Jimmy N. White v. Bruce White

IN THE COURT OF APPEALS OF TENNESSEE
AT JACKSON
NOVEMBER 18, 2010 Session
JIMMY N. WHITE, ET AL. v. BRUCE WHITE, ET AL.
Direct Appeal from the Chancery Court for Henderson County
No. 18020 James F. Butler, Chancellor
No. W2010-00891-COA-R3-CV - Filed February 4, 2011
This appeal arises out of the dissolution of a partnership. After several days of trial, the
parties reached a settlement agreement. After the partnership property was sold pursuant to
the settlement agreement and the proceeds were to be disbursed, one of the defendants
claimed that he was entitled to more money than the settlement agreement provided for him
to receive. The trial judge denied the request for additional funds. We affirm and remand
for the trial court to determine a reasonable and appropriate attorney’s fee.
Tenn. R. App. P. 3; Appeal as of Right; Judgment of the Chancery Court Affirmed and
Remanded
ALAN E. HIGHERS, P.J.,W.S., delivered the opinion of the court, in which DAVID R. FARMER, J., and
HOLLY M. KIRBY , J., joined.
Carthel L. Smith, Jr., Lexington, Tennessee, for the appellants, Bruce White, et al
William D. Bowen, Milan, Tennessee, for the appellees, Jimmy N. White, et al
OPINION
I. F ACTS & P ROCEDURAL H ISTORY
In 1995, Jimmy and Dorothy White (“Plaintiffs”) entered into a partnership with
Bruce and Tommie White (“Defendants”) in order to conduct business in land development.
Plaintiffs and Defendants purchased real property for development and sale, doing business
as Susan Branch Development, and thereafter, as White Properties. In 2004, Plaintiffs filed
this lawsuit alleging that Defendants had wrongfully and without consent applied partnership
monies to their own personal use. Plaintiffs sought a judgment dissolving the partnership
and requiring the partnership’s property to be sold, with the proceeds to be divided according
to the parties’ interests after creditors were paid and Plaintiffs were compensated for the
misappropriated funds.1 In the months and years that followed, much of the partnership
property was sold, and the funds were deposited with the clerk and master. The parties
agreed to numerous consent orders authorizing the payment of certain expenses from the
funds held by the clerk.
In April 2005, Defendants filed a motion requesting that they be allowed to use money
held by the clerk to pay property taxes owed by the partnership. One month later, a consent
order was entered that authorized the clerk to issue a check to Plaintiffs for $28,980, another
check to Defendants for $17,727, and a third check to the county trustee for $1,996.
A trial was held over multiple days, but prior to its conclusion, on February 22, 2007,
counsel for Plaintiffs announced in open court that the parties had reached a settlement. He
described the terms of the settlement, and the trial judge questioned all of the parties under
oath about their understanding of the settlement and their agreement to its terms. On April
12, 2007, a consent order was entered that contained the terms of the settlement agreement.
It first provided that Plaintiffs were awarded a judgment against Defendants in the amount
of $112,500. The order then provided that one-half of the funds currently held by the clerk
would be disbursed to Plaintiffs, and the other one-half of the funds would also be disbursed
to Plaintiffs but would be credited against the $112,500 judgment owed by Defendants.2 The
order further provided that the real estate still owned by the partnership would be listed with
a realtor for one year. Any proceeds from the sale of such real estate would be deposited
1
Defendants filed a counterclaim in which they asserted that they were entitled to compensation for their work
for the partnership. The parties later agreed to a consent order granting judgment to Plaintiffs in this regard, stating that
Defendants were not entitled to remuneration for expenses and labor they put forth on behalf of the partnership, with the
exception of expenses and labor to facilitate the winding up of the partnership's affairs.
2
Based upon the explanation given by Plaintiffs’ counsel in open court, it appears that Plaintiffs would receive
$66,703.10 as their one-half of the funds and $66,703.10 to be credited against the $112,500 judgment.
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with the clerk and disbursed to Plaintiffs until the remainder of the $112,500 judgment was
satisfied. Once the judgment was satisfied, however, the remaining proceeds were to be
disbursed equally to Plaintiffs and to Defendants. If, after the one-year listing period, the
parties did not agree to extend it, any remaining property would be sold at auction. Again,
the auction proceeds were to be deposited with the clerk and disbursed to Plaintiffs until the
$112,500 judgment was satisfied. Once the judgment was satisfied, any remaining proceeds
were to be disbursed in equal shares to Plaintiffs and to Defendants. The parties further
agreed that Plaintiffs would abandon their demand for discretionary costs and that
Defendants would abandon any claim for compensation for winding up the partnership
affairs. Finally, the order provided that court costs would be equally divided and the parties
would pay their own attorney’s fees.
The property was listed with a realtor, and after the one-year listing period expired,
Plaintiffs filed a motion requesting judicial supervision and seeking authority to take the
actions necessary to wind up the partnership affairs. The motion stated that an auctioneer
had been selected for the purpose of disposing of the partnership’s remaining real estate. On
April 30, 2009, an agreed order was entered that granted Plaintiffs’ motion and provided that
after the property was disposed of at auction, the entire sale proceeds would be deposited
with the clerk. From those proceeds, the order provided that the clerk would first pay the
auctioneer for his services, then reimburse Plaintiffs for their authorized expenses, then pay
Plaintiffs an amount sufficient to satisfy the unpaid remainder of the $112,500 judgment.
Finally, the clerk was to disburse any remaining money to the parties in equal one-half
shares.
After the auction was held, Plaintiffs filed a motion requesting an order approving the
disbursements authorized by the previous consent order, but with specific figures to be paid
to the auctioneer and to each party. At a hearing on the motion, counsel for Defendants 3
argued that the residual balance should not be divided equally between the parties because
Plaintiffs had received $11,253 more than Defendants prior to trial, in 2005, pursuant to the
consent order that authorized the clerk to issue a $28,980 check to Plaintiffs and a $17,727
check to Defendants. The trial court denied Defendants’ request for additional funds and
divided the remaining funds equally. Defendant Bruce White timely filed a notice of appeal.
3
Defendants’ previous attorney had withdrawn, and another attorney appeared on behalf of Defendants at the
hearing.
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II. I SSUES P RESENTED
On appeal, Defendant contends that Plaintiffs were “awarded monies above what was
the intent and agreement of the parties” and that Plaintiffs were thereby unjustly enriched.
Plaintiffs, on the other hand, argue that this appeal is frivolous.
III. D ISCUSSION
A. Division of the Remaining Funds
The settlement reached by the parties in 2007 provided that after the $112,500
judgment was satisfied, any remaining funds would be “disbursed in equal shares to the
Plaintiffs and Defendants.” The April 30, 2009 Agreed Order similarly provided that “[a]ny
residual monies [would] be disbursed in equal one-half (½) shares, with one-half (½) to be
disbursed to the Plaintiffs, Jimmy N. White and Dorothy White, and the other one-half (½)
to be disbursed to the Defendants, Bruce White and Tommie White (Campbell).”
On appeal, Defendant points out that these consent orders did not mention the $11,000
discrepancy in the 2005 consent order and did not expressly waive Defendants’ right to
recoup that money. However, these were detailed orders, which addressed every issue down
to the payment of court costs and attorney’s fees. When the terms of the settlement were
announced in open court, the trial judge asked the parties, under oath, whether they
understood the terms of the agreement and whether they thought the settlement was a fair and
equitable way to settle “all the issues in this case,” to which all of the parties replied, “Yes,
sir.” We reject Defendant’s assertion that he could come back later and request an additional
$11,000 to be paid from the remaining funds.4 We further conclude that Defendant cannot
complain that Plaintiffs were unjustly enriched, when he agreed to the method of
disbursement utilized by the trial court. “It is well settled in Tennessee that consent orders
are valid and binding.” Bacardi v. Tenn. Bd. of Registration in Podiatry, 124 S.W.3d 553,
562 (Tenn. Ct. App. 2003) (citing Underwood v. Zurich Ins. Co., 854 S.W.2d 94, 97 (Tenn.
4
Defendant claims that the trial court found that he did not waive his right to recover the extra money. From
an examination of the trial judge’s remarks, in their entirety, it is clear that the trial judge did not make such a finding.
He stated,
On the issue relative to the M ay 5, '05 order, the Court denies the right to go back and start over with
this trying to equalize the distribution at that point. There was nothing reserved in that order. W e’ve
had a number of orders come through since that time. Nothing has been waived. Nothing has been
reserved about that order ever in any order that I see. And the final order merges all of these previous
orders. And anything that’s left unsaid or undone, by implication or otherwise, are merged into the
final order. And so that’s why we have – that’s why we have orders. The final order is to bring things
to an end. So that will be denied.
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1993)). “‘[T]he reason for the unassailability of a consent decree is based on the
well-founded maxim volenti non fit injuria (he who consents to what is done cannot
complain of it).’” Id. (quoting Gardiner v. Word, 731 S.W.2d 889, 893 (Tenn. 1987)).
B. Attorney’s fees on Appeal
As noted above, Plaintiffs contend that this appeal is frivolous and that they should
be awarded their attorney’s fees on appeal. Tennessee Code Annotated section 27-1-122
provides:
When it appears to any reviewing court that the appeal from any court of
record was frivolous or taken solely for delay, the court may, either upon
motion of a party or of its own motion, award just damages against the
appellant, which may include, but need not be limited to, costs, interest on the
judgment, and expenses incurred by the appellee as a result of the appeal.
A frivolous appeal is one that is devoid of merit or has little prospect for success. Robinson
v. Currey, 153 S.W.3d 32, 42 (Tenn. Ct. App. 2004). The decision to award damages for the
filing of a frivolous appeal rests solely in the discretion of this Court. Whalum v. Marshall,
224 S.W.3d 169, 180-81 (Tenn. Ct. App. 2006) (citing Banks v. St. Francis Hosp., 697
S.W.2d 340, 343 (Tenn. 1985)). We exercise our discretion under this statute sparingly so
as not to discourage legitimate appeals. Id. However, we are also mindful that “[s]uccessful
litigants should not have to bear the expense and vexation of groundless appeals.” Id. at 181
(quoting Davis v. Gulf Ins. Group, 546 S.W.2d 583, 586 (Tenn. 1977)). In this case, we find
it equitable to award Plaintiffs their attorney’s fees on appeal.
IV. C ONCLUSION
For the aforementioned reasons, we affirm the decision of the chancery court and
remand for the trial court to determine a reasonable and appropriate attorney’s fee. Costs of
this appeal are taxed to the appellant, Bruce White, and his surety, for which execution may
issue if necessary.
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ALAN E. HIGHERS, P.J., W.S.
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