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.
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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.
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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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