E. Jay Mounger v. Charles D. Mounger, Jr. ( 2012 )

IN THE COURT OF APPEALS OF TENNESSEE
AT KNOXVILLE
January 31, 2012 Session
E. JAY MOUNGER ET AL. v. CHARLES D. MOUNGER, JR. ET AL.
Appeal from the Circuit Court for Roane County
No. 14402 Russell E. Simmons, Jr., Judge
No. E2010-02168-COA-R3-CV-FILED-MARCH 12, 2012
The plaintiffs, in their capacity as executors of their mother’s estate, filed this action against
their brother alleging that he caused the estate to lose the sale of a valuable piece of lakefront
property by maliciously asserting a meritless claim to a portion of the property. The
defendant represented himself in a jury trial. The jury awarded the estate $6,000,000. The
defendant appeals the judgment entered on the jury’s verdict. We affirm.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court
Affirmed; Case Remanded
C HARLES D. S USANO, J R., delivered the opinion of the Court, in which H ERSCHEL P. F RANKS,
P.J., and J OHN W. M CC LARTY, J., joined.
Charles D. Mounger, Jr., Kingston, Tennessee, appellant, pro se.
Archie R. Carpenter, Knoxville, Tennessee, for the appellees, E. Jay Mounger and Katherine
Mounger Lasater, Executors of the Estate of Katherine M. Mounger.
OPINION
I.
Katherine M. Mounger died owning several pieces of valuable property. This action
arises out of her estate’s attempt to sell one particular parcel consisting of approximately
1,200 acres of lakefront property in Roane County (“the Parcel”). Two of Mrs. Mounger’s
three children, E. Jay Mounger and Katherine M. Lasater, were named executors of her estate
(“the Estate”). By and through the executors, the Estate entered into a contract (“the
Contract”) to sell the Parcel to McKenzie Loudon Properties, LLC, for the price of
$15,200,000.
The Contract is dated May 9, 2007. It grants McKenzie a 120-day window to perform
its due diligence inquiry. The Contract provides for a 30-day extension of the due diligence
period. Closing is to occur within 30 days of the completion of McKenzie’s due diligence.
During the due diligence period, an appraiser, who was physically on the Parcel,
encountered Charles D. Mounger, Jr. (“the Defendant”), a sibling of the executors. The
Defendant informed the appraiser that he owned pieces of property within the Parcel and, in
fact, had constructed a home on the Parcel. The Defendant advised that any purchaser would
be forced to deal with him and that he would not be easy to deal with. The appraiser
informed McKenzie and McKenzie’s lender as well as the Estate of his encounter with the
Defendant. McKenzie considered the Defendant’s claims to be a cloud on the title. After
the time expired for closing under the strict terms of the Contract, the Defendant recorded
a deed from his mother dated March 27, 1995, purporting to grant him several small tracts
within the Parcel.
After several unsuccessful attempts by the Estate and McKenzie to settle with the
Defendant so that the sale could go forward, the Estate filed an action in chancery court to
clear the cloud on the title and eject the Defendant. The Estate prevailed. The chancery
court’s judgment is part of the record in the present action. It provides that the Defendant’s
deed is “void and of no effect” and orders the Defendant “immediately ejected from the
property of the [E]state in Roane County. . . .”
After clearing title to the Parcel and ejecting the Defendant, the Estate gave McKenzie
a further opportunity to close on the property. McKenzie declined, and the Estate filed the
present action alleging that it lost the sale because of the Defendant’s wrongful conduct. The
Estate also alleged that the market value of the Parcel had decreased greatly. The Defendant
answered with denials of almost all allegations of the complaint and asserted “res judicata
and estoppel, as affirmative defenses, as to any and all matters determined or could have been
determined in the prior litigation between the parties . . . .”
The case was tried to a jury. The Defendant represented himself. The jury awarded
the Estate compensatory damages of $6,000,000. The court entered judgment on the jury
verdict and later denied the Defendant’s motion for new trial. The Defendant appeals.
II.
The issues raised on appeal, taken verbatim from the Defendant’s brief, are:
-2-
Whether the Circuit Court erred by permitting the [Estate] to
introduce testimony concerning issues that were not in [the]
complaint.
Whether the Circuit Court erred by permitting the [Estate’s
witness] to testify as to the content of a document that was not
produced in discovery nor introduced as evidence in the trial.
Whether the Circuit Court erred by holding that the former suit,
tried in Roane County Chancery Court, involving the same
parties and same facts, was not a bar to this suit.
III.
A trial court’s rulings on evidentiary and discovery matters, including discovery
sanctions, is reviewed for abuse of discretion. Mercer v. Vanderbilt University, Inc., 134
S.W.3d 121, 131-33 (Tenn. 2004). Under this standard, a trial court will not be reversed on
appeal if reasonable minds could differ as to the soundness of the ruling. Id. at 133. A trial
court’s ruling on the affirmative defense of res judicata constitutes a conclusion of law that
is reviewed by us de novo with no presumption of correctness. In re Estate of Boote, 198
S.W.3d 699, 719 (Tenn. Ct. App. 2005); Morris v. Esmark Apparel, Inc., 832 S.W.2d 563,
566 (Tenn. Ct. App. 1991).
IV.
The Defendant’s argument combines a discussion of the first and second issues. The
Defendant claims that the testimony of his brother, E. Jay Mounger, on behalf of the Estate
is inconsistent with the allegations of the complaint in at least two significant respects. One
of his points concerns Jay Mounger’s testimony that McKenzie – upon learning that the
Defendant verbally asserted a claim to the appraiser, even before the Defendant recorded the
deed – considered the Defendant’s claim to be a cloud on the title. We find no inconsistency
here since the complaint clearly alleges that the Defendant informed the appraiser that he had
an unrecorded deed. Further, the complaint alleges that the appraiser’s encounter with the
Defendant caused serious enough concern that McKenzie’s lender stopped processing the
loan. Thus, we do not agree with the Defendant that the proof on this point was inconsistent
with the allegations of the complaint.
The second point concerns Jay Mounger’s testimony that McKenzie sent the Estate
written notification it considered the Defendant’s claims to be a cloud on the title. The
Defendant points out that the executors stated, in a response to the Defendant’s request for
-3-
production of documents, that no such writing existed. The Defendant appears to argue that
the verdict should be reversed on this basis or that the Estate should be sanctioned by
dismissal of their claim against him. The Defendant claims that he “objected” when this
testimony was given. We have reviewed the record before us and find no error. First, the
transcript does not show that the Defendant objected. He did inform the court of his
predicament in that he himself elicited testimony that surprised him, but he did not object,
or move to strike, or move for sanctions or anything of that nature. He merely informed the
court of his predicament and moved on with his cross-examination of his brother. There is
no copy of the alleged letter in the record before us. We are unable to discern whether Jay
Mounger was simply mistaken in remembering a letter that did not exist or in denying in
discovery that such a document existed. Whatever the truth, we are not presented with a
record that justifies finding an abuse of discretion on the part of the trial court, much less an
error that justifies reversing the jury’s verdict. See Tenn. R. App. P. 36(b). It is clear that,
despite the Defendant’s cross-examination of his brother, the jury had no problem accepting
the testimony of Jay Mounger as true. On the record before us, we would not be justified in
interfering with that finding.
The Defendant argues strenuously that the trial court should have dismissed the case
on his affirmative defense of res judicata. Again, we are unable to determine that the
Defendant put the court in a position to sustain the defense. His only proof during his case
in chief was the introduction of one document that has no bearing on the issue of res judicata
plus his nearly incoherent attempt to testify in narrative form to a lengthy history of the
property that has little bearing on the issues in this case. Page after page of the transcript is
filled with objections by counsel for the Estate to irrelevant testimony, which objections were
almost all sustained. There is no indication in the record before us that the defense of res
judicata, although stated in the answer, was ever presented to the court as a basis for
dismissing the Estate’s Complaint. The only reference to res judicata that we could find in
the transcript was in the context of an evidentiary objection lodged by the Estate. It is true
that the Defendant discussed the plea of res judicata in a motion for new trial, however, that
discussion is also in the context of an evidentiary objection. The record does not contain the
parties’ opening statements and argument to the jury or the court. In the absence of a record
showing that the defense of res judicata was presented to the trial court, we cannot consider
it:
. . . [I]t was the defendant’s responsibility, as the appellant, to
insure that the record on appeal contained all of the trial court
actions and events needed to convey a fair, accurate and
complete account of what transpired relative to the issue [of res
judicata] being appealed. See T.R.A.P. 24; State v. Groseclose,
615 S.W.2d 142, 147 (Tenn. 1981). Thus, even if the defendant
-4-
did raise the matter in the trial court, the lack of a record on
appeal of such matter requires us to presume that the trial court
ruled correctly. See State v. Jones, 623 S.W.2d 129, 131 (Tenn.
Crim. App.1981).
State v. Loden, No. 03C01-9702-CR-00075, 1998 WL 151135 at *2 (Tenn. Crim. App., filed
April 2, 1998). See also, Jones v. Lemoyne -Owen College, 308 S.W.3d 894, 902, 908
(Tenn. Ct. App. 2009)(appellant’s responsibility to prepare a record that shows he presented
the issue to the trial court and in the absence of that, this court will assume that the trial court
ruled correctly and treat the issue as waived). Further, we do not give relief on appeal to a
party who is responsible for an alleged error that he or she blames on the trial court. Tenn.
R. App. P. 36 (a).
Even if the Defendant properly raised the issue of res judicata, we are not convinced
that the chancery court action to clear title and for ejectment bars this action. The Defendant
insists that the Estate impermissibly split its cause of action, therefore, according to the
Defendant, the claims in this present action are barred because they could have been made
in the chancery court case. The Defendant is correct that the general rule is a party “cannot
split up his cause of action, but must include all grounds upon which he seeks relief in one
suit.” Caldwell v. Spicer & McEvoy, 19 S.W.2d 238, 239 (Tenn. 1929); see Regions
Financial Corp. v. Marsh USA, Inc., 310 S.W.3d 382, 397 (Tenn. Ct. App. 2009).
However, there is authority to the contrary regarding ejectment actions. Specifically, Tenn.
Code Ann. § 29-15-121 (2000) states, regarding chapter 15 of Title 29 of the Tennessee Code
which deals with ejectment actions: “This chapter does not deprive the plaintiff of a right to
an action for mesne profits after verdict and judgment in plaintiff’s favor . . . .” Further,
“[t]he action for mesne profits only accrues after a recovery in ejectment.” 10 Tenn. Juris.,
Ejectment § 34 (2011)(citing Avent v. Hord, 40 Tenn. (3 Head) 458 (1859); Rhodes v.
Crutchfield, 75 Tenn. (7 Lea) 518 (1881)); Whitaker v. Poston, 110 S.W. 1019, 1022 (Tenn.
1908). The term “mesne profits” is defined as the “[v]alue of use or occupation of land
during time it was held by one in wrongful possession and is commonly measured in terms
of rents and profits.” Blacks Law Dictionary, abridged 5th edition (1983). Damages are
allowed from the time of occupation until the time the interloper vacates the property. See
id. Neither party discusses the statute we have cited, but we see no logical reason for treating
the claim made by the Estate in this action different from an action for recovery of rent.
Normally, the measure of damages for being wrongfully dispossessed of real property is the
rental value of the property. Uhlhorn v. Keltner, 723 S.W.2d 131, 135 (Tenn. Ct. App.
1986). However, in this case, the unique facts before us justify an award of the damages
resulting from the lost sale. Accordingly, we find no error with regard to the Defendant’s
affirmative defense of res judicata asserted in his answer.
-5-
V.
The judgment of the trial court is affirmed. Costs on appeal are taxed to the appellant,
Charles D. Mounger, Jr. This case is remanded, pursuant to applicable law, for enforcement
of the trial court’s judgment and collection of costs assessed by the trial court.
_______________________________
CHARLES D. SUSANO, JR., JUDGE
-6-