A & D Asphalt Co. v. Carroll & Carroll of Macon, Inc.

543 S.E.2d 397, 247 Ga. App. 77, 2001 Fulton County D. Rep. 196, 2000 Ga. App. LEXIS 1419
CourtCourt of Appeals of Georgia
DecidedNovember 29, 2000
DocketA00A1192
StatusPublished
Cited by5 cases

This text of 543 S.E.2d 397 (A & D Asphalt Co. v. Carroll & Carroll of Macon, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
A & D Asphalt Co. v. Carroll & Carroll of Macon, Inc., 543 S.E.2d 397, 247 Ga. App. 77, 2001 Fulton County D. Rep. 196, 2000 Ga. App. LEXIS 1419 (Ga. Ct. App. 2000).

Opinion

Phipps, Judge.

In September 1995, Carroll & Carroll of Macon, Inc. entered an asset purchase agreement with A & D Asphalt Company whereby Carroll purchased A & D’s business and essentially all of its assets. Carroll and A & D also entered a lease agreement whereby Carroll [78]*78was given a five-year lease on real property belonging to A & D, which included 17.4 acres of land, an asphalt plant, shop facilities and administrative offices. The lease agreement contained a provision which gave Carroll the option to purchase the leased premises for $175,000 but only at such times as it was not in default under the agreement or any contemporaneously executed instruments or agreements. On June 18, 1996, A & D informed Carroll by letter that Carroll was in default of the lease agreement because it had installed an underground natural gas line on the property. A & D further informed Carroll that, pursuant to the lease agreement, A & D would declare the lease cancelled and terminated if the alleged default was not cured within 30 days.

By letter dated June 20, Carroll disputed A & D’s contention that it was in default and asked for clarification of the basis for A & D’s contention. The dispute was not resolved, and on August 1, A & D sent a letter to Carroll declaring that the lease had been cancelled and terminated as of July 19. On August 9, Carroll sent a certified letter to A & D stating that it was exercising its option to purchase the property.

A & D refused to sell the property. And thereafter Carroll filed suit, stating several claims and seeking specific performance, declaratory and injunctive relief and damages.

A & D filed a counterclaim against Carroll, asserting that by installing a natural gas pipeline on the leased property Carroll had permanently encumbered the property and encroached upon existing easements that had been granted other utilities and companies. A & D asserted that the installation of the pipeline constituted a default and that the failure to cure the default within 30 days constituted a breach of the lease. Furthermore, it contended that the installation of the pipeline impaired the marketability of the property.

A & D moved for jury trial on all issues triable by a jury. The court severed the equitable claims and, after hearings, decided them without a jury.

By order dated July 21,1998, the court enjoined the President of A & D from activities which violated a noncompete agreement. That ruling was appealed to the Supreme Court of Georgia. The Supreme Court transferred the appeal to this court, and in Case No. A99A0736, this court affirmed that judgment of the trial court.1

By order dated October 27, 1998, the trial court ruled that Carroll had not defaulted on its obligations under the lease and that it [79]*79had properly exercised its option to purchase the property. Therefore, with Carroll having paid $175,000 into the registry of the court, the court ordered that title to the property would be vested in Carroll. The court further ordered A & D to return to Carroll the rent payments it made during the period A & D refused to sell the property.

The latter judgment is the subject of the instant appeal, which was also filed in the Supreme Court of Georgia and transferred to this court.

1. A & D contends that the trial court erred in deciding Carroll’s specific performance claim without a jury. At the beginning of the hearing on Carroll’s claim for specific performance, A & D asserted that it was entitled to a jury trial on the claim because it overlapped factually with Carroll’s damages claims.

An action for specific performance lies in equity,2 and there is no right to a jury trial on claims that lie in equity.3 However, a demand for jury trial must be honored with respect to damages claims that are raised in the same case with equity claims.4 “In order to preserve the right to a jury trial on the question of damages, the jury trial on the damage question should [be] held prior to the nonjury trial o[n] the [equity] issue. [Cits.]”5 If such a procedure is not followed, “any issue common to both the legal and equitable claims [would be] finally determined by the court and the party seeking trial by jury on the legal claim [would be] deprived of .that right as to these common issues.”6 The question we must determine then is whether Carroll’s claim for specific performance had factual issues in common with its damages claims.

Carroll raised eight claims for damages against A & D. In one, it asserted that it was entitled to a refund of rent payments it had paid to A & D after A & D had wrongfully refused to sell the leased property. The remaining claims alleged the following types of actionable conduct by A & D: (1) withholding sums paid on construction contracts that were purchased from A & D by Carroll and performed by Carroll; (2) misrepresenting the value of assets purchased from A & D by Carroll; (3) misrepresenting the amount of contaminated soil on the property and (4) failing to comply with environmental laws on the leased property.

Only the claim seeking a return of rent payments presented factual issues that were also a part of the claim for specific performance. [80]*80However, that request for damages did not necessitate a jury trial. When a court sitting in equity awards specific performance, it may also award incidental damages to the plaintiff “in order to make [it] whole.”7 In Golden v. Frazier, the Supreme Court of Georgia explained:

[S]pecific performance at the end of a protracted litigation under compulsion is practically never full performance of the contract; instead, there has been an extensive and injurious partial breach. In such a case, the court should decree the payment of damages for the partial breach that has already occurred, even though obedience of the decree will prevent the commission of further breaches. [Cit.]8

Thus, we find no factual overlap between Carroll’s claim for specific performance and its claims for damages that required the trial court to conduct a separate damages trial.

On appeal, A & D also argues for the first time that it was entitled to a jury trial because it had filed a counterclaim for damages against Carroll and because Carroll was not in compliance with several provisions of the agreements relating to insurance, taxes, accounts receivable, environmental laws and assignment of rights. Because this argument was not ruled upon by the trial court and is being raised for the first time on appeal, this court will not consider it.9

We find no error in the trial court’s determination that Carroll’s claim for specific performance could be tried without a jury.

2. Next we consider whether the trial court correctly decided Carroll’s claim for specific performance. A & D asserts that Carroll’s attempt to exercise the option was invalid because Carroll was in default under the lease at the time and because the purchase option no longer existed.

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Bluebook (online)
543 S.E.2d 397, 247 Ga. App. 77, 2001 Fulton County D. Rep. 196, 2000 Ga. App. LEXIS 1419, Counsel Stack Legal Research, https://law.counselstack.com/opinion/a-d-asphalt-co-v-carroll-carroll-of-macon-inc-gactapp-2000.