Gospel Tabernacle Deliverance Church, Inc. v. From the Heart Church Ministries, Inc.
312 Ga. App. 355
Ga. Ct. App.2011Background
- From the Heart sued Gospel Tabernacle Deliverance Church, Inc., and the Jacksons for negligent misrepresentation regarding real property that induced purchase of Gospel Tabernacle land.
- Plaintiff alleged the Jacksons misrepresented that adjacent land was part of the purchased property and parking; after closing, it was discovered the land was not owned by Gospel Tabernacle.
- The purchase agreement described the property by attached survey or deed reference; the attached survey depicted adjacent land not owned by Gospel Tabernacle.
- During due diligence, From the Heart obtained a second survey, a title commitment, and a parking report all showing the adjacent land was not part of the property; the second survey included a boundary description excluding the adjacent land.
- Pastor Cherry learned pre-closing that Gospel Tabernacle did not own the adjacent land and sought assurances; closing occurred with assurances that the entire parking lot was Gospel Tabernacle’s.
- The trial court denied a directed verdict; on appeal, the court reversed, holding as a matter of law that From the Heart failed to exercise due diligence, entitling defendants to judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did due diligence defeat negligent misrepresentation? | From the Heart asserts reliance on misrepresentation despite due diligence. | Gospel Tabernacle/Jacksons argue lack of justifiable reliance due to failure to exercise due diligence. | Yes; due diligence failed as a matter of law. |
| Was justifiable reliance shown where due diligence would have disclosed truth? | From the Heart relied on assurances that the parking lot was fully Gospel Tabernacle’s. | Reliance is not justifiable where due diligence would have revealed falsity. | No; reliance not justifiable given discovery opportunities. |
Key Cases Cited
- Aldworth Co. v. England, 281 Ga. 197, 637 S.E.2d 198 (Ga. 2006) (duty to exercise due diligence affects misrepresentation claims)
- Lester v. Bird, 200 Ga. App. 335, 408 S.E.2d 147 (Ga. App. 1991) (buyer cannot claim deception where truth could have been learned)
- Artzner v. A & A Exterminators, 242 Ga.App. 766, 531 S.E.2d 200 (Ga. App. 2000) (justifiable reliance requires evidence of diligence)
- St. Paul, etc., Ins. Co. v. Meeks, 270 Ga. 136, 508 S.E.2d 646 (Ga. 1998) (directed verdict standard and sufficiency of evidence)
- Parsells v. Orkin Exterminating Co., 178 Ga.App. 51, 342 S.E.2d 13 (Ga. App. 1986) (directed verdict requires lack of evidence on essential issue)
- Klusack v. Ward, 234 Ga.App. 178, 507 S.E.2d 1 (Ga. App. 1998) (whether plaintiff could have discovered truth is for the jury)
- Anderson v. Atlanta Committee for the Olympic Games, 261 Ga.App. 895, 584 S.E.2d 16 (Ga. App. 2003) (justifiable reliance requires proof of due diligence)