SANDRA CLARKE v. DYE-MASTER, GROUP, INC.

Court of Appeals of Georgia·Decided June 25, 2024·No. A24A0093·Published

Opinion

SECOND DIVISION

MILLER, P. J.,

MARKLE and LAND, JJ.

NOTICE: Motions for reconsideration must be physically received in our clerk’s office within ten days of the date of decision to be deemed timely filed.

https://www.gaappeals.us/rules

June 25, 2024

In the Court of Appeals of Georgia A24A0093. CLARKE v. DYE-MASTER GROUP, INC. et al.

MARKLE, Judge.

After Sandra Clarke failed to pay Dye-Master Group, Inc. and American Property Restoration, Inc. (collectively “Appellees”) for renovation work completed on her home, the Appellees sued Clarke for breach of contract, conversion, violations of the Georgia Racketeer Influenced and Corrupt Organizations (“RICO”) Act, and to foreclose on liens they filed on the property.1 A jury found in Appellees’ favor, and awarded more than $365,000 in damages and attorney fees. Clarke now appeals, arguing that the trial court erred by (1) denying her motion for summary judgment;

1 Appellees originally named Clarke’s mortgage company, Specialized Loan Servicing, LLC, in the complaint because it held some of the funds, but they later dismissed that defendant.

(2) granting a motion for contempt and striking her pleadings due to discovery violations; (3) denying her motion to dismiss or for judgment on the pleadings; (4) granting a motion in limine to exclude evidence showing that Dye-Master Group was not licensed to act as a contractor; (5) denying her motion to recuse based on comments the trial court made during a motions hearing; and (6) denying her motion for judgment notwithstanding the verdict. For the reasons that follow, we affirm.

The record shows that, in 2016, Clarke’s home was damaged by fire, and she hired Dye-Master Group (“DMG”) to perform remediation services.2 During the clean-up, Clarke asked DMG about some renovation work, and DMG advised her that it was not a licensed contractor. DMG recommended American Property Restoration (“American”), which was licensed as a contractor. DMG and American then entered into an agreement in which DMG would finance the renovation, American would obtain the permits and perform the work, and the two companies would split the profits. Clarke’s insurance company prepared an estimate of the repairs, which Clarke gave to DMG. DMG and American prepared their own estimate, matching the same amount, and Clarke approved it. DMG then provided funding to American to cover

2 DMG completed this work and was paid.

the renovation work. Clarke later made changes that added to the cost, bringing the total to $198,498.75.

After American completed the work and the insurance company verified it, Clarke signed a certification of completion, indicating that she was satisfied with the renovation. Clarke’s insurance company then released the funds to Clarke’s mortgagor. Despite her acceptance of the work, however, Clarke notified her mortgage company that she had already paid the contractor, and she requested that payment be sent to her directly.3 Once she received the money from the mortgagor, Clarke deposited the funds into her own bank account, and refused to pay DMG.

DMG sent Clarke a demand letter and, when she failed to remit payment, DMG and American filed suit against Clarke for breach of contract, conversion, and RICO violations.4 They also placed liens on the property. Clarke answered and filed a counterclaim, arguing that the allegations in the complaint demonstrated that DMG

3 Clarke did not merely make a single misleading statement to the mortgagor.

She made several misrepresentations that she and the contractor were in dispute over the work, that the dispute had been resolved, and that she had already paid the contractor for the work. These statements are unsupported by the record.

4 The Appellees also pled, in the alternative, unjust enrichment, quantum meruit, and money had and received.

violated various statutes, including OCGA § 43-41-17, by providing renovation work without the proper license.5 During her deposition testimony, Clarke stated that she had evidence showing that she had paid DMG and purchased materials consistent with the information she gave her mortgage company. She further stated that the work performed had been substandard, requiring costly repairs. Clarke agreed to provide copies of those financial documents to the Appellees. But after the deposition, counsel withdrew, and the documents were not produced. DMG then sent Clarke’s new counsel another request, but he failed to submit any responses despite his assurances that he would do so. Appellees then moved for sanctions due to Clarke’s failure to respond to discovery requests. Counsel responded that there were no documents that were relevant to the request, and that Clarke had been unable to locate any of the financial records. Counsel then argued that DMG acted unlawfully by representing that it had a license to provide contractor services, and that, because it was in violation of the licensing requirements, it had no right to seek payment or to obtain discovery.

5 Clarke made additional allegations that DMG improperly acted as an insurance adjustor, but she seems to have abandoned that argument during the proceedings and on appeal.

Clarke then moved for summary judgment, arguing that DMG violated licensing regulations and thus any contract was unenforceable. In response, the Appellees argued that there were no such violations because American completed all the work, American was properly licensed, and American and DMG entered into a joint venture for completion of the renovations. Clarke later supplemented her motion to include the outcome of a complaint she filed with the state licensing board, which resulted in DMG agreeing to a cease and desist order.

Following a hearing, the trial court denied the motion for summary judgment, and ordered Clarke to respond to the pending discovery request within 30 days. Despite the trial court’s order, Clarke did not provide any discovery, and the Appellees filed a second motion for sanctions and for contempt. The trial court deferred its ruling on the motion for sanctions and contempt and again ordered Clarke to comply with discovery. When she failed to do so, the trial court granted the motion for sanctions, noting that the discovery request had been pending for three years and that Clarke had twice ignored the trial court’s orders to respond. Accordingly, the trial court struck Clarke’s answer and entered a default judgment as to liability. The trial

court further found Clarke in criminal contempt for ignoring the court’s order, and ordered her to pay a fine.

Clarke moved to vacate the order under OCGA § 9-11-60 (d) (3), and to dismiss the complaint, or to grant judgment on the pleadings. In doing so, Clarke repeated her argument that DMG violated licensing regulations and thus could not enforce the contract. The trial court denied the motion, finding that the motion improperly relied on documents outside the pleadings. The court further found that relief from judgment under OCGA § 9-11-60 was not warranted.

Prior to trial, the Appellees filed a motion in limine to exclude any evidence of the cease and desist order, as well as any argument that they could not collect because DMG was unlicensed. The trial court granted the motion.

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SANDRA CLARKE v. DYE-MASTER, GROUP, INC., (Ga. Ct. App. 2024).

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