SHOOTER ALLEY, INC. v. CITY OF DORAVILLE (Two Cases) , 341 Ga. App. 626 ( 2017 )

FIFTH DIVISION
MCFADDEN, P. J.,
BRANCH and BETHEL, 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.
http://www.gaappeals.us/rules
May 5, 2017
In the Court of Appeals of Georgia
A17A0381, A17A1067. SHOOTER ALLEY, INC. v. CITY OF
DORAVILLE.
BETHEL, Judge.
Shooter Alley, Inc. appeals from a contempt order requiring it to pay
$17,296.53 in attorney fees and litigation costs under OCGA § 9-15-14. Shooter
Alley argues the trial court erred in awarding attorney fees against it, and that the
underlying injunction imposes an impermissible prior restraint, is overbroad, and is
based on a statute that is unconstitutional as applied.1 We affirm the award and
decline to consider the prior restraint argument for the reasons that follow.
1
Shooter Alley separately appealed the injunction to Georgia’s Supreme Court.
The Supreme Court transferred the appeal to this Court as appeal number A17A1067.
Because Shooter Alley also challenged the constitutionality of the injunction in
appeal number A17A0381, we have combined the two appeals for the purposes of
this opinion.
The record shows that Shooter Alley offered nude dance entertainment in
unincorporated DeKalb County. After the property was annexed by the City of
Doraville (the “City”) in 2014, Shooter Alley filed suit against the City, challenging
its adult entertainment ordinances. The City counterclaimed, seeking injunctive relief
requiring Shooter Alley to honor the City’s ordinances. The City moved for judgment
on the pleadings, which the trial court granted, dismissing Shooter Alley’s claims and
granting a permanent injunction against Shooter Alley. Several months later, the City
filed a motion for criminal and civil contempt against Shooter Alley for violating the
injunction,2 which the trial court granted.
In its order, the trial court found that Shooter Alley violated the injunction in
numerous ways on several occasions. The trial court found Shooter Alley guilty of
criminal contempt and fined it $15,000 under OCGA § 15-6-8 (5) for violations of
the injunction. In its finding of civil contempt, the trial court set a prospective fine of
$10,000 for each future violation of the injunction. Finally, the trial court also
awarded the City its attorney fees and litigation expenses under OCGA § 9-15-14 (a)
and (b) for having to bring the motion for civil contempt, which amounted to
$17,296.53. This appeal followed.
2
The City also requested attorney fees under OCGA § 9-15-14.
2
1. Shooter Alley first argues that the trial court erred in awarding attorney fees
and litigation costs. In particular, Shooter Alley argues that: (a) the civil contempt
award is improper because it is seeks to punish future uncommitted violations of a
past order, and attorney fees could not have been awarded as a sanction for criminal
contempt; (b) the trial court failed to hold a hearing on the grounds for and the
amount of fees awarded under OCGA § 9-15-14; and (c) the trial court failed to enter
findings of fact and conclusions of law that allocate fees to sanctionable conduct. We
affirm under OCGA § 9-15-14 (a) if there is any evidence to support the award of
attorney fees, while we review awards under subsection (b) for abuse of discretion.
Shiv Aban, Inc. v. Georgia Dep’t of Transp., 336 Ga. App. 804, 814-15 (2) (784 SE2d
134) (2016).
(a) Shooter Alley challenges the award of attorney fees and litigation costs,
arguing that the civil contempt award was improper, and that attorney fees and costs
could not be awarded as a sanction for criminal contempt. “Acts of contempt are
neither civil or criminal.” Grantham v. Universal Tax Sys., Inc., 217 Ga. App. 676,
677 (2) (458 SE2d 870) (1995). Once an act is considered to constitute contempt of
court, the action the court takes to remedy it determines whether the contempt is
deemed criminal or civil. Id. “The distinction between the two is that criminal
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contempt imposes unconditional punishment for prior acts of contumacy, whereas
civil contempt imposes conditional punishment as a means of coercing future
compliance with a prior court order.” Id. (quoting Carey Canada, Inc. v. Hinely, 257
Ga. 150, 151 (356 SE2d 202) (1987)).
In this case, the trial court levied a “civil contempt sanction” in the amount of
$10,000 for each future violation of the injunction. The trial court expressly stated
that this amount was intended to prevent future violations of, and to coerce
compliance with, the injunction. We have found no case law prohibiting such a civil
contempt award, and Shooter Alley directs us to none.3 Rather, Shooter Alley argues
that the cases the trial court relied on in awarding civil contempt required the party
to do or not do some action, which it claims is different than the trial court order here.
This is obviously incorrect, as the injunction sets forth several prohibitions on
Shooter Alley’s conduct. Nor, as Shooter Alley argues, is the award of civil contempt
based on an anticipatory breach of the injunction, a theory of recovery the Supreme
Court rejected in Hardman v. Hardman, 295 Ga. 732, 739-40 (4) (763 SE2d 861)
3
In Murtagh v. Emory Univ., 321 Ga. App. 411 (741 SE2d 212) (2013), this
Court noted that a prospective fine of $15,000 for any future violations of a
settlement agreement “attempted to induce future obedience to the court’s
commands.” Id. at 415 (2). But this was dicta.
4
(2014). Rather, civil contempt was awarded after Shooter Alley violated the
injunction. Thus, the award is a valid civil contempt award.
While it is true that there is a prohibition against awarding attorney fees in
criminal contempt proceedings, other authority such as OCGA § 9-15-14 may
authorize an award of fees. Murtagh, 321 Ga. App. at 416 (3) (b). Under OCGA § 9-
15-14 (a), the court shall award fees against a party that asserted a defense or other
position with “such a complete absence of any justiciable issue of law or fact that it
could not be reasonably believed that a court would accept the . . . defense, or other
position.” Under OCGA § 9-15-14 (b), the court may award fees against a party that
“brought or defended an action, or any part thereof, that lacked substantial
justification” or “unnecessarily expanded the proceeding by other improper
conduct[.]” The trial court awarded attorney fees to the City under both provisions of
this statute “for having to bring and argue this motion for civil contempt to coerce
Shooter Alley’s future compliance with the permanent injunction.” Contrary to
Shooter Alley’s arguments, attorney fees and costs were not granted based on some
theoretical future conduct. Nor was it awarded as a criminal contempt sanction.
Rather, the award was based on Shooter Alley’s conduct in litigating the contempt
order. A party’s conduct in litigation is a valid basis for awarding attorney fees. See
5
Minor v. Minor, 257 Ga. 706, 709 (2) (362 SE2d 208) (1987) (noting that OCGA §
9-15-14 can provide authority for awarding attorney fees in a contempt action where
warranted by a party’s conduct).
(b) Shooter Alley next argues that the trial court erred when it failed to hold a
hearing on the grounds and amount of fees, and that the fees were neither reasonable
nor necessary. “[I]t is ‘black letter law’ that a hearing is required to enter an award
of attorney fees.” Moore v. Moore, 307 Ga. App. 889, 899 (1) (706 SE2d 465) (2011).
In order for an award under OCGA § 9-15-14 to be valid, “the trial court must
conduct an evidentiary hearing to determine the amount of reasonable and necessary
attorney fees, and the failure to do so is reversible error.” Id. (citation omitted). An
exception to this requirement exists where a party against whom attorney fees may
be awarded waives the hearing either expressly or by its conduct. Williams v. Becker,
294 Ga. 411, 413 (2) (a) (754 SE2d 11) (2014). The City argues Shooter Alley waived
its right to a separate evidentiary hearing on attorney fees by failing to respond to the
City’s initial motion seeking them, and by failing to lodge an objection to this effect
at the hearing.
Shooter Alley received notice that the City was seeking attorney fees and
litigation costs under OCGA § 9-15-14 in the City’s motion for sanctions. At the
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hearing on the City’s motion, Shooter Alley also had the opportunity to cross-
examine the investigator the City used in preparing its case, and for whose work the
City was seeking reimbursement. At the end of the hearing on the City’s contempt
motion, the trial court gave the City a chance to submit its attorney fees via affidavit
and gave Shooter Alley the opportunity to submit any additional arguments via brief.4
Shooter Alley filed a “hearing brief” in which it primarily challenged the
constitutionality of the injunction, but also argued that the City was not entitled to
attorney fees because Shooter Alley was not in willful violation of the injunction. The
City filed its affidavit, Shooter Alley did not respond or object to it, and 10 days later,
the trial court entered the order granting the request for contempt and attorney fees
and costs. Shooter Alley was thus given a clear opportunity to challenge the basis on
which the attorney fees and costs were assessed, and it waived the right to an
evidentiary hearing by its conduct. See Tavakolian v. Agio Corp., 304 Ga. App. 660,
664 (3) (697 SE2d 233) (2010).
(c) Shooter Alley argues that the lump sum award under both OCGA § 9-15-14
(a) and (b) is not permissible, and that the trial court should have distinguished
4
We note, however, that the additional arguments that Shooter Alley and the
court appeared to be contemplating did not pertain to the attorney fees.
7
between expenses needed to prove past violations and those seeking prospective
relief. But this is an inconsequential distinction because the trial court determined that
the same facts supporting both civil and criminal contempt—that is, Shooter Alley’s
conduct in requiring a contempt action to enforce the injunction in the first
place—lacked substantial justification such that an award of attorney fees and
litigation expenses under OCGA § 9-15-14 was warranted. In other words, the trial
court found that Shooter Alley lacked substantial justification for any of its positions
in the contempt proceedings. Accordingly, it held all of the conduct in the contempt
proceedings to be sanctionable.
“In cases involving OCGA § 9-15-14 (a) or (b), the trial court must limit the
fees award to those fees incurred because of the sanctionable conduct. Lump sum or
unapportioned attorney fees awards are not permitted in Georgia.” Razavi v.
Merchant, 330 Ga. App. 407, 410 (1) (c) (765 SE2d 479) (2014) (footnote and
punctuation omitted). In its order, the trial court awarded $17,296.53 in attorney fees
and litigation expenses based on the affidavit filed by the City. The trial court made
this award under both § 9-15-14 (a) and (b) after finding an absence of any justiciable
issue of law or fact in Shooter Alley’s “contemptuous operation” and in light of on-
point Supreme Court authority upholding the City’s challenged ordinance. The court
8
also found that Shooter Alley willfully disregarded and disobeyed the injunction
without substantial justification and expanded the proceedings to require a contempt
motion. That the trial court decided to award both civil and criminal contempt to
enforce its injunction does not invalidate its determination that Shooter Alley’s
conduct lacked substantial justification such that attorney fees and litigation expenses
were appropriate under OCGA § 9-15-14. See Murtagh, 321 Ga. App. at 417 (3) (b)
(affirming award of attorney fees made under separate statutory authority where trial
court also awarded criminal contempt sanctions).
2. Shooter Alley next argues that the attorney fee award is premised on an
injunction that imposes an impermissible prior restraint, is overbroad, and that the
injunction is based on a statute that is unconstitutional as applied. These issues were
raised in Shooter Alley’s appeal that was pending before the Supreme Court of
Georgia. In transferring the appeal to this Court,5 however, the Supreme Court held
that Shooter Alley had not timely raised these arguments in the trial court, and the
trial court had not ruled on the constitutional challenges to the City’s ordinance. We
are bound by the Supreme Court’s ruling—now the law of the case—that such issues
5
Shooter Alley conceded at oral argument that if the Supreme Court’s transfer
order said that the issue of prior restraint was not preserved, then this would be the
law of the case.
9
were not passed upon by the lower court. Armstrong v. Lawyers Title Ins. Corp., 138
Ga. App. 727, 727-28 (1) (227 SE2d 409) (1976) (physical precedent only); see also
Stephens v. Tate, 147 Ga. App. 366, 370 (2) (C) (249 SE2d 92) (1978). We therefore
must dispose of the case as if these issues had never been raised, and consideration
of Shooter Alley’s argument is precluded. Stephens, 147 Ga. App. at 370 (2) (C);
Watson v. Frnka, 266 Ga. App. 64, 65-66 (596 SE2d 187) (2004).
Judgment affirmed. McFadden, P. J., and Branch, J., concur.
10