Flateau v. Reinhardt, Whitley & Wilmot

469 S.E.2d 222, 220 Ga. App. 188, 96 Fulton County D. Rep. 460, 1996 Ga. App. LEXIS 417
CourtCourt of Appeals of Georgia
DecidedJanuary 25, 1996
DocketA95A2874
StatusPublished
Cited by1 cases

This text of 469 S.E.2d 222 (Flateau v. Reinhardt, Whitley & Wilmot) 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
Flateau v. Reinhardt, Whitley & Wilmot, 469 S.E.2d 222, 220 Ga. App. 188, 96 Fulton County D. Rep. 460, 1996 Ga. App. LEXIS 417 (Ga. Ct. App. 1996).

Opinion

Beasley, Chief Judge.

Tifton Heating & Cooling, Inc. (Tifton) and Edward Rhodes sued Al-Temp Services, Inc. (Al-Temp), Means, his wife, attorney Reinhardt, Reinhardt’s law firm, and the Sheriff of Tift County. Plaintiffs seek damages against defendants for wrongful foreclosure and excessive levy, trespass, conversion, RICO violations, and abusive litigation. Plaintiffs appeal the trial court’s grant of Reinhardt and his law firm’s (the Reinhardt defendants) motion for summary judgment, as well as the denial of plaintiffs’ motion for partial summary judgment.

Al-Temp was owned by Means and his wife. Tifton is owned by Rhodes. In 1985, a sales contract was executed under which the assets of Al-Temp were sold to Tifton. Means and his wife, Al-Temp, Tifton, and Rhodes were parties to the sales contract. Shortly after the sales contract was executed, Al-Temp was dissolved.

The total purchase price of $230,200.87 was paid by a $20,000 [189]*189down payment with the remainder to be paid under a promissory note payable to Al-Temp in 120 consecutive monthly installments. The note and a security agreement gave Al-Temp a security interest in Tifton’s accounts receivable, inventories of equipment (for sale), tools and equipment (for use), motor vehicles, and all proceeds and products of the business. The security agreement contained provisions stating that a default would occur if the note was not paid when due or if “the secured party fe[lt] insecure for any other reason whatsoever.”

Means testified that in January 1990, Rhodes told him he was having cash flow problems and would like one week’s extension for making the note payment due on January 15, and although he agreed to the extension he did not receive payment within the week.

Rhodes, on the other hand, testified that he told Means he would mail the January 15 payment to him on January 22, as it was his custom to send the note payments by mail; that he called Means on January 22 and told him that the check had been written; and that Means said he would pick it up but did not do so.

Means testified that after hearing that Rhodes had terminated his employees and was closing his business, he went to Tifton’s office on January 22 and found the doors locked and the business closed. According to Means, the business’ closing was confirmed by several employees who stated they had been asked to remain temporarily in order to wind up its affairs.

Means went to see his attorney, Reinhardt, concerned about the loss of easily transportable, untitled collateral. There was apparently a substantial quantity of collateral, including heavy equipment, so all of it was not easily transportable. Means and Reinhardt discussed past problems concerning Rhodes’ maintenance and unauthorized disposition of collateral. A decision was made to file a petition for an immediate writ of possession, naming Al-Temp as the plaintiff and Tifton as the defendant. The petition contained the same description of the secured property as that set forth in the note and security agreement. Means executed an affidavit on January 23 and executed a bond for Al-Temp.

The writ was issued on January 23. The writ ordered the sheriff to levy on the personal property described in the note and security deed and, at the option of plaintiff, either surrender the property to the plaintiff for retention and disposition in accordance with OCGA Title 11 or advertise and sell it. Plaintiff elected to receive the property.

Reinhardt testified that Means accompanied him to the chambers of the judge and represented to the judge that the writ was being sought because of concerns about collateral rather than a default in the note payment. The judge was informed of the default because it [190]*190was relevant to the question of whether Means felt “insecure.”

Reinhardt further testified that after the judge signed the writ, Reinhardt asked Means to allow him to attempt to contact Rhodes and resolve the matter, and he unhesitatingly agreed. Reinhardt arranged a meeting with Rhodes, but Rhodes cancelled it. Rhodes said he told Reinhardt on January 24 that the business was not closing, but he acknowledged that he cancelled the arranged meeting. Reinhardt then called Rhodes’ attorney, who suggested that he contact Rhodes through an attorney who practices bankruptcy law and is a standing bankruptcy trustee. Reinhardt attempted to do so but was advised he was unavailable. Reinhardt and Means decided to file the petition for an immediate writ of possession with the clerk and obtain execution of the writ. That was done on January 25.

The sheriff testified that after Reinhardt and Means delivered the writ to him, he informed them that he had no facilities for storing the collateral and could only take control of it by securing the premises. He instructed them to arrange for a locksmith to meet him at Tifton’s offices. The sheriff also instructed them to accompany him. He executed the levy personally, supervised the locksmith’s changing of the locks, took possession of the keys, and retained possession of the collateral.

Tifton claims that, as a result of the levy, it was forced to leave construction sites and to default on contracts. Thereafter, Tifton sought relief under Chapter 11 of the United States Bankruptcy Code. On February 20, 1990, the bankruptcy court directed that the seized property be returned to Tifton.

The Reinhardt defendants moved for summary judgment as to their liability. Plaintiffs sought partial summary judgment on issues involving the liability of all defendants. The court granted the Reinhardt defendants’ motion and denied plaintiffs’ motion.

Plaintiffs appealed from the order granting the Reinhardt defendants’ motion, although the notice of appeal was served on the attorneys for all defendants. In their enumeration of errors and appellate brief, plaintiffs contend that the court erred in denying their motion for partial summary judgment as well as in granting the Reinhardt defendants’ motion for summary judgment.

Certificates of service show that plaintiffs’ enumeration of errors and brief were not served on the attorney representing Means, and Means has not filed an appellate brief. We have addressed the issues concerning Means’ liability without ordering or requesting that Means file a brief, because most of them are interrelated with the issues concerning the Reinhardt defendants’ liability; they are resolved against the plaintiffs in any event.

1. Plaintiffs’ primary argument is that Means and the Reinhardt defendants are subject to personal liability as agents acting on behalf [191]*191of a non-existent principal, in that Al-Temp, having been dissolved, did not legally exist on the date the petition for an immediate writ of possession was filed.

Plaintiffs have overlooked OCGA § 14-2-1408 (b). It authorizes the shareholders, directors, and officers of a corporation which has been voluntarily dissolved to take actions to protect any remedy, right or claim on behalf of the corporation, which actions may proceed in the corporate name. Compare Gas Pump v. Gen. Cinema Beverages &c., 263 Ga. 583 (436 SE2d 207) (1993) (involving an administratively dissolved corporation).

2.

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Cite This Page — Counsel Stack

Bluebook (online)
469 S.E.2d 222, 220 Ga. App. 188, 96 Fulton County D. Rep. 460, 1996 Ga. App. LEXIS 417, Counsel Stack Legal Research, https://law.counselstack.com/opinion/flateau-v-reinhardt-whitley-wilmot-gactapp-1996.