Triad Construction Co., Inc. v. Robert Half International, Inc. , 679 F. App'x 748 ( 2017 )

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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 16-14942
Non-Argument Calendar
________________________
D.C. Docket No. 1:13-cv-03581-ODE
TRIAD CONSTRUCTION CO., INC.,
Plaintiff-Appellant,
versus
ROBERT HALF INTERATIONAL, INC.,
d.b.a. Accountemps,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Northern District of Georgia
________________________
(February 7, 2017)
Before JULIE CARNES, JILL PRYOR, and ANDERSON, Circuit Judges.
PER CURIAM:
Triad Construction Co., Inc., (“Triad”) appeals the district court’s grant of
summary judgment over its breach of contract and tort claims against Robert Half
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International, Inc., d.b.a. Accountemps (“Robert Half”). Having given thorough
consideration to both parties’ arguments, we affirm the district court.
I. FACTS
This dispute arises out of a fraud perpetrated against Triad. The fraud
involved Nicole Crisp (“Crisp”), a former employee of Triad, and LaTreisha
McKay (“McKay”), neither of whom is party to this suit. Robert Half provides
temporary staff to third parties, and its Accountemps division specializes in the
placement of staff in accounting and financial positions.1 McKay was assigned by
Robert Half to work as a “full charge bookkeeper” for Triad when the fraud
occurred.
Prior to her employment with Robert Half, McKay had been arrested and
charged with fraud. Because she was a first-time offender, McKay was placed in
the Cobb County District Attorney’s Pretrial Diversion Program. When she
successfully completed this program, a nolle prosequi was entered in her case.
McKay testified that she had disclosed her arrest and the charges to a Robert Half
employee during the application process. 2 It is undisputed that McKay did not
discuss the substance of the charges with Robert Half employees. Robert Half
1
From this point on, this opinion will use “Robert Half” to refer to both Robert Half and
Accountemps.
2
A claim that Robert Half strenuously denies.
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contracted with a third party to provide a criminal background check on McKay.
The background report did not show any criminal history.
McKay was placed at Triad in January 2008. In May 2011, Triad reported
to Robert Half that it wanted to terminate McKay’s placement because the quality
of her work had deteriorated. After a transition period, McKay left Triad in
August 2011. On March 14, 2012, McKay’s replacement (who was also on
assignment from Robert Half) discovered an unauthorized transfer from Triad’s
bank account to Crisp’s. Further investigation revealed a string of unauthorized
transfers to Crisp’s account between April 2008 and March 2012. Triad promptly
terminated Crisp’s employment and notified the Clayton County police. Crisp was
prosecuted and pled guilty. Triad believed that McKay was involved in the fraud
at some point before March 29, 2012. This belief was confirmed when Crisp, at
her sentencing hearing in May, 2012, implicated McKay.
On October 30, 2013, Triad filed suit against Robert Half, asserting various
breach-of-contract claims, tort claims, and claims for attorneys’ fees arising out of
McKay’s fraud. McKay’s assignment to Triad was covered by “General
Conditions of Engagement” (“the General Conditions”), which contained a notice
clause. This clause disclaimed Robert Half’s liability for “any claim related to
work performed” unless Triad provided notice of such a claim within ninety days
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of the termination of McKay. In responding to Robert Half’s motion for summary
judgment, Triad pointed to a letter that it sent Robert Half in January 2013 as
satisfying the notice requirement. The district court, relying on the notice
provision, granted summary judgment for Robert Half on all claims.
Triad then filed a motion for reconsideration. Triad attached to this motion a
letter demonstrating that it had given Robert Half written notice of its potential
claims in November 2012. The district court denied this motion for
reconsideration, and Triad now appeals.
II. ANALYSIS
This is an appeal from the district court’s grant of summary judgment and
denial of a motion for reconsideration in a diversity case. The district court had
jurisdiction pursuant to 28 U.S.C. § 1332 (2012), and we have jurisdiction pursuant
to 28 U.S.C. § 1291.
“We review a grant of summary judgment de novo, examining the evidence
in the light most favorable to the non-moving party and affirming if ‘there is no
genuine issue as to any material fact’ and ‘the movant is entitled to judgment as a
matter of law.’” Schwarz v. City of Treasure Island, 544 F.3d 1201, 1211 (11th
Cir. 2008) (quoting Fed. R. Civ. P. 56(c)). “This court reviews the denial of a Rule
59 motion for an abuse of discretion.” Lockard v. Equifax, Inc., 163 F.3d 1259,
4
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1267 (11th Cir. 1998) (citing O’Neal v. Kennamer, 958 F.2d 1044, 1047 (11th Cir.
1992)).
A. Substantial Compliance
Triad’s main argument on appeal is that its claims were not barred by the
notice provision.3 This argument fails.
The notice provision that Robert Half sent to Triad reads as follows:
It is understood that you are responsible for reporting any claim to us
in writing during or within ninety (90) days after the engagement.
Under no circumstances will [Robert Half] be responsible for any
claim related to work performed unless you have reported such claim
in writing to us within ninety (90) days after the termination of the
engagement. 4
Triad terminated McKay’s engagement on August 19, 2011, for performance-
related reasons unconnected to the fraud. Triad discovered the fraud on March 14,
2012, and began to suspect McKay’s involvement between then and March 29,
2012. Triad orally notified Robert Half of McKay’s involvement and “kept
3
In the district court, Triad also argued that the notice provision was not enforceable
under Georgia law. Triad has waived that argument on appeal. Triad lists the question of the
notice provision’s enforceability in its statement of issues on appeal. Triad also mentions in
passing in its argument section that it “disputes” the provision’s enforceability. However, this is
not enough to raise the issue on appeal or to adequately brief this Court as to how Triad thinks
that the district court might have erred. See Sapuppo v. Allstate Floridian Ins. Co., 739 F.3d 678,
681 (11th Cir. 2014) (“A party fails to adequately ‘brief’ a claim when he does not ‘plainly and
prominently’ raise it, ‘for instance by devoting a discrete section of his argument to those
claims.’” (quoting Cole v. U.S. Attorney Gen., 712 F.3d 517, 530 (11th Cir. 2013))).
4
It is undisputed that Patrick Mehan, one of Triad’s principals, acceded to the notice
provision by signing McKay’s timesheets.
5
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[Robert Half’s management] in the loop” during their investigation into the fraud.
However, at summary judgment, the earliest evidence of written communication to
Robert Half provided by Triad was a letter dated January 28, 2013 — at least 305
days after Triad began to suspect McKay’s involvement, and 251 days after Crisp
implicated her at her sentencing hearing.5
Like the district court, we begin by accepting for the purpose of argument
that Triad’s initial delay in providing notice — for the period between McKay’s
termination and Triad’s suspicion of her involvement in the fraud — was justified.
Even then, the evidence at summary judgment (or, for that matter, the evidence on
Triad’s motion for reconsideration) did not establish any written communication
from Triad to Robert Half within the ninety-day period.
Under Georgia law, “[t]he general rule in determining contract compliance is
substantial compliance, not strict compliance.” Del Lago Ventures, Inc. v.
QuickTrip Corp., 330 Ga. App. 138, 142, 764 S.E.2d 595, 598 (2014) (quoting
Rome Healthcare LLC v. Peach Healthcare Sys., Inc., 264 Ga. App. 265, 272, 590
S.E.2d 235, 241 (2003)); see also O.C.G.A. § 13-4-20 (West 2010). Substantial
compliance is also the general rule for notice provisions. See Del Lago, 330 Ga.
5Along with its motion for reconsideration, Triad produced a letter to Robert Half dated
November 28, 2012, that communicates that Triad was contemplating claims against Robert
Half. This was at least 244 days after Triad began to suspect McKay’s involvement and 190
days after Crisp implicated her at the sentencing hearing.
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App. at 144, 764 S.E.2d at 599. However, substantial compliance is not the rule
when a contract clearly establishes written notice as a condition precedent to suit.
See Pillar Dev., Inc. v. Fuqua Constr. Co., Inc., 284 Ga. App. 858, 860, 645 S.E.2d
64, 66 (2007) (“Where a contract contains a provision requiring written notice of a
claim for breach, ‘[t]he failure to give notice as required or to show waiver by [the
party entitled to notice] is an independent bar to the maintenance of a successful
cause of action on the contract.’” (quoting Orkin Exterminating Co. v. Stevens,
130 Ga. App. 363, 369, 203 S.E.2d 587, 593) (1973)) (alterations in original)).
Critically, “oral notice is not sufficient where written notice is required.” Id. at
860, 645 S.E.2d at 66; see also Eells v. State Farm Mut. Auto. Ins. Co., 324 Ga.
App. 901, 904, 752 S.E.2d 70, 73 (2013) (holding that oral notice did not comply
with an insurance contract’s requirement for written notice of a claim); Moss v.
Cincinnati Ins. Co., 154 Ga. App. 165, 165, 268 S.E.2d 676, 677 (1980) (“Even if
appellants established that oral notice had been given, it would not satisfy the
written notice requirement.”).
We are not convinced by Triad’s attempts to distinguish Pillar and Eells. In
Pillar, two companies had entered into a real estate contract. See 284 Ga. App. at
858, 645 S.E.2d at 65. The buyer paid earnest money but, after becoming
concerned that the seller would not deliver the property with the relevant permits,
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did not complete its purchase. See id. at 859–60, 645 S.E.2d at 66. The court
determined that the contract required written notice within fifteen days of the date
set for closing as a condition precedent to the buyer recovering its earnest money.
See id. at 861, 645 S.E.2d at 67. Because the buyer had not provided such written
notice, the court, reasoning that “oral notice is not sufficient where written notice is
required,” id. at 860, 645 S.E.2d at 66, ruled that the buyer had breached the
contract and could not recover its earnest money. See id. at 860, 645 S.E.2d at 67.
We disagree with Triad’s characterization of the case as one in which no notice
was provided at all. While the Pillar court did not explicitly state that oral notice
was provided, this is the fairest reading of that case. The court stated that both
parties had attended the abortive closing but the buyer refused to close because it
suspected that the seller lacked the permits. See id. at 859, 645 S.E.2d at 66.
Further, the court repeatedly referred to the buyer’s failure to comply with the
“written notice” requirements. See id. at 860–61, 645 S.E.2d at 860–62 (referring
to “written notice” requirements ten times). We conclude that the contract’s
requirement of written notice was not mere dicta, but central to the Pillar court’s
holding.
We also decline to find Eells distinguishable in any relevant respect. In
Eells, the plaintiff was injured in a hit-and-run incident. 324 Ga. App. at 902, 752
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S.E.2d at 72. He was covered by his family’s insurance policy, which required
notice of a claim within thirty days and written notice “as soon as reasonably
possible.” Id. at 901, 752 S.E.2d at 72 (quoting Lankford v. State Farm Mut. Auto.
Ins. Co., 307 Ga. App. 12, 14, 703 S.E.2d 436, 438 (2010)). Eells did not realize
that he was covered and did not provide written notice to his insurance carrier until
nearly two years after the accident. See id. at 902, 752 S.E.2d at 72. The court
rejected Eells’ argument that he had substantially complied with the written notice
provision because his mother had mentioned it in passing to their insurance agent
several months after the fact. See id. at 902, 752 S.E.2d at 72.
Clearly Eells might be distinguished on the grounds that oral notice was
undeniably tardy. But the problem for Triad is that the Eells court specifically
based its holding on the rule that “even if the insurer receives oral or other notice
that does not comply with the policy’s written notice requirement, that notice is
insufficient.” Id. at 904, 752 S.E.2d at 73.6
We agree with Robert Half that the cases Triad cites for the alternative
proposition — that “[t]he key issue is whether [the party] had actual notice,”
6
To the extent that Triad relies on the fact that Eells arose in the insurance context in
attempting to distinguish it, we fail to see a relevant difference. A notice provision such as this
serves the same function in the insurance context as in the professional services context: ensuring
that the party defending the claim has the opportunity to investigate the underlying facts while
they are fresh. If any difference is appropriate, a business entity such as Triad (which was
represented by counsel) should be held to a higher standard than a consumer claiming on his
insurance policy.
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APAC-Georgia, Inc. v. Dep’t of Transp., 221 Ga. App. 604, 605, 472 S.E.2d 97,
98 (1996) — are distinguishable. In APAC-Georgia itself, although the plaintiff
had not complied with the precise terms of the written notice provision, it had sent
the defendant over fifty letters discussing the subject matter of its claims, to which
the defendant had responded. See id. at 606, 472 S.E.2d at 99. This, the trial court
held, created questions of fact with regard to both substantial compliance and
waiver. See id. at 606, 472 S.E.2d at 99. Several of the other cases relied upon by
Triad are likewise distinguishable because they involve defective written notice,
rather than oral notice alone. See Bickerstaff v. SunTrust Bank, 332 Ga. App. 121,
125–26, 770 S.E.2d 903, 908 (2015) (holding that a plaintiff’s filing a lawsuit and
serving notice on defendant within the notice period constituted substantial
compliance with a provision requiring written notice to opt out of arbitration
agreement), rev’d on other grounds, 299 Ga. 459, 788 S.E.2d 787 (2016); Del
Lago, 330 Ga. App. at 143, 764 S.E.2d at 599 (holding that an issue of material
fact existed with regard to whether the defendant had substantially complied with a
contract requiring its written notice to the plaintiff and a third party by giving
written notice to the plaintiff and misrepresenting that notice had been given to the
third party); Rice v. Lost Mountain Homeowners Ass’n, Inc., 269 Ga. App. 351,
355, 604 S.E.2d 215, 220 (2004) (upholding the district court’s determination that
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a plaintiff substantially complied with a requirement of notice by certified mail by
providing “written and oral notice”); Wallick v. Period Homes, Ltd., 252 Ga. App.
197, 202, 555 S.E.2d 863, 868 (2001) (holding that a material question of fact
existed with regard to whether written notice not specifying the reasons for a
contract’s termination coupled with oral notice specifying those reasons constituted
substantial compliance with a requirement of written notice specifying those
reasons).7
The other cases that Triad relies upon are distinguishable because they rest
on waiver of strict compliance with the written notice provision. See Stimson v.
George Laycock, Inc., 247 Ga. App. 1, 4–5, 542 S.E.2d 121, 124–25 (2000);
Fremichael v. Doe, 221 Ga. App. 698, 700–01, 472 S.E.2d 440, 442–43 (1996); S.
Mut. Ins. Co. v. Mason, 213 Ga. App. 584, 587, 445 S.E.2d 569, 572 (1994).8 As
Triad admits, it has not argued that Robert Half waived the written notice
7
Because oral notice cannot constitute substantial compliance with a written notice
condition under Georgia law (absent waiver or estoppel), we do not reach the question of
whether Triad’s oral notice would itself have been sufficient to constitute actual notice. It likely
was not; although Triad alleges that Robert Half knew of some facts underlying its eventual
claims — i.e. that McKay had some involvement in the fraud — Triad did not allege that it
communicated (even orally) that it considered that it had legal claims against Robert Half until
November 2012 (in its motion for rehearing) or January 2013 (on the initial summary judgment
record).
8
Triad also makes passing reference to three other distinguishable cases. See Rome
Healthcare LLC v. Peach Healthcare Sys., Inc., 264 Ga. App. 265, 272, 590 S.E.2d 235, 241
(2003) (written notice twice provided); State Highway Dept. v. Hall Paving Co., 127 Ga. App.
625, 628, 194 S.E.2d 493, 495 (1972) (nonconforming written notice could constitute substantial
compliance); McDaniel v. Mallary Bros. Mach. Co., 6 Ga. App. 848, 66 S.E.2d 146, 147 (1909)
(party had waived strict compliance).
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requirement. Consequently, it cannot prevail upon this theory. See Access Now,
Inc. v. Sw. Airlines Co., 385 F.3d 1324, 1331 (11th Cir. 2004) (“This Court has
‘repeatedly held that “an issue not raised in the district court and raised for the first
time in an appeal will not be considered by this court.”’” (quoting Walker v. Jones,
10 F.3d 1569, 1572 (11th Cir. 1994))).
Additionally, Triad accuses the district court of erroneously rewriting the
General Conditions by requiring notice within a reasonable time of Triad’s
discovery of the fraud. Instead, Triad would have had the district court determine
that it could not have complied with the written notice provision, and then simply
ignored the notice provision. The only authority that Triad cites in the course of
arguing this point stands for the more general proposition that “conditions
precedent are not favored in interpreting contracts,” e.g., Gen. Steel, Inc. v. Delta
Bldg. Sys., Inc., 297 Ga. App. 136, 139, 676 S.E.2d 451, 454 (2009), and
Georgia’s statutory rule that “[i]mpossible . . . conditions are void,” O.C.G.A. §
13-5-5.
Triad cannot be heard to complain. The district court did not hold that
Triad’s compliance with the notice provision was impossible; it merely assumed
for the sake of argument that Triad’s initial noncompliance was justified, and went
on to hold that, even so, Triad’s failure to provide Robert Half with written notice
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after it learned of McKay’s fraud was not justified. We see no reversible error in
the district court’s analogy to insurance cases in this context. The district court
could have reached the same result by relying on the substantial compliance cases
discussed above; Triad’s written notice, produced several months too late after it
learned of McKay’s fraud, does not constitute substantial compliance with the
written notice requirement in the contract. See Pillar, 284 Ga. App. at 861, 645
S.E.2d at 67 (written notice sent twenty-one days too late did not constitute
substantial compliance with written notice provision).9
B. The Notice Provision
Triad next makes two arguments that the notice provision does not cover all
its claims. First, Triad argues that, because McKay’s alleged fraudulent scheme
falls outside of the tasks that she was assigned to perform, several of its claims are
not claims “related to work performed” by McKay. We do not reach this argument
because Triad waived it by not raising it in the district court. See Access Now, 10
F.3d at 1572.
9
We also agree with Robert Half that impossibility is a narrow defense to contractual
performance in Georgia. See, e.g., Felder v. Oldham, 199 Ga. 820, 825, 35 S.E.2d 497, 500
(1945) (start of Second World War did not excuse contractual performance). In arguing that
Georgia does not limit impossibility to acts of God, Triad has cited only cases in which
performance was rendered impossible by an act of the opposing litigant. See, e.g., Kent v. Hunt
& Assocs., Inc., 165 Ga. App. 169, 171, 299 S.E.2d 123, 125 (1983) (judge correctly instructed
jury that the defendant’s nonperformance of a condition was excused if they found that the
plaintiff had prevented its performance). Accordingly, Triad’s performance was not impossible
as a matter of Georgia law.
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Second, Triad argues that its “extra-contractual” claims — namely
negligence; negligent hiring, retention, and misrepresentation; and respondeat
superior — are not barred by the contract. We disagree. Again, the contract
requires Triad to have given notice of “any claim related to work performed” in
order for Robert Half to be liable.
Triad’s argument fails because the contract does not support the distinction
between tort claims and contract claims that Triad seeks to read into it. Nor does
Triad point to any external source of law that recommends this reading.
Additionally, Triad’s “extra-contractual” claims all do “relate” to “work
performed” under the contract. Triad’s negligent hiring, retention, and
misrepresentation claims all turn on Robert Half’s performance of duties relating to
McKay’s assignment — i.e., a purported duty to ensure that McKay was not unfit
to work as a bookkeeper. In other words, they all relate to work performed by
Robert Half. Triad’s injury at McKay’s hands is also related to work she
performed; if she had not been placed in the position she was in, she could not
have orchestrated the alleged fraud.
Even if the notice provision were construed only to cover work performed
by McKay, Triad’s negligent hiring, retention, and misrepresentation claims would
fail because they still relate to work performed by McKay. McKay was in the
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position to orchestrate the alleged fraud because of the role that Triad placed her in
pursuant to the assignment; the claims “relate to” the work that McKay was
required to perform.
C. Triad’s Other Claims
1. Triad’s Claim for Attorneys’ Fees
A claim for attorneys’ fees under Georgia Code § 13-6-11 is derivative and
can only survive to the extent that underlying claims survive. See, e.g., Wright v.
Apartment Inv. & Mgmt. Co., 315 Ga. App. 587, 590 n.6, 726 S.E.2d 779, 784 n.6
(2012). Because we hold that the district court correctly granted summary
judgment against Triad on all of its substantive claims, we affirm its dismissal of
Triad’s claim for attorneys’ fees.
2. Triad’s Motion for Reconsideration
The district court did not err in denying Triad’s motion for reconsideration.
“The only grounds for granting [a Rule 59] motion are newly-discovered evidence
or manifest errors of law or fact.” Arthur v. King, 500 F.3d 1335, 1343 (11th Cir.
2007) (quoting In re Kellogg, 197 F.3d 1116, 1119 (11th Cir. 1999) (alteration in
original)). “[W]here a party attempts to introduce previously unsubmitted
evidence on a motion to reconsider, the court should not grant the motion absent
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some showing that the evidence was not available during the pendency of the
motion.” Mays v. U.S. Postal Serv., 122 F.3d 43, 46 (1997).
Here, the November 2012 letter that Triad attached to its motion for
reconsideration was written by Triad and had already been produced during
discovery when Triad responded to Robert Half’s motion for summary judgment.
It was no ground for a motion for reconsideration. 10 Further, as our foregoing
discussion demonstrates, the district court did not commit a clear error of law.
Accordingly, it was not abuse of discretion to deny Triad’s motion for
reconsideration.
III. CONCLUSION
We have thoroughly considered all Triad’s further arguments and find them
to be duplicative of the arguments discussed or otherwise without merit.
Accordingly, the decision of the district court is AFFIRMED.
AFFIRMED
10
And, given that it was still untimely, it would not have changed the result of the district
court’s analysis, or ours.
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