ECO Chemical Specialties, Inc. (ECO) brought suit on an account against Riberglass, Inc., a distributor, seeking recovery of $104,549.09 plus interest allegedly owed as payment for the purchase by Riberglass of large quantities of an acetone substitute cleaning solution known as Res-Off. ECO filed, inter alia, requests for admission, which Riberglass failed to answer within the statutory time period. After Riberglass filed late answers to the requests for admission, denying two requests previously admitted by operation of law, ECO filed a motion for summary judgment based solely upon the admissions deemed admitted by Riberglass. Riberglass then filed a motion to withdraw admissions. A hearing on both motions (and others) was *418 held, and the trial court entered an order denying Riberglass’ motion to withdraw the admissions and granting ECO’s motion for summary judgment. Riberglass appeals from these orders, and ECO cross appeals from the trial court’s use of 7 percent as the rate of interest on attorney fees awarded.
The admissions appellant sought to deny stated that “[appellee] is entitled to recover from [appellant] the amount prayed for in the [c]omplaint” and that “[t]he denials and defenses raised in [appellant’s] [a]nswer have been interposed for the purpose of harassment, delay and to avoid payment of [appellee’s] just claim.”
1. Appellant contends the trial court abused its discretion by denying its motion to withdraw the admissions. The propriety of the trial court’s failure to grant the motion to withdraw admissions must be determined by consideration of whether “the presentation of the merits of the action [would have been] subserved thereby” and whether appellee “failfed] to satisfy the court that withdrawal or amendment [would] prejudice [it] in maintaining [its] action or defense on the merits.” OCGA § 9-11-36 (b).
(a) The meaning of the phrase “the presentation of the merits of the action will be subserved thereby” was clarified by the Supreme Court in
Whitemarsh Contractors v. Wells,
In the action sub judice, since both parties admit the purchase and the price, the issues in the case are raised by appellant’s defenses, as to which it would have the burden of proof at trial. Thus, to satisfy that criterion for allowing withdrawal of the admissions, in addition to showing that it was not seeking to deny the request for admission solely for the purpose of delay appellant was required to show that its defenses were provable “by admissible evidence having a modicum of credibility.” The record reveals that appellant’s primary defense was its allegation of a failure of consideration, which, if proved, is sufficient to defeat an action on a contract. See generally OCGA § 13-5-9;
Jones v. Dixie O’Brien Div.,
Specifically, appellant’s defense was that the product did not perform in the manner appellee represented it would; that contrary to appellee’s representations, it irritated the user’s hands; that appellant was induced to purchase greater quantities of Res-Off than it desired by appellee’s agent’s fraudulent misrepresentations that a purchase in *419 those amounts was a prerequisite to establishment of an exclusive distributorship; and that appellee failed to provide the support services it promised. In support of the motion to withdraw the admissions, appellant relied on its answers to appellee’s interrogatories, sworn to by Mark R. Long, appellant’s secretary/treasurer, and the affidavits of Long and Frank Riberlin, appellant’s president. The affidavits stated specifically that withdrawal of the admissions was not being requested solely for delay, and further showed that appellant could prove by the testimony of Long and Riberlin that they personally received complaints from customers that the Res-Off irritated their hands and caused skin rashes and that, contrary to appellee’s representations, the product was inferior to acetone as a cleaning solution. In addition, the affidavits showed that Don Shipman, appellee’s agent, represented to the affiants that appellant would have to purchase three truckloads of the product in order to obtain an exclusive dealership; that appellant would not have purchased that quantity had it not been for Shipman’s representation; that as a result of customer dissatisfaction with Res-Off, appellant was unable to sell the product; and that affiants were subsequently informed by J. W. Evans, appellee’s agent, that there was no minimum order necessary to establish an exclusive dealership. The record also contains letters written by Riberlin to appellee seeking to return the product.
Contrary to appellee’s argument, even though the Riberlin affidavit was not submitted contemporaneously with the motion to withdraw admissions, it was submitted over three months before the hearing on the motions, thus preventing any surprise to appellee, unlike the affidavit in
Big Canoe Corp. v. Williamson,
(b) For withdrawal to be permitted, appellant also must show
*420
that appellee would not be prejudiced thereby in trying the merits of the case. OCGA § 9-11-36 (b). Contrary to appellee’s argument, the fact that it relied on the admissions and expended time and resources on what appeared to be a well advised motion for summary judgment and would now have to try the case on the merits is insufficient prejudice to warrant denying the motion. Rather, we perceive no difference between this argument and that advanced and rejected in
Battle v. Strother,
As both prongs of the standard have been met, the trial court abused its discretion by denying appellant’s motion to withdraw the admissions, thereby preventing a trial on the merits.
2. It follows from our ruling in Division 1 that summary judgment was erroneously granted to appellee.
3. Because of our reversal of the award of summary judgment, it is unnecessary that we address appellee’s cross-appeal, in which it challenges the trial court’s use of a 7 percent per annum rate for prejudgment interest as part of the award of summary judgment, and accordingly the cross-appeal is dismissed.
Judgment reversed in Case No. A89A2348; appeal dismissed in Case No. A89A2349.