Court Opinion

ID: 9855572
Source: CourtListenerOpinion
Date Created: 2023-09-24 06:27:30.169663+00
Date Added: 2024-06-11T09:36:13.235142
License: Public Domain

Andrews, Presiding Judge,
dissenting.
Because I believe the majority has totally ignored the plain wording of the controlling law and contract documents at issue here, as well as overemphasizing immaterial issues of fact which fly in the face of the wording of the documents, I respectfully dissent.
First, a number of facts in addition to those set out in the majority should be noted. It is not disputed that Browning dealt only with Wayne Mason, former Gwinnett County commissioner and principal of Madison Ventures, Ltd. during negotiations concerning the 153 acres. It is also not disputed that Mason brought in John D. Stephens, individual, as a third partner in the venture. The documents establishing Pine Creek, including the Operating Agreement, were prepared by Andersen, Davidson & Tate, appellate counsel for Pine Creek, on behalf of Madison Ventures and Stephens, individually, and reviewed by separate counsel for Pine Mount.9 At no point during Browning’s negotiations with Mason was John D. Stephens, Inc. mentioned.10
On June 2, 1997, the Operating Agreement for Pine Creek was signed. The initial paragraph lists the parties as “JOHN D. STEPHENS, a resident of the State of Georgia (‘JDS’), MADISON VENTURES, LTD., a Georgia corporation (‘Madison’), and PINE MOUNT, L.L.C., a Georgia limited liability company (‘Pine Mount’).” The same three parties are listed as members in Paragraph 2.7 titled “Members” and the same three parties signed the agreement. There is no mention in the document of John D. Stephens, Inc. (Stephens, Inc.).
In its brief here, Pine Creek states that the trial court
correctly noted that any attempted transfer of an interest in the Company which would result in a termination of the Company under I.R.C. § 708 would be “deemed invalid, null and void, and of no force or effect” under Paragraph 6.1.1.3 of the Operating Agreement, and accordingly found that the September 12, 1997 Madison Ventures to Stephens, Inc. [tjransfer failed to transfer any interest in the Company to Stephens, Inc.
(Emphasis supplied.)
Nonetheless, the majority has found extensive factual issues *40regarding whether, in fact, Madison Ventures’ transfer to Stephens, Inc. was truly a transfer of dominion and control of Madison Ventures’ interest in Pine Creek. Such a conclusion ignores the documents which were, again, prepared by Andersen, Davidson & Tate for Pine Creek and Madison Ventures. The Transfer and Assignment of Limited Liability Company Interest, found unambiguous by the trial court, states that “Assignor [Madison Ventures] hereby sells, conveys, assigns, and transfers to Assignee [Stephens, Inc.] the Interest and all of Assignor’s right, title and interest in and to the Company [Pine Creek] in consideration for Assignee’s execution in favor of Assignor of a Promissory Note of even date herewith. . . .”
It has been repeatedly held that
[t]he construction of a contract is peculiarly well suited for disposition by summary judgment because, in the absence of an ambiguity in terms, it is a question of law for the court. An ambiguity exists only if after the application of the pertinent rules of interpretation, it remains uncertain which of two or more possible meanings the parties intended. “No construction is required or even permissible when the language employed by the parties in the contract is plain, unambiguous and capable of only one reasonable interpretation.”
(Footnotes omitted.) Tucker Materials v. DeVito Contracting &c., 245 Ga. App. 309, 310 (535 SE2d 858) (2000). See also Balata Dev. Corp. v. Reed, 249 Ga. App. 528, 529 (548 SE2d 668) (2001).
Considering the documents effecting this transfer from Madison Ventures to Stephens, Inc., without reference to any parol evidence regarding an intent contrary to that expressed in the documents,11 it is clear that the trial court correctly concluded that this transfer would violate § 708 and, thereby, the Operating Agreement. Evans v. Commr. of Internal Revenue, 54 TC 40, 50-51 (U. S. Tax Court 1970), aff’d, 447 F2d 547 (7th Cir. 1971); 26 CFR § 1.708-1 (b) (2).
The majority also ignores the argument actually made below by Pine Creek. As restated by the trial court, that argument was that even if there were a § 708 termination, the Operating Agreement would render the transfers null and void, such that (1) the interests would never be considered transferred; (2) there would not be a termination under § 708; and (3) there would not be a violation of the Operating Agreement because John D. Stephens signed the docu*41ments concerning the limited liability company action both in his individual capacity and as president of John D. Stephens, Inc. and Madison Ventures ratified the sale.
This circuitous argument was, I believe, correctly rejected by the trial court as ignoring the plain language of Section 6.1.3 regarding the consequences of an impermissible transfer, as agreed to by all parties to the Operating Agreement.
Therefore, I agree with the trial court that Stephens, Inc., as the person to whom Madison Ventures sought to transfer its 37.5 percent, lost its rights to participate in Pine Creek, at least as to this 37.5 percent.12 Since the sale to M. D. Hodges could not have been completed by Stephens, Inc. voting only its other 37.5 percent because, according to Section 5.1.3.1 of the Operating Agreement, the sale of substantially all of the assets of Pine Creek was required to be approved by “no less than two-thirds (2/3) of the Percentages then held by Members,” the limited liability company action was done in contravention of the Operating Agreement.
That, as concluded by the majority, had the improper transfers not occurred, Stephens individually (and/or Stephens, Inc.) along with Madison Ventures could have done what they did regarding the sale of the 153 acres without Pine Mount’s participation or knowledge obfuscates the real issue. That issue is, if the Operating Agreement were violated, all parties agreeing that the sale of the property cannot be undone, what is Pine Mount’s remedy? Is it restricted to the “nonjury equitable valuation proceeding” provided by OCGA § 14-11-1011 of the Dissenters’ Rights Article, or may it sue for breach of contract, fraud, and other remedies?
I agree with the trial court which concluded that Pine Mount was not, as argued by Pine Creek, restricted to the dissenters’ rights proceeding,13 but could pursue other remedies.
Pine Creek relies on Grace Bros., Ltd. v. Farley Indus., 264 Ga. 817 (450 SE2d 814) (1994), which dealt with dissenting shareholders’ rights in a corporate merger situation. That case, however, did not *42involve a situation where there was a violation of the articles of incorporation or bylaws or fraudulent and deceptive means used to obtain approval of the corporate action. As the Supreme Court noted, it was instead a “complaint about stock price,” as to which the statutory appraisal remedy is exclusive. Id. at 821. See also Matthews v. Tele-Systems, 240 Ga. App. 871, 873 (525 SE2d 413) (1999) (depletion of corporate assets through excessive salaries relates to value of shares to be determined in appraisal action); Lewis v. Turner Broadcasting System, 232 Ga. App. 831, 833 (3) (503 SE2d 81) (1998) (claims of violation of corporate bylaws not viable, statutory appraisal action exclusive remedy); Croxton v. MSC Holding, Inc., 227 Ga. App. 179, 182 (2) (489 SE2d 77) (1997) (shareholder’s complaint not essentially a “complaint about price” and he was not restricted to statutory appraisal proceeding).
Had the legislature intended that a member of a limited liability company be restricted to the dissenters’ rights procedure in the case of a violation of the operating agreement, it could have so specified. Instead, it designated the appraisal process for situations where no such violation or fraud had been shown and only value was at issue.
I am persuaded, as was the trial court, by Shidler v. All American Life &c. Corp., 775 F2d 917 (8th Cir. 1985), which considered the Iowa dissenting shareholders’ statute and concluded that the legislature had not intended, by that statute, to exclude other private remedies. As stated therein,
[t]he defendants argue first that statutory appraisal, [cit.], is the sole relief intended by the legislature for disappointed minority shareholders. However, the statute provides for appraisal as the exclusive remedy only where “the proposed corporate transaction [is] approved by the required vote.” [Cits.] ... If the transaction is unlawful [as the result of improper corporate action], appraisal cannot be the exclusive remedy.
Id. at 922 (I) (D).
If Pine Mount were restricted,- in this situation, to the dissenters’ rights valuation proceeding, as noted in Shidler, the statute would condone wrongdoing, and I will not presume the legislature intended that result. Therefore, I believe that the trial court properly granted Pine Mount summary judgment on its third defense and dismissed the petition of Pine Creek.
I am authorized to state that Presiding Judge Johnson and Judge Eldridge join in this dissent.
*43Decided November 30, 2001
Reconsideration denied December 14, 2001.
Andersen, Davidson & Tate, Gerald Davidson, Jr., Thomas T. Tate, Tanya A. Eades, Robert H. Hishon, for appellant.
Chamberlain, Hrdlicka, White, Williams & Martin, Eric C. White, James L. Paul, Matthew J. McCoyd, for appellee.

 Stephens repeatedly referred to Andersen, Davidson & Tate as “representing the deal.”

 That company’s shareholders were Stephens and his three sons.

 Such parol evidence may not, of course, be considered to alter the terms of a written document where the terms are unambiguous. OCGA § 13-2-2 (1). This parol evidence was specifically objected to below by Pine Mount.

 I would not decide whether the trial court correctly determined that Stephens, Inc. was precluded from voting its original 37.5 percent received from Stephens by its receipt of the second 37.5 percent in violation of § 708 because that decision of the trial court was not necessary to the decision rendered and was, therefore, obiter dicta. Davis v. State, 266 Ga. 212 (465 SE2d 438) (1996); Veal v. Barber, 197 Ga. 555, 560 (1) (30 SE2d 252) (1944); Peacock a Peacock, 196 Ga. 441, 449 (26 SE2d 608) (1943); Glisson v. Hosp. Auth. of Valdosta &c., 224 Ga. App. 649, 652 (481 SE2d 612) (1997).

 To the extent that Pine Creek argues here that Pine Mount should have sought to enjoin the limited liability company action, i.e., the sale to M. D. Hodges, the argument is factually inapposite because the sale was concealed from Pine Mount until the sale was consummated and, as acknowledged by Pine Creek’s brief, “Pine Mount could not legally have set aside the sale of the Property to Hodges, a bona fide purchaser for value, without notice of any conflicting interest in the property.”