Effingham County v. Roach
329 Ga. App. 805
Ga. Ct. App.2014Background
- In 2005–2006 Darrell Morgan (later represented by Chapter 7 trustee Benjamin Roach) negotiated with Effingham County to obtain county water/sewer (w/s) service for a 75‑acre residential development called Grandview; the County provided a March 1, 2005 letter of intent projecting service by July 2006.
- The parties signed a November 1, 2005 Development Agreement and a May 10, 2006 Water, Sewer, and Re‑Use Water Service Agreement (the “2006 Agreement”); both required the County to build off‑site w/s and Morgan to build/dedicate on‑site improvements; the 2006 Agreement left two completion‑date blanks unfilled and included a severability clause and a no‑consequential‑damages‑for‑delay clause conditioned on notice/default procedures.
- The County engaged in ongoing discussions with the City of Rincon about substituting Rincon as the w/s provider, and DOT road realignment and other factors delayed County work; Morgan was not told about continuing Rincon talks and did not start on‑site construction because he relied on the County’s assurances.
- Morgan rezoned the property to industrial in 2008; he later defaulted on financing and the bank foreclosed in 2009; Roach delivered ante litem notice in September 2010 and sued the County for breach of contract (and other claims later narrowed to breach of contract).
- The trial court denied the County’s second summary‑judgment motion on multiple grounds (contract validity/severability, sovereign‑immunity waiver, damages, timeliness of ante litem notice, mitigation); the County appealed and the appellate court affirmed.
Issues
| Issue | Plaintiff's Argument (Roach) | Defendant's Argument (County) | Held |
|---|---|---|---|
| Enforceability of 2006 Agreement given Park West decision | 2006 Agreement is valid; any void impact‑fee provision is severable from County’s promise to provide w/s | Park West renders similar impact‑fee clauses void and thus 2006 Agreement unenforceable | Court: Severability clause governs; unenforceable impact‑fee term does not void County’s obligation to provide w/s |
| Sovereign immunity waiver | Claim arises from a valid written contract, so sovereign immunity is waived | No valid written contract, so sovereign immunity bars suit | Court: Because 2006 Agreement is enforceable (see above), sovereign immunity does not bar the breach claim |
| Damages and no‑consequential‑damages clause | Seeks damages including diminution in property value; clause ambiguous as to county‑caused delays (e.g., Rincon talks) | Contract precludes consequential/economic damages for delay | Court: Ambiguity and factual dispute about causes of delay (County conduct) create jury issues; diminution in value is cognizable damage |
| Timeliness of ante litem notice (statute of limitations) | Accrual is fact‑dependent; reasonable time to complete was not fixed; County’s concealment/ongoing delays tolled accrual | Claim accrued by end of 2006 (blanks mean Dec. 31, 2006) so 2010 notice was untimely | Court: Blanks create ambiguity; accrual depends on when breach occurred and reasonable time — fact questions and possible tolling prevent summary judgment |
Key Cases Cited
- Benton v. Benton, 280 Ga. (explains summary judgment/de novo appellate review standard)
- Effingham County Bd. of Commrs. v. Park West Effingham, 308 Ga. App. 680 (invalidated an impact‑fee clause under the Development Impact Fee Act)
- Nolley v. Maryland Cas. Ins. Co., 222 Ga. App. 901 (severability preserves remainder of contract)
- Circle Appliance Leasing v. Appliance Warehouse, 206 Ga. App. 405 (severability clause shows parties’ intent)
- Bulloch South, Inc. v. Gosai, 250 Ga. App. 170 (severability via contract language)
- Bd. of Regents v. Ruff, 315 Ga. App. 452 (sovereign immunity not waived absent proof of written contract)
- Budget Rent‑a‑Car of Atlanta v. Webb, 220 Ga. App. 278 (elements of breach include damages)
- Dept. of Transp. v. Arapaho Constr., 257 Ga. (no‑damages‑for‑delay clauses construed strictly; must be clear and cover contemplated delays)
- Royal Capital Dev. v. Maryland Cas. Co., 291 Ga. (diminution in value as measure of damages to real property)
- IH Riverdale v. McChesney Capital Partners, 280 Ga. App. 9 (reasonable time for performance is generally a jury question)
- Mansell 400 Associates v. Entex Information Svcs., 239 Ga. App. 477 (when time not specified, law implies reasonable time)
- Gamble v. Lovett School, 180 Ga. App. 708 (breach accrues at time of breach; accrual test explained)