Whitaker Farms, LLC v. Fitzgerald Fruit Farms, LLC ( 2018 )

SECOND DIVISION
MILLER, P. J.,
BROWN and GOSS, 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
September 26, 2018
In the Court of Appeals of Georgia
A18A1420, A18A1421. WHITAKER FARMS, LLC v.
FITZGERALD FRUIT FARMS, LLC; and vice versa.
BROWN, Judge.
Whitaker Farms, LLC appeals following a jury verdict in favor of Fitzgerald
Fruit Farms, LLC on Fitzgerald Farms’ complaint seeking damages for trespass after
Whitaker Farms’ property manager locked the gates to the peach orchard where
Fitzgerald Farms was harvesting peaches. In Case No. A18A1420, Whitaker Farms
contends that the trial court erred in denying its motion for a directed verdict and
motion for judgment notwithstanding the verdict on the trespass claim, and awarding
Fitzgerald Farms attorney fees. Fitzgerald Farms cross-appeals in Case No.
A18A1421, arguing that the trial court erred by not allowing the jury to consider an
award of punitive damages. For reasons that follow, we affirm the trial court’s denial
of Whitaker Farms’ motion for a directed verdict and motion for judgment
notwithstanding the verdict, but reverse the trial court’s refusal to allow the jury to
consider an award of punitive damages.
Construed in favor of the verdict, Hagan v. Keyes, 329 Ga. App. 178 (764
SE2d 423) (2014), the evidence shows that Sean Lennon, the owner of Fitzgerald
Farms, began working for Carroll Farms in high school. Carroll Farms was a peach
and cattle farm in Meriwether County owned by Lennon’s math teacher, Elizabeth
“Kay” Carroll Barnes, and her son, Walter “Hynes” Barnes; Hynes ran the business
and managed the family’s farm properties. Throughout high school and college,
Lennon worked at Carroll Farms during the summer months. After obtaining a
master’s degree in 2003, Lennon began working full-time farming peaches at Carroll
Farms. Sometime around 2006, Hynes and Kay agreed to allow Lennon to grow Baby
Gold peaches on a 20-acre tract of their farm after he was approached by a Canadian
canning company looking for people to grow Baby Gold peaches for use in baby
food. Lennon testified that the parties had an “oral handshake deal” for him to lease
the 20-acre tract for the economic life of the peach trees (10-15 years), and that
Lennon and Kay later signed a written lease agreement so that Lennon could obtain
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crop insurance.1 Lennon maintained his own packing facility, including a commercial
packing shed and a forced air cooler, which cools the peaches rapidly because “they
can’t tolerate [the summer] heat for that long”; Fitzgerald Farms has the only forced
air cooler in Meriwether County.
Unbeknownst to Lennon, in October 2015, Hynes and Curtis Whitaker, the
owner of Whitaker Farms, agreed that Whitaker Farms would buy 290 acres of
Carroll Farms, including the 20-acre orchard on which Fitzgerald Farms had been
farming peaches for over a decade and a separate 95-acre tract, as well as the Carroll
Farms “business.”2 At closing, both Hynes and Kay signed an Owner’s Affidavit
swearing that the property was “subject to no leases, tenancies, adverse possession,
occupancy rights, licenses, or similar claims by third parties.” Hynes never advised
1
A copy of the written lease could not be found, but evidence was presented
that Lennon maintained crop insurance on the Baby Gold orchard for at least 2013-
2016, and both Lennon and Hynes confirmed that Lennon could not have obtained
crop insurance without a written lease. And, acreage reports for the years 2009-2016,
produced by the United States Department of Agriculture, Farm Service Agency, list
Lennon as “other tenant” of the farm/tract of land on which he grew the Baby Golds.
2
Hynes testified that he and Whitaker have been friends for approximately 15
years. In late 2014, the bank foreclosed on another piece of property owned by the
Barnes family. Hynes and Whitaker discussed that Whitaker would bid on the
property and that “‘at some point Curtis Whitaker would allow [Hynes] to buy it
back.’” Whitaker did not win the bid. Hynes confirmed that Lennon or Fitzgerald
Farms won the bid.
3
Whitaker that Lennon “had planted a 20-acre peach orchard [on the property] and had
farmed it every year for a decade” because he “didn’t feel like it was necessary. The
land was sold, and there was no lease.”3 After the purchase, Hynes agreed to manage
the property for Whitaker Farms and testified that he works as a contractor.
Several months after the sale, Lennon and his workers began to prepare for the
2016 harvest, which included regularly spraying the Baby Gold peach trees in the
“Jones Chapel Baby Gold Tract” from December 2015 through July 2016. Lennon
3
Hynes did not tell Whitaker about Lennon’s Baby Gold orchard until April
2016, when Hynes saw that Fitzgerald Farms had “pushed up” 270 experimental trees
that Lennon had planted on the property sometime after 2006. Lennon explained that
after he planted the Baby Gold peach trees in 2006, he planted a test block of
experimental trees which he never harvested because the “trees never cropped.” When
those trees were nine-years old, Lennon decided to “push[] them up.” Lennon
explained that it is important to “push up” non-producing trees because “as part of
being a good steward to the land and just being a good farmer, you just don’t want to
leave things growing up there . . . they’ll just rot” and become infested with insects
which will then invade a neighboring vigorous orchard. When Whitaker found out
from Hynes that Lennon had “pushed up” the experimental trees, he reported the
incident to the Sheriff, complaining that Lennon or his crew damaged “200, 220
peach trees” on his property. A deputy advised Whitaker that the issue was a civil
matter because Lennon and Hynes “entered into an agreement and . . . owned these
trees together from my understanding at that time . . . they both had ownership of the
trees. . . . [A]s far as damaging the trees, . . . it’s part of Mr. Lennon’s property.”
When the deputy referred Whitaker to the magistrate court, he recalled that Whitaker
became “somewhat abrasive” because Lennon was not going to be arrested
immediately.
4
testified that he never observed Whitaker in the orchard during that time, but that
Hynes drove by the packing shed at least a dozen times every day, never stopping to
say a word. On August 3, 2016, “the day before harvest,” Lennon and his workers
moved their equipment to the orchard so they would be ready to begin picking the
following morning. The following morning, a crew of approximately 25-28 workers
gathered at the orchard to begin harvesting the peaches. Levi Jackson, a Fitzgerald
Farms employee, testified that while he was working that morning, he observed
Hynes driving “down the road that cuts through the orchard.” Jackson left the orchard
with the first load of peaches, dropped them at Fitzgerald Farms’ packing shed and
then returned to the orchard to pick up a second load; at that time, all of the gates to
the orchard were unlocked. When Jackson tried to leave the property with the second
load, he found that all three gates to the orchard had been locked and he observed
Hynes driving away from one of the gates. According to Jackson, “our lock was took
off of [the gate], and it had a combination lock on it.” For his part, Hynes testified
that he never saw anyone picking peaches on August 4, 2016, and that he changed the
lock to a combination lock because “[e]very lock on the farm ha[d] been changed to
a combination lock.”
5
When Jackson realized he and the workers were locked in the orchard, he
called Lennon. Lennon immediately texted Hynes asking if he could unlock the gate
and Hynes texted back: “‘You will need to talk to Curtis Whitaker that now owns it.
I will send you his number.’” Lennon left a voice mail for Whitaker4 and also called
the sheriff’s office. The record reflects that Hynes immediately called Whitaker to
advise that he had given Whitaker’s phone number to Lennon and that Lennon
“would like to get in the gate at the blackberries.” Whitaker testified that he and
Hynes spoke for ten minutes about Hynes “going to the market to buy more produce”
and that Hynes mentioned something about the locked gate, “but [Whitaker] didn’t
pay any attention to it.” According to Hynes, Whitaker said “he would get with
[Lennon].” Whitaker acknowledged that he never called Lennon back and “never
instructed Mr. Lennon to go complete the harvest on my property.” Whitaker testified
that he did not “think [Lennon] had any right to be out there picking peaches” on
4
Whitaker testified at trial that he could not recall whether he heard Lennon’s
voice mail late that night or the following morning, but stated that he knew who
Lennon was “because he was the guy that I understood that worked for Hynes as an
employee that bulldozed our experimental trees.” Whitaker, in his deposition
testimony, which was read to the jury, testified that he did not return Lennon’s call
because he “really didn’t even know who [Lennon] was. I mean, I don’t even know
who he is. Plus at this point in time I don’t think – you know, I don’t think it would
be good for he and I to have a conversation.” Whitaker clarified “this point in time”
as being the date of his deposition as well as August 4, 2016.
6
Whitaker Farms property and when asked why he did not return Lennon’s call, he
stated “[w]ell, . . . I was going from one place, I think, to another, and I don’t know
that I would pick up the phone and call someone that had bulldozed my peaches. I
thought that issue was behind me, and it had been three or four months.”
After receiving permission from a superior court judge, the sheriff cut the lock.
The next morning, Hynes returned to the property and re-locked the gates; both Hynes
and Whitaker acknowledged that they spoke at least eight times that day, but could
not recall the details of any of those calls though Whitaker testified, “[w]hen someone
steals your peaches you, you know, are going to have a lot of conversation about
that.”
On August 5, 2016, Fitzgerald Farms filed a verified complaint for temporary
restraining order against Hynes asking the court for authorization to complete the
peach harvest and advising that the matter required immediate attention because any
delay could result in the crop being ruined. Fitzgerald Farms’ attorney emailed a copy
of the complaint to Hynes on the same day and Hynes immediately forwarded that
email to Whitaker. On August 9, 2016, Whitaker executed an application for criminal
arrest warrant seeking to keep Lennon off the property. Three days later, a judge
granted Fitzgerald Farms’ motion for temporary restraining order and Hynes unlocked
7
the gates at the direction of Whitaker’s attorney, Virgil Brown. By that time, the
peaches were “overripe,” “decay[ed]” and damaged by insects; the crop was ruined.
Fitzgerald Farms’ verified complaint included a claim for trespass, and was
later amended to include claims for unjust enrichment and attorney fees under OCGA
§ 13-6-11, and sought “actual damages” in the amount of not less than $90,000 and
punitive damages. On September 6, 2016, Whitaker Farms moved to intervene in the
action and filed an answer and counterclaim. The court granted the motion to
intervene and, shortly thereafter, Hynes was dismissed without prejudice by consent
of the parties, and Fitzgerald Farms withdrew its claim for unjust enrichment. The
trial court ruled that Fitzgerald Farms could not seek punitive damages, reasoning that
Whitaker
didn’t lock the workers in the field. . . . [W]hile it may very well be that
Mr. Whitaker ratified [Hynes’] conduct, that ratification in my mind
certainly wouldn’t allow the jury to extrapolate from that a claim for
punitive damages. If [Hynes] was in the case, I would let a claim against
him for punitive damages go to the jury, but not this.
Following a trial on the claims asserted, a jury found in favor of Fitzgerald
Farms in the amount of $150,000 in actual damages, found against Whitaker Farms
on its counterclaim, and concluded that Fitzgerald Farms was entitled to attorney fees.
8
In the second phase of the bifurcated trial on the issue of attorney fees, counsel for
Fitzgerald Farms testified that his client had incurred attorney fees of $244,159, plus
expenses of $2,174.63, and an estimated $150,000 for trial, but that Fitzgerald Farms
was seeking to recover $272,929.20. The jury awarded Fitzgerald Farms $400,000 in
attorney fees pursuant to OCGA § 13-6-11.5 After the trial court entered judgment in
favor of Fitzgerald Farms in the amount of $550,000, Whitaker Farms filed a motion
for judgment notwithstanding the verdict and motion for new trial. Following a
hearing, the trial court denied Whitaker Farms’ motions, but reduced the attorney fees
award to $272,000.6
Case No. A18A1420
5
During the bifurcated portion of the trial on attorney fees, Lennon testified
that in an effort to settle the matter, he met with Whitaker in January 2017. Whitaker
refused to settle, stating “‘I’m going to make an example of you. I’m going to make
a point. . . . I thrive off this type of litigation. . . . I have been in this type of litigation
before and that individual had to file bankruptcy.’” Whitaker also indicated that “he
was litigating with a blank check and for [Lennon] to keep that in mind.”
6
The trial court granted Whitaker Farms’ motion for new trial as to attorney
fees only, conditioned on Fitzgerald Farms’ refusal to accept a reduced judgment in
the amount of $422,000 (general damages of $150,000 and reduced attorney fees of
$272,000). Fitzgerald Farms filed a notice of acceptance of reduced OCGA § 13-6-11
attorney fees award and modified judgment. The notice of acceptance states that “the
jury award of $150,000 in damages remains unchanged.” The trial court subsequently
entered a modified judgment in the amount of $422,000, which also noted that the
original $150,000 damage award remained unchanged.
9
1. Whitaker Farms contends that the trial court erred in denying its motion for
a directed verdict and motion for judgment notwithstanding the verdict on Fitzgerald
Farms’ claim for trespass because there was no evidence presented at trial that
Whitaker Farms’ ratified Hynes’ “unauthorized wrong.” In support of this claim,
Whitaker Farms argues that Fitzgerald Farms failed to provide evidence that Whitaker
Farms received a certain, direct tangible and valuable benefit from the unauthorized
act. This argument is without merit.
“The standard of appellate review of a trial court’s denial of a motion for a
directed verdict or motion for judgment notwithstanding the verdict is the any
evidence test.” (Citation and punctuation omitted.) Bailey v. Annistown Road Baptist
Church, 301 Ga. App. 677, 685 (5) (689 SE2d 62) (2009). In general, an employer
is not responsible for the torts of its independent contractor. OCGA § 51-2-4. An
exception to this rule exists, however, “[i]f the employer ratifies the unauthorized
wrong of the independent contractor.” OCGA § 51-2-5 (6). See also Jones v. Ceniza,
257 Ga. App. 806, 808 (1) (572 SE2d 362) (2002). Whitaker Farms’ claim fails
because it presumes that receipt of a benefit is the only way to prove ratification by
an employer. Ratification can be either express, or implied from: (1) slight acts of
confirmation by the employer; (2) silence or acquiescence of the employer; or (3)
10
where the employer receives and holds the benefits of an unauthorized wrong. See
Merritt v. Marlin Outdoor Advertising, 298 Ga. App. 87, 91 (2) (b) (679 SE2d 97)
(2009); Medley v. Boomershine Pontiac-GMC Truck, 214 Ga. App. 795, 798-799 (4)
(449 SE2d 128) (1994); Kelley v. Carolina Life Ins. Co., 48 Ga. App. 106 (171 SE
847) (1933). See also Greenwald v. Kersh, 265 Ga. App. 196, 198-201 (1) (593 SE2d
381) (2004) (general contractor’s acceptance of work by independent contractor
amounted to ratification of tortious act); Chipley v. Beeler, 122 Ga. App. 781, 782 (1)
(178 SE2d 767) (1970) (homeowner ratified conduct of county by accepting the
work). “Whether ratification occurred is usually a question for the jury.” Medley, 214
Ga. App. at 798 (4).
In this case, there was ample evidence for the jury to conclude that Whitaker
Farms, as owner of the property, ratified Hynes’ wrongful conduct. Whitaker knew
that (a) Lennon had occupied the Baby Gold orchard and harvested peaches on it for
at least a decade; (b) Hynes had locked the gates of the peach orchard where
Fitzgerald Farms was harvesting its peaches; and (c) any delay in harvesting could
result in destruction of the crop. Nevertheless, Whitaker neither instructed Hynes to
unlock the gates on August 4 – thus allowing Lennon and his workers to return to the
property – nor stopped Hynes from relocking the gate the following morning. Instead,
11
Whitaker ignored Lennon’s phone call and Fitzgerald Farms’ complaint for a
temporary restraining order, and proceeded to file a criminal arrest warrant against
Lennon to keep him off the property. The verdict was supported by the record. See
Stinespring v. Fields, 139 Ga. App. 715, 717 (1) (229 SE2d 495) (1976) (trial court
correctly denied motion for directed verdict where there was evidence supporting
ratification).
2. Whitaker Farms next contends that there is no evidence to support an award
of attorney fees under OCGA § 13-6-11 because (a) the award was based on mere
guesswork; (b) the associate attorney representing Fitzgerald Farms did not testify;
and (c) fees were awarded on Fitzgerald Farms’ abandoned claim for unjust
enrichment. We disagree.
“Under Georgia law, expenses of litigation and attorney fees may be awarded,
pursuant to OCGA § 13-6-11, if the fact-finder determines the defendant has acted
in bad faith, has been stubbornly litigious, or has caused the plaintiff unnecessary
trouble and expense.” (Citation, punctuation and footnote omitted.) Atlanta
Emergency Svcs. v. Clark, 328 Ga. App. 9, 13 (2) (761 SE2d 437) (2014). See also
Jones, 257 Ga. App. at 809 (5). “The question of attorney fees under OCGA § 13-6-
11 is a question for the jury.” KDS Properties v. Sims, 234 Ga. App. 395, 400 (5) (506
12
SE2d 903) (1998). This Court will affirm such an award if there is any evidence to
support it. See Mize v. McGarity, 293 Ga. App. 714, 720 (6) (667 SE2d 695) (2008)
(“intentional tort of trespass will support a claim for expenses of litigation and
attorney fees under OCGA § 13-6-11 [because] the intentional nature of the trespass
gives rise to the bad faith necessary for such recovery”) (citation, punctuation and
footnote omitted).
Fitzgerald Farms’ principal attorney testified as to his experience and the
experience of his associate who performed a majority of the work, their billing rates,
the number of hours both spent on the case, as well as the amount anticipated in trial
fees. He presented invoices to support the fee request, stated that the incurred fees
were reasonable, and explained that the total amount included reductions for work on
the counterclaims as well as the claim for unjust enrichment. Counsel for Whitaker
Farms cross-examined the attorney about the reasonableness of his rates.
There was ample evidence presented to support the award. Counsel testified as
to his associate’s involvement and confirmed that the fees did not include the claim
for unjust enrichment. As for Whitaker Farms’ complaint that the trial fees were
based on mere guesswork, defense-counsel never cross-examined or challenged the
attorney’s assessment on this issue. “Since this [testimony] was not objected to or
13
controverted by [Whitaker Farms], it authorized the jury to find that the fee charged
was reasonable in this case.” Carpet Transport v. Kenneth Poley Interiors, 219 Ga.
App. 556, 558 (2) (a) (466 SE2d 70) (1995).
3. Whitaker Farms last complains that the award of attorney fees was
unreasonable because it was “excessive[ly] out-of-market.” We disagree.
It is well established that a party’s “attorney himself is competent to testify as
to his opinion on reasonable fees.” (Citation and punctuation omitted.) Campbell v.
Bausch, 195 Ga. App. 791, 792 (2) (b) (395 SE2d 267) (1990). Compare Gray v.
King, 270 Ga. App. 855, 858 (2) (b) (608 SE2d 320) (2004) (no evidence as to
reasonableness of attorney fees presented even though testimony from own attorney
would have sufficed). As discussed in Division 2, supra, Fitzgerald Farms’ counsel
testified to his experience and his hourly rate, as well as the experience and hourly
rate of his associate. He explained that the associate, who was billed out at a lower
rate, did a majority of the work in the case, and testified that he specialized in
agriculture law and that the rates charged were reasonable. On cross-examination,
counsel explained that his rates were reasonable given the complexity of the case and
“aggressive nature” of the opponent. The trial court reduced the amount of attorney
14
fees awarded by the jury to the amount requested by Fitzgerald Farms and proved by
counsel. The award was supported by the evidence and was not unreasonable.
Case No. A18A1421
4. In its cross-appeal, Fitzgerald Farms contends that the trial court erred in
withdrawing the issue of punitive damages from the jury and in refusing to instruct
the jury on punitive damages. We agree.
(a) We first address Whitaker Farms’ claim that Fitzgerald Farms’
unconditional acceptance of the reduced judgment bars it from asserting its cross-
appeal under InterAgency, Inc. v. Danco Financial Corp., 203 Ga. App. 418, 429 (6)
(417 SE2d 46) (1992) (physical precedent only), citing Sparks v. Aetna Ins. Co., 62
Ga. 198 (1879), and conclude that the cross-appeal is not barred. In InterAgency, the
plaintiff/cross-appellant accepted a write-off of the attorney fees award and then
sought to appeal the write-off. In this case, Fitzgerald Farms is not appealing the
reduction of the attorney fees award to which it agreed. Rather, it is appealing the
issue of punitive damages related to its trespass claim, which is in no way related to
its request for attorney fees under OCGA § 13-6-11.
Federal law provides guidance, albeit non-binding, on this issue. Federal courts
follow the longstanding rule reiterated by the Supreme Court in Donovan v. Penn
15
Shipping Co., 429 U. S. 648 (97 SCt 835, 51 LE2d 112) (1977) (per curiam), “that a
plaintiff in federal court, whether prosecuting a state or federal cause of action, may
not appeal from a remittitur order he has accepted.” Id. at 650 (2, 3). The Donovan
rule, however, “does not prevent the appeal of issues that are separate or distinct from
the issue on which a plaintiff has accepted a remittitur.” Cohen v. Yale-New Haven
Hosp., 800 A2d 499, 504 (I) (Conn. 2002) (dismissing appeal where plaintiff
accepted remittitur reducing non-economic, compensatory damages judgment and
then sought additional non-economic, compensatory damages). See Utah Foam
Products Co. v. Upjohn Co., 154 F3d 1212, 1216 (I) (10th Cir. 1998) (pointing out
that Donovan permits party who has accepted remittitur on one cause of action to
appeal issues related to other causes of action not subject to remittitur order). While
we recognize that a plaintiff in state court is not bound by Donovan, the rationale for
the exception to its application, is persuasive. We therefore find, based upon the
particular facts and circumstances of this case, that Fitzgerald Farms’ claim for
attorney fees under OCGA § 13-6-11 is separate and distinct from its cause of action
16
for compensatory and punitive damages based on its trespass claim. Accordingly, we
reject Whitaker Farms’ contention that this cross-appeal is barred.7
(b) Under OCGA § 51-12-5.1 (b), punitive damages may be awarded in tort
actions where “it is proven by clear and convincing evidence that the defendant’s
actions showed willful misconduct, malice, fraud, wantonness, oppression, or that
entire want of care which would raise the presumption of conscious indifference to
consequences.” “A conscious indifference to consequences relates to an intentional
disregard of the rights of another.” Tyler v. Lincoln, 272 Ga. 118, 120 (1) (527 SE2d
180) (2000). See also Oglethorpe Power Corp. v. Sheriff, 210 Ga. App. 299, 301 (4)
(a) (436 SE2d 14) (1993). Trespass is an intentional act which will authorize a claim
for punitive damages. See Tyler, 272 Ga. at 120 (1). “Ordinarily, the imposition of
punitive damages is a question for the jury.” Baumann v. Snider, 243 Ga. App. 526,
530 (3) (532 SE2d 468) (2000).
The actions taken by Whitaker Farms and its owner, as laid out in Division 1,
supra, are sufficient evidence of “conscious indifference” to authorize a jury to award
punitive damages. See Baumann, 243 Ga. App. at 530-531 (3) (reversing grant of
7
Had Fitzgerald Farms accepted a reduced compensatory damages award our
conclusion might be different.
17
motion for directed verdict on plaintiff’s claim for punitive damages in action for
trespass); T. G. & Y. Stores Co. v. Waters, 175 Ga. App. 884, 887-888 (3) (334 SE2d
910) (1985) (affirming denial of motion for directed verdict on claim for punitive
damages in action for trespass). See also Langlois v. Wolford, 246 Ga. App. 209, 210-
212 (1) (539 SE2d 565) (2000) (affirming denial of motion for directed verdict on
punitive damages claim). Whitaker allowed the gates to Fitzgerald Farms’ orchard to
remain locked while Fitzgerald Farms’ peach harvest rotted, and he not only refused
to unlock the gates despite Lennon’s pleas to finish harvesting the peaches, but
sought to have Lennon arrested and kept him off the property to prevent Fitzgerald
Farms from completing the harvest. The trial court’s ruling on this issue is reversed.
Judgment affirmed in Case No. A18A1420; reversed in Case No. A18A1421.
Miller, P. J., and Goss, J., concur.
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