Intern. Biochem. Indus. v. Jamestown Mgmt.

586 S.E.2d 442, 262 Ga. App. 770
CourtCourt of Appeals of Georgia
DecidedAugust 15, 2003
DocketA03A1275
StatusPublished
Cited by1 cases

This text of 586 S.E.2d 442 (Intern. Biochem. Indus. v. Jamestown Mgmt.) 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
Intern. Biochem. Indus. v. Jamestown Mgmt., 586 S.E.2d 442, 262 Ga. App. 770 (Ga. Ct. App. 2003).

Opinion

586 S.E.2d 442 (2003)
262 Ga. App. 770

INTERNATIONAL BIOCHEMICAL INDUSTRIES, INC.
v.
JAMESTOWN MANAGEMENT CORPORATION et al.

No. A03A1275.

Court of Appeals of Georgia.

August 15, 2003.

*443 Schreeder, Wheeler & Flint, Lynn C. Stewart, Atlanta, Scott D. McAlpine, for appellant.

Holland & Knight, Susan E. Edlein, Atlanta, for appellees.

ELLINGTON, Judge.

This appeal arose from an action to recover unpaid rent and other expenses due under the terms of a commercial lease. The trial court granted summary judgment to the lessor's *444 agent, Jamestown Management Corporation (Jamestown), and International Biochemical Industries, Inc. f/k/a Bioshield Technologies, Inc.[1] (Bioshield), the former tenant who breached the lease, appeals. Bioshield contends that the doctrine of res judicata barred the underlying action and that the trial court erred in finding otherwise. Bioshield also asserts that the trial court erred by granting summary judgment on its counterclaim and in denying its motion to strike portions of an affidavit. We find no error and affirm.

On July 9, 1999, Bioshield entered into a ten-year commercial lease with Cologne Investors, Ltd. and Erwin Walter Graebner as lessors, and Jamestown as agent for the lessors. Bioshield leased an office building at 5655 Peachtree Parkway, Norcross, Georgia, at the initial monthly rate of $29,967.17. Under the lease, the base rent gradually increased to a maximum of $15.54 per square foot, or $71,644.58 per month.

In the event of default, the lease provided for several remedies, including, but not limited to, the termination of the lease and acceleration of future rent. Under Paragraph 12.1.1, the lessor could terminate the lease, obtain possession, then seek indemnification from the lessee "for all loss, cost, expense, and damage which Lessor may suffer by reason of the termination, whether through inability to relet the Premises, or through decrease in rent or otherwise." Alternatively, under Paragraph 12.1.2 the lessor could:

[w]ithout terminating this Lease, retake possession of the Premises and rent the Premises, or any part thereof, for such term or terms and for such rent and upon such conditions as Lessor may, in its sole discretion, think best.... All rent received by Lessor from any reletting shall be applied first to the payment of any indebtedness...; second, to the payment of any costs and expenses of the reletting ...; third, to the payment of rent due and unpaid hereunder, and the residue, if any, shall be held by Lessor and applied in payment of future rent or damage as they may become due and payable hereunder. If the rent received from the reletting during the Lease Term is at any time insufficient to cover the costs, expenses, and payments enumerated above, Lessee shall pay any deficiency to Lessor, as often as it shall arise, on demand.

During the second year of the lease, Bioshield abandoned the premises, relocated elsewhere, and failed to pay any rent after December 2000. Jamestown did not terminate the lease. As was its option under Paragraph 12.1.2, Jamestown chose to regain possession without terminating the lease and to relet the premises. After Bioshield moved out, Jamestown, on behalf of itself and the lessors, instituted a dispossessory proceeding against Bioshield and sought the unpaid rent for December 2000 and January 2001. The dispossessory action resulted in a default judgment against Bioshield on January 29, 2001, for $151,706.10 for two months past due rent.

Thereafter, Jamestown undertook various marketing activities to attempt to relet the premises but could not find another tenant. In December 2001, Jamestown sued Bioshield for rent, late fees, interest, attorney fees, and damages for bad faith. Bioshield answered and counterclaimed. Among other defenses, Bioshield asserted that the claims were "barred by res judicata, collateral estoppel and estoppel by judgment." Bioshield counterclaimed that Jamestown had "unreasonably prevented" it from having access to the building to remove telephone equipment that Bioshield had leased from a third party. Bioshield claimed that because it could not recover the telephone equipment, it had been sued by the third party.

To establish damages, Jamestown offered the affidavit testimony of James B. Reaves, the vice president of asset management for Jamestown. Reaves testified as to the amount of rent, interest, and expenses due under the lease for the period from February 2001 through August 2002.

In directing summary judgment against Bioshield, the trial court made several findings. Noting that the lease had not been terminated, the court found that the lease provided a right to obtain future rent that *445 had not yet accrued at the time of the dispossessory proceeding. As to Bioshield's counterclaim, the trial court found "[Jamestown] by the terms of the lease is not responsible for the equipment left on the premises. [Bioshield] created the quandary with which it is now faced."

1. Bioshield contends that the trial court erred by failing to apply the doctrine of res judicata. Bioshield argues that Jamestown's failure to bring the claim for future rent or accelerated rent in the dispossessory action precluded it from doing so later. Bioshield asserts OCGA § 44-7-55, the statute governing dispossessory actions, intends for all related claims between a landlord and tenant to be determined in a dispossessory proceeding. See America Net v. U.S. Cover, Inc., 243 Ga.App. 204, 206, 532 S.E.2d 756 (2000). Bioshield claims that OCGA § 44-7-55(a) required Jamestown to bring the claim "for all rents due and for any other claim relating to the dispute" in the dispossessory proceeding. Bioshield argues that the lease afforded Jamestown only "two options: (1) seek recovery of future rent in the dispossessory action; or (2) dismiss the dispossessory action (since the tenant had already vacated) and litigate both the past and future contract rent claim in one proceeding in state court." Bioshield contends that because the lease permitted Jamestown to collect post-eviction rent, Jamestown was obligated to do so in the dispossessory proceeding and so as a result "the doctrine of res judicata bars Jamestown's second lawsuit for rent."

"[I]t is general contract law in Georgia that parties are free to contract about any subject matter, on any terms, unless prohibited by statute or public policy, and injury to the public interest clearly appears." (Citation and punctuation omitted.) Kurc v. Herren, 196 Ga.App. 331, 332(1), 396 S.E.2d 62 (1990). "Absent a limiting statute or controlling public policy, parties may contract with one another on whatever terms they wish and the written contract defines the full extent of their rights and duties." (Citations and punctuation omitted.) American Med. Transp. Group v. Glo-An, Inc., 235 Ga.App. 464, 465(1), 509 S.E.2d 738 (1998).

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586 S.E.2d 442, 262 Ga. App. 770, Counsel Stack Legal Research, https://law.counselstack.com/opinion/intern-biochem-indus-v-jamestown-mgmt-gactapp-2003.