*1 MECHANICAL, v. SIEMENS A97A1367. INDUSTRIAL INC. AUTOMATION, & INC. ENERGY Harold R. Banke. (“Industrial”) Mechanical, Energy Inc. sued Siemens Industrial (“Siemens”) Automation, allegedly Inc. to recover for a debt owed (“Free Flow”), It is company. Free Flow Ltd. a British Cooling, lacked over Free Flow. the trial court trial court’s dismissal of its action Sie- appeals Industrial that Free Flow was an mens based on the court’s determination indispensable party. it subcontracted with complaint
Industrial and that Free Flow for a of a construction Texas portion project $171,974.44, Free failing Flow breached subcontract interest, Yet, Industrial did not sue the real plus prop- Industrial.1 owner, or Free in breach. Industrial erty party allegedly itself and Sie- any relationship made no claim of contractual any alleged mens or contract other than breach Held: guaranty. Industrial, filed Free Flow sued About one month after Industrial the instant sought declaratory corporation, an Arizona in federal district court Arizona. contract, fiduciary duty, interference with Industrial breach of
relief and sued breach defamation, relations, The trial court prospective and an action on an account. contractual speculate Free Flow in the did not seek relief here declined to as to federal action.
To determine whether Free Flow anwas we complaint need look no further than Industrial’s and the document doing, which Industrial claimed it attached to its In so we viability underlying do not consider the of Industrial’s claim that agreement Free Flow breached its with Industrial but address indispensable party to Industrial’s claims *2 Floyd Mtg. Corp. Siemens. Davis &c., Sales v. Central 197 (398 820) (1990) (this App. 532, Ga. 533 SE2d Court considered the party’s indispensability). record evidence to ascertain purported guaranty single page correspondence This is a of January appellate 27, 1994, dated and which Industrial which is included in the record
referenced as A” “Exhibit to its Industrial claimed that this document constituted an enforceable surety agreement between itself and Siemens. It is solely Industrial’s claim for is based on this indemnification docu- purported guaranty ment. This is a handwritten telefax from Sie- (a entity mens addressed to Industrial Free Flow different who is not here)2 pertinent part, a pre- which states in “Wehave received liminary point [sic] notices and we like to out that the contract we signed [sic] have does not allow for such action to recourse with the the that suppliers customer. Please advise all subcontractors and they correspon- recourse that will have is Siemens.” The signed “[k]ind regards” by dence was Schultz, Arnold Siemens’ project manager Project. paragraph senior complaint, for the Welsh In 17 of its “By [the
Industrial contended that virtue of the letter exhibit] [Free alleged debt] above . . . that sum Flow’s became due [Siemens] Defendant to Plaintiff.” guaranty suretyship primarily A pay contract or is one to the may payable by debt of principal another which be due and the upon debtor to the creditor default. Co. v. Shoaf, 184 Ga. Hartsfield (191 693) 378, suretyship 380 SE2d “The contract of is one of surety’s liability by implica- law; strict will not be extended interpretation.” tion or mens was OCGA 10-7-3. Nowhere in the fax did Sie- guarantee any specified entity the debt of or state that Siemens agreeing indemnify anyone obligations to or the on behalf of anyone identify principal else. This fax failed to the debtor whom purportedly agreed indemnify and failed to state that Sie- agreed entity’s mens to answer for that debt. In the absence of these terms, essential a matter the fax does not constitute a contract of Supply Corp. Taylor, App. of law. Builder’s v. 164 127, Understanding The record contains a Memorandum of between Industrial and Free (1) they agreed Flow in which inter alia: that Free Flow was to act as an exclusive consult ant to company, Industrial and Company, form U. S. Industrial Free Flow as a divi sion of Industrial. 417) (1982) (failure identity the document to state SE2d fatal). See Ellis indemnify is agreed entity guarantor whom 756) (1992) (2) (420 Curtis-Toledo, 704, SE2d Inc., 204 Ga. App. v. 259, 260 Foures, App. 201 Ga. Co. v. Bldg. Supply and Northside 87) (1991). the fax consti- Thus, Industrial’s claim despite SE2d as a matter contract,” it is indemnity apparent tuted a “written law, exists and that even no guaranty of contract was not Sie- of Free who guarantee indebtedness (contract suretyship “customer.” See OCGA 10-7-3 mens’ extended implication). be cases involv- contrary, Industrial’s claim to
Notwithstanding no inapplicable perfor- bonds or are because pledges ing performance Hendricks Compare to exist here. pledge mance or was bond (1) (472 482) Pendleton, Inc., SE2d App. 221 Ga. v. Blake Co., App. Elec. Co. v. Fed. Ins. 195 Ga. (1996); Mayer Supply &c., 141 Ins. Co. (1990); Noland Co. Commercial (1) (233 259) (1977). Similarly, Sales, at Floyd misplaced on Davis reliance in that unlike were co-sureties. parties because suretyship, only remaining In the contract for absence *3 it on Free Flow’s liability co-obligor for Siemens’ is that was theory noted, it that Free Flow debt. As previously rule, the trial court’s As a where subject jurisdiction. general is not joined over a cannot be party, party a court lacks determine, considering a court “must the factors set by (b), if the is also an indis necessary party forth OCGA 9-11-19 proceed.” without whom the action should not Turner pensable party South Advertising, Corp., Outdoor Ltd. v. Old 149) (1933). However, Court of Supreme Georgia as the held, obligors joined, has to a contract are not previously joint where Wall, the case dismissed. must be Wall 893) (1933). Thus, SE assuming argument even for sake that Siemens for Free Flow’s indebt joint obligor was a edness, indispensable Free Flow was an without whom action could not Id. proceed. Wall, holding
Even the action had not been foreclosed failed to present the trial court determined that supra, the action any argument “in conscience” as to equity good [or] (b). the trial dis proceed. Accordingly, should OCGA 9-11-19 court’s Turner Outdoor Advertis proper missal was and must be affirmed. ing, at 584 J., Andrews, J., Judgment Birdsong, Ruffin, C. P. affirmed. JJ.,
J., J., Eldridge, concur. P. Smith and dissent. McMurray, dissenting. Judge, Smith, I agree that Free I dissent because respectfully must case against indispensable party. is an Flow constitutes a guaranty, the fax from Schultz whether depends upon If existed. it Indus- any guaranty i.e., depends upon If no severally. an action right bring trial had the at all. In either existed, Siemens is not responsible and the merits of the Free Flow is not being litigated and Siemens are dispute not an indispensable party, action. Because another dismissing the action on basis. the trial court erred Presiding McMurray I authorized to state that am in this dissent. Judge Eldridge join Decided December denied December
Reconsideration for Longino, appellant.
John T. Jameson, Hill, L. appellee. Louis N. Mitzi King Spalding, PEACHTREE CASUALTY A97A1533. LUNCEFORD v. INSURANCE COMPANY. Judge. Smith, pol-
The issue in this is whether an automobile insurance (Peachtree) Insurance Casualty Company issued Peachtree icy language We conclude that the broad covers reverse and we therefore encompasses type coverage, to Peachtree. grant summary judgment the trial court’s in an collision with Terry Lunceford was involved automobile other alleged, among He filed suit her and Susan Brown. He influence of alcohol. driving that she was while under the things, *4 Peach- injuries punitive damages. sought damages personal insurer, action tree, brought declaratory judgment Brown’s did not Lunceford, contending policy Brown and The trial court concluded that cover summary judg- coverage damages granted for such provide ensued.1 ment to Peachtree. This Lunceford to cov- following regard policy provides 1. The insurance judgment against based in favor of Peachtree The trial court entered a default Brown declaratory judgment. complaint for on Brown’s faitee to answer Peachtree’s