Malicious Prosecution, Wrongful Arrest, and Infliction of Emotional Harm

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It goes without saying that being arrested and prosecuted for something you didn’t do is a nightmare. In Georgia, if this happens to you, you have options for holding the responsible parties accountable. To win such a claim, it must be shown that (1) you were prosecuted for a criminal offense, (2) there was no probable cause for the prosecution, (3) the prosecution was instigated with malice, (4) the prosecution was under a valid warrant, (5) the charges were dismissed, and (6) you were damaged.

Whether you prosecuted for a crime under a valid warrant, whether the charges were dismissed, and whether you were damaged are straightforward factual issues. The more difficult issues to overcome are probable cause and malice.

Probable cause and malice exist when the information and facts provided to the police, which caused the charges to be brought, were lies or exaggerations. In other words, there is no probable cause when the complaining party knew the facts provided to the police were false or were not a fair, full, and complete statement of the facts.

A related claim is intentional infliction of emotional harm. This requires that the defendant’s conduct be (1) intentional or reckless, (2) extreme and outrageous, (3) the emotional distress was caused by the wrongful conduct, and (4) the emotional distress was severe. Like malicious prosecution, the key is whether the complaining party’s dishonesty  caused the charges to be brought against you. If so, a jury determines whether the conduct was outrageous enough to support a claim for intentional infliction of emotional distress.

If you’ve be wrongly arrested, please call us to discuss how we can help you hold the responsible parties accountable.

Georgia Tax Deeds: Excess Tax-Sale Funds and Super Liens

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There was an important shift in Georgia tax deed law last year. The Georgia Supreme Court, in DLT List, LLC vs. M7even, 301 Ga. 131 (2017), decided that a party who redeems a tax deed is not automatically first in line to receive excess tax-sale funds following a tax sale.

The facts of DLT List are straightforward: a property was auctioned at a tax sale and sold for $110,000. The delinquent taxes were $5,000, so there were $105,000 in excess tax-sale funds. The delinquent taxpayer applied to the tax commissioner to receive the excess funds–there were no other claims to the funds. Several months later, a third-party, who held a lien against another property owned by the delinquent taxpayer, redeemed. The redeeming party applied for the excess tax-sale funds. The question became who was entitled to the excess tax-sale proceeds.

Under existing law in Georgia, a redeeming party, simply by virtue of redeeming, is entitled to first position against excess tax-sale funds. This arose out of an often-cited case, National Tax Funding vs. Harpagon, 277 Ga. 41 (2003), which involved competing lien holders in the context of a tax sale. Harpagon held that following a tax sale, a competing lien holder had two choices: (1) claim the excess tax-sale funds, or (2) redeem the property. Importantly, if a competing lien holder chose to redeem, the redemption converted the competing lien holder’s claim into a first-position lien against the property. This is known as a “super lien” and allows a redeeming party to leapfrog over higher priority creditors. A super lien has many benefits for tax sale investors.

Redeeming parties, relying on the super lien language in Harpagon, began claiming their super lien status not only gave them a first-position lien against the property, but also entitled them to the excess tax-sale funds following redemption. These claims were affirmed by the courts in cases like Wester v. United Capital Financial of Atlanta, LLC, 282 Ga. App. 392 (2006).

Fast forward to 2017.  In DLT List, LLC vs. M7even, the Georgia Supreme Court revisited the issue of excess tax-sale funds and found that super liens attach only to real estate, not to personal property. Therefore, because excess tax-sale funds are personal property, super liens don’t attach to excess tax-sale funds. Thus, redeeming parties aren’t entitled to any preference with regard to excess tax-sale funds. By so deciding, the Supreme Court distinguished Harpagon and overruled cases like Wester.

While this ruling isn’t likely to slow down the tax deed business in Georgia, as a real estate investor, it’s something to be aware of.

Bankruptcy: repeat filings

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A question we get frequently, especially after a debtor files a second or third bankruptcy as a delay strategy, is just how many times can a debtor get away with filing for bankruptcy? We refer to these folks, not so affectionately, as “serial filers.” While not perfect, there are some restrictions for debtors filing multiple bankruptcies:

180 days: A debtor can’t file a second bankruptcy case for 180 days if the debtor’s case was dismissed (i.e., the bankruptcy wasn’t completed) for the following reasons: (1) by the court for willful failure of the debtor to abide by orders of the court, or to appear before the court in proper prosecution of the case; or (2) the debtor requested and obtained the voluntary dismissal of the case following the filing of a request for relief from the automatic stay.

Two bankruptcies in one year: When a debtor files a second bankruptcy within one year of the dismissal of the first case, the automatic stay expires 30 days after filing (11 U.S.C. § 362(c)(3)). There’s one exception, which is if the debtor can prove to the court that the second case was filed in good faith (meaning the debtor didn’t file repeatedly to delay collection by a creditor), the court has discretion to extend the automatic stay.

Three bankruptcies in one year: When a debtor files a third bankruptcy within one year of the dismissal of the first case, the automatic stay doesn’t take effect at all upon the third filing (11 U.S.C. § 362(c)(4)).

After successful completion of a bankruptcy (i.e., a discharge): For a Chapter 7 bankruptcy, a debtor is not eligible for a discharge if the debtor received a discharge in another Chapter 7 filed within the prior eight years, or in a Chapter 13 case filed in the prior six years (unless the prior Chapter 13 payment plan either paid 100% of the unsecured claims or paid 70% of the unsecured claims). For a Chapter 13 bankruptcy, a debtor is not eligible for a discharge if the debtor received a discharge in another Chapter 13 case filed in the prior two years, or in a Chapter 7 case filed in the prior four years.

Miscellaneous note: The one-year period for either termination or non-application of the stay begins to run from the date of dismissal of the first case. In a joint case, if only one of the debtors had a prior case dismissed in the year before filing, the automatic stay is affected only as to the debtor with the prior case. Section 362(c) (3) and (4) apply to the acts of a specific debtor rather than joint debtors in the aggregate.

Please call us if you need clarification or have any questions.

Negligence law in Georgia

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What is negligence law? At the risk of sounding overdramatic, at Gomez & Golomb LLC, we believe negligence law is similar to the golden rule, which is “do unto others as you would have them do unto you.” Here is why.

Long ago, the first laws developed to discourage citizens from intentionally harming each other. Under this system, when someone intentionally harms another, the state prosecutes the responsible person. If found guilty, the state puts the person in jail.

But what about when someone unintentionally harms another? Clearly, it would be unfair to put someone in jail for conduct that lacked intent, but, at the same time, it would also be unfair to the injured person if there were no consequences? As a middle ground, we created a set of rules known as negligence law in which a negligent party isn’t prosecuted or jailed for wrongdoing, but is liable for the monetary damages caused to the harmed party. In other words, as we go about our daily business in our communities, we are obligated to act in a manner consistent with that of an ordinarily prudent and reasonable person. Georgia law confirms this principle. See O.C.G.A. § 51-1-2.

The personal injury cases we handle at Gomez & Golomb LLC all involve negligence. This means the responsible parties harmed our clients but did so without any intent. Examples of cases we’ve worked on are drivers who didn’t pay close enough attention to the road, manufacturers who design products without attention to safety, or doctors who provide medical treatment that isn’t as good as it should be.  None of these parties woke up with up plans to harm to anyone, but, for various reasons, each acted in a way that a careful, responsible, and reasonable person would not.

In our view, our society is better off when someone who intentionally harms another is put in jail and someone who unintentionally harms another is responsible for paying for the damages. While not everyone agrees with this system, and there is no doubt abuse, the alternative is a society without incentive to treat each other as each of us would like to be treated (the golden rule).

At Gomez & Golomb LLC, we see our job as making sure our clients are fairly compensated for legitimate injuries sustained because another person or entity failed to act responsibly.

Venue in a Trucking Case

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In a recent dispute over where a wrongful death lawsuit should be tried, the plaintiff made the winning argument against a commercial trucking company. Natasha Blakemore as Mother of Natroya Hulbert v. Dirt Movers, Inc. et al., A17A1540 (January 11, 2018). The plaintiff argued that the case should be tried in the county where the injury took place, while the trucking company argued it had the right to remove the case to the county where its office was located.

The two statutes at issue were O.C.G.A. §§ 40-1-117(b) and 14-2-510(b)(4). O.C.G.A. § 40-1-117(b) is part of the Georgia Motor Carrier Act, which are the statutes that govern commercial motor carriers. That statute says an injured party who sues a motor carrier can bring the case in the county where the injury occurred regardless of where the motor carrier is located. In contrast, O.C.G.A. § 14-2-510(b)(5), which governs corporations, says that, regardless of where the injuries occurred, a corporation is entitled to have the case adjudicated in the county where it maintains its principal place of business.

Here, Dirt Movers, Inc. argued that O.C.G.A. § 14-2-510(b)(5) should apply even if venue was proper under O.C.G.A. § 40-1-117(b). The Court of Appeals disagreed. Holding that if venue was proper under both O.C.G.A. §§ 40-1-117(b) and 14-2-510(b)(4), which was true here, the plaintiff was entitled to bring her lawsuit in the county where the injuries occurred.

Nice try by the trucking company, but the case will go forward in the county where the injuries occurred.