FIFTH DIVISION RICKMAN, C. J., MCFADDEN, P. J., and SENIOR APPELLATE JUDGE PHIPPS
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November 3, 2021
In the Court of Appeals of Georgia A21A0791. RENASANT CORPORATION et al. v. KORST.
MCFADDEN, Presiding Judge.
Dean A. Korst brought an action against Renasant Corporation and Renasant
Bank, Inc. (collectively, the Renasant defendants) alleging that they violated the
Georgia Fair Housing Act by discriminating against him in renegotiating the terms
of his residential mortgage. The Renasant defendants moved to dismiss the action on
three grounds: because Korst failed to effect proper service upon them; because the
complaint failed to state a claim upon which relief could be granted; and because the
statute of limitation barred the action. The trial court denied the motion to dismiss and
we granted interlocutory review.
We are not persuaded that any of the grounds asserted by the Renasant
defendants required the trial court to dismiss the action. As to service of process, there is a factual dispute on the issue of the authority of the persons served to accept
service. As to whether the complaint states a claim, Korst has sufficiently alleged a
discriminatory housing practice, refusal to make reasonable accommodation; that he
has a disability; and that, because of that refusal disability, Renasant’s refusal to
accomodate has had a disparate impact upon him. As to the statute of limitations, the
complaint, properly construed, alleges an unlawful practice that continues into the
limitations period. So we affirm.
1. Procedural history.
Korst filed this action on September 27, 2019. He alleged in his complaint that
he is disabled and that the Renasant defendants and another defendant not involved
in this appeal (Brand Mortgage Group, LLC) collectively discriminated against him
based on that disability by refusing to speak with his counsel regarding a loan
modification. This forced Korst to negotiate the modification by himself, which he
asserts he was unable to do effectively due to his disability.
The Renasant defendants raised insufficient service of process as a defense in
their answer. They also moved to dismiss the action, arguing that there was
insufficient service of process, that the complaint failed to state a claim upon which
relief could be granted, and that the applicable statute of limitation barred the action.
2 After reviewing affidavits submitted by the parties and hearing oral argument, the
trial court issued an order denying the motion to dismiss without express findings of
fact or conclusions of law. The trial court also issued a certificate of immediate
review, and we granted the Renasant defendants’ application for an interlocutory
appeal.
2. Service of process.
The sufficiency of service of process is a jurisdictional question. “When there
is no proper service, and no valid waiver of service, the [trial] court does not have
jurisdiction over the defendant[s].” Bonner v. Bonner, 272 Ga. 545, 546 (2) (533
SE2d 72) (2000). The defendant bears the burden of showing insufficient service,
Russell v. Muscogee County School Dist., 341 Ga. App. 229, 232 (1) (800 SE2d 7)
(2017), and where, as here, the only evidence presented to the trial court was in the
form of written submissions, “disputes of fact found in the affidavits are resolved in
favor of the plaintiff.” Beasley v. Beasley, 260 Ga. 419, 420 (396 SE2d 222) (1990).
On appeal we examine that evidence “under a non-deferential standard[,]” id., and,
as to questions of law, we review the ruling de novo. City of Sandy Springs Bd. of
Appeals v. Traton Homes, 341 Ga. App. 551, 552 (801 SE2d 599) (2017).
3 The Renasant defendants argue that the trial court should have dismissed the
action for insufficient service of process because the persons to whom the process
servers gave the complaint and summons were not authorized to accept service on
their behalf. But the Renasant defendants did not satisfy their burden of showing lack
of jurisdiction because there is a factual dispute on the issue of those persons’
authority to accept service.
Korst filed returns of service from the process servers stating that they had
personally served the summons and complaint upon employees of the Renasant
defendants. As to Renasant Bank, the return showed that service was made upon Lori
Garner, a “Teller,” at the Georgia address listed for Renasant Bank’s registered office
and registered agent in its annual filing with the Secretary of State of Georgia. As to
Renasant Corporation, the return showed that service was made upon Ann Stafford,
a “Vice President/Bank Manager,” at a Mississippi address that Korst alleged, in his
complaint, was the address of Renasant Corporation’s principal office and registered
agent.
Garner and Stafford both submitted affidavits stating that they were not
authorized to accept service of process on behalf of those entities and did not hold the
types of positions with those entities that would permit them to accept service of
4 process under OCGA § 9-11-4 (e), which governs personal service upon corporations.
But corporations may delegate the authority to receive service to someone other than
the persons identified in the statute. See Murray v. Sloan Paper Co., 212 Ga. App.
648, 649 (2) (442 SE2d 795) (1994) (service may be made upon employee “expressly
designated by the corporation to receive service”) (citation and punctuation omitted);
Northwestern Nat. Ins. Co. v. Kennesaw Transp., 168 Ga. App. 701, 702 (309 SE2d
917) (1983) (service was proper upon employee authorized to accept service on
behalf of corporation’s designated agent); Normal Svc. Indus. v. Lusty, 168 Ga. App.
164, 165 (1) (308 SE2d 411) (1983) (rejecting challenge to sufficiency of service
where it was undisputed that the secretary of the corporation’s registered agent was
authorized to accept service on his behalf and it could be inferred from the evidence
that service was made upon that secretary).
Korst presented the trial court with affidavit evidence that the Renasant
defendants’ registered agents had delegated such authority to Garner and Stafford. He
submitted the affidavit of Richard Poncinie, the chief executive officer of the
company for which the two process servers worked. Poncinie stated that, according
to his company’s records, both Garner and Stafford told the process servers that they
were authorized to accept service on behalf of the registered agents of Renasant Bank
5 and Renasant Corporation, respectively. The records of Poncincie’s company also
showed that in past cases its process servers had served pleadings upon Renasant
Bank’s tellers, bank managers, and vice presidents, and that the bank’s employees had
told process servers that its registered agent in Georgia worked from an undisclosed
location rather than the location listed with the Georgia Secretary of State. See
generally OCGA § 14-2-1622 (a) (2) (corporation’s annual filing with the Secretary
of State must set forth “[t]he street address and county of its registered office and the
name of its registered agent at that office in this state”).
The Renasant defendants assert that Poncinie’s affidavit cannot be considered
because it contains hearsay — testimony from Poncinie on topics about which he had
no personal knowledge. But Poncinie stated in the affidavit that he based his
testimony on his review of his company’s business records, which he averred
contained “notes of each service attempt . . . entered in real-time by [his company’s]
process servers.” The affidavit established a foundation for the records of Poncinie’s
company to be considered under the business records exception to hearsay. See
OCGA § 24-8-803 (6) (setting forth business records exception); Matthews v. Wells
Fargo Bank, 335 Ga. App. 526, 526-527 (782 SE2d 312) (2016) (business record
falls within exception if it was made at or near the time of the described act, by a
6 person with personal knowledge and a business duty to report, is admitted through
a qualified witness’s testimony, was kept in the course of a regularly conducted
business activity, was made as a part of that regular business activity, and there is no
indication of lack of trustworthiness in connection with the source of the information
or the method or circumstances of the record’s preparation). And the information
contained in those business records indicated that Garner and Stafford had
represented that they were authorized to accept service of process on behalf of the
Renasant defendants’ registered agents. This constituted evidence that the registered
agents had appointed those employees to accept service. See Northwestern Nat. Ins.
Co., 168 Ga. App. at 702 (evidence that person at registered agent’s office told
process servers that registered agent was not there, that she led process servers to
believe that she was authorized to accept service, and that process servers were
acquainted with corporation’s customary practice of designating an employee to
accept service on agent’s behalf, created fact question regarding whether that person
had been appointed to accept service).
Certainly, the evidence on this point is disputed. Both Garner and Stafford state
they had no such authorization. But as stated above, the Renasant defendants bear the
burden of showing improper service, and because the only evidence was in the form
7 of written submissions the disputes of fact found in the affidavits must be resolved
in Korst’s favor. See Beasley, 260 Ga. at 420. Because there are factual disputes
regarding Gardner’s and Stafford’s authority to accept service of process, the trial
court did not err in denying the Renasant defendants’ motion to dismiss the action for
insufficient service.
3. Sufficiency of the complaint allegations to state a claim under the Georgia
Fair Housing Act.
The Renasant defendants argue that Korst’s action must be dismissed because
the complaint fails to state a claim of discrimination under the Georgia Fair Housing
Act, OCGA § 8-3-200 et seq. (the Act). See OCGA § 9-11-12 (b) (6) (permitting
dismissal of action for failure to state a claim upon which relief can be granted).
A motion to dismiss for failure to state a claim “should not be granted unless
it appears to a certainty that the plaintiff would be entitled to no relief under any state
of facts which could be proved in support of his claim. If, within the framework of
the complaint, evidence may be introduced which will sustain a grant of relief to the
plaintiff, the complaint is sufficient.” Austin v. Clark, 294 Ga. 773, 775 (755 SE2d
796) (2014) (citation omitted). “The main consideration of such a motion to dismiss
is whether, under the assumed set of facts, a right to some form of legal relief would
8 exist.” Northway v. Allen, 291 Ga. 227, 229 (728 SE2d 624) (2012) (citation and
punctuation omitted).
“On appeal, a trial court’s ruling on a motion to dismiss for failure to state a
claim for which relief may be granted is reviewed de novo[.]” Northway, 291 Ga. at
229. “[A]ny doubts regarding the complaint must be construed in favor of the
plaintiff.” Norman v. Xytex Corp., 310 Ga. 127, 131 (2) (848 SE2d 835) (2020). So
viewed, Korst’s complaint makes the following allegations.
The Renasant defendants1 are assignees of a loan secured by his residence.
Korst is disabled, and due to his disability he “struggles to keep up with his financial
obligations, including the mortgage for his home.” After payments on his home loan
became delinquent, he attempted to negotiate the terms of that loan with the Renasant
defendants “but his health problems prevented him from being fully engaged due to
constant medical treatment.” For that reason, Korst hired legal counsel to assist him
in loan modification negotiations. The Renasant defendants, however, persistently
refused to speak with Korst’s counsel, instead informing counsel that it was their
policy not to work with third parties to resolve the past-due debts of their borrowers.
1 Most of the complaint’s factual allegations can be read to pertain to all three defendants, because the complaint refers to all of the defendants collectively using the single term “Brand.”
9 The Renasant defendants took the position that Korst must contact them directly.
Although Korst’s counsel made further attempts to discuss his loan with the Renasant
defendants, they “continued [their] refusal to interact with or respond to Korst’s legal
counsel’s requests to communicate.”
At Korst’s urging, the Federal Reserve Bank investigated his claim, determined
that the Renasant defendants’ lending practices, policies, and procedures were
discriminatory, and referred the matter to the Department of Housing and Urban
Development for further investigation. During that time, the Renasant defendants
continued to refuse to speak with Korst’s counsel about his loan, demanding only to
speak with Korst. And during that time, Korst continued to “struggle[ ] with his
failing health and crushing economic pressure due to [his] reduced fixed income.”
The Renasant defendants threatened Korst with foreclosure twice: on January
5, 2017, and again on November 16, 2017. In light of the Renasant defendants’
ongoing refusal to speak with his counsel about his loan, Korst felt that the Renasant
defendants had “left [him] with no choice and [he] was forced to negotiate a
modification of his residential mortgage on his own, without the assistance of legal
counsel.” The Renasant defendants forced Korst to accept a modification that made
“meager adjustments to [his] obligations and did little if anything to ease his
10 economic burden.” Korst asserts that the unfavorable outcome of his negotiation
“could have been avoided but for [the Renasant defendants’] discriminatory and
predatory lending practices, policies and procedures related to disabled veterans.”
Construing these allegations in Korst’s favor, as we must at this stage of the
proceedings, it does not appear to a certainty that Korst would be entitled to no relief
under any state of facts which could be proved in support of a claim under the Act.
See Austin, 294 Ga. at 775. The Act provides that a person aggrieved by a
discriminatory housing practice may file a civil action “to obtain appropriate relief
with respect to such discriminatory housing practice[,]” OCGA § 8-3-217 (a) (1),
including injunctive relief, actual and punitive damages, and reasonable attorney fees
and costs. OCGA § 8-3-217 (b) (1).
Korst’s complaint expressly asserts that the Renasant defendants violated
OCGA § 8-3-204 of the Act, which provides that “discriminatory housing practices”
include acts by a “person or other entity whose business includes engaging in
residential real estate related transactions to discriminate against any person in
making available such a transaction or in the terms or conditions of such a transaction
because of race, color, religion, sex, handicap, familial status, or national origin.”
OCGA § 8-3-204 (b). See OCGA § 8-3-201 (8) (defining “discriminatory housing
11 practice” to include acts that are unlawful under OCGA § 8-3-204, among other
provisions of the Act). The Act defines the term “residential real estate related
transaction” to include “[t]he making or purchasing of loans or providing other
financial assistance . . . [s]ecured by residential real estate[.]” OCGA § 8-3-204 (a)
(1) (B).
Contrary to the Renasant defendants’ argument, however, the complaint’s
allegations are not limited to discriminatory housing practices under OCGA § 8-3-
204. Korst also alleges more generally that the Renasant defendants’ “lending-related
practices, policies and procedures” violated his rights under the Act, which, construed
broadly in Korst’s favor, could include Code provisions setting forth other examples
of discriminatory housing practices. One such provision is OCGA § 8-3-202, which
provides that it is a discriminatory housing practice to “refus[e] to make reasonable
accommodation in rules, policies, practices, or services when such accommodations
may be necessary to afford such person equal opportunity to use and enjoy a
dwelling.” OCGA § 8-3-202 (a) (7) (B) (ii). See OCGA § 8-3-201 (8) (defining
“discriminatory housing practice” to include acts that are unlawful under OCGA § 8-
3-202, among other provisions of the Act).
12 The Renasant defendants assert that the only way Korst may prevail under the
Act is to show discriminatory intent. But as Korst argues, a plaintiff can also establish
a claim under the Act under a theory of disparate impact. See Stewart v. McDonald,
334 Ga. App. 461, 465-466 (1) (779 SE2d 695) (2015) (applying Title VII’s
discrimination analysis); Bailey v. Stonecrest Condo. Assn., 304 Ga. App. 484, 487-
488 (1) (696 SE2d 462) (2010) (to prevail on a claim under the Act, a plaintiff “can
show either discriminatory intent or disparate impact”) (citation and punctuation
omitted). Disparate impact involves “practices . . . that are facially neutral, but in fact
fall more harshly on one group than another and cannot be justified as a business
necessity.” Dept. of Human Resources v. Montgomery, 248 Ga. 465, 467 (2) (a) (284
SE2d 263) (1981).
Korst alleges that he is disabled, that his disability prevented him from capably
negotiating a modification of his residential loan, and that the Renasant defendants’
policy of refusing to negotiate with any third parties prevented him from using legal
counsel to accommodate for his disability, thereby harming him in his efforts to
modify his loan. Evidence could be presented within the framework of these
allegations to establish a claim of disparate impact under the Act.
13 We are not persuaded by the Renasant defendants’ other arguments that the
complaint allegations were not sufficient. They argue that Korst’s allegations “cannot
state a claim for relief under [the Act], because nothing in [the Act] provides Korst
with the right to counsel in the modification or restructuring of a mortgage.” While
the Act does not specifically address a borrower’s right to counsel in the loan-
modification context, it prohibits discrimination in the context of loan modifications,
OCGA § 8-3-204 (b), and it must be “broadly construed to further the general
purposes stated in [that] code section,” OCGA § 8-3-200 (c), such as: “safeguard[ing]
all individuals from discrimination in any aspect relating to the . . . financing of
dwellings . . . because of that individual’s . . . disability or handicap[,]” OCGA § 8-3-
200 (b) (2); “promot[ing] the elimination of discrimination in any aspect relating to
the . . . financing of dwellings . . . because of a person’s . . . disability or handicap[,]”
OCGA § 8-3-200 (b) (3); and “promot[ing] the protection of each individual’s interest
in personal dignity and freedom from humiliation[.]” OCGA § 8-3-200 (b) (4). The
Renasant defendants offer no authority or meaningful argument that policies with a
disparate impact upon disabled persons’ ability to modify their loans should be carved
out of the Act’s prohibition against discrimination.
14 The Renasant defendants also argue that Korst failed to sufficiently allege that
he has a disability under the Act, which defines “disability” to mean: “A physical or
mental impairment which substantially limits one or more of such person’s major life
activities; . . . [a] record of having such an impairment; or . . . [b]eing regarded as
having such an impairment[.]” OCGA § 8-3-201 (7). Although Korst asserted that he
was disabled, the Renasant defendants argue that he was required to allege the facts
related to his disability with more particularity, citing a federal circuit court opinion,
Mack v. City of High Springs, 486 Fed. Appx. 3 (11th Cir. 2012). But in that decision,
the court expressly “[a]ccept[ed] as true the allegations that [the plaintiff] is
disabled,” and upheld the dismissal of the plaintiff’s complaint on another ground.
Id. at 8 (III). So that decision does not stand for the proposition that Korst was
required to plead his disability with a greater degree of particularity than is normally
required by our principles of notice pleading. See generally Tenet HealthSystem GB
v. Thomas, 304 Ga. 86, 89 (816 SE2d 627) (2018) (notice pleading, as set forth in
OCGA § 9-11-8 (a) (2), is the “hallmark” of Georgia’s Civil Practice Act and under
it “a complaint need only provide fair notice of what the plaintiff’s claim is and the
grounds upon which it rests”) (citations and punctuation omitted).
15 It may be that Korst will not be able to establish that he has a disability as
defined by the Act. We take no position on that issue, or on Korst’s ability to prove
any other element of his claim under the Act. “At this stage in the litigation, it does
not matter that the existence of [the assumed set of facts] is unlikely. . . . This is
factual evidence which may or may not be developed during discovery and can be
considered on a subsequent motion for summary judgment.” Austin, 294 Ga. at 775.
As the record stands, the trial court did not err in denying the motion to dismiss for
failure to state a claim.
4. Statute of limitation.
The Renasant defendants argue that Korst’s action is barred by the Act’s two-
year statute of limitation, which provides that “[a]n aggrieved person may commence
a civil action in an appropriate superior court not later than two years after the
occurrence or the termination of an alleged discriminatory housing practice[.]”
OCGA § 8-3-217 (a) (1). They contend that this two-year period commenced in May
of 2016 when, according to Korst’s complaint, a representative of the Renasant
defendants first told Korst’s lawyer that their policy prohibited them from working
with third parties to resolve borrowers’ past-due debts. Korst did not file his
complaint until September 27, 2019, more than two years after that conversation.
16 Korst argues that his claim involves a “continuing violation” that extended into
the limitation period. There appears to be no Georgia precedent stating whether or not
the continuing violation doctrine applies to a claim under the Act, but federal
precedent has applied that doctrine to permit actions under the federal Fair Housing
Act in circumstances “[w]here a plaintiff . . . challenges not just one incident of
conduct violative of the Act, but an unlawful practice that continues into the
limitations period[.]” Havens Realty Corp. v. Coleman, 455 U. S. 363, 380-381 (IV)
(102 SCt 1114, 71 LE2d 214) (1982) (footnote omitted). “Given that the [Georgia
Fair Housing] Act and the [federal Fair Housing Act] are nearly identical, we consider
federal cases applying the [Fair Housing Act] persuasive precedent[.]” Stewart, 334
Ga. App. at 465 (1) (citation and punctuation omitted). So we will apply the
continuing violation doctrine to determine whether the statute of limitation bars
Korst’s action.
“The critical distinction in the continuing violation analysis is whether the
plaintiff complains of the present consequence of a one time violation, which does
not extend the limitations period, or the continuation of that violation into the present,
which does.” Lovett v. Ray, 327 F3d 1181, 1183 (11th Cir. 2003) (citation and
punctuation omitted). In determining which of these categories applies to Korst’s
17 complaint, we construe the complaint under the pleading standard that governs
motions to dismiss under OCGA § 9-11-12 (b) (6). See Dept. of Transp. v. Mixon,
355 Ga. App. 463, 465 (2) (844 SE2d 524) (2020). In other words, the complaint
should not be dismissed as barred by the statute of limitation “unless it appears to a
certainty that [Korst] would be entitled to no relief under any state of facts which
could be proved in support of (his) claim.” Id. (citation omitted).
So viewed, Korst’s complaint alleges a continuation of a Fair Housing Act
violation into the two-year limitation period. He could introduce, within the
framework of his complaint, evidence that the Renasant defendants’ refusal to allow
Korst’s counsel to negotiate his loan modification was not a one-time event but was
the application of a policy that persisted until November 2017, when the Renasant
defendants threatened Korst with foreclosure for the second time and after which
Korst was forced to negotiate the modification himself. For this reason, the trial court
did not err in denying the motion to dismiss, and we need not consider Korst’s other
arguments regarding the statute of limitation.
Judgment affirmed. Rickman, C. J., and Senior Appellate Judge Herbert E.
Phipps concur.