Tuesday, March 30, 2010

Court reviews motion to dismiss in a damages and recission of a financing contract case


Daniel Walker and W&W Golf Management, Inc., dba Cedar Hills Golf Club ("the plaintiffs") filed this action against Frontier Leasing Corporation, demanding in their amended complaint, damages and rescission of the lease financing contract the plaintiffs had signed with Frontier's assignor, C and J Leasing Corp.

The complaint attached a copy of the contract and a copy of a judgment that the plaintiffs had previously secured against C&J1 awarding them damages and rescission of the subject contract. The complaint alleged that Frontier had full knowledge of the complaint against C&J and that Frontier took the assignment of the contract with knowledge that a judgment would be entered against C&J rescinding the contract. The complaint alleged that the plaintiffs' lessor, Royal Links USA, was an agent of both C&J and Frontier and that the agent induced the plaintiffs to sign the finance contract by misrepresentations.

Frontier moved to dismiss the complaint pursuant to Tenn. R. Civ. P. 12.02 on five grounds: (1) failure to state a claim, (2) lack of personal jurisdiction over Frontier, (3) a contract provision calling for the state of Iowa to be the forum for any dispute, (4) failure to plead fraud with particularity, and (5) a "hell or high water" legal obligation on the part of the plaintiffs to perform as lessees despite any breach by Royal Links as the supplier of the leased goods. The plaintiffs were allowed to file their amended complaint before the motion was heard. The trial court granted the motion to dismiss in an order that does not state the court's reasoning. The plaintiffs appeal. We affirm.

Opinion available at: