contend that the trial court erred

in denying their motion for summary judgment on the Kahn Plaintiffs’ negligence and

breach of fiduciary duty claims for not properly advising Kahn and RK Trust about

the risks of the asset transfer and poorly managing the transfer. We disagree.

      There is conflicting evidence as to whether Britt properly advised Kahn, as co-

trustee, regarding the risks associated with asset transfer. Britt testified that, upon

being hired to represent RK Trust, Kahn and Union rejected his advice to either file

a declaratory judgment and have a court place the assets from the loan proceeds into

a constructive trust or, alternatively, execute deeds to secure debt so that RK Trust

had a security interest in the properties Kahn purchased with RK Trust money. Kahn

did not deny having received Britt’s proposals, but testified that he only agreed to the

asset transfer because Britt threatened to sue Kahn on behalf of the trust if he did not

proceed with this option. Contrary to Britt’s arguments, the above conflicts in the

evidence preclude summary judgment on the issue of whether Britt was negligent in

advising RK Trust and Kahn regarding the asset transfers. See Rogers, supra, 203 Ga.

App. at 416 (2) (attorney’s liability extended to persons who would foreseeably rely

on attorney’s advice regarding asset transfer).

                                          36
      Like Neimark, Britt argues that RK Trust cannot establish proximate cause, but

we have rejected these arguments above. In light of these conflicts in the evidence,

along with the evidence showing that the asset transfer was poorly executed, Britt was

not entitled to summary judgment on the Kahn Plaintiffs’ claims that he was negligent

and breached a fiduciary duty.

      12. Britt contends that the trial court erred in failing to grant summary

judgment to Britt & Associates on Kahn’s conversion claim. We disagree because

there is some evidence showing that that an employee of Britt’s law firm may have

removed identified boxes of Kahn’s personal files from the Cattle Ranch. Therefore,

the trial court correctly denied summary judgment to Britt & Associates on the

conversion claim with respect to Kahn’s personal property.

      In sum, in Case A14A1015, we affirm the trial court’s rulings that: Britt and

Neimark were entitled to summary judgment on the claim that they were negligent in

allowing Gwaltney to become a temporary co-trustee; Eastwood was entitled to

summary judgment as to negligence and breach of fiduciary duty claims; Gwaltney

was entitled to summary judgment on negligence and breach of fiduciary duty claims

related to verifying Kahn’s promissory notes, his role in the asset transfer, and his

actions in remaining as co-trustee beyond the designated term; all of the defendants

                                         37
were entitled to summary judgment on the aiding and abetting claims; and Britt was

entitled to summary judgment on the conversion claim. We also affirm the denial of

the Kahn Plaintiffs’ motion for summary judgment. We reverse the trial court’s grant

of summary judgment to Gwaltney on negligence and breach of fiduciary duty claims

relating to the hiring of Britt to represent RK Trust in Schleta, selling the Cattle

Ranch at auction, and handling Brock’s commission; Neimark on claims brought by

Kahn individually; Gwaltney and Eastwood regarding the conversion of Kahn’s

personal property; and Gwaltney, Eastwood, and Britt on Kahn’s claims for trespass

and wrongful eviction. Additionally, we reverse the trial court’s rulings on the Kahn

Plaintiffs’ request for attorney fees and punitive damages to the extent the substantive

claims on which they are based survive.

         In Case A14A1016, we affirm the denial of summary judgment to Neimark on

claims that he was negligent and breached his fiduciary duty to RK Trust with respect

to the asset transfer. In Case A14A1017, we affirm the denial of summary judgment

to Britt on negligence and breach of fiduciary duty claims regarding the asset transfer,

and affirm the denial of summary judgment to Britt & Associates on the conversion

claim.

                                          38
      Judgment affirmed in part and reversed in part in Case A14A1015; judgment

affirmed in Case A14A1016; judgment affirmed in A14A1017. Doyle, P. J., and

Dillard, J., concur.

                                      39