Inland Atlantic Old National Phase I, LLC v. 6425 Old National, LLC.
329 Ga. App. 671
| Ga. Ct. App. | 2014Background
- Consolidated appeals concern a Site Development Agreement for Phase I and Phase II of a shopping-center project on the Property in South Fulton County.
- Old National owned 25% of the Joint Venture; Inland Atlantic owned 50%; another entity held 25%.
- The Joint Venture delegated site-development duties primarily to Inland Atlantic, with Old National supervising Phase I site work; Lewis Trucking and Grading was hired as the Phase I contractor at Old National’s insistence.
- Phase I had defects: Lewis’s subcontractor nonpayment, incomplete items, and site issues (signal, brick pavers, piping, grading, sink hole, buried rock), causing additional costs to Inland Atlantic.
- Inland Atlantic sued for various counterclaims (fiduciary duty, fraud, negligent misrepresentation, breach of contract, indemnification) after discovery and partial summary judgments; the trial court denied some motions and granted others.
- The court ultimately reversed in part and affirmed in part, and held questions of fact remained on termination of the Site Development Agreement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Breach of fiduciary duty arising from Joint Venture duties | Inland Atlantic contends Old National owed fiduciary duties as a managing party. | Old National argues no fiduciary duty absent managing authority; duties were limited per LLC agreement. | Question of fact on fiduciary duty; reversed summary judgment for Inland Atlantic on this claim. |
| Fraud and negligent misrepresentation based on Lewis’s qualifications | Inland Atlantic alleges Old National owed a duty to disclose material facts due to fiduciary relationship and misrepresented Lewis’s finances. | Old National disputes materiality/reliance; no fiduciary duty established. | Question of fact remains; reversed summary judgment for Inland Atlantic on these claims. |
| Breach of contract under Site Development Agreement | Inland Atlantic alleges Old National breached by failing to supervise Phase I and by waiving defects. | Old National contends no breach or waived claims under contractual terms. | Trial court did not err in denying Old National summary judgment; issue for jury as to waiver and conduct. |
| Indemnification under Site Development Agreement | Indemnity provision should cover claims; ambiguity must be resolved in Inland Atlantic’s favor. | Ambiguity against indemnitee; contract language unclear as to who indemnifies whom. | Ambiguity remains; denial of summary judgment affirmed; jury to interpret contract. |
| Whether Site Development Agreement was terminated | Inland Atlantic substantially complied with termination notice requirements through communications of deficiencies. | Strict adherence required to 30-day termination notice. | Question of fact for jury; no clear termination finding by trial court. |
Key Cases Cited
- GEICO Gen. Ins. Co. v. Wright, 299 Ga. App. 280 (Ga. App. 2009) (de novo review for summary-judgment appeal; standard)
- Ansley Marine Constr. v. Swanberg, 290 Ga. App. 388 (Ga. App. 2008) (fiduciary duty concepts and duties in Georgia)
- ULQ, LLC v. Meder, 293 Ga. App. 179 (Ga. App. 2008) (duties of managers/LLC members; fiduciary duties when managing affairs)
- Goldston v. Bank of America Corp., 259 Ga. App. 690 (Ga. App. 2003) (duty to disclose material facts in fiduciary relationship)
- Bogle v. Bragg, 248 Ga. App. 632 (Ga. App. 2001) (duty to disclose; fraud when duty exists)
- Young v. Oak Leaf Builders, Inc., 277 Ga. App. 274 (Ga. App. 2006) (waiver analysis; material facts for contract breach resolved by jury)
- Rome Healthcare LLC v. Peach Healthcare System, 264 Ga. App. 265 (Ga. App. 2003) (substantial compliance vs. strict compliance in termination clauses)
- Old Republic Nat. Title Ins. Co. v. Harry J. Pannella, LLC, 319 Ga. App. 274 (Ga. App. 2012) (contract interpretation; ambiguity resolved by jury if persists)
- Service Merchandise Co. v. Hunter Fan Co., 274 Ga. App. 290 (Ga. App. 2005) (indemnification construction; ambiguity against drafter)
- Board of Commrs. of Crisp County v. City Commrs. of the City of Cordele, 315 Ga. App. 696 (Ga. App. 2012) (ambiguity in indemnity provisions; jury factor)
- UWork.com, Inc. v. Paragon Technologies, Inc., 321 Ga. App. 584 (Ga. App. 2013) (contract interpretation; when ambiguity remains, jury decides meaning)