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Lawskills.com Georgia Caselaw
MANAGEMENT SEARCH, INC. v. KINARD.
28059.
NICHOLS, Justice.
Questions one, two and five are answered in the affirmative and questions three, four and six are answered in the negative.
The Court of Appeals has certified the following questions to this court:
"1. Is the license required of a private employment agency by Ga. L. 1959, pp. 283, 284, 292, 293 (Code Ann. 84-4102 (a) (s) and 84-9967) a regulatory measure, in the public interest, or a mere revenue measure? See, in this connection: Toole v. Wiregrass Development Co., 142 Ga. 57 (82 SE 514); McLamb v. Phillips, 34 Ga. App. 210 (1) (129 SE 570); Bernstein v. Peters, 68 Ga. App. 218 (1) (22 SE2d 614).
"2. In an action by a private employment agency to recover for services rendered in obtaining employment for the defendant under a written contract, is the holding of a license as required by the statute a condition precedent to recovery?
"See in this connection: Taliaferro v. Moffet, 54 Ga. 150; Murray v. Williams, 121 Ga. 63 (48 SE 686); Padgett v. Silver Lake Park Corp., 168 Ga. 759 (149 SE 180); Bayne v. Sun Finance Co., 114 Ga. App. 27 (3) (150 SE2d 311); Pratt v. Sloan, 41 Ga. App. 150, 153 (152 SE 275); Lee v. Moseley, 40 Ga. App. 371 (2) (149 SE 808); Singleton v. State, 14 Ga. App. 527 (2, 3) (81 SE 596); McLamb v. Phillips, 34 Ga. App. 210 (1), supra; Colter v. Consolidated Credit Corp., 115 Ga. App. 408 (4) (154 SE2d 713); Hardy v. R & S Finance Co., 116 Ga. App. 451 (1) (157 SE2d 777); Camilla Loan Co. v. Sheffield, 116 Ga. App. 626 (158 SE2d 698).
"3. If the holding of a license at the time of the transaction is a condition precedent to recovery, is it necessary under the Civil Practice Act, particularly 8 (a) (1) and 9 (c) (Code Ann. 81A-108 (a) (1) and 81A-109 (c)), that the plaintiff plead that it was then duly licensed? (As to the necessity for pleading compliance with a condition precedent, see Porter-Lite Corp. v. Warren Scott Contracting Co., 126 Ga. App. 436, 439 (4) (191 SE2d 95); 2A Moore's Federal Practice, p. 1945, 9.04, 5 Wright & Miller, Federal Practice and Procedure, p. 429, 1303; 1 Kooman, Federal Civil Practice, Georgia Treatment, p. 321, 9.03; prior to CPA, Mayo v. Lynes, 80 Ga. App. 4 (55 SE2d 174); Nussbaum v. Shaffer, 105 Ga. App. 430 (124 SE2d 658); Robinson v. Colonial Discount Co., 106 Ga. App. 274 (3) (126 SE2d 824); Hale v. Chatham, 91 Ga. App. 519 (86 SE2d 536)).
"4. Is it necessary that the plaintiff both plead and prove that it was duly licensed at the time of the transaction?
"(See, in this connection: Meinhard v. Stillwell Realty Co., 47 Ga. App. 194 (169 SE 732); Service Loan & Finance Corp. v. McDaniel, 115 Ga. App. 548 (1) (154 SE2d 823)).
"5. Or, is it enough to satisfy the requirement as to a showing of license to omit pleading the fact of license, and prove it as a part of the plaintiff's case?
"(See in this connection: Jobson v. Masters, 32 Ga. App. 60 (2) (122 SE 724); Bayne v. Sun Finance Co., 114 Ga. App. 27 (3) (150 SE2d 311); Maxwell v. Tucker, 118 Ga. App. 695, 698 (4) (165 SE2d 459); Culverhouse v. Atlanta Assn. for Convalescent &c., 127 Ga. App. 574 (2) (194 SE2d 299)).
"6. Or, is the matter of whether the plaintiff was licensed at the time of the transaction a matter of defense which the defendant must raise?
"(See in this connection: Taliaferro v. Moffett, 54 Ga. 150 (2), supra; Suddath v. Blanchard & Calhoun, 39 Ga. App. 262 (2) (146 SE 798); Knight Drug Co. v. Naismith, 73 Ga. App. 793 (38 SE2d 87)).
"7. Or, if a matter of defense, may the defendant prove the lack of a proper license where that issue is not made in the pleadings?
"See generally on this subject-matter: Jalonick v. Greene County Oil Co., 7 Ga. App. 309 (66 SE 815); Bartow Guano Co. v. Adair, 29 Ga. App. 644 (3) (116 SE 342); Southern Flour & Grain Co. v. Smith, 31 Ga. App. 52, 53 (120 SE 36); Gilder v. Moore, 93 Ga. App. 448 (91 SE2d 834); Raines v. State, 96 Ga. App. 727, 729 (101 SE2d 589); Liberty Loan Corporation v. Crowder, 116 Ga. App. 280 (I) (157 SE2d 52); Johnson v. Frazier, 121 Ga. App. 212 (5) (173 SE2d 434); City of Atlanta v. Henry Grady Hotel Corp., 220 Ga. 249, 256 (138 SE2d 362); also Code Ann. 25-9903; 84-721; 84-9901 through 84-9980."
1. The Act regulating private employment agencies, supra, is a regulatory measure in the public interest and not a mere revenue measure. This Act requires more than the mere obtaining of a business license and a mere reading of the Act discloses without contradiction that it is an enactment for the protection of the public and a recognition that unless such employment agencies are solvent and operated by persons of integrity, the public is not protected. The first question is answered in the affirmative.
2. In Bernstein v. Peters, 68 Ga. App. 218, (22 SE2d 614), supra, Judge Sutton, later Mr. Justice Sutton, explored the area of contracts by persons engaged in business regulated by government in the public interest and quoted extensively from prior decisions of both the Court of Appeals and this court, and under such decision and the numerous authorities there quoted and cited, contracts made in violation of such a statute are void and unenforceable. The second question is answered in the affirmative.
3. The remaining questions will be discussed together. Prior to the adoption of the Civil Practice Act, supra, when issue pleadings were required, it was necessary, where a cause of action was based upon a contract which required a regulatory license, to allege compliance in order to withstand general demurrer. Under notice pleadings, a motion to dismiss would not result in the dismissal of a complaint in such a case unless it affirmatively appeared that the plaintiff did not possess such license, but the meagerness of pleadings required to withstand a motion to dismiss under the Civil Practice Act does not change the substantive issues involved in litigation. What was a necessary element in order to authorize a recovery under issue pleadings is still a necessary element under notice pleadings. The difference is how it is shown.
In Morgan v. Reeves, 226 Ga. 697 (177 SE2d 68), a majority of this court held that under the Civil Practice Act it is no longer necessary to allege a city ordinance in order to permit its introduction into evidence. In Maxwell v. Tucker, 118 Ga. App. 695, 698 (165 SE2d 459), the Court of Appeals, in dealing with a real estate broker's license pointed out the change in the requirements of law relating to pleading real estate brokers' licenses, and held that it was not necessary to plead the existence of such a license in order to state a claim. In Culverhouse v. Atlanta Association for Convalescent Aged Persons, 127 Ga. App. 574, 578 (194 SE2d 299), it was said: "With the advent of the Civil Practice Act of 1966 (Code Ann. 81A-108), although the fact of license need not be alleged, it must be shown to entitle the plaintiff to recover. Byrd v. Ford Motor Co., 118 Ga. App. 333 (163 SE2d 327); Maxwell v. Tucker, 118 Ga. App. 695, 698 (165 SE2d 459); Household Finance Corp. v. Johnson, 119 Ga. App. 49 (165 SE2d 864)." Accordingly, at whatever stage of the proceedings it appears that the plaintiff is seeking to recover upon a contract permitted to be entered into only by persons holding licenses issued as a regulatory measure, it becomes imperative for the plaintiff to prove that he holds such a license and held such license at the time the contract was entered into in order to authorize a recovery. Accordingly, the third, fourth and sixth questions are answered in the negative, and the fifth question is answered in the affirmative. Question seven requires no answer.
Questions one, two and five are answered in the affirmative; questions three, four and six are answered in the negative. All the Justices concur.
Smith, Cohen, Ringel, Kohler, Martin & Lowe, Hoke Smith, for appellee.
Thomas C. Jones, Jr., for appellant.
SUBMITTED JULY 11, 1973 -- DECIDED SEPTEMBER 6, 1973.
Friday May 22 14:15 EDT


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