RL BB ACQ I-GA CVL, LLC v. WORKMAN Et Al.

798 S.E.2d 677, 341 Ga. App. 127, 2017 WL 1013732, 2017 Ga. App. LEXIS 132
CourtCourt of Appeals of Georgia
DecidedMarch 15, 2017
DocketA16A1512
StatusPublished
Cited by7 cases

This text of 798 S.E.2d 677 (RL BB ACQ I-GA CVL, LLC v. WORKMAN Et Al.) 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
RL BB ACQ I-GA CVL, LLC v. WORKMAN Et Al., 798 S.E.2d 677, 341 Ga. App. 127, 2017 WL 1013732, 2017 Ga. App. LEXIS 132 (Ga. Ct. App. 2017).

Opinion

Branch, Judge.

The current appeal arises out of a post-judgment discovery dispute, and it presents this Court with several unique questions. First, the appeal requires us to determine whether a party involved in a post-judgment discovery dispute can assert a claim for attorney fees under OCGA § 9-15-14. Additionally, this case poses the question of whether a party who fails to request an award of expenses (including attorney fees) at the time it moves for a protective order can seek such an award at a later time, by way of a separate motion for sanctions. And assuming that a party may bring a separate sanctions motion to recover expenses incurred in obtaining a protective order, the question becomes whether the Civil Practice Act allows that party to recover the expenses associated with such a sanctions motion. We address each of these questions, as well as other relevant issues, below.

The record shows that after RL BB ACQ I-GA CVL, LLC (“Rialto”), obtained a $1.9 million judgment against Cooper Village, LLC, and Howard Workman (collectively, the “Judgment Debtors”), the company served post-judgment discovery requests on Howard’s wife, *128 Honey C. Workman, and 16 separate LLCs 1 managed by Honey and in which Howard had an ownership interest. Honey and the LLCs (collectively, the “Third Parties”) limited their discovery responses to information and documents relating to or evidencing assets belonging to or transferred from the Judgment Debtors and/or transactions involving the Judgment Debtors. Rialto then served additional discovery requests on Fidelity Bank, seeking numerous documents relating to any account held at Fidelity by Cooper Village, Howard, Honey, and/or any of the LLCs. The Third Parties sought and obtained a protective order that limited the discovery Rialto could receive from Fidelity. Approximately six weeks after entry of that order, and three days after Rialto’s attorneys allegedly failed to appear to take Honey’s deposition, the Third Parties filed a motion seeking costs, attorney fees, and sanctions under OCGA §§ 9-15-14, 9-11-26, 9-11-30, and 9-11-37. Following a hearing, the trial court granted that motion and entered an order requiring Rialto and its attorneys to pay the fees and costs incurred by the Third Parties in moving for the protective order, in preparing for and attending Honey’s deposition, and in pursuing their motion for sanctions. That order also sanctioned Rialto by barring it from conducting a post-judgment deposition of Honey for a period of five years.

Rialto now appeals, asserting that the trial court erred in basing its award of fees and costs on OCGA § 9-15-14. Rialto further contends that any award based on OCGA § 9-15-14 must be reversed because the findings of fact on which the trial court based that award are not supported by the evidence and because the trial court failed to determine what portion of the fees claimed by the Third Parties was attributable to Rialto’s sanctionable conduct. Additionally, Rialto argues that the trial court erred in awarding the Third Parties the costs and fees they incurred in preparing for and attending Honey’s deposition and in bringing the sanctions motion. Finally, Rialto asserts that the Third Parties waived their right to seek an award under OCGA § 9-11-26 because they did not assert a right to recover under that statute until they filed their reply in support of their sanctions motion, and because they did not request their costs and fees at the time they moved for the protective order.

We find that OCGA § 9-15-14 does not apply to post-judgment discovery, and we reverse the trial court’s order to the extent that it *129 holds otherwise. Additionally, for reasons explained more fully below, we reverse the trial court’s award of the Third Parties’ costs and fees incurred in preparing for and attending Honey Workman’s deposition and in bringing the sanctions motion. We also reverse the court’s imposition of the non-monetary sanction against Rialto. Finally, we vacate that part of the court’s order awarding the Third Parties the costs and fees associated with their motion for a protective order and remand for further proceedings on the question of whether OCGA § 9-11-26 permits a party to pursue such an award by way of a separate sanctions motion, filed after the motion for a protective order has been heard and decided.

“[T]rial courts are afforded broad discretion to control discovery and to impose sanctions for a party’s failure to comply with discovery requests, and this Court will not reverse a trial court’s ruling on such matters absent an abuse of that discretion.” North Druid Dev. v. Post, Buckley, Schuh & Jernigan, 330 Ga. App. 432, 434-435 (1) (767 SE2d 29) (2014) (citation and footnote omitted). See also In re Callaway, 212 Ga. App. 500, 501 (442 SE2d 309) (1994) (under the Civil Practice Act, the trial court’s broad discretion with respect to discovery extends to post-judgment discovery). Such an abuse of discretion occurs where the trial court either fails to apply or misapplies the relevant law. See North Druid Dev., 330 Ga.App. at 441 (on motion for reconsideration); Mathis v. BellSouth Telecommunications, 301 Ga. App. 881 (690 SE2d 210) (2010).

The relevant facts are undisputed and show that in exchange for a $5.5 million loan from BB&T Bank, Cooper Village provided the bank with both a promissory note and a security interest in certain real property located in Gwinnett County Howard, who executed all of the loan documents in his capacity as manager of Cooper Village, also gave a personal guaranty to secure the note. BB&T eventually assigned its rights under all of the loan documents, including Howard’s personal guaranty, to Rialto. After Cooper Village defaulted on the note and Howard refused to honor his guaranty, Rialto exercised its rights under the deed to secure debt, sold the Gwinnett County property for $4 million, and obtained a judicial confirmation of that sale. 2

In July 2012, Rialto sued Cooper Village and the Workmans in Fulton County Superior Court seeking a deficiency judgment for the amounts owed under the promissory note. In its complaint, Rialto *130 asserted a claim against Cooper Village for breach of the promissory note, a claim against Howard for breach of the guaranty, and a claim against both Howard and Honey for fraudulent transfer of property 3

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Bluebook (online)
798 S.E.2d 677, 341 Ga. App. 127, 2017 WL 1013732, 2017 Ga. App. LEXIS 132, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rl-bb-acq-i-ga-cvl-llc-v-workman-et-al-gactapp-2017.