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Inland A. Old Nat'l Phase I, LLC v. 6425 Old Nat'l, LLC

Court of Appeals of Georgia

November 17, 2014

INLAND ATLANTIC OLD NATIONAL PHASE I, LLC et al.
v.
6425 OLD NATIONAL, LLC; and vice versa

Page 87

Contract, etc. Fulton Superior Court. Before Judge Markle.

Judgment affirmed in Case No. A14A1062, and affirmed in Case No. A14A0853.

Hartman Simons & Wood, Samuel R. Arden, Irene Vander Els, Chelsea L. Dennis, Leslie A. Brooking, for appellants.

Vaughn, Wright & Boyer, Frederick L. Wright, for appellee.

MILLER, Judge. Doyle, P. J., and Dillard, J., concur.

OPINION

Page 88

Miller, Judge.

These consolidated appeals arise from a contractual dispute concerning the development of certain real property located in south Fulton County (hereinafter the " Property" ). 6425 Old National, LLC (" Old National" ) sued Inland Atlantic Old National Phase I, LLC and Inland Georgia Old National Venture, LLC (collectively " Inland Atlantic" ) for breach of the parties' Site Development Agreement.[1] Inland Atlantic denied liability and counterclaimed for breach of contract, fraud, negligent misrepresentation, breach of fiduciary duty, indemnification, and attorney fees, and also sought to quiet title on the Property.[2] Following discovery, both parties filed cross-motions for partial summary judgment. The trial court denied Inland Atlantic's motion. The trial court partially granted and partially denied Old National's motion.

Page 89

The instant cross-appeals ensued. In Case No. A14A0853, Inland Atlantic contends that the trial court erred in granting Old National's motion for summary judgment on Inland Atlantic's counterclaims for breach of fiduciary duty, fraud, and negligent misrepresentation. In Case No. A14A1062, Old National contends that the trial court erred in denying its motion for summary judgment on Inland Atlantic's counterclaims for breach of contract and indemnification. Old National also contends that the trial court erred by failing to find that the Site Development Agreement was not terminated.

In Case No. A14A0853, we reverse the grant of summary judgment to Old National on Inland Atlantic's counterclaims for breach of fiduciary duty, fraud and negligent misrepresentation. In Case No. A14A1062, we affirm the denial of summary judgment to Old National on Inland Atlantic's remaining counterclaims.

Summary judgment is proper when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. A de novo standard of review applies to an appeal from a [grant or] denial of summary judgment, and [329 Ga.App. 672] we view the evidence, and all reasonable conclusions and inferences drawn from it, in the light most favorable to the nonmovant.

(Citations and footnote omitted.) GEICO Gen. Ins. Co. v. Wright, 299 Ga.App. 280, 281 (682 S.E.2d 369) (2009).

So viewed, the evidence shows that, in June 2007, Old National and Inland Atlantic's predecessor-in-interest, as well as another entity, entered into a joint venture pursuant to a Limited Liability Company Agreement (hereinafter the " Joint Venture" ) providing for the development of a shopping center on the Property (hereinafter the " Project" ). Inland Atlantic owned 50 percent of the Joint Venture; Old National's sole owner, Wayne Kendall, owned 25 percent; and another group owned the remaining 25 percent. The provisions of the Joint Venture Agreement gave Old National the right to either perform the site improvement work for the Project or negotiate a contract for that work.

The members of the Joint Venture spent the next three years lining up tenants for the Project. When enough tenants were lined up to develop half of the Project, the members of the Joint Venture decided to develop the Property in two phases. Thereafter, on March 22, 2011, the parties entered into a membership purchase agreement whereby Inland Atlantic bought out Kendall's 25-percent interest in the Joint Venture (hereinafter the " Buyout Agreement" ). On that same date, Old National and Inland Atlantic entered into a separate Site Development Agreement providing for development of the Project in Phase I and Phase II.

The Site Development Agreement was expressly conditioned upon consummation of the Buyout Agreement. Additionally, at Old National's insistence and in accordance with the provisions of the Joint Venture Agreement, the Buyout Agreement was conditioned upon the selection and hiring of Lewis Trucking and Grading Inc. (" Lewis" ) as the site-work contractor for Phase I.[3] Accordingly, Lewis was retained. Although Old National may have known that Lewis was having financial difficulties, Old National nevertheless represented that Lewis was financially qualified and would undoubtedly complete the site work as required.

The Site Development Agreement provided that Old National would supervise and manage the construction of site improvements in Phase I of the Project. Old National's duties under the Site [329 Ga.App. 673] Development Agreement included reviewing and submitting a site plan and other documentation for governmental approval; coordinating the activities of architects, engineers and other consultants; coordinating permits and governmental approvals; and coordinating preparation of construction plans and specifications. The Site Development Agreement provided for payment of a Phase I site development fee to Old National in the amount $175,000, which Inland Atlantic subsequently paid to Old National in full.

The Site Development Agreement contained an Ancillary Agreement providing that

Page 90

Inland Atlantic would retain Old National to oversee the site development of Phase II, so long as Old National was not in default of the Site Development Agreement. The Ancillary Agreement further provided that Old National would receive a Phase II development fee in the greater ...


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