HANHAM v. ACCESS MANAGEMENT GROUP, LP
305 Ga. 414
Ga.2019Background
- James and Mary Hanham sued their neighbor Marie Berthe‑Narchet, her landscaper, and Access Management Group L.P. after landscaping on Narchet’s lot caused flooding onto the Hanhams’ property and obstructed their golf‑course view.
- St. Marlo Homeowners Association had a written management agreement delegating community management to Access Management; the written duties focused on common areas.
- Despite the written scope, Access Management (with the association’s knowledge) handled homeowners’ applications for architectural/landscape modifications: collecting materials, reviewing for compliance, and forwarding to the architectural committee.
- Narchet’s application failed to meet the association’s standards but was nonetheless approved and the work proceeded, allegedly causing the Hanhams’ injuries.
- At trial, the court denied Access Management’s motion for directed verdict on the Hanhams’ breach of contract claim; the jury found for the Hanhams. The Court of Appeals reversed as to breach of contract, holding that responsibilities outside the written contract could not form a contractual breach.
- The Georgia Supreme Court granted certiorari, reversed the Court of Appeals on the breach issue, reinstated the jury verdict as to breach of contract, and remanded for consideration of potential double recovery of damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Access Management breached the management contract such that the Hanhams (as third‑party beneficiaries) can recover for breach | Hanham: Access Management assumed expanded duties by course of conduct (managing homeowners’ applications); its deficient performance of those duties breached the contract and injured the Hanhams | Access Mgmt: The written management agreement limited duties to common areas; responsibilities outside the written contract cannot support a breach claim — directed verdict appropriate | The Supreme Court held there was evidence of a course‑of‑conduct modification of the contract; the Court of Appeals erred to treat nonwritten duties as categorically incapable of supporting breach; denial of directed verdict was upheld (verdict reinstated) |
| Whether a written contract may be modified by parties’ course of conduct | Hanham: Course of conduct showed parties mutually extended Access Management’s duties, effectively modifying the written agreement | Access Mgmt: Any additional responsibilities were noncontractual; breach cannot be based on duties not specified in the written contract | Court: Parties may modify a written contract by course of conduct absent a law or contractual provision prohibiting modifications; course‑of‑conduct modification was available here |
| Whether the Court of Appeals’ “as specified in the contract” rule forbids course‑of‑conduct modifications | Hanham: That rule improperly prevents private parties from modifying contracts by conduct | Access Mgmt: Relied on Court of Appeals precedent applying that phrase | Court: Rejected the broad application of that rule to private parties; it is only appropriate in limited situations (e.g., sovereign immunity contexts). The Court disapproved its prior expansive use |
| Whether the jury verdict permits double recovery for breach and negligence | Hanham: Jury awarded damages; breach remains valid | Access Mgmt: Verdict form may allow double recovery and final judgment may be erroneous | Court: Because breach verdict and damages are reinstated, the Court of Appeals must address the double‑recovery argument on remand |
Key Cases Cited
- Vasche v. Habersham Marina, 209 Ga. App. 263 (course of conduct can modify a written contract)
- American Century Mtg. Investors v. Bankamerica Realty Investors, 246 Ga. 39 (parol/oral modification of a written contract recognized where agreed by parties)
- Albany Fed. Sav. & Loan Assn. v. Henderson, 200 Ga. 79 (course of conduct evidence can establish contract modification)
- Cooley v. Moss, 123 Ga. 707 (common law statements on how breach may arise)
- Ga. Dept. of Labor v. RTT Assocs., 299 Ga. 78 (limitations on contract modification in suits involving the State and sovereign immunity)
- Cordell & Cordell, P.C. v. Gao, 331 Ga. App. 522 (Court of Appeals case describing breach elements that the Supreme Court found was misapplied here)