FIFTH DIVISION
DILLARD, P. J.,
REESE 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
March 15, 2017
In the Court of Appeals of Georgia
A16A2192. REDCEDAR, LLC v. CML-GA SOCIAL CIRCLE,
LLC.
A16A2193. CML-GA SOCIAL CIRCLE, LLC v. REDCEDAR,
LLC.
REESE, Judge.
In these companion cases, the parties dispute whether Redcedar, LLC, a
company which cut and removed timber from certain property, can be held liable
under the Georgia Timber Collateral Conversion Statute (“GTCCS”), OCGA § 51-12-
51, and, if so, the proper measurement of damages arising from such conversion. In
Case No. A16A2192, Redcedar appeals from an order of the Superior Court of
Newton County granting a motion for partial summary judgment filed by CML-GA
Social Circle, LLC (“CML-GA”), based on a finding that Redcedar was liable under
the GTCCS as a matter of law.1 In Case No. A16A2193, CML-GA appeals from a
related order granting Redcedar’s cross-motion for partial summary judgment as to
the applicable measure of damages to be determined at trial. For the reasons set forth,
infra, we affirm the grant of partial summary judgment to CML-GA in Case No.
A16A2192, and we affirm in part and reverse in part the judgment in Case No.
A16A2193.
“On appeal from the grant of summary judgment this 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.”2 With these guiding
principles in mind, we turn now to the parties’ specific claims of error.
1
The court’s order also granted summary judgment to CML-GA as to the
liability of Redcedar’s co-defendants, Georgia Timber, LLC and its agent, Barry
Bedingfield. In addition, the court denied cross-motions for summary judgment filed
by Redcedar and Bedingfield. Although Bedingfield initially appealed from the
summary judgment order, this Court granted his motion to withdraw the appeal on
August 19, 2016. Georgia Timber and CML-GA settled the case after the court
entered summary judgment against the former on the issue of liability. Thus, Georgia
Timber is not a party to these appeals.
2
Home Builders Assn. of Savannah v. Chatham County, 276 Ga. 243, 245 (1)
(577 SE2d 564) (2003) (citation and punctuation omitted).
2
Case No. A16A2192
This case arose from the cutting and removal of timber from portions of
undeveloped property in Newton County. In 2007, Carolyn Penland executed a
security deed to the entire 463.74-acre parcel of land as collateral for three
promissory notes.
In October 2010, the security deed executed by Penland was assigned to CML-
GA. When Penland defaulted on the three notes secured by the security deed, CML-
GA filed suit on the notes. In August 2012, CML-GA obtained a default judgment
against Penland for approximately $9.6 million in principal, accrued interest, late
charges, and attorney fees. CML-GA did not, however, institute foreclosure
proceedings pursuant to the security deed at that time.
Georgia Timber, LLC, subsequently contracted with Little River Construction
Company (a company owned by Penland’s son, Michael), for the “thinning and
removal” of timber from the property. In September 2013, Georgia Timber applied
for a timber harvest permit from Newton County, and it hired Redcedar to cut the
trees and haul them off the property. Georgia Timber then sold the timber to third
parties.
3
In October 2014, CML-GA discovered that someone had “clear-cut” several
acres of the property and removed the timber. In response, CML-GA filed a complaint
for conversion against the Penlands, Georgia Timber, Redcedar, and others, asserting
that they had illegally cut and removed timber from the property without first
obtaining its written permission and that, as a result, they were liable under the
GTCCS. The GTCCS provides, in relevant part, as follows:
Every person, firm, or corporation who, without the written consent of
the person holding legal title to land or to an interest in land as security
for debt, . . . buys, sells, cuts, removes, holds, disposes of, changes the
form of, or otherwise converts to the use of himself, itself, or another
any trees growing or grown on such land shall be liable to the holder of
the legal title for such trees, in any form, bought, sold, cut, removed,
held, disposed of, changed in form, or otherwise converted by him or it,
or for the value of such trees, provided that recovery may not be for
more than the unpaid portion of the secured indebtedness, interest
thereon, and a reasonable attorney’s fee. Recovery may be had by action
at law from one who purchases, without the consent of the holder of the
legal title, such interest in the trees, mineral or other rights, or interest
in the encumbered real estate, either jointly or severally, with the holder
of the equitable title.3
3
OCGA § 51-12-51 (a).
4
In its complaint, CML-GA alleged that, because the removal of the timber had
diminished the fair market value of the real property, the damaged property provided
“inadequate security to cover the debt owed [by Penland] under the Security Deed.”
CML-GA subsequently amended its complaint to add allegations that, under
the GTCCS, Redcedar was a “purchaser” of the timber removed from the property or,
in the alternative, purchased an “interest” in that timber. CML-GA also added a claim
that Redcedar “aided, abetted, and assisted” Georgia Timber in the unauthorized
removal and purchase of the timber removed from the property and, as a result, was
just as liable as Georgia Timber for damages under the GTCCS.
In February 2015, while this conversion action was pending, CML-GA
instituted foreclosure proceedings under the security deed. CML-GA purchased the
property at the foreclosure sale, crediting $4.4 million toward Penland’s outstanding
debt on the notes.
Then, in July 2015, CML-GA filed a motion for partial summary judgment in
the instant conversion action, seeking a ruling that the co-defendants were liable as
a matter of law under the GTCCS. In its brief and documents supporting the motion,
CML-GA asserted that, after it credited $4.4 million from the foreclosure sale to the
balance owed on the promissory notes that were subject to the security deed, a
5
deficiency remained unpaid on the notes. It claimed that the co-defendants were liable
for this “unpaid portion of the indebtedness [that was] secured by the security deed.”
In response to CML-GA’s motion for partial summary judgment, Redcedar
filed a cross-motion for summary judgment on CML-GA’s complaint, denying that
it was liable under the GTCCS because, although it had cut and removed timber from
the property, it had been hired to do so by Georgia Timber and, as a result, was
simply acting as a contractor under the direction of Georgia Timber. Redcedar also
contended that CML-GA could not recover money damages under the GTCCS
because it had foreclosed on its security interest in the property. According to
Redcedar, the plain language of the statute provided that a plaintiff’s “recovery may
not be for more than the unpaid portion of the secured indebtedness, interest thereon,
and a reasonable attorney’s fee.” It argued that the foreclosure on the security deed
extinguished any “secured indebtedness” upon which to claim damages under the
statute. Further, Redcedar argued that CML-GA should be estopped from trying to
recover a deficiency judgment, i.e., the difference between the outstanding balance
on the notes and the proceeds from the foreclosure sale, because CML-GA had failed
to obtain a judicial confirmation of the sale, pursuant to OCGA § 44-14-161. Finally,
it argued that, even if CML-GA had secured a judicial confirmation of the sale, it
6
should be estopped from seeking a deficiency judgment from Redcedar because
CML-GA had failed to provide it with notice of the confirmation proceedings, as
required by OCGA § 44-12-161 (c).
Following motion hearings, the trial court denied Redcedar’s motion for
summary judgment and granted partial summary judgment to CML-GA, finding that
the co-defendants were liable as a matter of law under the GTCCS. Redcedar appeals
from the court’s order.
1. Redcedar contends that the trial court erred in concluding that it was liable
as a matter of law under the GTCCS, arguing that it is not within the class of
defendants subject to liability under the statute. Given the plain language of the
statute, however, this argument lacks merit.
In interpreting any statute, we necessarily begin our analysis with
familiar and binding canons of construction. Indeed, in considering the
meaning of a statute, our charge as an appellate court is to presume that
the General Assembly meant what it said and said what it meant. And
toward that end, we must afford the statutory text its plain and ordinary
meaning, consider the text contextually, read the text in its most natural
and reasonable way, as an ordinary speaker of the English language
would, and seek to avoid a construction that makes some language mere
surplusage. In sum, where the language of a statute is plain and
7
susceptible of only one natural and reasonable construction, courts must
construe the statute accordingly.4
With regard to the GTCCS, the General Assembly left little doubt as to how it
expected this statute to be construed.5 Indeed, the statute explicitly provides as
follows:
Every person, firm, or corporation who, without the written consent of
the person holding legal title to land or to an interest in land as security
for debt, . . . buys, sells, cuts, removes, holds, disposes of, changes the
form of, or otherwise converts to the use of himself, itself, or another
any trees growing or grown on such land shall be liable to the holder of
the legal title for such trees, in any form, bought, sold, cut, removed,
held, disposed of, changed in form, or otherwise converted by him or
it[.]6
In this case, Redcedar did not dispute that it cut and removed timber from the
property without CML-GA’s written authorization. It argued, however, that it had
been hired as a contractor by Georgia Timber to cut and remove the timber and, as a
4
Holcomb v. Long, 329 Ga. App. 515, 517-518 (1) (765 SE2d 687) (2014)
(punctuation and footnotes omitted).
5
See generally Holcomb, 329 Ga. App. at 518 (1).
6
OCGA § 51-12-51 (a) (emphasis supplied).
8
result, it could not be held directly liable for its actions in this case. In support of this
argument, Redcedar showed that it was not a party to the timber removal contract
between Georgia Timber and Little River, and it did not obtain the timber removal
permit from Newton County. Further, Redcedar argued that, as a contractor hired by
Georgia Timber, it provided services pursuant to Georgia Timber’s instructions and
under the company’s direction; that it had relied on Georgia Timber to obtain the
necessary consent and permits to authorize the timber removal; that this reliance was
consistent with industry standards and practices; and that, while it was compensated
by Georgia Timber for its services, it did not purchase or sell the timber at issue in
this case.
However, we decline to construe the plain language of the GTCCS in a manner
that provides for an exception to liability for those who admittedly violated the
statute, but insist that they only did so as an agent or employee of another. Indeed,
doing so would run afoul of the General Assembly’s explicit creation of broad, strict
liability for anyone who cuts, removes, or otherwise converts timber from property
without the written consent of those with an ownership or security interest in the
land.7 Consequently, we conclude that the trial court did not err in finding that
7
See generally Holcomb, 329 Ga. App. at 520 (1).
9
Redcedar was liable to CML-GA under the GTCCS as a matter of law and in granting
partial summary judgment to CML-GA on this issue.8
2. Nevertheless, Redcedar contends that, despite the above-quoted language,
OCGA § 51-12-51 (a) limits liability to either the purchasers of the timber at issue or
the holder of the equitable title to the property. In support of this argument, Redcedar
relies on the second sentence of the statute, which provides that “[r]ecovery may be
had by action at law from one who purchases, without the consent of the holder of the
8
We note that this Court has previously held that individuals who cut or
removed trees without the requisite consent could be held liable under the GTCCS,
although the rulings did not expressly address the issues raised by Redcedar in this
appeal. See, e.g., AgSouth Farm Credit v. Gowen Timber Co., 336 Ga. App. 581, 587-
592 (2) (b) (784 SE2d 913) (2016) (holding that a company that cut, removed, and
sold timber from land that secured a debt held by the plaintiff was liable as a matter
of law under the GTCCS because it had not first obtained the written consent of the
plaintiff); Thakkar v. St. Ives Country Club, 250 Ga. App. 893, 896 (5) (553 SE2d
181) (2001) (holding that a person who cut and removed timber from a golf course
was liable to the owners of the course as a matter of law under the GTCCS, regardless
how the person subsequently disposed of the timber, i.e., by using, selling, or
discarding it); Southern Land & Cattle Co. v. Simmons, 202 Ga. App. 734, 736 (415
SE2d 329) (1992) (holding that a person who cut and removed timber pursuant to the
direction of the person in possession of the property, but without the written consent
of the company holding legal title to the land, could be held liable under the GTCCS);
Cordele Sash, Door & Lumber Co. v. Prudential Ins. Co. of America, 86 Ga. App.
738, 742 (2) (72 SE2d 497) (1952) (holding that a company that cut and removed
timber from land that secured a debt held by the plaintiff was liable as a matter of law
under an earlier version of the GTCCS because it had not first obtained the written
consent of the plaintiff).
10
legal title, such interest in the trees, mineral or other rights, or interest in the
encumbered real estate, either jointly or severally, with the holder of the equitable
title.”9
However, the fact that this sentence provides that the holder of legal title or a
security interest in the property may also recover from the purchaser of an interest in
the subject trees, the holder of equitable title to the property, or both, does not negate
or undermine the strict liability that the first sentence of the statute expressly imposes
on those who, inter alia, cut and remove trees without written consent. Indeed,
Redcedar’s proposed construction of the GTCCS would render the statute’s express
imposition of strict liability for cutting and removing trees without consent
meaningless, essentially treating it as mere surplusage.10
Consequently, we find this argument to be without merit.
9
OCGA § 51-12-51 (a) (emphasis supplied).
10
See Hill v. Owens, 292 Ga. 380, 383 (2) (a) (738 SE2d 56) (2013) (“[T]his
Court avoids interpreting statutes in a manner that renders any portion of them
surplusage or meaningless.”) (citation omitted); Motors Acceptance Corp. v. Rozier,
278 Ga. 52, 53 (1) (597 SE2d 367) (2004) (“This Court is to construe the statute to
give sensible and intelligent effect to all of its provisions and to refrain from any
interpretation which renders any part of the statute meaningless.”) (punctuation and
footnote omitted); see also Holcomb, 329 Ga. App. at 517-518 (1).
11
3. Redcedar contends that the trial court erred in rejecting its argument that
CML-GA could not recover under the GTCCS because it no longer held a security
interest in the property. Redcedar also argues that the trial court erred in finding that
it was liable to CML-GA for “the unpaid portion of the secured indebtedness” under
the GTCCS, arguing that CML-GA was seeking a deficiency judgment following its
foreclosure on the property.
Redcedar has failed, however, to show that the trial court specifically ruled on
these issues. “When this Court reviews a decision of a trial court on a motion for
summary judgment, it sits as a court for the correction of errors of law. An error of
law has as its basis a specific ruling made by the trial court.”11 It follows that, because
the trial court did not rule on these issues, there is nothing for this Court to review.12
Case No. A16A2193
In this case, CML-GA appeals from the trial court’s grant of Redcedar’s cross-
motion for partial summary judgment as to the appropriate measure of damages to be
applied in this case.
11
Williams v. United Cmty. Bank, 313 Ga. App. 706, 707-708 (722 SE2d 440)
(2012) (citation and punctuation omitted).
12
Id.
12
4. CML-GA contends that the trial court erred in limiting the amount of
damages it could recover at trial to the value of the trees as personal property, instead
of allowing it to recover damages in the amount of the diminished value of the land
that resulted from Redcedar’s unauthorized removal of timber. We disagree.
As shown above, the GTCCS specifically provides that a person who converts
timber shall be liable “for such trees, in any form, bought, sold, cut, removed, held,
disposed of, changed in form, or otherwise converted by him or it, or for the value of
such trees[.]”13 In this case, the trial court ruled that, given this plain language,
“recovery under OCGA § 51-12-51 (a) shall be limited to the value of the removed
trees as personal property.”
CML-GA has not identified anything in the text of the GTCCS that would
allow it to recover damages in the amount of the diminished value of the property due
to the unauthorized removal of timber. It follows that CML-GA has failed to show
any error in the trial court’s grant of summary judgment to Redcedar on this issue.14
13
OCGA § 51-12-51 (a) (emphasis supplied).
14
See AgSouth Farm Credit, 336 Ga. App. at 585, 592 (3) (remanding for a
new trial on damages only in a conversion case brought under the GTCCS, in which
the plaintiff sought to recover the amount paid to the defendant for “the value of the
. . . timber”); Cordele Sash, Door & Lumber Co., 86 Ga. App. at 742 (2) (affirming
the trial court’s submission of “the amount of the value of the timber cut and removed
13
5. Nevertheless, CML-GA contends that the court abused its discretion in
refusing to allow it to present evidence of the diminished value of the property at trial
for the purpose of showing that it is entitled to attorney fees and punitive damages.
It argues that such evidence is relevant to show that Redcedar acted in bad faith and
in conscious indifference to the consequences,15 contending that, when Redcedar cut
and removed the timber, it knew that its actions would diminish the value of the
property.
It is axiomatic that, “[e]vidence having a tendency to establish facts in issue is
relevant and admissible, and no matter how slight the probative value, our law favors
admission of relevant evidence.”16 Under the circumstances presented here, we
by the defendant” to the jury).
15
See OCGA §§ 13-6-11 (“The expenses of litigation generally shall not be
allowed as a part of the damages; but where the plaintiff has specially pleaded and has
made prayer therefor and where the defendant has acted in bad faith, has been
stubbornly litigious, or has caused the plaintiff unnecessary trouble and expense, the
jury may allow them.”); 51-12-5.1 (b) (“Punitive damages may be awarded only in
such tort actions in which 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.”).
16
AgSouth Farm Credit, 336 Ga. App. at 593 (3) (a), (b) (citation and
punctuation omitted). See also OCGA §§ 24-4-401 (“[T]he term ‘relevant evidence’
means evidence having any tendency to make the existence of any fact that is of
14
conclude that the trial court erred in refusing to allow CML-GA to present evidence
of the diminished value of the property following Redcedar’s removal of timber at
trial for the limited purpose of demonstrating its entitlement to attorney fees and
punitive damages. Thus, we reverse that portion of the trial court’s order in Case No.
A16A2193.
Judgment affirmed in Case No. A16A2192. Judgment affirmed in part and
reversed in part in Case No. A16A2193. Dillard, P. J., and Bethel, J., concur.
consequence to the determination of the action more probable or less probable than
it would be without the evidence.”); 24-4-402 (“All relevant evidence shall be
admissible,” unless constitutional or other legal authority renders it inadmissible.).
15