Court Reviews Whether A Commercial Landlord Misrepresented the Estimated Operating Expenses to the Tenant-Plaintiff

SOLES4SOULS, INC. v. DONELSON CEDARSTONE ASSOCIATES, LP ET AL. (Tenn. Ct. App. December 20, 2010).

In a landlord-tenant dispute, the tenant plaintiff claims that before the parties entered into a lease for commercial property, the landlord defendants misrepresented estimated operating expenses that the plaintiff was expected to pay as part of its rent pursuant to the lease terms.

The plaintiff appeals the trial court's dismissal of its claims for fraud and violation of the Tennessee Consumer Protection Act. We find that the defendants misrepresented estimated operating expenses after entering into the initial lease with the plaintiff but before entering into an agreement for expansion space.

We therefore reverse the judgment of the trial court on the plaintiff's claims for fraud and violation of the TCPA and remand for determination of an appropriate remedy for damage the plaintiff suffered after agreeing to lease the expansion space.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/soles4souls_122010.pdf

TN Supreme Court Reviews Whether a Creditor May Bring a Direct Cause of Action Against an Insolvent Corporation’s Directors and Officers

MICHAEL SANFORD v. WAUGH & COMPANY, INC. ET AL. (Tenn. December 17, 2010)

The primary issue presented in this appeal is whether an individual creditor of an insolvent corporation may bring a direct cause of action for breach of fiduciary duty against the corporate directors and officers.

We hold that a creditor of an insolvent corporation may not bring a direct claim, only a derivative claim, against officers and directors for breach of the fiduciary duties they owe to the corporation.

We adopt the reasoning of the Delaware Supreme Court in North American Catholic Educational Programming Foundation, Inc. v. Gheewalla, 930 A.2d 92 (Del. 2007), observing that corporate creditors are adequately protected by existing law, and that recognizing a new direct cause of action is unnecessary and would impede corporate governance.

We further hold that the trial court properly excluded evidence of conspiracy to interfere with contract and dismissed the claim for punitive damages. The judgment of the Court of Appeals is reversed.

Opinion available at:
http://www.tba2.org/tba_files/TSC/2010/sanfordm_121710.pdf

TN Supreme Court Reviews A Corporation’s Liability for the Payment of Use Tax

CAO HOLDINGS, INC. v. CHARLES A. TROST, COMMISSIONER OF REVENUE (Tenn. December 15, 2010).

This appeal involves a corporation's liability for the payment of use tax following its purchase of a business jet. After it received an assessment from the Tennessee Department of Revenue for over $700,000, the corporation paid the tax and filed suit in the Chancery Court for Davidson County seeking a refund on the ground that it qualified for the sale for resale exemption under Tenn. Code Ann. section 67-6-102(a) (28)(A) (Supp. 2004) because it had leased the aircraft to another corporation. Both the corporation and the Department filed motions for summary judgment.

The trial court granted the corporation's motion for summary judgment, and the Department appealed. A divided Court of Appeals panel affirmed the trial court. CAO Holdings, Inc. v. Chumley, No. M2008-01679-COA-R3-CV, 2009 WL 1492230 (Tenn. Ct. App. May 27, 2009). We granted the Department's application for permission to appeal.

We have now determined that neither party is entitled to a summary judgment because material disputes exist regarding the factual inferences or conclusions that can be drawn from the facts.

Opinion available at:
http://www.tba2.org/tba_files/TSC/2010/caoholdings_121510.pdf
 
CORRECTION: on page 5, line 25 adds the word "no" between the words "conferred" and "real"
http://www.tba2.org/tba_files/TSC/2011/caoholdings_COR_011311.pdf

Court Reviews Contractual Obligations and Retaliatory Discharge Claims in a Breach of Contract Case

KARIM SKAAN v. FEDERAL EXPRESS CORPORATION, INC. (Tenn. Ct. App. December 14, 2010).

Plaintiff/Appellant filed an action alleging breach of contract and retaliatory discharge. Defendant moved for summary judgment on both claims, and asserted the action was barred by a contractual limitations provision in the application for employment.

The trial court awarded summary judgment to Defendant with respect to the retaliatory discharge claim, and denied summary judgment with respect to Defendant's assertion that the matter was timebarred. Plaintiff appealed.

We dismiss this appeal for failure to appeal a final judgment where the trial court has not entered an order adjudicating or otherwise disposing of Plaintiff's breach of contract claim, and Plaintiff has failed to show cause why this matter should not be dismissed.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/skaank_121410.pdf

Court Reviews Whether Plaintiff Proved the Existence of a Partnership for Profit Between the Partie

JOYCE VIA v. LARRY EDWARD OEHLERT, SR. (Tenn. Ct. App. December 10, 2010)

This appeal arises out of a complaint to dissolve a partnership. The plaintiff alleged that she and the defendant, an unmarried couple, acquired real property through joint efforts. She further alleged that she contributed to the improvement of the property and an increase in its value, giving rise to a partnership for profit and a right to a distribution of the partnership's assets following dissolution.

The defendant denied that a partnership existed and counterclaimed for damages and attorney's fees arising out of the plaintiff's refusal to vacate the property following their break-up. At the ensuing bench trial, the defendant moved for a directed verdict on the plaintiff's claims.

The trial court granted the motion and dismissed the plaintiff's claims, specifically finding that the plaintiff was unable to prove the existence of an express or implied partnership for profit between the parties. We affirm.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/viaj_121010.pdf

Attorney General Reviews Whether Beer Boards Can Prohibit Sales of Beer through Drive-Up Windows or other Curbside Services

Prohibiting the Sale of Beer Through Drive-Up Windows
TN Attorney General Opinions
Date: 2010-11-19
Opinion Number: 10-113

In this opinion, the Attorney General distinguishes between Class A counties and Class B counties, cities, and towns. Class A counties have the authority to create beer boards and issue beer permits, but do not have the statutory authority to deny beer permits based solely on the sale of beer through drive-up windows, drive-through service, or curb service. Class B counties also have the authority to create beer boards and issue permits, but they have also been granted broad discretion to regulate, restrict, or prohibit beer sales.

Based on these classifications, the Attorney General concludes that while a Class B county (or municipality) would be able to deny permits to applicants who want to sell beer through drive-up windows, this type of restriction could not be imposed by a Class A county's local beer board rule or decision.

The full opinion is available at:
http://www.tba2.org/tba_files/AG/2010/ag_10_113.pdf

Court Reviews Employee's Discharge for Violating Company Policy

ALBERT J. HALE, v. JAMES NEELEY, COMMISSIONER, et al. (Tenn. Ct. App. November 19, 2010)

Claimant, an employee of Wal-Mart, was charged with possession of cocaine and pled guilty to a misdemeanor possession, and was then discharged for violating company policy. Claimant was not at work nor on Wal-Mart's property when the offense occurred.

The agency found that claimant was discharged under disqualifying conditions and denied unemployment benefits. Throughout the appeals process, denial of benefits was upheld.

On appeal to this Court, we hold that claimant violated Wal-Mart's policies by failing to report his conviction under a criminal drug statute to his employer within three days as required under the employer's policy. We affirm the denial of unemployment benefits to claimant.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/halea_111910.pdf

Court reviews award of attorney's fees as well as principal and interest amounts of a promissory note.

FIRST PEOPLES BANK OF TENNESSEE v. JAMES L. HILL (Tenn. Ct. App. May 26, 2010)

James L. Hill ("the defendant"), in order to accommodate his son, Shannon Hill, co-signed a note to First Peoples Bank of Tennessee ("the Bank") in the amount of $50,500 ("the small note"). Shannon later approached the Bank about a larger loan for his pizza business. As a consequence, the small note was combined with two other notes. The Bank made a loan in the amount of $294,764.65 under a new note ("the big note") but required a personal guaranty from the defendant as security. Unbeknownst to the Bank, the guaranty Shannon produced was a forgery. Shannon was later killed and, still later, his pizza business defaulted on the big note.

The Bank initially filed this action against the defendant on the sole basis of the guaranty. The Bank later amended its complaint to allege that the big note was a renewal of the small note and that the defendant remained liable on the small note. The primary issue for trial was whether the small note was renewed or whether it was satisfied with the proceeds from the big note.

On the morning of trial, when the Bank's witnesses appeared, the chancellor announced that he was acquainted with several of the Bank's witnesses. The defendant made an oral motion seeking recusal of the chancellor. The court denied the motion and the case proceeded to a bench trial. After trial, the court entered a judgment in favor of the Bank which included the attorney's fees of the Bank. The defendant appeals. The Bank asks for its attorney's fees incurred on appeal.

We affirm that part of the judgment which awards principal and interest, but vacate the award of attorney's fees claimed in the amount of $25,125 and remand for a determination of a reasonable fee. Additionally, we hold that the Bank is entitled, under the note, to recover reasonable attorney's fees incurred on appeal and remand for a determination of a reasonable appellate fee.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/firstpeoples_052610.pdf

Court review summary judgment ruling in a tortious intereference cause between two companies

BAILEY TOOL & MANUFACTURING CO. v. FORREST BUTLER ET AL. (Tenn. Ct. App. May 24, 2010)

This is a dispute between two companies that supply parts in the automotive industry. Company A claims that Company B tortiously interfered with its contract and with its business relationships. The trial court granted summary judgment on the grounds that there was no genuine issue of material fact as to causation and that Company B conclusively established the affirmative defense of justification. We affirm the decision of the trial court because Company B negated the element of causation.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/baileytool_052410.pdf

Court reviews whether creditor's involvement in the sale of collateral was commercially reasonable

REGIONS BANK v. TRAILER SOURCE, ET AL. (Tenn. Ct. App. May 24, 2010)

A junior creditor sued the senior creditor claiming that the senior creditor's involvement in the sale of collateral, used trailers for tractor-trailer trucks, was commercially unreasonable. We agree with the trial court that the senior creditor, a bank, was subject to the commercially reasonable disposition of collateral rule. However, we hold that the bank's approval of the sale, arranged by the debtor, was not commercially unreasonable. Consequently, we reverse the judgment of the trial court.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/regionsbank_052410.pdf

Court reviews whether trial court propery ruled that appellee entities were not partnerships

SHERRY TANNER v. WHITECO, L.P. and ORANGECO, L.P. (Tenn. Ct. App. May 17, 2010)

This case involves the question of whether Appellee entities are partnerships under Tennessee law. Appellant appeals the trial court's order, which found that Appellee entities were not partnerships. Finding no error, we affirm.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/tanners_051710.pdf

Court reviews dismissal of action regarding a business's accounting practices

COLE BRYAN HOWELL, III, ET AL. v. CHERYL RYERKERK, ET AL. (Tenn. Ct. App. April 30, 2010)

Cole Bryan Howell, III ("the Grandson"), is the son of Cole Bryan Howell, Jr. ("the Father"), who in turn is the son of Margaret Lyons Howell ("the Grandmother"). The Grandson inherited stock in Howell Nurseries, Inc. ("the Nursery") through the Grandmother's will, which left a block of stock to the Father for life and then to the Father's children.

After the Father's death, the Grandson filed this stockholder's derivative action against all persons who acted as directors of the Nursery and the Nursery itself ("the Defendants"), claiming, in essence, that the directors had sold away all of the corporate assets, leaving him with a rather hollow inheritance.

The trial court held that the Grandson did not have standing to challenge any transactions that preceded the Father's death because it was only after his death that the Grandson became the owner of the stock. The trial court ordered an accounting as to all monies handled after the Father's death, which the Defendants filed with the court. Over the Grandson's objections, the trial court, on the Defendants' motion, approved the accounting and dismissed the case in its entirety. The Grandson appeals. We vacate the judgment of dismissal and remand for further proceedings.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/howellc_043010.pdf

Court reviews claim of misrepresentation in a case about a purchase of property

JIMMY E. HOLT ET AL. v. SHAWN R. WILMOTH (Tenn. Ct. App. April 30, 2010)

Shawn R. Wilmoth ("the Buyer") approached Jimmy E. Holt about buying a building Mr. Holt owned jointly with his wife Betty L. Holt (collectively "the Sellers"). The Sellers advised they were only willing to sell the building if they could also sell the inventory from their lamp business that was stored in the building. The Buyer agreed to purchase the building and the inventory. The purchase of the inventory was accomplished through a promissory note in the amount of $250,000. Subsequently, the Buyer paid $150,000 toward the note but refused to pay the balance of $100,000.

The Sellers filed suit to collect the balance owed on the note. In his answer and counterclaim, the Buyer alleged that Sellers represented the value of the goods to be $500,000, but that he only realized $65,000 through liquidation of the goods and that $65,000 was the true value of the inventory. The Buyer alleged that the figure he was given constituted an intentional misrepresentation and, when compared to the amount he recovered from the goods, amounted to a failure of consideration. The Buyer asked to recover damages that included the difference in the amount he paid on the note and the amount he realized out of the liquidation, that difference being $85,000.

After a bench trial, the trial court determined that there was no intentional misrepresentation and dismissed the counterclaim. Nevertheless, the trial court refused to award the Sellers a recovery on the unpaid balance of the note. The court stated that it was leaving the parties where it found them. The Sellers appeal, raising issues; the Buyer, by way of his own issue, challenges the trial court's refusal to award him damages. We reverse and remand the case to the trial court with instructions to enter a judgment in favor of the Sellers and consider their prayer for prejudgment interest.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/holtj_043010.pdf

Court reviews whether a city's bidding process violates the TN Trade Practices Act

BAIRD TREE COMPANY, INC. v. CITY OF OAK RIDGE, ET AL. (Tenn. Ct. App. April 26, 2010)

In 2004, Baird Tree Company, Inc. ("Baird Tree") unsuccessfully bid on a tree trimming and removal project with the City of Oak Ridge ("Oak Ridge"). Baird Tree filed a lawsuit claiming, inter alia, that Oak Ridge's bidding process violated the Tennessee Trade Practices Act, Tenn. Code Ann. Section 47-25-101.

We affirmed the Trial Court's grant of summary judgment to the defendants because the contract at issue was a contract for services, not goods, and, therefore, the Tennessee Trade Practices Act did not apply. We also concluded that Baird Tree could not challenge the bidding process because it had failed to submit a valid bid in the first place. See Baird Tree Co., Inc. v. City of Oak Ridge, No. E2007-01933- COA-R3-CV, 2008 WL 2510581 (Tenn. Ct. App. June 24, 2008). When the same project came up for bid in 2007, Baird Tree again submitted a fatally defective bid. When it was not awarded the contract, Baird Tree filed the present lawsuit raising various challenges to Oak Ridge's bidding process. The Trial Court granted summary judgment to all defendants. We, again, conclude that Baird Tree does not have standing to challenge the bidding process because it submitted a fatally defective "bid" in the first place. The judgment of the Trial Court is, therefore, affirmed.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/bairdtreeco_042610.pdf

One-Fourth of Nonprofits Are to Lose Tax Breaks

Some nonprofits' tax breaks to end May 15

At midnight on May 15, an estimated one-fifth to one-quarter of some 1.6 million charities, trade associations and membership groups will lose their tax exemptions, thanks to a provision buried in the Pension Protection Act of 2006. An I.R.S spokeswoman said that while groups would lose their exemptions effective May 16, the I.R.S. would probably not send out notices until January to give nonprofits a chance to bring themselves into compliance with the law.

Learn more from The New York Times:
http://www.nytimes.com/2010/04/23/us/23exempt.html

Court reviews decision to revoke Petitoner's license to operate a wrecker service

MARK WAYMAN d/b/a ABLE TOWING v. TRANSPORTATION LICENSING COMMISSION OF THE METROPOLITAN GOVERNMENT OF NASHVILLE AND DAVIDSON COUNTY, TENNESSEE (Tenn. Ct. App. April 6, 2010)

The Transportation Licensing Commission revoked Petitioner's license to operate a wrecker service. The chancery court upheld the revocation. We affirm.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/waymanm_040610.pdf

Attorney General reviews whether a corporation would be required to file a report of its independent expenditures in the same manner as a political campaign committee under Tennessee‟s current campaign finance laws.

Filing of Disclosure Statements By Corporations For Independent Expenditures
TN Attorney General Opinions
Date: 2010-03-31
Opinion Number: 10-39

In this opinion, the Attorney General reviews whether a corporation would be required to disclose contributions or independent expenditures in the same manner as a political campaign under current Tennessee campaign finance laws. The Attorney General reviews Citizens United v. Federal Election Comm’n and its effect on current Tennessee law, and determines that current Tennessee law does not require corporations making independent political contributions to file statements disclosing such expenditures under the Campaign Financial Disclosure Act. The Attorney General also determines, however, that the Citizens United case holds that legislation requiring such disclosure by corporations would not violate the First Amendment.

"Under the plain language of Tenn. Code Ann. § 2-10-102(12)(B), if a corporation is making expenditures to support or oppose a measure, then it meets the definition of a political campaign committee and, therefore, would be required to file disclosure statements in accordance with the requirements of Tenn. Code Ann. §§ 2-10-105 and -106. However, to the extent a corporation makes expenditures to support or oppose any candidate for public office, it does not meet the definition of political campaign committee set forth in Tenn. Code Ann. § 2-10-102(12)(A) or (C) and, therefore, would not be required to file statements disclosing its contributions and expenditures." Id.

Full Opinion available at:
http://www.tba2.org/tba_files/AG/2010/ag_10_39.pdf

Court reviews order to comply with request to inspect corporate records and to pay attorney's fees

BETH PROFFITT v. SMOKY MOUNTAIN WOODCARVERS SUPPLY, INC. (Tenn. Ct. App. March 31, 2010)

The plaintiff filed this action seeking to review the business records of the defendant, asserting under oath that she is a 25 percent shareholder of the defendant corporation. The defendant moved to dismiss. The trial court found that the plaintiff had complied with the requirements of Tenn. Code Ann. section 48-26-104(a) - the corporate records statute - and ordered the defendant to comply with the request to inspect and/or copy corporate records. The trial court also ordered the defendant to pay the plaintiff's attorney fees. We reverse.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/proffittb_033110.pdf

Court reviews whether trial court properly ruled a contract unenforceable due to one party's not having a broker's license

CHRISTENBERRY TRUCKING & FARM, INC. v. F&M MARKETING SERVICES, INC. (Tenn. Ct. App. March 31, 2010)

Christenberry Trucking & Farm, Inc., initiated this litigation against F&M Marketing Services, Inc., with a complaint seeking a declaration that Christenberry had not contracted to pay F&M a commission on loads Christenberry hauled for UPS/Dell Computer ("the UPS/Dell account"). F&M filed an answer and counterclaim asking for a determination that there was a contract with respect to the UPS/Dell account under which Christenberry was obligated to pay F&M a commission of 6%. F&M's counterclaim also asked for an accounting and attorney's fees. The case was tried without a jury, after which Christenberry was allowed to amend its pleadings to allege that if there was a contract it was illegal and unenforceable because F&M is not licensed as a broker by the Interstate Commerce Commission ("the ICC").

The trial court found that there was a contract between Christenberry and F&M, but that the contract was rendered illegal and unenforceable because of F&M's lack of a broker's license. F&M hired new counsel who filed a notice of appeal that did not contain the signature of its trial counsel. Christenberry filed a motion with the trial court to strike the notice of appeal. Six days later, F&M filed an amended notice of appeal which bore, in addition to the signature of its new appellate counsel, the signature of its counsel of record in the trial court. F&M argues on appeal that it was not required to be licensed and, alternatively, that the contract should not be nullified for its lack of a license, even if one was required. Christenberry argues that the notice of appeal is ineffective. We vacate the judgment of the trial court and remand for further proceedings.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/christenberry_033110.pdf

Small Business Advocate created within Tennessee's Office of the Comptroller

The Senate Commerce Labor and Agriculture Committee has voted to create a small business advocate within the Office of the Comptroller of the Treasury, utilizing existing personnel.

Senate Bill 3484 calls for the advocate to mediate and assist with resolution of issues concerning small business owners and state departments and agencies. The bill also requires the small business advocate to prepare an annual report on their office's activities, findings and recommendations to the governor, members of the General Assembly and the heads of the affected departments and agencies to make sure officials are notified about any problems or concerns.

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

DANIEL WALKER ET AL. v. FRONTIER LEASING CORPORATION (Tenn. Ct. App. March 30, 2010)

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:
http://www.tba2.org/tba_files/TCA/2010/walkerd_033010.pdf

Court reviews whether the TN Dealer Protection Act applies to the termination of a sales and service agreement between a distributor and a manufacturer

CONSTRUCTION CRANE AND TRACTOR, INC. v. WIRTGEN AMERICA, INC. (Tenn. Ct. App. March 25, 2010)

Distributor of road construction equipment sought an injunction and declaratory judgment against the manufacturer of such equipment following the manufacturer's termination of its sales and service agreement with the distributor without cause in accordance with the terms of the agreement. Distributor asserted that such termination violated the Tennessee Dealer Protection Act, Tenn. Code Ann. section 47-25-1301 et seq.

The trial court found that the statutory provision prohibiting manufacturers from terminating a dealer's relationship with the manufacturer without cause was inapplicable to the parties because the operative agreement between the parties pre-dated the 1999 amendments to the Tennessee Dealer Protection Act prohibiting such terminations. Distributor appeals. Finding no error, we affirm.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/wirtgenamerica_032510.pdf

Court reviews validity of a service mark license agreement in a service mark case

GUESTHOUSE INTERNATIONAL, LLC v. SHONEY'S NORTH AMERICA CORPORATION AND SHOLAND, LLC (Tenn. Ct. App. March 19, 2010)

This appeal involves a licensing agreement for service marks protected under trademark laws. One of the defendants is the owner of the service marks, which are used at both restaurants and motels. This original owner of the service marks sold the motel business along with the service marks, but it retained the restaurant business. After using the service marks for many years, the owner of the motel business decided to convert its motels from the service mark brand to another brand. Eventually, the owner of the motel business sold its motels to the plaintiff, and it included in the sale its rights under the service mark license agreement. Soon after that, the owner of the service marks sold its restaurant business and its service marks to the other defendant herein. When the plaintiff motel business attempted to franchise new motels using the service mark name, the defendant new owner of the service marks objected and terminated the license agreement.

The plaintiff motel business filed this lawsuit, alleging breach of contract, tortious interference with contract, and violation of the Tennessee Consumer Protection Act. It sought declaratory relief, injunctive relief, and restitution. The new service mark owner asserted that the license agreement was unenforceable based on lack of consideration, waiver, and fraud. The parties filed cross- motions for summary judgment.

The trial court denied the plaintiff's motion for summary judgment and granted summary judgment in favor of the defendants. The trial court concluded, inter alia, that the service mark license agreement assigned to the plaintiff was invalid for lack of consideration and, alternatively, that the plaintiff waived its right to franchise new motels using the service mark name. The plaintiff's complaint was dismissed in its entirety. The plaintiff now appeals.

We reverse, finding, inter alia, that the license agreement was supported by consideration, that no valid basis existed on which to terminate the license agreement, and that the doctrine of waiver is not applicable under the facts in this case. Furthermore, we find that the dismissal of the request for restitution as a remedy for the defendant's breach of contract is premature at this juncture.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/guesthouse_031910.pdf

Court reviews whether permit board had sufficient proof to revoke beer license

MALIK YAFAI d/b/a FAMILY MARKET v. METROPOLITAN BEER PERMIT BOARD OF METROPOLITAN GOVERNMENT OF NASHVILLE DAVIDSON COUNTY, TENNESSEE (Tenn. Ct. App. March 11, 2010)

The Metropolitan Nashville Beer Permit Board found that the owner of a grocery store had allowed illegal drugs to be sold on his premises, and it revoked his license to sell beer. The Chancery Court reversed the Board's action, finding that there was insufficient proof that the proprietor actually knew about the illegal activities. We affirm.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/yafaim_031110.pdf

Court reviews reasonableness of law firm's claimed value in its operating agreement

SHUTTLEWORTH, WILLIAMS, HARPER, WARING & DERRICK, PLLC v. GARY K. SMITH, SMITH, SABBATINI & MCLEARY, PLLC (Tenn. Ct. App. March 5, 2010)

This dispute is between an attorney and his former firm. All parties to this suit appeal the trial court's interpretation of their operating agreement about how the fees and expenses generated by the withdrawing member's cases should be apportioned among them. The operating agreement gave the firm discretion to value the services provided by its other members, but the trial court correctly determined that the firm's claimed value was not reasonable.

We reverse the trial court's holding with regard to the withdrawing lawyer's interest in a member's share of the expenses he is obligated to pay the firm. The trial court is affirmed on the issue of sanctions and as to its refusal to make an award to nonparties.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/shuttleworth_030510.pdf

Court reviews whether death can trigger dissolution of a company pursuant to the company's operating agreement

MITZI BAYNE RUTH, ET AL. v. HOME HEALTH CARE OF MIDDLE TENNESSEE, LLC, ET AL. (Tenn. Ct. App. March 3, 2010)

Mitzi Bayne Ruth, executrix of the Estate of Fred W. Bayne ("Executrix"), the Estate of Fred W. Bayne ("the Estate"), and Home Health Care of East Tennessee, Inc. ("HHC East") sued Home Health Care of Middle Tennessee, LLC ("the Company") and B. Fred Allred, III ("Allred") seeking, among other things, a declaratory judgment that Fred W. Bayne's death was an event triggering dissolution of the Company. Both plaintiffs and defendants filed motions for partial summary judgment.

After a hearing, the Trial Court entered an order granting plaintiffs' motion for partial summary judgment finding and holding, inter alia, that Fred W. Bayne's death was a liquidating event triggering the dissolution of the Company pursuant to the Company's Operating Agreement, and that Allred did not have the right pursuant to the Operating Agreement to purchase Fred W. Bayne's membership interest and continue the Company business. The Company and Allred appeal to this Court. We hold that the Operating Agreement was ambiguous, vacate the award of partial summary judgment, and remand to the Trial Court for further proceedings consistent with this Opinion.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/ruthm_030310.pdf

Court reviews whether certain transactions were loans in order to determine whether defendants were responsible as alter egos of a defunct nonprofit corporation

CHRISTINA ALTICE v. NATS, INC. ET AL. (Tenn. Ct. App. February 26, 2010)

Judgment creditor sued defendants to collect a judgment against a defunct nonprofit corporation, claiming defendants were the alter egos of the defunct corporation. In a prior appeal, this court instructed the parties to focus on whether certain transactions were or were not loans. If they were loans, then the plaintiff could not prove her case to make the defendants responsible for the judgment against the defunct corporation. The trial court found that the transactions were loans. We affirm.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/alticec_022610.pdf

Supreme Court Adopts Headquarters Test, Hampering Forum-Shopping Plaintiffs

High court defines 'headquarters' (February 23, 2010)

The U.S. Supreme Court may have made it more difficult for tort lawyers to bring lawsuits in plaintiff-friendly state courts with today's ruling that a company's principal place of business is typically its headquarters. The 9-0 ruling, authored by Justice Stephen G. Breyer, said a company should be considered a citizen of a state where its "nerve center" is located. The "nerve center" test will be used to establish diversity jurisdiction, allowing more lawsuits to be tried in federal rather than state courts.

Full story available at:
http://www.abajournal.com/news/article/supreme_court_adopts_headquarters_test_hampering_forum-shopping_plaintiffs/

Court reviews whether one party wrongfully dissociated from a partnership.

BEVERLY MORAN v. ELLIOT WILLENSKY (Tenn. Ct. App. February 3, 2010)

This case arises from a partnership gone bad. The trial court found that the Appellant wrongfully dissociated from the partnership. Pursuant to the Tennessee Uniform Partnership Act, Tenn. Code Ann. section 61-1-101 et seq., the trial court awarded Appellee project costs, and winding up costs, including attorney's fees. Appellant appeals. We affirm.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/moranb_020310.pdf

Court reviews whether greenhouses are real property or personal property for taxation purposes

HERMANN HOLTKAMP GREENHOUSES, INC. v. METROPOLITAN NASHVILLE AND DAVIDSON COUNTY, TENNESSEE, JO ANN NORTH, Assessor of Property for Davidson County, and TENNESSEE STATE BOARD OF EQUALIZATION (Tenn. Ct. App. February 3, 2010)

This appeal concerns the classification of property for taxation purposes. The petitioner commercial business grows plants in large greenhouses erected on its land. The county assessor of property classified the greenhouses as real property, to be taxed as such. The petitioner taxpayer appealed the assessor's classification, contending that the greenhouses are personal property. An administrative law judge concluded that the greenhouses are personal property, taxed at a lower rate than real property. The assessor appealed to the state board of equalization. The state board of equalization reversed the ALJ's decision and concluded that the greenhouses are real property.

The petitioner taxpayer then filed a petition for judicial review of the state board's decision. On cross motions for summary judgment, the trial court concluded that the greenhouses are real property and dismissed the taxpayer's petition. The petitioner taxpayer now appeals. Utilizing the common law of fixtures, we find that the greenhouses are properly classified as real property. Thus, we affirm the decision of the trial court.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/holtkamph_020310.pdf

Court reviews the timeliness of a TN Consumers Protection Act claim filing.

CITICAPITAL COMMERCIAL CORPORATION v. CLIFFORD COLL (Tenn. Ct. App. January 20, 2010)

A finance company that owned a security interest in a Hyundai excavator appeals the award of a judgment against it in favor of a consumer for violations of the Tennessee Consumer Protection Act.

The consumer alleged in his complaint that the creditor and the equipment company that sold the excavator to the consumer had engaged in unfair and deceptive trade practices, because the excavator was defective when it was delivered, it never worked properly, and the defendants failed to make repairs and refused to permit him to trade for another excavator. The financing company denied any wrongdoing and asserted the one-year statute of limitations as an affirmative defense. The equipment company that sold the excavator went out of business and dissolved prior to trial. The only claim tried was the consumer's TCPA claim against the finance company.

The trial court denied the finance company's Tenn. R. Civ. P. 50.01 motion for a directed verdict on the statute of limitations defense, finding that the TCPA claim was timely filed within the five-year statute of repose. At the conclusion of the jury trial, the consumer prevailed on his TCPA claim and the trial court awarded treble damages and attorneys' fees based on a finding the finance company "willfully and knowingly" violated the TCPA. We have determined the TCPA claim was barred by the one-year statute of limitations; therefore, the trial court erred in denying the motion for a directed verdict, and the judgment of the trial court is reversed.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/citicapital_012010.pdf