WOODRUM Et Al. v. GEORGIA FARM BUREAU MUTUAL INSURANCE COMPANY. , 815 S.E.2d 650 ( 2018 )


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  •                                  FIFTH DIVISION
    MCFADDEN, P. J.,
    RAY and RICKMAN, 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
    June 27, 2018
    In the Court of Appeals of Georgia
    A18A0596. WOODRUM et al. v. GEORGIA FARM BUREAU
    MUTUAL INSURANCE COMPANY.
    MCFADDEN, Presiding Judge.
    The dispositive issues in this appeal are whether the trial court abused its
    discretion in excluding a witness’ opinion testimony as to diminution in value of
    certain property and in then granting summary judgment based on an absence of any
    evidence of diminution in value. While the court did not abuse its discretion in
    finding that the witness could not offer expert opinion testimony, the court did abuse
    its discretion in finding that the witness could not offer his opinion of value as a lay
    witness. So we reverse both the order excluding such lay witness opinion testimony
    and the grant of summary judgment.
    “On appeal from the grant of summary judgment, the appellate court conducts
    a de novo review of the evidence to determine whether there is a genuine issue of
    material fact and whether the undisputed facts, viewed in the light most favorable to
    the nonmoving party, warrant judgment as a matter of law.” Bank of America, N. A.
    v. Cuneo, 
    332 Ga. App. 73
    , 74 (770 SE2d 48) (2015) (citation and punctuation
    omitted). So viewed, the evidence shows that during a thunderstorm on July 5, 2012,
    a large tree fell onto the roof of William and Kathy Woodrum’s house, causing
    significant damage to the house. The next day, the Woodrums reported the damage
    to their insurer, Georgia Farm Bureau Mutual Insurance Company. On November 7,
    2012, after the Woodrums and Georgia Farm Bureau were unable to agree upon the
    amount of the loss, the Woodrums invoked the appraisal clause of the insurance
    policy. That clause provided:
    If you[, the Woodrums,] and we[, Georgia Farm Bureau,] fail to agree
    on the amount of loss, either may demand in writing an appraisal of the
    loss. In this event, each party will choose a competent appraiser within
    20 days after receiving a written request from the other. The two
    appraisers will choose an umpire. If they cannot agree upon an umpire
    within 15 days, you or we may request that the choice be made by a
    judge of a court of record in the state where the residence premises is
    located. The appraisers will separately set the amount of the loss. If the
    appraisers submit a written report of an agreement to us, the amount
    agreed upon will be the amount of loss. If they fail to agree, they will
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    submit their differences to the umpire. A decision agreed to by any two
    will set the amount of loss.
    On February 5, 2013, pursuant to the appraisal process, an award was issued and
    agreed to by the Woodrums’ appraiser and the appointed umpire. Georgia Farm
    Bureau made payment of the award to the Woodrums.
    The Woodrums subsequently brought suit against Georgia Farm Bureau,
    seeking compensation for diminution in value. The complaint included counts for
    breach of contract and breach of an implied duty of good faith and fair dealing. The
    breach of contract claim was based on allegations that the fallen tree had caused a
    crack in the slab foundation of the house, that the value of the house was diminished
    by the cracked foundation, that such diminished value was a covered loss under the
    policy that was not included in the appraisal award, and that Georgia Farm Bureau
    had failed to pay for that diminished value. In support of the claim, the Woodrums
    filed the affidavit of George Hall, the contractor who had repaired the Woodrums’
    house and who opined that the value of the house was diminished by the foundation
    being cracked. During a subsequent deposition, Hall gave his opinion that the house
    had lost 25 percent of its value due to the cracked foundation.
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    Georgia Farm Bureau filed a motion to exclude Hall as an expert witness and
    a motion for summary judgment. On March 24, 2017, the trial court entered an order
    granting the motion to exclude Hall’s testimony as an expert regarding the diminution
    in value of the Woodrums’ property. In that same order, the trial court also excluded
    Hall’s testimony as a lay witness giving an opinion as to value. On that same date, the
    trial court issued a separate order granting the insurance company’s motion for
    summary judgment on both of the Woodrums’ claims. As to the breach of contract
    claim, the court found that without Hall’s excluded testimony, there was no other
    evidence that the diminution in value of the property was not included in the amount
    of loss determined under the appraisal clause. As to the claim for breach of implied
    duty of good faith and fair dealing, the court found that it could not be maintained
    because there is no such independent cause of action apart from the breach of contract
    claim, which had already been disposed of on summary judgment. The Woodrums
    appeal.
    1. Exclusion of Hall’s testimony.
    The Woodrums challenge the trial court’s exclusion of Hall’s expert testimony
    as to value and his lay witness opinion testimony on that issue. While the court did
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    not err in excluding his testimony as an expert, the court did err in excluding his
    testimony as a lay witness.
    At the outset, we note that the Woodrums were not required to present expert
    testimony as to value. As we have explained in a different context involving property
    valuation – confirmation of a nonjudicial foreclosure sale – the party seeking such
    confirmation
    is under no obligation to present an expert appraisal of the property.
    Direct testimony as to market value is in the nature of opinion evidence.
    One need not be an expert or dealer but may testify as to its value if he
    has had an opportunity for forming an opinion. Of course, the opinions
    of experts as to the true market value of property are admissible, and
    provide sufficient evidence of value to support a trial court’s order of
    confirmation.
    Harper v. Ameris Bank, 
    326 Ga. App. 67
    , 69-70 (2) (755 SE2d 872) (2014) (citation
    and punctuation omitted; emphasis supplied).
    (a) Expert testimony.
    OCGA § 24-7-702 (b) provides:
    If scientific, technical, or other specialized knowledge will assist the
    trier of fact to understand the evidence or to determine a fact in issue, a
    witness qualified as an expert by knowledge, skill, experience, training,
    or education may testify thereto in the form of an opinion or otherwise,
    if: (1) The testimony is based upon sufficient facts or data; (2) The
    testimony is the product of reliable principles and methods; and (3) The
    witness has applied the principles and methods reliably to the facts of
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    the case which have been or will be admitted into evidence before the
    trier of fact.
    In determining the admissibility of proposed expert testimony, “the trial court must
    consider whether the methodology by which the expert reaches his conclusions is
    sufficiently reliable.” Scapa Dryer Fabrics v. Knight, 
    299 Ga. 286
    , 289 (788 SE2d
    421) (2016) (citation and punctuation omitted).
    In this case, the trial court found that Hall’s estimation of the diminution in
    value of the subject property was “not based on any market comparisons or related
    methodology” and that the Woodrums had “failed to establish that the methodology
    by which Hall reached his conclusions was sufficiently reliable” to qualify him as an
    expert witness. See Vineyard Indus. v. Bailey, 
    343 Ga. App. 517
    , 522 (2) (b) (806
    SE2d 898) (2017) (the party seeking to rely on the expert bears the burden of
    establishing that his testimony is reliable within the meaning of the statute). Hall’s
    affidavit did not describe a methodology by which he reached his conclusions and at
    his deposition, when asked to explain how he determined the amount of the value
    diminution, he said that he had made the determination based on his experience.
    Under these circumstances, we find that the trial court has not “abused its discretion
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    in excluding [Hall from giving expert] testimony on this issue.” 
    Id. at 523
    (2) (b). So
    that portion of the trial court’s order is affirmed.
    (b) Lay witness opinion testimony.
    OCGA § 24-7-701, which governs lay witness opinion testimony, provides:
    (a) If the witness is not testifying as an expert, the witness’s testimony
    in the form of opinions or inferences shall be limited to those opinions
    or inferences which are: (1) Rationally based on the perception of the
    witness; (2) Helpful to a clear understanding of the witness’s testimony
    or the determination of a fact in issue; and (3) Not based on scientific,
    technical, or other specialized knowledge within the scope of Code
    Section 24-7-702.
    (b) Direct testimony as to market value is in the nature of opinion
    evidence. A witness need not be an expert or dealer in an article or
    property to testify as to its value if he or she has had an opportunity to
    form a reasoned opinion.
    Thus, in this case, “the issue [is] whether the record demonstrate[s] that [Hall]
    had an opportunity to form a [reasoned] opinion as to the amount [the Woodrums’]
    house diminished in value[.]” Vitello v. Stott, 
    222 Ga. App. 134
    , 136 (1) (473 SE2d
    504) (1996). See also Hirsch v. Joint City County Board of Tax Assessors, 218 Ga.
    App. 881, 882 (1) (463 SE2d 703) (1995) (opinion evidence as to the value of an item
    must be based upon a foundation that the witness has some knowledge, experience,
    or familiarity with the value of the property in question). Contrary to the trial court’s
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    ruling, the record amply demonstrates that Hall had such an opportunity to form a
    reasoned opinion as to the value of the house.
    In his affidavit, Hall averred that he is a licensed contractor; that he is
    experienced in home building and remodeling, and has constructed and repaired many
    homes during his career; that he is familiar with the costs of construction and the
    valuation of homes based on his professional experience; that he performed the repair
    of the Woodrums’ house; that the house suffered massive structural damage due to
    the fallen tree; that he witnessed the damage to the slab foundation, which had a crack
    running from one edge to the other where the tree had fallen; that the crack affected
    structural integrity of the home because the slab foundation will never be as strong
    as it was before the crack; that he remains concerned about the crack reopening due
    to future expanding and contracting of repairs made to the crack; that such structural
    damage to a house’s foundation causes the loss of value; that a purchaser would
    expect to pay less for a home with a cracked slab foundation; and that the ability to
    use certain materials on top of the compromised foundation is limited, which causes
    further loss of value.
    Similarly, at his deposition, Hall testified that he has experience inspecting
    houses for structural integrity and giving opinions as to value; that he has the
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    knowledge and experience to know what a house is worth by inspecting it; that he had
    helped build an addition on to the Woodrums’ house in 2004; that the tree which fell
    on the house was massive and basically cut the house in half; that the cracked
    foundation was shown in certain photographs; that he performed repairs to the house;
    and that his opinion as to the diminished value was based on his experience.
    “This evidence demonstrated that [Hall] was qualified to give an opinion [as
    a lay witness] as to the amount the [foundation] damage diminished the value of the
    property.” 
    Vitello, supra
    (citation omitted) (lay witness opinion as to diminished value
    appropriate where witness testified that she had personally viewed termite damage to
    house, that she met with two contractors who inspected the house, and that the
    contractors described to her the extent of the damage and the cost of repairs). “The
    admission or exclusion of lay [witness] opinion evidence is committed to the sound
    discretion of the trial court, and appellate courts will not interfere with such a ruling
    absent an abuse of discretion.” Dagne v. Schroeder, 
    336 Ga. App. 36
    , 38 (2) (783
    SE2d 426) (2016) (citation and punctuation omitted). Here, because the record shows
    that Hall had an opportunity to form a reasoned opinion as to the value of the house,
    the trial “court erred in excluding [his lay witness] opinion testimony as to the value
    of [the] property and damages thereto.” Schoolcraft v. DeKalb County, 
    126 Ga. App. 9
    101, 103 (2) (189 SE2d 915) (1972). See also Long v. Marion, 
    182 Ga. App. 361
    ,
    364-365 (4) (355 SE2d 711) (1987) (lay witness opinion as to value proper where
    witness related his knowledge and familiarity with the item, described its condition,
    and introduced photographs of the damage to it). Accordingly, the trial court’s order
    excluding Hall’s lay witness opinion testimony is reversed.
    2. Summary judgment.
    Given our holding above allowing Hall’s lay witness testimony, it follows that
    the trial court erred in granting summary judgment on the Woodrums’ claims.
    Summary judgment is proper ‘if the pleadings, depositions,
    answers to interrogatories, and admissions on file, together with the
    affidavits, if any, show that there is no genuine issue as to any material
    fact and that the moving party is entitled to a judgment as a matter of
    law.’ OCGA § 9-11-56 (c). Thus, to prevail on a motion for summary
    judgment, the moving party must demonstrate that there is no genuine
    issue of material fact, so that the party is entitled to judgment as a matter
    of law. A defendant may do this by either presenting evidence negating
    an essential element of the plaintiff’s claims or establishing from the
    record an absence of evidence to support such claims.
    Cowart v. Widener, 
    287 Ga. 622
    , 623 (1) (a) (697 SE2d 779) (2010) (citations and
    punctuation omitted).
    (a) Breach of contract claim.
    10
    The trial court granted summary judgment to Georgia Farm Bureau on the
    Woodrums’ breach of contract claim on the basis that without Hall’s excluded
    testimony, there was no evidence of the diminished value of the house. But because
    of our holding above reversing the exclusion of Hall’s lay witness opinion testimony,
    there is, contrary to the trial court’s finding, some evidence creating a genuine issue
    of material fact as to the diminished value of the house. The trial court’s summary
    judgment ruling as to the breach of contract claim was erroneous and therefore must
    be reversed.
    (b) Breach of implied duty claim.
    As to the claim for breach of an implied duty of good faith and fair dealing, the
    trial court’s grant of summary judgment on that claim was premised on its grant of
    summary judgment on the breach of contract claim. The trial court reasoned:
    Georgia law does not recognize an independent cause of action based on
    the covenant of good faith and fair dealing apart from the breach of
    contract claim. [Cit.] Since the [c]ourt has determined that summary
    judgment is warranted as to Plaintiffs’ breach of contract claim,
    Plaintiffs’ claim for breach of the implied duty of good faith and fair
    dealing cannot be maintained. Therefore, the [c]ourt is compelled to find
    that summary judgment is proper as a matter of law on this claim.
    However, as explained above, the trial court erred in granting summary
    judgment on the breach of contract claim and that ruling has been reversed.
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    Consequently, its grant of summary judgment as to the breach of implied duty claim,
    premised on its erroneous grant of summary judgment on the breach of contract
    claim, must also be reversed.
    Judgment affirmed in part and reversed in part. Rickman, J., concurs. Ray, J.,
    concurs in the judgment only.*
    THIS OPINION IS PHYSICAL PRECEDENT ONLY. COURT OF
    APPEALS RULE 33.2.
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Document Info

Docket Number: A18A0596

Citation Numbers: 815 S.E.2d 650

Judges: McFadden

Filed Date: 6/27/2018

Precedential Status: Precedential

Modified Date: 10/19/2024