Haley v. Oaks Apartments, Ltd.

325 S.E.2d 602, 173 Ga. App. 44, 1984 Ga. App. LEXIS 2723
CourtCourt of Appeals of Georgia
DecidedNovember 20, 1984
Docket68629
StatusPublished
Cited by16 cases

This text of 325 S.E.2d 602 (Haley v. Oaks Apartments, Ltd.) 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
Haley v. Oaks Apartments, Ltd., 325 S.E.2d 602, 173 Ga. App. 44, 1984 Ga. App. LEXIS 2723 (Ga. Ct. App. 1984).

Opinion

Birdsong, Judge.

This is an appeal by the defendants/counterclaimants, who purchased an apartment complex in July 1980 from the plaintiff Oaks Apartments, Ltd. (“Oaks”). The seller Oaks sued appellants in a claim on a $25,000 escrow account established for air conditioning repairs. Oaks sought $16,812.66 from the fund, plus $6,621 claimed due for rents collected by appellant buyers after the closing, and further sought attorney fees for bad faith and stubborn litigiousness. The ap *45 pellants counterclaimed for breach of the escrow agreement, fraud and deceit, and breach of warranties. It was alleged that at the closing, Oaks did not produce certain assurances relating to the number of tenants then occupying the property, the number and condition of appliances in the 204 apartment units, and the existence of a termite bond and absence of termite infestation. The sales contract was “as is” but, to comply with the assurances sought by appellants and to close the sale, the seller Oaks gave certain express warranties as to those assurances, specifically provided to survive the sale. Extensive discovery ensued and a great deal of testimony and evidence was received, including hundreds of documents tending to show that between sale and trial, the property had increased in value and income. The trial court instructed the jury on punitive damages, and provided a special verdict form allowing an award of punitive damages.

The jury returned a verdict awarding the $16,812.66 of the air conditioning escrow fund to the plaintiff-seller, awarding plaintiff $3,923 punitive damages, and awarding nothing to the defendants on their counterclaims. Defendants made motion for new trial, which was denied, but the trial court did strike the award for punitive damages. Defendants’ (“appellants” herein) appeal enumerates 25 enumerations of error. Held:

1. Appellants, in the first four enumerations of error, complain of the jury charge and special verdict form allowing punitive damages. The issue is moot, as the judgment is reversed on other grounds.

2. Enumerations 5-10 urge error in the admission of evidence and documentation (including rent rolls and accounting records) concerning value and income of the property after the date of sale. The plaintiff-seller introduced this evidence purportedly to show that, rather than getting “much less than they bargained for due to seller’s fraud,” the appellant-buyers “got a better deal than they were willing to admit.” The legal ground for admission of all this evidence was essentially that it illustrates the appellant-buyers’ failure to prove damages, or proves that appellants suffered no damages or had mitigated their damages.

We agree with appellants that any increase in value or income of the property after the seller’s alleged fraud or breach of warranty at the time of sale is generally irrelevant. The measure of proof of damages in cases of specific fraud and breach of warranty is the difference between the value of the property at the time of delivery and the value the property would have had if the property had been as warranted and represented. Gaulden v. Shehee, 24 Ga. 438; Murdock v. Godwin, 154 Ga. App. 824, 825-826 (269 SE2d 905). The seller contends the evidence was proper to show mitigation of damages, but mitigation of damages is not required in the case of fraud, a “positive tort” (OCGA § 51-12-11), nor breach of warranty. Murdock, supra.

*46 Specifically as to the breach of contract (warranty) claim, “[i]t is undoubtedly true that where by a breach of contract one is injured, he is bound to lessen the damages so far as is practicable, by the use of ordinary care and diligence. . . . This rule is applicable only where the damages can be lessened by reasonable efforts and expense. . . . [But] [t]he rule requiring the plaintiff to protect himself from loss arising from breach of a contract is not applicable where there is an absolute promise to pay. ...” Reid v. Whisenant, 161 Ga. 503, 509-510 (131 SE 904). An express warranty is an absolute promise; under these circumstances the measure of damages is based on the value of the property at the time of the breach. Reid, p. 509. Moreover, any general rule stating that “where by a breach of contract one is injured, he is bound to lessen the damages so far as is practicable by the use of ordinary care and diligence” (Reid, supra), really only means that the injured party, by his own negligence (failure to use ordinary care), cannot set about to take advantage of the breach and make his damage worse. A breach of contract is a “positive act” which does not affirmatively require the injured party, in order to recover, to mitigate his damages. See Athens Mfg. Co. v. Rucker, 80 Ga. 291, 295 (4 SE 885); see, similarly, OCGA § 51-12-11. The defaulting party cannot avoid his breach by showing that the claimant by his own skill or luck was able to make a profit somewhere else.

The appellee-seller should not have been allowed to show that the appellants “got a better deal than they were willing to admit”; this was irrelevant to the issue of damages for appellee’s fraud or breach. It was prejudicial error. The appellants gave evidence showing the correct measure of damages (Murdock, supra) and if the fraud or breach was proved, were entitled to recover whether they later made a profit.

3. The trial court erred in refusing to permit appellants to surrebut the specific testimony of a surprise rebuttal witness who had “sneaked onto appellants’ property and performed a purported termite inspection” during trial and testified that he found very little termite damage at the time of trial. See generally Walker v. Fields, 28 Ga. 237.

4. The trial court committed prejudicial error in giving to the jury, as exhibits, certain pleadings and documents from other lawsuits, which appellees introduced allegedly for purposes of impeachment of general veracity of one of appellants’ witnesses. Goins v. Glisson, 163 Ga. App. 290, 292-293 (292 SE2d 917); see also Laster v. State, 163 Ga. App. 294 (293 SE2d 75). Oral testimony concerning any such other lawsuits would be incompetent for impeachment purposes unless it contradicted the witness’ testimony at trial (OCGA § 24-9-82; Hardeman v. MARTA, 157 Ga. App. 271 (277 SE2d 65)) and cannot be used merely to expose the witness’ “intelligence, memory, *47 accuracy, judgment and veracity,” as appellee contends. Such personal qualities, or lack thereof, may be subject to cross-examination but not by the introduction of irrelevant, prejudicial evidence. See esp. Gilbert v. State, 159 Ga. App. 326 (283 SE2d 361), where this court held that the defendant (accused of possession of cocaine) could not impeach a state’s witness who denied having been a model, by showing in evidence a Gallery magazine depicting the witness and another cavorting about the seashore au naturel.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

David F. Hewitt v. Community & Southern Bank
Court of Appeals of Georgia, 2013
Hewitt v. Community & Southern Bank
751 S.E.2d 513 (Court of Appeals of Georgia, 2013)
Big Sandy Partnership, LLC v. Branch Banking & Trust Co.
723 S.E.2d 82 (Court of Appeals of Georgia, 2012)
Cleveland Motor Cars, Inc. v. Bank of America, N.A.
670 S.E.2d 892 (Court of Appeals of Georgia, 2008)
Insurance Industry Consultants, LLC v. Alford
669 S.E.2d 724 (Court of Appeals of Georgia, 2008)
Wachovia Bank of Georgia, N.A. v. Namik
620 S.E.2d 470 (Court of Appeals of Georgia, 2005)
Adams v. State
499 S.E.2d 105 (Court of Appeals of Georgia, 1998)
McLane v. Atlanta Market Center Management Co.
486 S.E.2d 30 (Court of Appeals of Georgia, 1997)
Victory Sign Industries, Ltd. v. Potter
430 S.E.2d 882 (Court of Appeals of Georgia, 1993)
Crosby v. Spencer
428 S.E.2d 607 (Court of Appeals of Georgia, 1993)
Krause v. Vance
428 S.E.2d 595 (Court of Appeals of Georgia, 1993)
American Express Travel Related Services Co. v. Web, Inc.
405 S.E.2d 652 (Supreme Court of Georgia, 1991)
J. C. Penney Casualty Insurance v. Woodard
380 S.E.2d 282 (Court of Appeals of Georgia, 1989)
People v. Terry
720 P.2d 125 (Supreme Court of Colorado, 1986)
Southern Railway Co. v. Oliver
341 S.E.2d 270 (Court of Appeals of Georgia, 1986)

Cite This Page — Counsel Stack

Bluebook (online)
325 S.E.2d 602, 173 Ga. App. 44, 1984 Ga. App. LEXIS 2723, Counsel Stack Legal Research, https://law.counselstack.com/opinion/haley-v-oaks-apartments-ltd-gactapp-1984.