Old Hickory Coaches, LLC v. Star Coach Rentals, Inc. ( 2021 )

11/15/2021
IN THE COURT OF APPEALS OF TENNESSEE
AT NASHVILLE
September 15, 2021 Session
OLD HICKORY COACHES, LLC v. STAR COACH RENTALS, INC., ET
AL.
Appeal from the Chancery Court for Davidson County
No. 16-930-IV Russell T. Perkins, Chancellor
___________________________________
No. M2020-00941-COA-R3-CV
___________________________________
This appeal involves the enforcement of a revenue-sharing agreement between two
companies, in which one party supplied trailers and trucks and the other party leased the
trailers and trucks to television and film production companies in the New York City area.
Following a bench trial, the trial court entered its memorandum and order finding that the
leasing company owed the supplying company $101,529.00 in rental income and the
supplying company owed the leasing company $12,415.00 for major repairs and
renovations. Additionally, the trial court denied the supplying company’s motion to alter
or amend the judgment of the trial court to hold the owner of the leasing company
individually liable for the breach of contract. The supplier appeals. We affirm.
Tenn. R. App. R. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed
CARMA DENNIS MCGEE, J., delivered the opinion of the court, in which W. NEAL
MCBRAYER and ARNOLD B. GOLDIN, JJ., joined.
Stephen C. Knight and Nader Baydoun, Brentwood, Tennessee, for the appellant, Old
Hickory Coaches, LLC.
Davis F. Griffin and Cynthia A. Sherwood, Nashville, Tennessee, for the appellees, Star
Coach Rentals, Inc., and James Copeland.
OPINION
I. FACTS & PROCEDURAL HISTORY
In 2000, the principals of Old Hickory Coaches, LLC (“Old Hickory”) and Star
Coach Rentals, Inc. (“Star Coach”) agreed to a revenue-sharing agreement by a “handshake
deal.” Old Hickory was in the business of converting buses and trailers to meet the needs
of individual actors such as Nicholas Cage and Don Johnson. Sherry Wise was the manager
and an owner of Old Hickory.1 Star Coach was in the business of leasing trailers and trucks
to television and film production companies in the New York City area. James Copeland
was the owner of Star Coach, as well as its President and CEO. In this revenue-sharing
agreement between these two parties, Old Hickory would provide trailers and trucks that
would be leased by Star Coach to television and film production companies in the New
York City area. The parties agreed to the following terms: (1) Old Hickory would provide
the trailers and trucks; (2) Star Coach would lease the trailers and trucks to production
companies; (3) the parties would split the rental income 50/50; (4) Star Coach would be
responsible for routine maintenance and storage; and (5) Old Hickory would be responsible
for major repairs and renovations. As a result of this revenue-sharing agreement, the
trailers and trucks were leased to shows like The Sopranos, Sex and the City, and all three
Law & Order shows. For a majority of the parties’ time working together, Star Coach
leased the trailers and trucks to the production company for the television show Law &
Order: Special Victims Unit. For approximately a decade, the parties performed under this
agreement with no issues, but disagreements eventually arose between the parties, which
led to this lawsuit. Throughout the pendency of this lawsuit, the parties offered conflicting
testimony as to what exactly happened. These are their stories.
Originally in 2000, Old Hickory sent up to six trailers and six trucks to be leased by
Star Coach to production companies, as well as two Winnebagos and one camera truck.
The six trailers were 2000 Play-Mor trailers and the six trucks were Chevrolet two-wheel
drive, 3500 trucks. Mr. Copeland explained the trailer-truck unit as follows:
They were called two-actor trailers, meaning they were approximately 35
feet in length and they were separated in the middle, so there w[ere] two
entrance doors. And there were mirrored rooms, so that — each room would
have a bathroom, each room would have a dressing table, each room would
have a couch, and each room, I believe at the time, had a reclining chair. And
they were pulled by a Chevy two-wheel drive, 3500 truck.
Throughout the parties’ business relationship, the leasing price ranged from around $1,200
to $1,500 per trailer per week and $1,000 per truck per week.2 The rates were subject to
1
Ronald Wise, Ms. Wise’s husband, was the other member of Old Hickory. Mr. Wise testified that
his role in the business was as follows:
Sherry would consult me with our leasing contracts, the state of our equipment, whether
we need[ed] to purchase new equipment. So I was involved in those decision-makings as
far as income or potential-making income and — but I was not the face of the company,
per se. Sherry dealt with dealing with our customers.
2
The weekly rates for each year are as follows: (1) $1,200 per trailer and $1,000 per truck in 2008;
-2-
change from year to year, but the rates were fixed within each season once the trailers and
trucks were leased to a production company. Although Old Hickory initially provided Star
Coach with six trailers and six trucks, Mr. Copeland stated that they were only used in
whole from 2000 to 2007.
In 2007, a production company informed Mr. Copeland that it wanted new trailers
and trucks in order to renew its contract with Star Coach. As a result, Mr. Copeland
contacted Ms. Wise and the two of them visited a Play-Mor trailer manufacturer in
Missouri to look at purchasing two new 2008 trailers. The original six trailers were not
used again once they were replaced with the two new trailers. Although Ms. Wise ordered
the two trailers to be made and delivered to Star Coach, Old Hickory did not provide new
trucks. The parties’ testimony about the need for new trucks was conflicting.
Ms. Wise testified that the parties did not discuss having to get new trucks for the
trailers. Ms. Wise denied any discussion of having to get new trucks, which is shown in
her testimony as follows:
Q: Did y’all discuss having to get trucks?
A: No.
Q: You didn’t discuss having to get new trucks for the trailers?
A: No.
Mr. Copeland testified in his deposition that Old Hickory’s existing trucks would not
adequately pull the new trailers because the new trailers were bigger and heavier. As Mr.
Copeland explained it, the existing trucks were “light-duty” and the new trailers were
“heavy-duty.” According to Mr. Copeland, because the existing trucks weighed 16,000
pounds, a new 16,000-pound trailer attached to the hitch of one of these trucks would tend
to lift the truck’s front wheels off the ground. However, Ms. Wise testified in her
deposition that her trucks could have adequately pulled the trailers, that her trucks were
rated by General Motors to pull her trailers, and that she currently used her trucks to pull
the trailers.
According to Mr. Copeland, since the production company insisted on new trucks
in addition to the new trailers, he determined that he needed to buy new trucks if he wanted
to continue the contract with the production company. Mr. Copeland testified that he was
able to use a 2005 Chevy GMC 4500 crew cab already in his possession, but believing he
(2) $1,200 per trailer and $1,000 per truck in 2009 (the invoice shows $2,200 which represents the total
price for the trailer-truck unit); (3) $1,300 per trailer and $1,000 per truck in 2010; (4) $1,415 per trailer
and $1,000 per truck in 2011 (the invoice shows $2,415 which represents the total price for the trailer-truck
unit); (5) $1,415 per trailer and $1,000 per truck in 2012 (the invoice shows $2,415 which represents the
total price for the trailer-truck unit); (6) $1,294.25 per trailer and $1,000 per truck in 2013 (the invoice
shows $2,294.25 which represents the total price for the trailer-truck unit); (7) $1,294.25 per trailer and
$1,000 per truck in 2014; and (8) $1,294.25 per trailer and $1,000 per truck in 2015.
-3-
had no other option, he purchased a 2008 Ford F450 king cab for $62,000. Consequently,
Old Hickory’s existing trucks were not being used. Mr. Copeland testified that the parties
had a conversation about the new trucks:
[Ms. Wise], I believe she ordered the trailers to be made and delivered to my
garage. And I said, you know, they wanted new trucks as well, and she said,
you know, we’ve got to see about that. And the trailers came. The guys
dropped the trailers off and took off with the trucks. I said, what about the
trucks? The previous trucks, . . . [the production company] was complaining
about, and that’s why they wanted new trucks.
According to Mr. Copeland, Old Hickory did not provide the new trucks because Ms. Wise
could not afford them at that particular point in time. However, Ms. Wise testified that Mr.
Copeland never told her that he was leasing out his trucks along with her new trailers, that
she was not aware that her trucks were not working, and that she would have bought the
trucks he needed. Ms. Wise stated Mr. Copeland “[n]ever asked me, because I would have
gladly supplied the two trucks. I would have sold the six and bought the two to keep that
contract, because the six trailers weren’t working.” Again, Ms. Wise reiterated that “he
never asked me to buy trucks. I would have been stupid not to.” She agreed that she was
overpaid if her existing trucks were not being used, but maintained that she was never asked
to supply two new trucks and did not know her existing trucks were not being used.
In 2010, Ms. Wise became aware that Star Coach failed to make eleven weeks of
revenue-sharing payments to Old Hickory and informed Mr. Copeland about what she
believed to be missed payments. Ms. Wise also began to suspect that Mr. Copeland was
leasing her trailers for daily use without compensating Old Hickory for its share of the
profits. Ms. Wise explained that her suspicion arose from finding scripts and itineraries in
the drawers of her trailers from other television shows and Central Park jobs. Although
the parties’ testimony again conflicts, Ms. Wise testified that Mr. Copeland agreed to pay
Old Hickory for the missing payments, but initially the parties did not reach an agreement
as to how he would catch up. Ms. Wise had two email addresses which she believed that
Star Coach used for business purposes. In October 2010, she emailed Star Coach using
one of those addresses regarding her 2010 receivables and included a breakdown of each
missed payment. After receiving no response, she emailed Star Coach in May 2011 using
the other address. She also sent a letter to Star Coach in June 2011. In the letter, Ms. Wise
wrote in part the following:
The attached are my receivables records for Starcoach[] . . . . There are many
other productions that my equipment was used on. Will you please reconcile
it with your records? I am getting very concerned about the amount owed to
me and the very length of time that we are getting into to get payment for.
I have been very, very patient. The deal was 50 percent to Starcoach and 50
-4-
percent to [Old Hickory.]
As shown in this letter, Ms. Wise stated that the revenue-sharing agreement was between
Star Coach and Old Hickory only.3 As for the emails mentioned above, Mr. Copeland
testified that neither of the addresses used by Ms. Wise were correct. Sometime in 2011,
according to Ms. Wise, the parties purportedly agreed to split the income 75/25 until Star
Coach could pay off what was allegedly owed to Old Hickory from the 2010 missed
payments. Ms. Wise stated that Mr. Copeland told her, during a telephone conversation,
that he was going to pay her and he knew he missed the payments. Ms. Wise testified that
after the parties made this purported agreement, Mr. Copeland instead took seventy-five
percent for himself and gave twenty-five percent to her.
Mr. Copeland offered a very different explanation for this period of nonpayment in
2010 and then a subsequent period of reduced payment. Mr. Copeland explained that Star
Coach made “renovations” to the trailers in 2010, which included upgrading the televisions
and putting in new carpet, fixtures, and furniture. These renovations were mandated by
the production company in order for the trailers to continue to be used. Furthermore, the
trailers needed to be updated to comply with New York City’s Department of
Transportation regulations. In addition to these renovations, Star Coach replaced the
generators in the two trailers. This process involved bringing the new generator to the
trailer, getting the tools necessary for the replacement, disconnecting the necessary parts,
physically removing the old generator, installing the new generator, and reconnecting the
necessary parts. Moreover, the old generator had to be brought to a repair shop for overhaul
and the new generator had to be tested to ensure it was satisfactory. Star Coach also
replaced batteries, springs, and shackles in the trailers. A production company also had a
locksmith install combination locks on the trailers and billed Star Coach for the parts and
labor.
As explained before, major repairs and renovations were the responsibility of Old
Hickory, while maintenance was the responsibility of Star Coach. Mr. Copeland testified
that he informed Ms. Wise of the work he performed and she did not have the money to
pay for it, so he felt like he had to take the money out of the income that was owed to her.
However, Mr. Copeland testified that Ms. Wise begged him not to do this because she was
having some financial difficulties. Ms. Wise testified that Mr. Copeland never informed
her of these renovations and she did not remember a conversation between the two of them
about refurbishing the trailers. Although Ms. Wise did admit that she eventually learned
that some of these renovations took place, which she explained in her testimony as follows:
A: Like I said a while ago, he modified one room, took it from just a sitting
3
Despite Ms. Wise’s statement here, Old Hickory later filed a motion to alter or amend the
judgment of the trial court claiming that Mr. Copeland was an individual defendant in the underlying case
and also a party to the alleged contract in his individual capacity.
-5-
area to put a desk in it.
Q: Okay.
A: And then I’m sure he replaced carpet.
Q: And that’s all?
A: And then when he upgraded a couple of TVs, all he did was just where
the TV was inserted, the smaller ones, he just put a panel over it and mounted
a bigger TV.
After some time had passed, according to Mr. Copeland, he made the decision to start
withholding payments for several weeks to recuperate the money. Mr. Copeland testified
that this amount that he withheld from Ms. Wise did not fully reimburse him for the major
repairs and renovations to the trailers. However, Mr. Copeland believed the issue was
resolved after discussing the situation with Ms. Wise and withholding payments to Old
Hickory for eleven weeks.
Mr. Copeland testified that it was around this time when he realized that Ms. Wise
was being paid for both trailers and trucks when she was only providing the trailers. Mr.
Copeland believed that Old Hickory should have received money only for the trailers, and
not the trucks, because that was all that was provided by Old Hickory after 2007. Mr.
Copeland explained that the overpayment from 2007 to the end of 2010 was an oversight
on his part. Therefore, Mr. Copeland reduced Old Hickory’s payment from $1000 to $750
per week to correct this overpayment. Despite maintaining that this reduced payment was
still more than Ms. Wise was entitled to, Mr. Copeland continued to pay her $750 per week
because she insisted that she needed the money and he wanted to help her out. He testified
that “[y]es, I did overpay them. I continued to pay her [$]750, and she was not entitled to
[$]750.” Mr. Copeland believed that Ms. Wise was not entitled to $750 “[b]ecause she
was only entitled to 50 percent of the trailer rental. Whatever the trailer rented for, she was
entitled to 50 percent, and I don’t believe at any time that it was ever rented for $1,500,
which would be — half would be [$]750.” Ms. Wise testified that Mr. Copeland first
informed her of this overpayment in 2011.
After 2010, Mr. Copeland continued to make what he characterized as major repairs
and renovations to the trailers. Mr. Copeland replaced batteries, tires, tongue jacks, and a
fuel tank. Mr. Copeland also had to manually move a slide4 back in on one of the trailers.
After moving the slide back, Mr. Copeland discovered the drive motor was burnt and
needed to be replaced. Mr. Copeland testified that he was not reimbursed for this work
that occurred after 2010. Unlike the 2010 major repairs and renovations, Mr. Copeland
explained that he did not attempt to reimburse himself for this work for the following
reason:
4
The 2007 Play-Mor trailers were double-slide trailers, in which each room had a portion of it
where an electric motor would slide out and extend the overall dimensions of the room to add cabin space.
-6-
I can’t really answer that. I don’t — outside of that, I felt sorry. I felt bad
for her. We were, you know, friendly people. We worked together. As far
as I was concerned, the amount in 2010 was resolved, and I wasn’t in any
dire need of the money that I made out.
In all, Mr. Copeland estimated the total cost of these major repairs and renovations from
2010 to 2013 was $42,965.00.
In the spring or summer of 2015, the business relationship between the parties ended
after Mr. Copeland determined Star Coach could not continue to provide new trailers and
trucks for production companies. Mr. Copeland added the following:
I decided that I was 72 years old and that enough aggravation and hardship
was done, that I was going to downsize my business. I was not going to deal
with trailers any longer, and I didn’t want to spend my weekends underneath
trailers repairing them, and that I was going to end my relationship with
trailer rental to [the production company].
In August or September of 2015, Ms. Wise came and picked up the trailers. Ms. Wise
continued to email Mr. Copeland about her 2010 receivables that she argued Old Hickory
was never paid. Two emails were sent to a personal email address for Mr. Copeland and
two were sent to one of the email addresses she had previously used for Star Coach. In
February 2015, Ms. Wise emailed Star Coach stating that:
With the assumption that this is the last season for [Law & Order] SVU, I
would like to settle up with you.
First of all, a few years ago I called you and requested 75% of the rental to
recap the half season of 2010 that I did not get paid for. You said okay. I do
not know where the communication went wrong but you assumed that I
meant 75% for you. Of course, in no way would I have, out of the blue,
meant 75% for Starcoach, and surely it occurred to you that I wouldn’t have
meant that. Many times I tried to correct the misunderstanding but with no
luck. Presently I am suffering financially. Many of my older trailers are now
at the point of expensive repairs . . . and updating them to keep them
competitive. I also have the camera truck that you asked me to build that
rarely works. I never came close to breaking even on it.
As for as [sic] the new accommodations, I do not know why I am being hit
with these extra charges. Why wouldn’t that be absorbed in Starcoach’s fees.
I don’t understand why going from a[n] indoor warehouse to a[n] outside
yard would cause more expense on me. From the very beginning that
expense was covered by the rep fees.
-7-
Jim, I need my original 50% of the income, especially to help me recoup the
2010 income I did not receive. I will forward the income sheet that I gave
you in the past tomorrow. I will, however, agree to help with the storage fee
only if I receive the original 50%.
I certainly appreciate and have enjoyed working with you over the years and
I believe that we became good friends. However, ever since the
misunderstanding of the 75/25 percentage, I feel that I have been taken
advantage of. I don’t like that feeling at all and I’m sure that you didn’t
intend to do so.
...
I sincerely hope that you do not take this letter wrong, but I have tried to
discuss this with you with no result. This letter is strictly business and I
would like to see 50% on my next payment. Hope everything is good there
and thanks for everything.
Ms. Wise testified that she knew she was not responsible for the storage fee, but was
attempting to give Mr. Copeland some incentive to pay her what Old Hickory was owed.
Ms. Wise emailed Star Coach and Mr. Copeland again in July 2015 and October 2015, but
received no response. According to Mr. Copeland, Star Coach had an email address other
than the two that Ms. Wise used, but Mr. Copeland stated that Star Coach did not use emails
in its business. Mr. Copeland’s personal email address was the one that Ms. Wise used.
However, Mr. Copeland stated that he never received any emails from Ms. Wise or Old
Hickory and that Ms. Wise never referenced emails to him in their telephone conversations.
Ms. Wise admitted that Mr. Copeland never used emails or texts, and the parties would
primarily communicate by phone instead. Ms. Wise stated that she sent the emails to have
a record of her requests for payment.
On August 18, 2016, Old Hickory filed a complaint for claims of breach of contract
and promissory estoppel against Star Coach and Mr. Copeland. Thereafter, Star Coach
filed a motion to dismiss for lack of personal jurisdiction, which was denied by the trial
court. On December 20, 2016, Star Coach filed an answer and counterclaim asserting
unjust enrichment and money had and received. Old Hickory filed an answer to Star
Coach’s counterclaim.
A bench trial was held on January 21-22, 2020. At trial, Ms. Wise presented an
accounting of what she had estimated Old Hickory was owed. Mr. Copeland provided a
summary of the major repairs and renovations he performed on Old Hickory’s trailers from
2010 to 2013. Following the trial, the court entered an order requesting post-trial briefs.
On May 11, 2020, the trial court entered its memorandum and order. The trial court found
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that “[t]here [was] no evidence in the record that Mr. Copeland assumed personal liability
for any debts of Star Coach or that he personally claims a right to recover against Old
Hickory on the counterclaims asserted by Star Coach.” Furthermore, the trial court
determined the following:
[A]lthough Star Coach inquired about new trucks from Old Hickory and Old
Hickory was financially unable to provide new trucks at that time, Old
Hickory was unaware that Star Coach was not using Old Hickory’s trucks to
pull its new trailers. As such, Old Hickory did not materially breach the
parties’ agreement by failing to provide new trucks to pull its new trailers,
and Star Coach is bound by the parties’ agreement to provide 50% of the
rental income derived from leasing the Units to Old Hickory.
...
[T]he parties agreed that Old Hickory would be responsible for the cost of
repairs and renovations to its equipment, and the Court has previously
determined that Star Coach informed Old Hickory of the repairs and
renovations; Old Hickory was financially unable to afford the repairs and
renovations at that time; Star Coach performed the repairs and renovations;
and Star Coach considered the costs for repairs and renovations a debt.
The trial court awarded damages to Old Hickory in the amount of $101,529.00 for revenue-
sharing income due from September 2010 to 2015 pursuant to the parties’ agreement.5
Additionally, the trial court awarded damages to Star Coach in the amount of $12,415.00
for major repairs and renovations made to Old Hickory’s trailers after 2010.6 The trial
court declined to award attorneys’ fees to either party. On June 5, 2020, Old Hickory filed
a motion to alter or amend the judgment of the trial court claiming that Mr. Copeland was
an individual defendant in the underlying case and also a party to the alleged contract in
his individual capacity. The trial court entered an order denying Old Hickory’s motion to
alter or amend on the basis that Mr. Copeland acted in his capacity as President and CEO
of Star Coach at all times. On July 13, 2020, Old Hickory timely filed this appeal.
II. ISSUES PRESENTED
Old Hickory presents the following issues for review on appeal:
5
The trial court also awarded Old Hickory prejudgment interest in the amount of 5% per annum
pursuant to Tennessee Code Annotated section 47-14-123 and post-judgment interest in the amount of
6.75% per annum pursuant to Tennessee Code Annotated section 47-14-121 and section 47-14-122.
6
The trial court also awarded Star Coach prejudgment interest in the amount of 5% per annum
pursuant to Tennessee Code Annotated section 47-14-123 and post-judgment interest in the amount of
6.75% per annum pursuant to Tennessee Code Annotated section 47-14-121 and section 47-14-122.
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1. Mr. Copeland (1) is identified as a defendant in the Complaint, (2) is named a
defendant in every caption, (3) was served with a summons, (4) filed an answer and
counterclaim, and (5) participated in the lawsuit as a defendant. Is Mr. Copeland a
defendant?
2. In their answer, Star Coach and Mr. Copeland repeatedly admitted that they entered
into a contract with Old Hickory. Star Coach and Mr. Copeland also filed a
counterclaim alleging that the parties had entered into a contract. Did Mr. Copeland
admit that he entered into a contract with Old Hickory?
Star Coach and Mr. Copeland submit their own competing statement of the issues
and additional issues. Star Coach and Mr. Copeland present the following issues for review
on appeal, which we have slightly restated:
1. Whether the trial court was correct in holding that Mr. Copeland was only a party
to this lawsuit in his capacity as President and CEO of Star Coach when the
allegations in the Complaint dictate that he was not an individual defendant;
2. Whether the trial court was correct in holding that Mr. Copeland only ever
conducted business with Old Hickory in his capacity as President and CEO of Star
Coach when there was no evidence introduced at trial or otherwise in the record
suggesting otherwise;
3. Whether the trial court erred in finding that the oral agreement between Old Hickory
and Star Coach formed an enforceable contract;
4. Whether the trial court erred in failing to find Old Hickory was unjustly enriched
and awarding quasi-contract damages to Star Coach for overpayments and expenses
when there was no enforceable contract in place on the subject matter;
5. Whether, even if an enforceable oral contract was formed between Star Coach and
Old Hickory, the trial court erred in finding Star Coach breached the contract and/or
in awarding Old Hickory any damages; and
6. Whether, even if an enforceable oral contract was formed between Star Coach and
Old Hickory, the trial court erred in not awarding quasi-contract damages to Star
Coach under the theories of unjust enrichment and money had and received.
For the following reasons, we affirm the decision of the trial court.
III. STANDARD OF REVIEW
Because this case was tried before the trial court without a jury, we review the trial
court’s findings of fact de novo on the record, presuming those findings to be correct unless
the evidence preponderates otherwise. Regions Bank v. Bric Constructors, LLC, 380
S.W.3d 740, 760 (Tenn. Ct. App. 2011) (citing Tenn. R. App. P. 13(d)). “Because trial
courts are able to observe witnesses, assess their demeanor, and evaluate other indicators
of credibility, an assessment of credibility will not be overturned on appeal absent clear
and convincing evidence to the contrary.” Id. (quoting Hughes v. Metro. Gov’t of Nashville
- 10 -
& Davidson Cty., 340 S.W.3d 352, 360 (Tenn. 2011)). As for contract interpretation, our
standard of review is de novo on the record according no presumption of correctness to the
trial court’s conclusion of law. Allstate Ins. Co. v. Watson, 195 S.W.3d 609, 611 (Tenn.
2006) (citations omitted). As our supreme court has stated, “[a] cardinal rule of contract
interpretation is to ascertain and give effect to the intent of the parties.” Id. (citing
Christenberry v. Tipton, 160 S.W.3d 487, 494 (Tenn. 2005)).
IV. DISCUSSION
On appeal, Old Hickory argues two issues in regard to the trial court’s findings as
to Mr. Copeland. Those two concisely stated issues are (1) whether Mr. Copeland was a
defendant; and (2) whether Mr. Copeland admitted that he entered into a contract with Old
Hickory. Alternatively, Star Coach and Mr. Copeland submit two similar issues, which
are stated as follows:
1. Whether the trial court was correct in holding that Mr. Copeland was only a party
to this lawsuit in his capacity as President and CEO of Star Coach when the
allegations in the Complaint dictate that he was not an individual defendant; and
2. Whether the trial court was correct in holding that Mr. Copeland only ever
conducted business with Old Hickory in his capacity as President and CEO of Star
Coach when there was no evidence introduced at trial or otherwise in the record
suggesting otherwise.
In regard to these first two issues, the parties’ competing statements strike with different
sides of the sword, but nonetheless, the competing statements strike at the same crux on
this appeal.
A. Whether Mr. Copeland Admitted that He Entered into a Contract with Old Hickory
For reasons of efficiency, we first address whether Mr. Copeland admitted that he,
in his individual capacity, entered into a contract with Old Hickory. At the outset of this
particular discussion, we note that it is unlikely that Mr. Copeland was a party to the
agreement in his individual capacity because Ms. Wise clearly stated in communications
with Mr. Copeland in June 2011 that “[t]he deal was 50 percent to Starcoach and 50 percent
to [Old Hickory.]” Still, Old Hickory contends that Mr. Copeland admitted in the answer
and counterclaim that he entered into the contract, affirmatively alleged that he entered into
the contract, and asserted claims against Old Hickory based on the contract. As support
for this assertion, Old Hickory’s brief points to instances where the answer and
counterclaim used the plural form of “Defendants,” such as “Defendants agreed.”
However, the same paragraphs also use the term “it” in reference to “Defendants.”
We have discussed the law regarding the effect of admissions contained within a
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defendant’s answer. Sakaan v. Fedex Corp., Inc., No. W2016-00648-COA-R3-CV, 2016
WL 7396050, at *4 (Tenn. Ct. App. Dec. 21, 2016). In Sakaan, this Court stated the
following:
It is true that when the allegations of a complaint are admitted, “the subject
matter thereof is removed as an issue, no proof is necessary[,] and it becomes
conclusive on the parties.” Rast v. Terry, 532 S.W.2d 552, 554 (Tenn. 1976)
(citation omitted). Indeed, “[a]dmissions in pleadings are judicial admissions
that are conclusive on the pleader until withdrawn or amended.” Irvin v. City
of Clarksville, 767 S.W.2d 649, 653 (Tenn. Ct. App. 1988) (citation omitted).
It is important to recognize, however, that this principle extends to
admissions in pleadings regarding issues of fact. See John P. Saad & Sons,
Inc. v. Nashville Thermal Transfer Corp., 642 S.W.2d 151, 152 (Tenn. Ct.
App. 1982) (citation omitted) (“Facts confessed in pleadings are binding on
the parties[.]”). “A party is not ordinarily bound by admissions or averments
of legal conclusions.” Nichols v. Blocker, No. 87–110–II, 1988 WL 39569,
at *2 (Tenn. Ct. App. Apr. 29, 1988).
Id. This Court concluded in Sakaan that the defendants’ “inadvertent assent” to a legal
assertion was not controlling. Id. Additionally, the Sixth Circuit has stated that “[j]udicial
admissions of fact must be deliberate and clear, while legal conclusions are rarely
considered to be binding judicial admissions.” Commercial Money Ctr., Inc. v. Ill. Union
Ins. Co., 508 F.3d 327, 336 (6th Cir. 2007). Therefore, we must answer the question of
whether an alleged admission that one is a party to an agreement is a question of fact or a
question of law that requires a legal conclusion.
The Tennessee Supreme Court discussed the issue with the “fact/conclusion
dichotomy” as follows:
The differing viewpoints of the Iqbal majority and dissent illustrate a
fundamental problem with the fact/conclusion dichotomy: many, if not most,
allegations can be fairly described as at least having a “conclusory” aspect.
The problem is generally avoided by adhering to the principles that are
already well established in Tennessee for ruling on a motion to dismiss. The
texts of Federal Rule of Civil Procedure 8 and Tennessee Rule of Civil
Procedure 8.01 indicate that the drafters of the rules also aspired to avoid this
problem: the rules do not include terms such as “fact,” “conclusion,” or
“cause of action.”
This is not to say that there is absolutely no place for drawing an analytical
distinction between factual assertions and legal conclusions, however; as
noted, we stated in Riggs [v. Brunson] that “the legal conclusions set forth in
a complaint are not required to be taken as true.” [Riggs v. Brunson, 941
S.W.2d 44, 48 (Tenn. 1997)] (citing Dobbs v. Guenther, 846 S.W.2d 270,
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273 (Tenn.Ct.App.1992)).
Webb v. Nashville Area Habitat for Humanity, Inc., 346 S.W.3d 422, 434 (Tenn. 2011). In
a similar case to the case at bar, this Court found and held as a matter of law that a CEO
executed a contract at issue both in his capacity as CEO and in his individual capacity
personally guaranteeing the contract. Wise N. Shore Props., LLC v. 3 Daughters Media,
Inc., No. E2013-01953-COA-R3-CV, 2014 WL 2854258, at *1 (Tenn. Ct. App. June 23,
2014) (emphasis added). Wise and other cases have held that the execution of an
individual’s second signature on a contract personally guaranteeing the contract supports a
finding that the clear intent of the parties to the contract was for the individual to be held
personally liable. Id. at *3-4; see MLG Enters., LLC v. Johnson, 507 S.W.3d 183, 188-91
(Tenn. 2016), rev’g MLG Enters., LLC v. Johnson, No. M2014-01205-COA-R3-CV, 2015
WL 4162722, at *7 (Tenn. Ct. App. July 9, 2015). In this situation, “courts must bear in
mind ‘the general rule regarding the signature of a corporate representative’ in conjunction
with our supreme court’s statement regarding ‘the clear intent of the parties as gleaned
from the Contract itself.’” Hight v. Tramel, No. M2019-00845-COA-R3-CV, 2020 WL
6748789, at *5 n.5 (Tenn. Ct. App. Nov. 17, 2020) (quoting Wise, 2014 WL 2854258, at
*2).
This Court has also differentiated between an admission of the existence of a
contract and an admission that a contract is binding and enforceable. Nichols, 1988 WL
39569, at *2. In Nichols, we explained the difference as follows:
It is true that the admission of the existence of a contract is binding upon the
party who so pleads. However, the admission of the existence of a contract
is not an admission of a binding, enforceable contract.
A party is not ordinarily bound by admission or averments of legal
conclusions, as for example, an admission as to the legal effect of a written
instrument or by the name given to it.
Id. at *2 (citing 71 C.J.S. Pleading § 59(d)). Thus, a party may admit the existence of a
contract, but that admission does not establish whether the contract is one that is
enforceable and has bound certain parties to its obligations. It is for a court to determine
the legal effect of a contract, and consequently, a party is not ordinarily bound to an
admission or averment concerning the legal effect of a contract because it is a legal
conclusion for the court to make. See id.
Unfortunately, since this case involves an oral agreement between the parties, we
do not have the benefit of a written contract in this case “to ascertain and give effect to the
intent of the parties.” Watson, 195 S.W.3d at 611 (citing Christenberry, 160 S.W.3d at
494). Regarding oral agreements, the Tennessee Supreme Court has explained that:
[A] court [is not] required to accredit an affiant’s legal conclusions, such as
Mr. Battah’s characterizations of the relationships between [defendant] and
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its distribution companies, or Mr. Battah’s belief that he had an informal,
“oral” distribution agreement that included NV Sumatra as a party. Mr.
Battah has not demonstrated that he possesses the expertise necessary to draw
conclusions of this sort, and the record contains no documentary or other
reliable evidence to support them.
State v. NV Sumatra Tobacco Trading Co., 403 S.W.3d 726, 735 n.22 (Tenn. 2013). We
are persuaded from a reading of the case law that a party is not bound by an admission that
it is a party to an oral contract because that is a legal conclusion, the determination of which
properly rests with the court. See Sakaan, 2016 WL 7396050, at *4 (“[Plaintiff] correctly
cites the law regarding the effect of admissions contained within a defendant’s answer. . .
. In our opinion, [Plaintiff’s] averment . . . amounted to nothing more than a legal
conclusion, the determination of which would properly rest with the trial court.”).
Accordingly, regardless of whether Mr. Copeland allegedly admitted that he—in his
individual capacity—entered into a contract with Old Hickory in the answer or
counterclaim, we conclude that Mr. Copeland would not be bound by this admission
because it is a legal conclusion not required to be taken as true. A court is not required to
accredit a party’s legal conclusions, particularly those that conclude whether an oral
agreement includes certain parties. See NV Sumatra Tobacco Trading Co., 403 S.W.3d at
735 n.22. What Old Hickory contends was an admission of personal liability by Mr.
Copeland, we view as nothing more than an “inadvertent assent” to a legal assertion.
Sakaan, 2016 WL 7396050, at *4. Therefore, we cannot find that there was an admission
by Mr. Copeland that he was an individual party to the contract. Because Old Hickory
limits its argument to the implications of Mr. Copeland’s admissions, we need not address
whether Mr. Copeland was actually personally liable for the contract because “[a]ppellate
review is generally limited to the issues that have been presented for review.”7 Hodge v.
Craig, 382 S.W.3d 325, 334 (Tenn. 2012).
B. Whether Mr. Copeland was a Defendant
We now address the issue of whether Mr. Copeland was a defendant. In its
memorandum and order, the trial court began its discussion on personal liability with the
following sentence: “Old Hickory purports to sue Mr. Copeland in his personal capacity
for breach of contract.” The trial court then concluded that there was no evidence in the
record that Mr. Copeland assumed personal liability for any debts of Star Coach or that he
personally claimed a right to recover against Old Hickory on the counterclaims asserted by
Star Coach. In response, Old Hickory filed a motion to alter or amend the judgment of the
trial court claiming that Mr. Copeland was an individual defendant in the underlying case
and also a party to the alleged contract in his individual capacity. However, the trial court
denied this motion stating that “the parties’ generous use of plural references in the
7
We do note, however, that even Ms. Wise characterized in her letter in June 2011 that “[t]he deal
was 50 percent to Starcoach and 50 percent to [Old Hickory.]”
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pleadings should not be construed to create a contractual obligation which, under the
unique circumstances present here, does not appear to be contemplated by the parties.” In
its order on the motion to alter or amend, the trial court initially and inexplicably appeared
to question whether Mr. Copeland was named as an individual defendant in the first place
but nevertheless reiterated its finding in its memorandum and order as follows:
As previously determined in the Court’s May 11, 2020 Memorandum and
Order, to the extent Old Hickory is asserting personal liability against Mr.
Copeland on the theory that Mr. Copeland was a party to the revenue-sharing
contract, the Court determines that Mr. Copeland was a party to the contract
in his official capacity as President and CEO of Star Coach only. There is
no evidence in the record that Mr. Copeland assumed personal liability for
any debts of Star Coach or that he personally claims a right to recover against
Old Hickory on the counterclaims asserted by Star Coach. Rather, the
evidence demonstrates that Mr. Copeland was acting at all times relevant
hereto as the President and CEO of Star Coach.
(emphasis added).
Regardless of the court’s statement questioning whether Mr. Copeland was a
defendant to the case, the trial court, by the terms of its order, considered the potential
personal liability of Mr. Copeland. After the trial and consideration of the post-trial
motion, the court found no evidence of any personal liability against Mr. Copeland. Based
upon our findings regarding a lack of admission that he was a party, and the trial court’s
ultimate consideration of the potential liability of Mr. Copeland, we determine that this
Court need not reach the initial technicality of whether Mr. Copeland was a defendant, or
more precisely, whether Mr. Copeland was properly identified as a party defendant in the
complaint and given proper notice that he was being sued in his individual capacity. Even
assuming arguendo that he was named in his individual capacity, the trial court found that
Old Hickory did not prove personal liability against Mr. Copeland and Mr. Copeland
should not be held personally liable for the damages awarded to Old Hickory. The trial
court made that abundantly clear stating that “to the extent Old Hickory is asserting
personal liability against Mr. Copeland . . . , the Court determines that Mr. Copeland was
a party to the contract in his official capacity as President and CEO of Star Coach only.”
Old Hickory conceded in its post-trial brief that the question of piercing the corporate veil
was not before the trial court. Moreover, aside from the issue regarding admissions, Old
Hickory does not raise the issue of personal liability on appeal and we are “limited to the
issues that have been presented for review.” Hodge, 382 S.W.3d at 334. Thus, we find no
merit in this issue.
C. Star Coach’s Additional Issues
i. Formation of an Enforceable Contract
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Star Coach presents four additional issues on appeal. The first of those is whether
the trial court erred in finding that the oral agreement between Old Hickory and Star Coach
formed an enforceable contract under the statute of frauds. The Tennessee statute of frauds
requires in part that:
(a) No action shall be brought:
...
(5) Upon any agreement or contract which is not to be performed within the
space of one (1) year from the making of the agreement or contract;
unless the promise or agreement, upon which such action shall be brought,
or some memorandum or note thereof, shall be in writing, and signed by the
party to be charged therewith, or some other person lawfully authorized by
such party.
Tenn. Code Ann. § 29-2-101(a)(5). This Court has noted that if an oral contract is formed,
“the statute of frauds would not bar its enforcement because it was possible for defendant
to complete performance within one year.” Tolliver v. Tellico Vill. Prop. Owners Ass’n,
Inc., 579 S.W.3d 8, 29 n.12 (Tenn. Ct. App. 2019); see Tenn. Code Ann. § 29-2-101(a)(5);
Boutwell v. Lewis Bros. Lumber Co., 182 S.W.2d 1, 3 (Tenn. Ct. App. 1944) (“The mere
fact that the contract might continue for more than a year does not bring it within the statute
. . . . Nor is improbability of performance sufficient if the contract is susceptible to being
performed within the year[.]” (citations omitted)). In Boutwell, this Court found the
following excerpt from the Corpus Juris Secundum to be supportive:
‘The question is not what the probable, expected, or actual performance of
the contract may be, but whether, according to the reasonable interpretation
of its terms, it requires that it should not be performed within the year. Unless
the court, looking at the contract in view of the surroundings, can say that in
no reasonable probability can such agreement be performed within the year,
it is its duty to uphold the contract.’
Boutwell, 182 S.W. 2d at 3 (quoting 37 C.J.S., Frauds, Statute of, § 44).
At trial, Mr. Copeland explained that, early on, production companies would enter
into five-year contracts with his business. However, as time went on the production
companies became unsure about renewal, and thus, they changed to annual contracts. Mr.
Copeland stated that “[c]ontracts ran from year to year,” and a normal season of leasing to
production companies was “[a]pproximately 26 weeks.” The trial court found that “it [was]
possible that the parties’ agreement could have been fully performed within the space of
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one year.” We agree. It was possible for the contract to be completed within one year, and
consequently, the statute of frauds does not bar the enforcement of this oral agreement.
Therefore, we find that the trial court did not err in finding that the oral agreement between
Old Hickory and Star Coach formed an enforceable contract. Furthermore, because we
find that the statute of frauds does not bar enforcement of this contract, we need not
consider the partial performance exception to the statute of frauds.
ii. Unjust Enrichment and Quasi-Contract Damages If There Was No Enforceable
Contract
The second issue raised by Star Coach is whether the trial court erred in failing to
find Old Hickory was unjustly enriched and failing to award quasi-contract damages to
Star Coach for overpayments and expenses when there was no enforceable contract in place
on the subject matter. Because we have previously found that there was an enforceable
contract, this issue on unjust enrichment and quasi-contract damages is pretermitted.
iii. Breach of Contract and/or Award of Damages
Star Coach’s third issue is whether, even if an enforceable oral contract was formed
between Star Coach and Old Hickory, the trial court erred in finding Star Coach breached
the contract and/or in awarding Old Hickory any damages. Specifically, Star Coach argues
that it did not breach the contract, but that any breach it may have committed was preceded
by Old Hickory’s prior material breach. Star Coach further argues that the trial court erred
by finding that it had waived any right to assert Old Hickory’s first material breach of the
contract, and that Star Coach paid Old Hickory “every dollar to which Old Hickory was
entitled.”
The trial court found that there was no evidence in the record that Mr. Copeland
informed Ms. Wise that Star Coach was going to keep 100% of the rental income from the
trucks while only paying Old Hickory one-half of the rental income derived from the
trailers. Furthermore, the trial court found that Star Coach was responsible for paying Old
Hickory 50% of the rental income for each trailer-truck unit, not just the trailers, in
accordance with the parties’ agreement. Therefore, the trial court held that Star Coach did
not overpay Old Hickory, but rather, underpaid it.
To begin, we note that in Tennessee, “[r]equiring notice and a reasonable
opportunity to cure defects in the performance of a contract is a sound principle.” Custom
Built Homes by Ed Harris v. McNamara, No. M2004-02703-COA-R3-CV, 2006 WL
3613583, at *5 (Tenn. Ct. App. Dec. 11, 2006) (citing Carter v. Krueger, 916 S.W.2d 932,
935 (Tenn. Ct. App. 1995)). In arguing that it did not breach the contract, Star Coach
claims that both the trial court and Old Hickory misconstrue this Court’s holding in
McClain v. Kimbrough Constr. Co., 806 S.W.2d 194 (Tenn. Ct. App. 1990). In that case,
this Court explained that “[r]equiring notice is a sound rule designed to allow the defaulting
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party to repair the defective work, to reduce the damages, to avoid additional defective
performance, and to promote the informal settlement of disputes.” Id. at 198 (citing
Pollard v. Saxe & Yolkes Dev. Co., 525 P.2d 88, 92 (1974); Sturdy Concrete Corp. v. Nab
Constr. Corp., 411 N.Y.S.2d 637, 644 (1978)). “Notice ought to be given when
information material to the performance of a contract is within the peculiar knowledge of
only one of the contracting parties.” Id. Applying the duty of notice to the facts of the
case at bar, we fail to see a misconstruction of McClain by the trial court and Old Hickory.
Despite the conflicting testimony of the parties, the trial court credited both Mr.
Copeland’s and Ms. Wise’s testimonies on this issue.8 We reiterate that “trial courts are
able to observe witnesses, assess their demeanor, and evaluate other indicators of
credibility,” and therefore, “an assessment of credibility will not be overturned on appeal
absent clear and convincing evidence to the contrary.” Regions Bank, 380 S.W.3d at 760
(quoting Hughes v. Metro. Gov’t of Nashville & Davidson Cty., 340 S.W.3d 352, 360
(Tenn. 2011)). The trial court found no evidence in the record that Mr. Copeland informed
Ms. Wise that Star Coach was going to keep 100% of the rental income from the trucks
while only remitting payment to Old Hickory for half of the rental income derived from
the trailers. Just as the trial court found, we conclude that although some discussion about
new trucks occurred between the parties, Ms. Wise was not aware that her trucks were not
being used thereafter. Though the parties’ testimony was indistinct about what exactly
occurred relating to the new trucks, the record provided to this Court on appeal lacks
evidence that demonstrates Old Hickory was on notice that it must provide new trucks.
Consequently, because Ms. Wise had no notice that Old Hickory’s trucks were not being
used, she also had no notice that Star Coach was going to keep 100% of the rental income
derived from the trucks in the absence of Old Hickory providing new trucks. Regardless
of whether Old Hickory’s failure to provide new trucks would have been material, we find
that Star Coach failed to satisfy the notice requirement as explained by this Court in
McClain. McClain, 806 S.W.2d at 198. Without giving Old Hickory proper notice that
the contract with the production company could not continue without new trucks, Star
Coach chose to provide the trucks itself and continued leasing equipment to the production
company. Therefore, Star Coach breached the agreement with Old Hickory when it began
withholding the portion of the rental income that Old Hickory was entitled to because Star
Coach failed to impart “information material to the performance of [their] contract.” Id.Despite breaching the contract by withholding a portion of the rental income owed
to Old Hickory, Star Coach contends that the trial court erred in holding that Old Hickory’s
failure to provide new trucks was not a first material breach of the contract which preceded
Star Coach’s breach. “[A] party who commits the first uncured material breach of contract
may not recover damages for the other party’s material breach.” Madden Phillips Constr.,
Inc. v. GGAT Dev. Corp., 315 S.W.3d 800, 812 (Tenn. Ct. App. 2009) (citations omitted).
8
Although the trial court credited both Mr. Copeland’s and Ms. Wise’s testimony, their accounts
of the details of their transactions through the years differ greatly.
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Therefore, only Old Hickory’s uncured material failure to perform its obligations under the
contract would have excused Star Coach from performing its remaining obligations, those
being payment to Old Hickory. See McClain, 806 S.W.2d at 199. However, “[a] party
owed performance may . . . waive its right to assert the first uncured material breach as a
bar to recovery on its own subsequent breach.” Madden Phillips, 315 S.W.3d at 812(citations omitted). In Madden Phillips, this Court discussed the issue of waiver as follows:
Waiver is an affirmative defense. Tenn. R. Civ. P. 8.03. A party who raises
the issue of waiver has the burden of proving it by a preponderance of the
evidence. Jenkins Subway, Inc. v. Jones, 990 S.W.2d 713, 722
(Tenn.Ct.App.1998) (citations omitted). This burden requires proof of some
“‘absolute action or inaction inconsistent with the claim or right’ waived.”
Id. (quoting Koontz v. Fleming, 17 Tenn.App. 1, 65 S.W.2d 821, 825 (1933)).
Id. at 813-14. Moreover, this Court recognized that “[i]n general, by accepting benefits
under a contract with knowledge of a breach, the non-breaching party waives the breach.”
Id. at 815 (quoting 94th Aero Squadron of Memphis, Inc. v. Memphis-Shelby Cty. Airport,
169 S.W.3d 627, 635-36 (Tenn. Ct. App. 2004)). A non-breaching party waives a breach
“by ‘express declaration; or by acts and declarations manifesting an intent and purpose not
to claim the supposed advantage; or by course of acts and conduct, or by so neglecting and
failing to act, as to induce a belief that it was [the party’s] intention and purpose to waive.’”
Id. (quoting Aero Squadron, 169 S.W.3d at 636). Ultimately, this Court concluded in
Madden Phillips that the non-breaching party waived its right to assert the breaching
party’s suspension of performance as the first uncured material breach. Id. at 816. In
Carter v. Krueger, this Court followed McClain and held the following:
Without question, the first breach was attributable to the appellee in that he
failed to construct the addition to the appellant’s building in accordance with
the standards imposed upon him. We cannot say, however, that his breach
was an ‘uncured material breach’ because he was never given proper notice
of the claimed defects or an opportunity to ‘cure’ the breach.
Carter, 916 S.W.2d at 937.
Star Coach contends that it did not waive its right to assert Old Hickory’s first
material breach as a bar to Old Hickory’s breach of contract claim and that Star Coach paid
Old Hickory “every dollar to which Old Hickory was entitled.” We cannot agree. We find
that Star Coach, through its course of acts and conduct, waived its right to assert that Old
Hickory committed the first uncured material breach. As stated before, “by accepting
benefits under a contract with knowledge of a breach, the non-breaching party waives the
breach.” Madden Phillips, 315 S.W.3d at 815 (quoting Aero Squadron, 169 S.W.3d at 635-
36). Although Old Hickory did not provide new trucks, Star Coach continued under the
contract with Old Hickory after the new trailers were ordered and delivered. Star Coach
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began reducing payments around 2011, but the parties continued to work together until
2015. Old Hickory did not provide new trucks, but Star Coach retained possession of Old
Hickory’s trucks and trailers and continued to use the trailers to rent to production
companies.
Similar to the holding in Carter, the first breach may arguably have been attributable
to Old Hickory in that it failed to provide new trucks. Carter, 916 S.W.2d at 937.
However, by continuing under the revenue-sharing agreement, Star Coach waived its right
to assert Old Hickory’s alleged first material breach as a bar to Old Hickory’s breach of
contract claim. Old Hickory was not being paid what it was entitled to under the agreement
once Star Coach unilaterally began reducing payments.
iv. Quasi-Contract Damages Under the Theories of Unjust Enrichment and Money
Had, Money Received
The final issue presented by Star Coach is whether, even if an enforceable oral
contract was formed between Star Coach and Old Hickory, the trial court erred in not
awarding quasi-contract damages to Star Coach under the theories of unjust enrichment
and “money had, money received.” Having found that there was an enforceable contract,
we now address Star Coach’s contention that these quasi-contractual damages should be
awarded to them despite a finding of an enforceable contract.
First, Star Coach contends that it was entitled to quasi-contract damages under the
money had and received theory for the overpayments to Old Hickory. The claim for money
had and received is at least two centuries old in the State of Tennessee, as evidenced in the
Tennessee Superior Court of Law and Equity’s decision in Boyd v. Anderson, 1 Tenn. 438,
440 (1809) and Herd v. Vincent, 1 Tenn. 369, 369 (1808). In analyzing the claim for money
had and received, this Court has stated:
The action for money had and received is based upon an implied assumpsit.
It is an action at law, and properly cognizable in a court of law, and “is
maintainable in all cases where one person has received money or its
equivalent under such circumstances that in equity and good conscience he
ought not to retain it and ex aequo et bono it belongs to another.”
Interstate Life & Acc. Co. v. Cook, 86 S.W.2d 887, 891 (Tenn. Ct. App. 1935) (citations
omitted). Star Coach further claims that the trial court erred in not finding that Old Hickory
was unjustly enriched by Star Coach and not awarding Star Coach damages to its expense
from repairs, renovations, and replacements to Old Hickory’s trailers. Regarding unjust
enrichment, the Tennessee Supreme Court has explained that:
Actions brought upon theories of unjust enrichment, quasi contract, contracts
implied in law, and quantum meruit are essentially the same. Courts
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frequently employ the various terminology interchangeably to describe that
class of implied obligations where, on the basis of justice and equity, the law
will impose a contractual relationship between parties, regardless of their
assent thereto.
Paschall’s, Inc. v. Dozier, 407 S.W.2d 150, 154 (Tenn. 1966). More recently, this Court
has explained that “[b]oth unjust enrichment and money had and received are essentially
the same cause of action, being both quasi-contractual actions.” Bennett v. Visa U.S.A.
Inc., 198 S.W.3d 747, 755 (Tenn. Ct. App. 2006).
Star Coach cites to Farmers & Merchants Bank v. Midway Supply Co., Inc., No.
M1999-00147-COA-R3-CV, 2000 WL 356340, at *5 (Tenn. Ct. App. April 7, 2000),
arguing that money had and received should be awarded despite a finding of an enforceable
contract. In that case, this Court reiterated its holding from Interstate Life & Accident Co.
v. Cook, stating the following:
It is well settled in Tennessee that money paid upon consideration that
subsequently fails may be recovered. See Walker v. Walker, 3 Tenn.Civ.App.
670, 686 (1913). An action for money had and received is based upon an
implied assumpsit. It is properly cognizable in a court of law and may be
maintained where one receives money or its equivalent under such
circumstances that in equity and good conscience he ought not to retain and
in justice and fairness it belongs to another. Interstate Life & Accident Co.
v. Cook, 19 Tenn.App. 290, 86 S.W.2d 887, 891 (1935).
Farmers & Merchs. Bank, 2000 WL 356340, at *5. Star Coach also cites to Markow v.
Pollock, No. M2008-01720-COA-R3-CV, 2009 WL 4980264, at *4 (Tenn. Ct. App. Dec.
22, 2009), arguing that unjust enrichment damages should be awarded despite the existence
of a contract. In that case, this Court stated that “[t]o resolve unjust enrichment claims,
courts may impose a contractual relationship between the parties, regardless of their
assent.” Markow, 2009 WL 4980264, at *4; see Bennett v. Visa U.S.A. Inc., 198 S.W.3d
at 755.
We cannot find that these quasi-contractual damages should be awarded when there
has been a finding of an enforceable contract. It is well-established that a “quasi-
contractual theory” such as unjust enrichment or money had and received is one “in which
a court may impose a contractual obligation where one does not exist.” B & L Corp. v.
Thomas & Thorngren, Inc., 162 S.W.3d 189, 217 (Tenn. Ct. App. 2004) (citing Whitehaven
Cmty. Baptist Church v. Holloway, 973 S.W.2d 592, 596 (Tenn. 1998)). “Courts will
impose a contractual obligation under an unjust enrichment theory when: (1) there is no
contract between the parties or a contract has become unenforceable or invalid; and (2) the
defendant [or plaintiff] will be unjustly enriched absent a quasi-contractual obligation.”
Holloway, 973 S.W.2d at 596. “Where a contract is invalid or unenforceable, the court
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may impose a contractual obligation when the defendant will be unjustly enriched absent
a quasi-contractual obligation. ICG Link, Inc. v. Steen, 363 S.W.3d 533, 546 (Tenn. Ct.
App. 2011) (citing Doe v. HCA Health Servs. of Tenn., Inc., 46 S.W.3d 191, 197 (Tenn.
2001)). In our case, we have found that there is an enforceable contract which obligated
both parties to certain terms. Therefore, we find that the trial court properly denied Star
Coach’s requests for quasi-contract damages under the theories of unjust enrichment and
money had and received.
V. CONCLUSION
For the aforementioned reasons, we affirm the decision of the trial court. Costs of
this appeal are taxed to the appellant, Old Hickory Coaches, LLC, for which execution may
issue if necessary.
_________________________________
CARMA DENNIS MCGEE, JUDGE
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