Village at Lake Lanier, LLC v. State Bank & Trust Co.
314 Ga. App. 498
| Ga. Ct. App. | 2012Background
- Village modified its deed to secure debt on a Lake Lanier area commercial property in 2008 for $2.72 million.
- The loan defaulted in 2009, and State Bank hired VMG to obtain an appraiser after owing over $2 million.
- VMG procured Winters, who appraised the property at $850,000; State Bank purchased at foreclosure on May 4, 2010, as sole bidder for $880,000 (plus costs).
- Trial court denied confirmation of the sale for lack of fair market value but found good cause to permit a resale under OCGA § 44-14-161(c).
- Village appealed the Daubert rulings regarding Winters and sought a separate Daubert hearing to assess competence; State Bank cross-appealed the resale order.
- Confirmation hearing occurred November 11 and 22, 2010; court ordered resale after considering arguments and briefs.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court properly ordered a resale under OCGA § 44-14-161(c). | Village: no good cause; failed sale indicates lack of value, so no resale. | State Bank: broad discretion to order resale for good cause shown should apply; any abuse standard. | Court did not abuse discretion; broad discretion upheld and resale affirmed. |
| Whether the sale's failure to fetch fair market value demonstrates good cause for resale. | Village: failure to obtain FMV does not prove good cause; appraisal flaws alleged. | State Bank: good faith and lack of intentional misaction support good cause. | Good faith and FMV shortfall support resale; no abuse in finding good cause. |
| Whether the trial court properly handled Daubert challenges to the expert Winters. | Village: erred in admitting Winters's testimony and in denying a Daubert hearing on competence. | State Bank: trial court correctly applied Daubert and allowed cross-examination; competence hearing not required. | Trial court did not abuse its discretion; Daubert standards properly applied and Winters admissible. |
Key Cases Cited
- Resolution Trust Corp. v. Morrow Auto Center, 216 Ga.App. 226 (1995) (broad discretion in resale; abuse standard governs appellate review)
- McDowell v. Regions Bank, 311 Ga.App. 600 (2011) (discretion in resale context; appellate review for abuse)
- Regions Bank, ??? (2011) (guidance on good faith and resale decisions)
- Adams v. Gwinnett Commercial Bank, 140 Ga.App. 233 (1976) (support for discretionary resale analysis)
- Damil, Inc. v. First Nat. Bank of Dalton, 165 Ga.App. 678 (1983) (precedent on resale and FMV considerations)
- CSX Transp. v. McDowell, 294 Ga.App. 871 (2008) (Daubert: cross-examination for credibility; admissibility vs weight)
- Harper v. Barge Air Conditioning, 300 Ga.App. 901 (2009) (appellate presumption of trial court performance; lack of transcript hampers review)