Georgia Color Farms, Inc. v. K.K.L., Ltd. Partnership

507 S.E.2d 817, 234 Ga. App. 849, 1998 Ga. App. LEXIS 1321
Court of Appeals of Georgia·Decided October 5, 1998·No. A98A1990·Published·Cited by 13 cases

Opinion

Blackburn, Judge.

Georgia Color Farms, Inc. appeals the trial court’s grant of summary judgment in favor of plaintiff, K.K.L., Limited Partnership, in the underlying action based upon the breach of a lease between the parties. Georgia Color Farms contends: (1) that K.K.L. failed to give Georgia Color Farms credit for improvements it made to the property; (2) that the trial court granted K.K.L. excessive pre-judgment interest; and (3) that the trial court improperly awarded attorney fees to K.K.L. For the reasons set forth below, we affirm.

“Summary judgment is proper when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. OCGA § 9-11-56 (c). A de novo standard of review applies to an appeal from a grant of summary judgment, and we view the evidence, and all reasonable conclusions and inferences drawn from it, in the light most favorable to the nonmovant.” Matjoulis v. Integon Gen. Ins. Corp., 226 Ga. App. 459 (1) (486 SE2d 684) (1997).

The record shows that Georgia Color Farms entered into a three-year agreement with K.K.L. on December 15, 1993, to lease property to support a commercial nursery until January 14, 1997. On or around January 26, 1996, Georgia Color Farms vacated the property and failed to pay rent in the amount of $1,750 a month, thereafter owed to K.K.L. On December 16, 1996, K.K.L. rented the property to another tenant at the rate of $1,000 per month. 1

K.K.L. filed suit against Georgia Color Farms to collect back rent, interest, and attorney fees owed to it pursuant to the lease agreement. Georgia Color Farms counterclaimed, contending (1) that K.K.L. was responsible for reimbursing it for improvements made to the property and (2) that K.K.L. had tortiously interfered with Georgia Color Farms’ contract to sell its nursery business. 2 On December 22, 1997, K.K.L. filed a motion for summary judgment on both its claims and Georgia Color Farms’ counterclaims. On April 6,1998, the trial court granted K.K.L.’s motion, awarding it $20,250 for unpaid rent, $1,453.54 for taxes, $2,170.30 for attorney fees, and $8,301.60 *850 in pre-judgment interest. Georgia Color Farms appeals from this order.

1. Georgia Color Farms contends that K.K.L. should be required to reimburse it for the cost of improvements it made to the property, the value of which totaled approximately $15,027.41. These improvements include, among other things, electrical wiring, landscaping, fencing, installation of gas lines for heating, and installation of a bathroom.

Paragraph 13 of the lease agreement provides: “Tenant accepts the Premises in [its] present condition and as suited for the uses intended by Tenant. Tenant shall ... at its expense, maintain in good order and repair the Premises, including the heating (including but not limited to replacement of parts, air handling units and heating units) and other improvements located thereon, except those repairs expressly required to be made by Landlord hereunder. . . . Tenant further agrees to care for the grounds around the building, including paving, the mowing of grass, care of shrubs and general landscaping.” Although the lease agreement originally contained a paragraph requiring K.K.L. to make certain repairs to the property during the term of the lease, this paragraph was stricken by agreement of the parties. Thus, to the extent that Georgia Color Farms repaired the property, which it took on an “as-is” basis, it is foreclosed from receiving reimbursement.

Georgia Color Farms nevertheless contends that the changes it made to the property should be considered improvements, not repairs, and that K.K.L. gave it verbal consent to make these improvements. Based on this alleged consent, Georgia Color Farms argues that K.K.L. should be held responsible for the cost of the improvements pursuant to OCGA § 44-7-13.

Although this Code section generally holds a landlord liable for all substantial improvements placed upon property with its consent, it is not applicable here. Paragraph 14 of the lease agreement provides: “Tenant shall not make any alterations, additions, or improvements to the Premises without Landlord’s prior written consent. Tenant shall promptly remove any alterations, additions, or improvements constructed in violation of this Paragraph 14 upon Landlord’s written request. All approved alterations, additions, and improvements will be accomplished in a good and workmanlike manner, in conformity with all applicable laws and regulations, and by a contractor approved by Landlord, free of any liens or encumbrances. Landlord may require Tenant to remove any alterations, additions or improvements (whether or not made with Landlord’s consent) at the termination of this Lease and to restore the Premises to its prior condition, all at Tenant’s expense. All alterations, additions and improvements which Landlord has not required Tenant to remove *851 shall become Landlord’s property and shall be surrendered to Landlord upon the termination of this Lease.” (Emphasis supplied.) Therefore, on the face of the lease, Georgia Color Farms is held responsible for improvements made to the property without prior written consent, which it is undisputed that Georgia Color Farms lacked.

Georgia Color Farms further argues that, despite its lack of prior written consent to make improvements, the parties, by mutual agreement, departed from the express terms of the lease pursuant to OCGA § 13-4-4. This Code section provides: “Where parties, in the course of the execution of a contract, depart from its terms and pay or receive money under such departure, before either can recover for failure to pursue the letter of the agreement, reasonable notice must be given to the other of intention to rely on the exact terms of the agreement. The contract will be suspended by the departure until such notice.”

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Georgia Color Farms, Inc. v. K.K.L., Ltd. Partnership, 507 S.E.2d 817, 234 Ga. App. 849, 1998 Ga. App. LEXIS 1321 (Ga. Ct. App. 1998).

507 S.E.2d 817 (Georgia Color Farms, Inc. v. K.K.L., Ltd. Partnership) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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