In thеse cases, we are asked to decide whether Wachovia Bank of Georgia breached its fiduciary duties as trustee by causing an estate to pay what the estate contends were unnecessary and avoidable estate taxes. Following a bench trial, the trial court found in favor of the Bank on counts alleging breach of fiduciary duty as administrator, self-dealing as trustee, stubborn litigiousness, tort, and punitive damages. The trial court found in favor of Issam Namik, Suzan Namik, Jinan Namik, Sundus Namik, and Hadia Mahmoud (collectively “Namik”) on counts alleging breach of fiduciary duty as trusteе for failure to avoid estate taxes and breach of fiduciary duty and breach of contract for failure to invest the trust funds in accordance with allegedinstructions. The trial court awarded damages of $1,118,710 to Namik. In Case No. A03A2198, the Bank appeals the trial court’s final order awаrding damages to Namik. In Case No. A03A2199, Namik appeals the trial court’s final order, contending he was entitled to greater damages.
Case No. A03A2199
The crux of this case is Namik’s claim that the triаl court erred in failing to award him a greater amount of damages. The facts of the case have been fully set out in our previous decision.
1. Namik contends the trial court erred in arbitrarily determining that the trust assets should have been invested 50 percent in estate taxable investments and 50 percent in estate tax exempt investments because there is absolutely no evidence that the trust assets should or would have been invested in that manner. The records show that although the trial court determined that the Bank should have known about the estate tax exemption аvailable to nonresident alien customers and, therefore, breached its fiduciary duty in failing to invest the trust funds so as to avail the estate of that exemption, the court significantly reduced Namik’s damages because it found that due to the Bank’s concern over liquidity, only half of the funds would have been invested in government issues exceeding 183 days (estate tax exempt), with the remainder being invested in government issues of a shorter duration (subject to estate tax). Namik argues that this concern over liquidity is unsupported by law, fact, and practical economic reality. He further аrgues that the duration of a treasury bill has no relation to its liquidity and that there is no evidentiary basis for apportioning the investment as the trial court did in calculating damages. We disagree.
The trial court’s order in this case adequately explains the reasoning and methodology for the сourt’s award of damages. The trial court first held that the Bank did have a duty to consider the estate tax consequences of the trust fund investments. The only three investments that would have avoided estate taxes are passbook accounts, CDs, or treasury bills over 183 days. The court then cоncluded that, in accordance with the Slaughter memorandum, the trust funds should have been invested only in U. S. government issues, or treasury bills. Because the funds were not invested in treasury bills, the Bank was held liable for the differential between the actual investment income and the higher investment income that would have resulted from an investment in treasury bills.
With respect to damages for the estate tax, however, the trial court took into account two additional factors in considering whether the Bank’s actions caused the alleged damages. First, the court determined that the Bank was legitimаtely concerned with maintaining the liquidity of the trust assets and guaranteeing the safety
of the principal, because the Bank could not have known that Ali (Namik’s father) would die, and he could come back at any time and demand his money. Trial testimony supports this determination. Second, the trial court considered the fact that in 1989, the IRS had not yet issued its Technical Advice Memorandum clarifying that only investments in treasury bills over 183 days would be exempt from estate tax. Again, evidence in the record supports this fact. Based upon these two facts, the trial court held that, although the Bank had a duty to consider estate tax consequences of the investments, it cannot be held liable for failing to actually invest all of the trust funds to avoid estate taxes. We agree. Because of the Bank’s lack of knowledge regarding Ali’s return and because of the unclear IRS rеgulations, the Bank would have been justified in investing one-half of the trust funds in treasury bills over 183 days, which would have avoided estate taxes, and investing one-half of the trust funds in short-term treasury
The trial court’s findings as to damages were further supported by evidence presented by the Bank’s expert, who provided calculations via affidavit as to the exact amount of damages attributable to the Bаnk’s failure to invest one-half of the trust funds in treasury bills over 183 days. Thus, the damages were not arbitrary, but instead were within the “range of testimony” presented at trial. 3 We find no error.
2. Namik next contends the trial court erred in determining that Namik, as beneficiary, had a duty to mitigate damages resulting from the Bank’s breaches of fiduсiary duty and contract. The trial court reduced Namik’s damages based on (1) Namik’s two-year delay between the time Namik learned of his father’s death in July 1992 and the time he advised the Bank in August 1994, and (2) Namik’s failure to follow the Bank’s advice and probate Ali’s estate in a timely manner, delaying the appointment of an administrator for Ali’s estate until April 1996. According to Namik, the delays were not intentional acts designed to increase damages, and there is no evidence that Namik knew that any delays would have had any effect on taxes or interest thereon.
Notwithstanding these arguments, it is undisputed that Namik’s delay in notifying the Bank of Ali’s death and in probating Ali’s estate caused additional damages that would not have been incurred otherwise. Specifically, among other damages, the estate incurred over $500,000 in interest on overdue estate taxes. Damages, and the amount attributable to Namik’s failure to mitigate those damages, were calculated with specificity by an expert and provided via testimony and affidavit.
(a) Breach of Fiduciary Duty. The trial court correctly ruled that Namik had a duty to mitigate damages arising from the Bank’s breach of fiduciary duty. Georgia law allows а beneficiary to recover tort damages when a trustee commits a breach of fiduciary duty. 4 This Court has held unequivocally that an action for a breach of fiduciary duty lies in tort. 5 And in a Georgia tort action, parties are required to mitigate their damages; they are bound to reduce their damages “as far as is practicable by the use of ordinary care and diligence.” 6 This is true even in a case alleging tortious breach of fiduciary duty. 7 If a plaintiff fails to exercise ordinary care, his damages are limited to those he would have suffered had damages bеen properly mitigated. 8
The only exception to the duty to mitigate tort damages in Georgia is where “positive and continuous torts” occur. 9 However, contrary to Namik’s argument, the Bank’s breach of fiduciary duty in this case does not constitute a positive tort that would be exemрt from the requirement that a plaintiff mitigate his damages. Georgia courts have defined three types of “positive and continuous torts”: (1) fraud; 10 (2) ongoing violations of property rights; 11 and (3) intentional torts such as assault and battery. 12 Namik’s claims against the Bank do not fall into any of these three categories.
(b) Breach of Contract. The trial court correctly ruled that Namik had a duty to mitigate damages arising from the Bank’s breach of contract. OCGA § 13-6-5 mandates that where a party is injured by a breach of contract, “he is bound to lessen the damages as far as is practicable by the use of ordinary care and diligence.” Where a plaintiff, “acting as prudent men ordinarily do” can avoid any increase in damages but fails to do so, “[s]uch consequences can hardly be the direct or natural consequence of the defendant’s wrong, since it is at the plaintiffs option to suffer them.” 14 In such cases, the plaintiff is not damaged by the defendant’s act, but by his own negligence or indifference to consequences. 15
Georgia courts have recognized three exceptions to the duty to mitigate damages in breach of contract actions: (1) fraud; 16 (2) breach of an express warranty; 17 and (3) an “absolute promise to pay.” 18 None of these exceptions applies in this case. Contrary to Namik’s contention, this case does not involve an “absolute promise to pay” that would exempt Namik from his requirement to mitigate damages. Unlike the absolute promise to pay casеs cited by Namik, here the Bank made no absolute promise to pay a specified amount. Moreover, in this case, unlike the cases cited by Namik, Namik’s failure to mitigate damages increased the amount of damages. The trial court properly awarded only those damages that were not caused by Namik’s delay in notification and in probating the estate.
3. Namik maintains the trial court abused its discretion in not awarding attorney fees and disgorgement of all, not half, of the trustee fees and all, not half, of the costs. We find no abuse of discretion.
(a) Disgorgement of Fees. Although Namik’s enumeration of error refers to the trial court’s award of trustee fees and costs, Namik has not provided any argument or citation of authority to support his position that the court erred in requiring disgorgement of one-half of the trustee fees and costs. An argument which merely restates or rephrases an enumeration of error is insufficient to present an issue for appellate review. 19 Thus, this enumeration of error is deemed abandoned. 20
Notwithstanding the fact that Namik has abandoned this argument, we have reviewed Namik’s argument and find that it lacks merit. The argument regarding disgorgement of the fees relates to Namik’s first argument regarding the trial court’s award of damages. According to Namik, the trial court erred in determining that half of the trust funds would have been invested in taxable investments, and therefore erred in only awarding him half his fees and costs. Based on our holding in Division 1, we find that the trial court properly exercised its disсretion in awarding Namik half his trustee fees and costs.
(b) Attorney Fees. The issue of whether attorney fees should be awarded based upon the other party’s bad faith is a question for the factfinder to be determined from consideration of the facts and circumstances in the case. 22 We review the trial court’s denial of attorney fees under an abuse of discretion standard. 23 Contrary to Namik’s argument, the trial court did not “have” to award attorney fees after finding a breach of fiduciary duty.
“Bad faith is not simply bad judgment or negligence, but it imports a dishonest purpose or some moral obliquity, and implies conscious doing of wrong, and means breach of known duty through some motive of interest or ill will.” 24 Here, the trial court found that the Bank “did not act in bad faith, was not stubbornly litigious, and did not cause Plaintiffs unnecessary trouble and expense.” We agree that the evidence does not demand a finding of bad faith on the part of the Bank. The trial court did not abuse its discretion in refusing to award Namik attorney fees. 25
Namik argues that the trial court only considered OCGA § 13-6-11, and not OCGA§ 53-12-193 (a) (4), in deciding whether to award attorney fees. We disagree. There is no indication in the record that the trial court did not consider OCGA § 53-12-193. And, that Code section does not require a court to award-— or even consider awarding — attorney fees upon a finding of breach of fiduciary duty. It merely allows such an award. Moreover, contrary to Namik’s contention, findings of fact are required only whеn a trial court grants an award of attorney fees. 26 We find no error.
4. Namik also contends, in a one-paragraph argument, that the trial court erred in determining that Wachovia Bank of Ga. v. Reynolds 27 did not give rise to a cause of action in tort against the Bank for failing to follow Ali’s instructions. However, contrary to Namik’s assertion, Reynolds does not create a new tort cause of action imposing liability upon a bank for failing to follow a customer’s instructions. Reynolds is factually distinguishable from this case. In Reynolds, the issue centered on who the “customer” was and to whom the bank owed a duty. There is absolutely no indication that the Court was creating a new cause of аction. The trial court did not err in determining that Reynolds did not give rise to a cause of action in tort against the Bank.
Judgments affirmed in Case Nos. A03A2198 and A03A2199.
Notes
See
C & S Nat. Bank v. Haskins,
See OCGA§ 53-12-192 (a).
See
Nelson & Hill, P.A. v. Wood,
See OCGA§ 51-12-11.
See Kahn v. Columbus Mills,
See
Crowley v. Trust Co. Bank,
OCGA§ 51-12-11.
See, e.g.,
Haley v. Oaks Apts., Ltd.,
See, e.g.,
Price v. High Shoals Mfg. Co.,
See, e.g.,
Jeter v. Davis,
See
Central of Ga. R. Co. v. White,
Nicholas v. Tanner,
Id.
See, e.g., Haley, supra.
Id. at 45-46.
See, e.g.,
J. C. Penney Cas. Ins. Co. v. Woodard,
See
Vaughn v. Metro. Property &c. Ins. Co.,
Court of Appeals Rule 25 (c) (2).
C & S Nat. Bank, supra at 143 (10); see also OCGA § 53-12-192 (a) (7).
See
Multimedia Technologies v. Wilding,
East Beach Properties v. Taylor,
(Citations and punctuation omitted.) Jennings Enterprises, supra.
See Multimedia Technologies, supra (affirming jury’s refusal to award attorney fees despite the finding of breach of fiduciary duty and conversion).
See
Bellah v. Peterson,