## Facts

- A general contractor solicited bids for hardscaping and landscaping on an Olympic-related construction project in Atlanta.
- Insite, primarily a hardscaping contractor, sought subcontractor bids for the landscaping portion to include in its overall bid.
- SKB submitted a landscaping bid that was substantially lower than competitors, and Insite used it in its bid to the general contractor.
- Insite’s combined bid won the prime contract.
- After the award, it was discovered SKB’s bid used materials cheaper than the project specifications; SKB provided a revised, higher bid based on correct materials.
- Insite sent SKB a written subcontract reflecting the revised price, but SKB never signed it and later refused to perform a substantial portion of the originally contemplated landscaping work.
- Insite performed much of the landscaping itself and claimed it incurred significantly higher costs because it lacked comparable landscaping capacity.
- The parties later executed a second subcontract covering only limited remaining work and expressly excluding the landscaping portions SKB had refused to perform.
- Insite sued for promissory estoppel, tortious interference with Insite’s contract with the general contractor, and litigation expenses under O.C.G.A. § 13-6-11.
- SKB counterclaimed for breach of contract for unpaid amounts for work it did perform and sought its own litigation expenses.
- A jury awarded Insite damages for promissory estoppel, tortious interference, and litigation expenses; it also awarded SKB damages on its counterclaim and $1 in litigation expenses.

## Issues

1. Whether a subcontractor’s bid and revised bid could support promissory estoppel and reliance damages when no signed subcontract covered the full scope of work.
2. Whether a later, limited subcontract extinguished a promissory-estoppel claim based on the earlier bid-related promise.
3. Whether evidence supported a verdict that the subcontractor tortiously interfered with the contractor’s contract with the general contractor.
4. Whether litigation expenses under O.C.G.A. § 13-6-11 were supported and, if so, whether they had to be apportioned to the claim on which the party prevailed; and whether the $1 fee award to SKB was reversible.
5. Whether evidence supported SKB’s counterclaim award for unpaid amounts for performed work.

## Decision

- The court affirmed the verdict for Insite on promissory estoppel, holding the evidence permitted a finding of a promise, foreseeable reliance, detrimental reliance, and the need to award reliance damages to avoid injustice.
- The court held the later limited subcontract did not bar promissory estoppel because it expressly excluded the work forming the basis of the relied-upon promise.
- The court reversed the tortious-interference judgment for Insite, finding no evidence of intentional and improper interference with Insite’s contract with the general contractor.
- The court reversed and remanded Insite’s $50,000 litigation-expense award, requiring proof and allocation of expenses attributable to the claim on which Insite ultimately prevailed.
- The court affirmed the jury’s $1 award of litigation expenses to SKB, deferring to the jury’s determination of reasonableness.
- The court affirmed the jury’s award to SKB on its breach-of-contract counterclaim for amounts due for work completed.

## Legal Principles

- Promissory estoppel permits enforcement of a promise, or an award of reliance damages, when: (1) a promise is made; (2) the promisor should reasonably expect reliance; (3) the promisee relies to its detriment; and (4) only enforcement (or reliance damages) can avoid injustice.
- In construction bidding, a subcontractor’s bid may constitute a promise for promissory-estoppel purposes when submitted for inclusion in the contractor’s bid and reliance is foreseeable.
- A later agreement does not necessarily extinguish reliance-based claims where it does not cover, and expressly excludes, the promised work that induced the reliance.
- Tortious interference with contractual relations requires proof of purposeful, improper interference (without privilege) that causes a third party to breach or refuse to enter/continue a contract; nonperformance of a promise to the plaintiff, standing alone, does not establish interference with a separate third-party contract.
- Litigation expenses under O.C.G.A. § 13-6-11 require evidentiary support (e.g., bad faith, stubborn litigiousness, or unnecessary trouble and expense) and must be tied to the claim(s) on which the claimant prevails; where multiple claims are pursued with mixed results, expenses must be apportioned.
- The reasonableness of litigation expenses is a jury question; a nominal award may be upheld if the jury could find the reasonable value less than amounts actually paid.

## Conclusion

The court held that Insite could recover reliance damages under promissory estoppel based on SKB’s bid-induced promise despite the absence of a signed full-scope subcontract and despite a later limited subcontract excluding the refused work; it reversed the tortious-interference judgment for lack of evidence, affirmed SKB’s counterclaim recovery, and remanded Insite’s litigation-expense award for allocation to the successful claim while leaving SKB’s nominal fee award intact.


SKB Indus., Inc. v. Insite, 250 Ga. App. 574, 551 S.E.2d 380 (Ga. Ct. App. 2001)