Freund v. Warren
320 Ga. App. 765
| Ga. Ct. App. | 2013Background
- Freund, Ltd. (d/b/a All Cobb Bail Bonds) appeals summary judgment to ACBB over two CDs held by the Sheriff as collateral.
- The CDs were held in trust under a Deposit Agreement with the Sheriff, intended for a professional bonding business.
- Purchase and Sales Agreement: Hall and Smith would purchase All Cobb Bail Bonds assets; Freund signed as president of All Cobb Bail Bonds.
- The Agreement shows Hall and Smith signed individually; no corporate designation when purchasing assets, including CDs.
- Deposit Agreement names All Cobb Bail Bonds (not All Cobb Bail Bonds, Inc.) and requires ownership disclosures and termination provisions.
- Hall and Smith testified ownership and operation as All Cobb Bail Bonds, Inc., but their signatures and documents indicate individual ownership; ownership transfer to ACBB not documented.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Who owns the CDs held by the Sheriff? | Freund contends CDs are Freund/ACBB property per Deposit Agreement | ACBB argues CDs belong to ACBB under corporate ownership | CDs owned by Hall and Smith individually; not transferred to ACBB |
| Did the Deposit Agreement authorize transfer of CDs to ACBB when the bonding business terminated? | Funds should transfer to professional bonding business (ACBB) upon termination | No express transfer; Sheriff acted administratively without ownership change | No valid transfer; Sheriff’s actions did not vest title in ACBB |
| Is Freund a judgment creditor entitled to the CDs? | Freund's judgment against Hall and Smith allows recovery from funds in registry | Ownership disputes bar assignment of funds to Freund | Freund entitled to proceeds subject to liens; judgment creditor can recover |
| Were the Reliance on corporate form and signatories misapplied? | Documents show ownership in Hall/Smith individually; corporate form disregarded | ACBB limited by corporate status; signatures indicate corporation | Court rejected corporate veil; ownership remained with Hall/Smith; no transfer to ACBB |
| Did the trial court err in granting ACBB summary judgment and fees? | Disposition relies on contractual ambiguities and ownership | Desire to resolve contract construction; fees appropriate | Judgment reversed; remand for Freund; fees reversed |
Key Cases Cited
- Overton Apparel v. Russell Corp., 264 Ga. App. 306 (Ga. App. 2003) (summary judgment standards; de novo review)
- Lau’s Corp. v. Haskins, 261 Ga. 491 (Ga. 1991) (summary judgment standards; contract interpretation)
- Homelife Communities Group v. Rosebud Park, LLC, 280 Ga. App. 120 (Ga. App. 2006) (contract interpretation; duty of good faith)
- Ga. Magnetic Imaging v. Greene County Hosp. Auth., 219 Ga. App. 502 (Ga. App. 1995) (unambiguous contracts; parol evidence limits)
- Lifestyle Home Rentals v. Rahman, 290 Ga. App. 585 (Ga. App. 2008) (parol evidence only for ambiguity; contract certainty)
- UniFund Financial Corp. v. Donaghue, 288 Ga. App. 81 (Ga. App. 2007) (parol evidence not to contradict unambiguous contract)
- Gentile v. Miller, Stevenson & Steinichen, Inc., 257 Ga. 583 (Ga. 1987) (self-contradictory testimony; weigh against party)