Powerhouse Custom Homes, Inc. v. 84 Lumber Co.
307 Ga. App. 605
| Ga. Ct. App. | 2011Background
- 84 Lumber filed suit against Powerhouse and guarantor Anderson to collect on an open account for building materials and labor.
- Powerhouse entered a November 6, 2002 credit agreement with 84 Lumber and Anderson signed a personal guaranty.
- Balance due under the credit account totaled $95,260.42; failure to remit led to litigation.
- During discovery, Powerhouse and Anderson failed to respond to requests for admissions.
- On August 20, 2009, the parties mediated; a mediation agreement introduced a settlement proposal subject to 84 Lumber’s acceptance within 15 days and objections within 10 days.
- 84 Lumber did not accept the proposal within the 15-day window and rejected it on September 14, 2009; 84 Lumber later moved for summary judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether mediation proposal constituted a binding settlement | Powerhouse/Anderson contend it created settlement binding on all parties. | The proposal was subject to acceptance by 84 Lumber and no enforceable agreement formed. | No enforceable settlement reached; proposal remained non-binding. |
| Effect of failure to respond to requests for admissions | Admissions would establish liability and damages. | Failure to respond should not prejudice rights; admissions were improper. | OCGA 9-11-36(a)(2) admissions were deemed; they established liability and amounts due. |
| Impact of ten-day objection provision in mediation agreement | Provision supports enforceability of settlement. | Provision only relevant if an agreement was reached; no acceptance occurred. | Inapplicable since no settlement was reached. |
Key Cases Cited
- Jones v. Frickey, 274 Ga.App. 398, 618 S.E.2d 29 (2005) (mutual assent required for contract; an acceptance must be unequivocal)
- Valiant Steel & Equip., Inc. v. Roadway Express, 205 Ga.App. 237, 421 S.E.2d 773 (1992) (offer and acceptance must be unequivocal)
- Meece v. McCroskey, 151 Ga.App. 369, 259 S.E.2d 645 (1979) (settlement requires express acceptance)
- Jackson v. Nemdegelt, Inc., 302 Ga.App. 767, 691 S.E.2d 653 (2010) (admissions by failure to respond are binding on material facts)
- Hammett v. Bailey, 147 Ga.App. 105, 248 S.E.2d 180 (1978) (reiterates effect of admissions under 9-11-36)
- Lau's Corp. v. Haskins, 261 Ga. 491, 405 S.E.2d 474 (1991) (summary judgment standard and de novo review)
- Traditional Properties v. Performance Food Group of Ga., 291 Ga.App. 442, 662 S.E.2d 250 (2008) (summary judgment review of contract disputes)