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The Turfgrass Group Inc. v. Georgia Cold Storage Co.

Court of Appeals of Georgia, Second Division

June 27, 2018

THE TURFGRASS GROUP, INC.
v.
GEORGIA COLD STORAGE CO.

          MILLER, P. J., ANDREWS and BROWN, JJ.

          BROWN, JUDGE.

         The Turfgrass Group, Inc. appeals from the trial court's order granting summary judgment in favor of Georgia Cold Storage Co., as well as the trial court's earlier order denying partial summary judgment in its favor on the applicability of these same contract terms. Turfgrass asserts that the trial court erred by concluding that it is bound by the contractual terms and conditions listed on the reverse side of Cold Storage's warehouse receipts. For the reasons explained below, we reverse the trial court's grant of summary judgment to Cold Storage and affirm its denial of Turfgrass's motion for partial summary judgment.

         "On appeal, we review the grant or denial of summary judgment de novo, construing the evidence and all inferences in a light most favorable to the nonmoving party." (Citation and punctuation omitted.) Seki v. Groupon, Inc., 333 Ga.App. 319 (775 S.E.2d 776) (2015). So viewed, the record shows that beginning in June 2006, Turfgrass began storing its excess seed in a temperature-controlled Cold Storage warehouse. It subsequently stored additional seed in June 2007, July 2008, August 2008, and June 2009. The parties did not enter into a written and signed storage agreement.

         In June 2010, Turfgrass discovered that some of its stored seed was damaged by rodents and water. It notified Cold Storage about the problem by telephone. Turfgrass did not take any "serious activity" in connection with the loss "for some period of time" because one of its principals assumed "a very legitimate long-term big company" like Cold Storage would "take care of it" and make it "right."

         After Cold Storage was unresponsive to Turfgrass's attempts to resolve its complaint, Turfgrass sent an invoice in the amount of $9, 625 to Cold Storage for the damaged seed on December 29, 2010. On January 4, 2011, Cold Storage sent Turfgrass a check for $275 based upon a stipulated damage amount of $.50 per pound for damaged product contained in the "Contract Terms and Conditions" printed on the reverse side of its warehouse receipt. This form states:

SECTION 10 - NOTICE OF CLAIM AND FILING OF SUIT
(a)COMPANY shall not be liable for any claim of any type whatsoever for loss and/or destruction of and/or damage to GOODS unless such claim is presented, in writing, within a reasonable time, not exceeding 60 days after STORER learns or, in the exercise of reasonable care, should have learned of such loss, destruction and/or damage.
(b)As a condition precedent to making any claim and/or filing any suit, STORER shall provide COMPANY with a reasonable opportunity to inspect the GOODS which are the basis of STORER'S claim.
(c)NO LAWSUIT OR OTHER ACTION MAY BE MAINTAINED BY STORER OR OTHERS AGAINST COMPANY WITH RESPECT TO THE GOODS UNLESS A TIMELY WRITTEN CLAIM HAS BEEN MADE AS PROVIDED IN PARAGRAPH (a) OF THIS SECTION AND UNLESS STORER HAS PROVIDED WAREHOUSEMAN WITH A REASONABLE OPPORTUNITY TO INSPECT THE GOODS AS PROVIDED IN PARAGRAPH (b) OF THIS SECTION AND UNLESS SUCH LAWSUIT OR OTHER ACTION IS COMMENCED WITHIN NINE (9) MONTHS AFTER STORER LEARNS OR, IN THE EXERCI[S]E OF REASONABLE CARE, SHOULD HAVE LEARNED OF THE LOSS AND/OR DESTRUCTION OF AND/OR DAMAGE TO THE GOODS.

         A principal of Turfgrass admitted receiving the January 4, 2011 letter, including the check and the attached "contract terms and conditions." He stated that this was the first time he learned of such "terms and conditions" and denied that Turfgrass "ever enter[ed] into a contract based on terms and conditions in this document that our seed would not be protected in cold storage." He testified that he had "a little bit of a reaction to it when [he] saw it" and described the $275 check as a "disgustingly small" response to their claim for damages. Turfgrass did not cash the check. Cold Storage's office manager, Wanda Hingle, averred in an affidavit that Turfgrass "acknowledged receipt of, and responded to" the January 4, 2011 letter. She did not explain the nature of Turfgrass's response to the letter, and the record contains no further information about it.

         In January or February 2011, Cold Storage began having repeated cooling issues in a portion of its warehouse where Turfgrass's seed was stored. In May 2011, Turfgrass's farm manager went to Cold Storage to retrieve seed for a customer and discovered that seed bags had been damaged by water and rodents. He registered another complaint at Cold Storage's office, telling them "this was totally unacceptable" and that Turfgrass would need help to sort the seed and rebag it. A Cold Storage supervisor "came in and looked at" the damaged seed. Based upon this second incident of damaged seed, Turfgrass inspected more of its stored seed and found that some of it was "just in terrible shape." On May 19, 2011, Turfgrass removed all of its seed from Cold Storage's warehouse.

         On July 5, 2013, Turfgrass filed a complaint against Cold Storage, asserting that Cold Storage had improperly stored its seed, resulting in damages "in the principal amount of $492, 902." In its answer, Cold Storage asserted that Turfgrass's claims were barred based upon its failure to comply with the contractual period of limitation and conditions precedent listed on the back page of its warehouse receipt form.

         With regard to Turfgrass's notice of or assent to the terms and conditions of the warehouse receipts, the record shows that its farm manager and principal testified that they never saw or received the warehouse receipts and that a search of Turfgrass records did not reveal any warehouse receipts. They claim that Turfgrass did not learn of the purported existence of the warehouse receipts until after they received the January 4, 2011 ...


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