Damon Holland v. Brian Sullivan ( 2017 )

09/07/2017
IN THE COURT OF APPEALS OF TENNESSEE
AT NASHVILLE
April 11, 2017 Session
DAMON HOLLAND V. BRIAN SULLIVAN, ET AL.
Appeal from the Circuit Court for Davidson County
No. 16C86 Joseph P. Binkley Jr., Judge
No. M2016-00538-COA-R3-CV
The issues in this appeal arise from two very unorthodox agreements and the defendants’
actions to avoid the consequences of the agreements. The agreements are unorthodox
because, inter alia, each purports to be a “Bill of Sale” of an automobile when in fact
each is a loan agreement for which the certificate of title is held by the lender as security.
To complicate matters, the defendant who signed both agreements only owned one of the
vehicles; his wife owned the other, and it is disputed whether the husband was authorized
to act on her behalf. When the husband failed to pay either debt, the lender attempted
unsuccessfully to possess the vehicles. Immediately thereafter, the husband and wife
applied for and obtained new certificates of title and then used one of the duplicate titles
to sell one of the automobiles to a third party. Thereafter, the lender commenced this
action against the husband and wife for breach of contract, slander of title, and conspiracy
to commit slander of title. The lender sought both compensatory and punitive damages.
Following a bench trial, the court found the husband liable for breach of contract, and
found the husband and wife jointly liable for slander of title and conspiracy to commit
slander of title. The court then awarded compensatory damages in the amount of
$32,456.89 and punitive damages in the amount of $30,000. The defendants appealed
contending the trial court erred in failing to consider their affirmative defenses and in
failing to hold that the Tennessee Title Pledge Act, Tenn. Code Ann. §§ 45-15-101 to -
120 barred any recovery. They also contend that the evidence does not support a finding
that the husband breached the contract or that they were jointly liable for slander of title
and for conspiracy to commit slander of title. They further argue the trial court erred in
awarding punitive damages. We affirm.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court is Affirmed
FRANK G. CLEMENT JR., P.J., M.S., delivered the opinion of the Court, in which ANDY D.
BENNETT and JOHN W. MCCLARTY, J., joined.
Shannon L. Crutcher, Nashville, Tennessee, for the appellants, Brian Sullivan and
Tamara J. Sullivan.
Casey Adam Long, Franklin, Tennessee, for the appellee, Damon Holland.
OPINION
On August 28, 2013, Damon Holland and Brian Sullivan executed a written
agreement titled “Bill of Sale” that conveyed a 2013 BMW to Mr. Holland for $30,000.
Concurrent with the execution of the Bill of Sale, Mr. Holland gave Mr. Sullivan
$30,000, and Mr. Sullivan delivered to Mr. Holland the certificate of title to the BMW.
But for Mr. Holland taking possession of the BMW, it would appear that a routine sales
transaction had been concluded as of August 28, 2013. Well, it was neither routine nor
concluded.
As the following reveals, the transaction was unorthodox, at best, for several
reasons. One unorthodox aspect is that the Bill of Sale included a provision titled
“Agreement to Resale Back to Brian Sullivan.” Pursuant to this provision, Mr. Sullivan
could repurchase the BMW within 10 days of the purchase date (August 28, 2013) for
$33,000; within 33 days for $35,000; or, if beyond September 30, 2013, for $35,000 plus
$5,000 for each additional month beyond September 30, 2013. Another unorthodox
aspect of the transaction is that the parties had an oral agreement that Mr. Sullivan could
retain possession of the BMW for an indeterminate time while Mr. Holland retained the
certificate of tile. Another complicating factor is that, although Mr. Sullivan signed the
Bill of Sale for the BMW, he did not own the BMW, and he did not have a power of
attorney to sign a bill of sale. The registered owner of the vehicle was Mr. Sullivan’s
wife, Tamara Sullivan and while the certificate of title bore the signature “Tamara
Sullivan,” she denied having signed the title.
Two months later, Mr. Holland and Mr. Sullivan entered into an agreement
pursuant to which Mr. Sullivan purportedly sold a 2013 Land Rover, which Mr. Sullivan
owned, to Mr. Holland for $22,000. It was entitled “Bill of Sale of Motor Vehicle” but,
unlike the previous bill of sale, this one did not contain a buy-back provision.
Nevertheless, both Mr. Holland and Mr. Sullivan acknowledged that they had a
“handshake agreement” to that effect and on terms similar to the prior agreement.
The parties executed the Bill of Sale of Motor Vehicle on November 6, 2013.
Concurrent with the execution of the bill of sale, Mr. Sullivan delivered the signed
certificate of title to the Land Rover, and Mr. Holland tendered $22,000 in cash to Mr.
Sullivan but, by agreement of the parties, Mr. Sullivan retained $17,000 while Mr.
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Holland retained $5,000.1 As Mr. Holland explained, because Mr. Sullivan was still in
possession of the BMW and intended to repurchase the BMW, it was agreed that Mr.
Holland would apply the $5,000 to the repurchase price for the BMW. As had been done
in the previous transaction, Mr. Sullivan retained possession of the Land Rover while Mr.
Holland retained the title to the vehicle as security for the loan.
On May 20, 2014, Mr. Sullivan delivered two checks to Mr. Holland. One of
them, check No. 1435, was payable to Music City Pawn, Mr. Holland’s company, in the
amount of $71,210. The other, check No. 1436, was payable to Mr. Holland in the
amount of $48,000. However, Mr. Sullivan stopped payment on both checks before they
were negotiated. At trial Mr. Sullivan testified that he stopped payment based on a
subsequent agreement with Mr. Holland. He claimed that Mr. Holland agreed to return
the titles to both vehicles in exchange for $5,000. Mr. Holland disputes having made any
such agreement.
Three days later, and at the request of Mr. Holland, Mr. Sullivan wrote a check
payable to the order of Tervice Burnett, Mr. Holland’s sister and business partner, for
$5,000. Mr. Sullivan added a note in the memo line of the check that stated: “Payment in
full for Damon Holland and M.C.P. [Music City Pawn] for all outstanding loans.
Replaces Check Numbers 1435 and 1436 for the cash received.” Ms. Burnett cashed the
check. At trial, Mr. Holland acknowledged that he requested the payment to Ms. Burnett
but insisted that he would not have authorized her to cash the check if he had known what
was written in the memo line.
In August 2014, Mr. Holland hired Harpeth Towing to take possession of both
vehicles and to deliver them to him. When Harpeth Towing arrived at the Sullivans’
home, Harpeth’s employees immediately began loading the Land Rover onto the tow-
truck. As they were loading it, the Sullivans came out and attempted to stop them, but
Harpeth Towing was able to remove the Land Rover. However, the Sullivans prevented
Harpeth Towing from removing the BMW.2
Although they had already dug themselves into a deep hole, a point at which most
people stop digging, the Sullivans kept digging by driving to the Davidson County
Clerk’s Office, whereupon they applied for and obtained duplicate vehicle titles to both
vehicles. After obtaining duplicate titles, the Sullivans used the duplicate title to sell the
BMW to a third party.
1
The transaction took place at a SunTrust Bank while Mr. Holland withdrew $22,000 in cash
from an account owned by D&T Holdings, LLC d/b/a Music City Pawn, of which Mr. Holland was the
sole member.
2
The BMW was in the Sullivans’ garage and the Sullivans would not let them in the garage.
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Mr. Holland commenced this action against the Sullivans alleging claims for
breach of contract, conversion, slander of title, and civil conspiracy. The Sullivans filed
an answer and counterclaim, asserting claims against Mr. Holland for breach of contract
and conversion of the Land Rover. In their counterclaim, the Sullivans appear to assert
the following affirmative defenses as causes of action: accord and satisfaction; usury;
fraud; and unlawful repossession; and that “if these transactions are deemed a title loan,
that it is illegal and unenforceable for the amount is over the limits allowed by Tennessee
Law.”
The case was tried without a jury over two days. At the conclusion of the trial, the
trial court stated its detailed findings of fact and conclusions of law from the bench, and
we summarize the findings most pertinent to the issues on appeal as follows:
1. Although both contracts are entitled “Bill of Sale,” the contracts reflect
loans rather a sale due to, inter alia, the ambiguity created by the buy-
back provisions; the interest charges; the fact that the vehicles remained
in the possession of the Sullivans; the fact that Mr. Holland did not sign
the titles, record the titles, or pay sales tax on the transfer; and evidence of
a similar transaction between the parties that occurred in 2010 with Mr.
Sullivan successfully exercising the buy-back provision.
2. Concerning the signatures on the vehicle titles, as to the BMW, the trial
court stated, “I don’t think Mrs. Sullivan signed [the BMW title]. . . . But
. . . I’m not sure it’s really that important to anything.” As to the title for
the Land Rover, the trial court found the signature on the title to be that of
Mr. Sullivan. Nevertheless, the court further stated, “It’s not that
important really whether he sign[ed] it or didn’t sign it. The parties
intended to give [Mr. Holland] the titles to hold as security for the loans.”
3. The trial court found that Mrs. Sullivan’s claim that she did not know
about the sale of the BMW until the trial was not credible.
4. As to whether the subject loan agreements are illegal and in violation of
the Tennessee Title Pledge Act, Tenn. Code Ann. § 45-15-101 through
120, the trial court found that the loan agreements are not subject to the
Tennessee Title Pledge Act because the transactions were “person-to-
person” rather than “business-to-person.” The trial court further found
that should the opinion of the court regarding the application of Tenn.
Code Ann. § 45-15-101 through 120 be in error, that such cause of action
and defense has been waived by the Sullivans for failure to plead such
cause of action or defense and having been raised for the first time during
final arguments.
5. The Sullivans did not plead the defense of accord and satisfaction prior to
trial and it was therefore waived.
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6. Mr. Sullivan breached the contract as to the BMW by failing to pay what
was owed on the BMW and by failing to turn the vehicle over to Mr.
Holland.
7. The Sullivans are liable of conspiracy because of the following: (1) there
was a common design between the Sullivans each having intent and
knowledge of the others intent to deprive Mr. Holland of his security
interest; (2) conspiracy was accomplished by the Sullivans’ concerted
actions for an unlawful purpose when, after realizing that Mr. Holland
was attempting to collect the security for the loan agreements, the
Sullivans went to the County Clerk’s office to obtain duplicate titles; and
(3) overt actions occurred when the Sullivans applied for duplicate titles
to both vehicles and sold the BMW.
8. The Sullivans are liable for slander of title for the following reasons: (1)
Mr. Holland had an interest in property because he held the titles as
securities for the loan; (2) the Sullivans published false statements about
the property because they obtained duplicate titles and made false
statements about the title to the property; (3) the Sullivans acted
intentionally and maliciously because they knew Mr. Holland was
attempting to gain possession of both vehicles, the Sullivans failed to
inform the tow-service driver that the BMW was in their garage knowing
that Mr. Holland sent the service to collect the security, and the Sullivans
subsequently obtained duplicate titles; and (4) the foregoing false
statements caused Mr. Holland pecuniary loss because Mr. Holland’s
security interest (the BMW) was sold.
9. The Sullivans are not guilty of conversion or trespass to chattels because
they are the true owners of the vehicles.
10. Mr. Holland is entitled to punitive damages because Mr. Holland proved
by clear and convincing evidence that the Sullivans acted intentionally.
Based on these and other findings, the trial court awarded Mr. Holland the 2013
Land Rover as his property, compensatory damages in the amount of $40,756.89 less the
$8,300 already paid by the Sullivans, and punitive damages in the amount of $30,000 for
a final net judgment of $62,456.89. Relying on Tenn. Code Ann. § 29-11-107, the trial
court held the Sullivans jointly and severally liable for this judgment due to the Sullivans’
liability for conspiracy and slander of title.3 As for Mr. Holland’s claims for conversion
3
Tenn. Code Ann. § 29-11-107 reads in pertinent part as follows:
(a) If multiple defendants are found liable in a civil action governed by comparative fault,
a defendant shall only be severally liable for the percentage of damages for which fault is
attributed to such defendant by the trier of fact, and no defendant shall be held jointly
liable for any damages.
(continued…)
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and trespass to chattels, the court dismissed them on the finding that the Sullivans were
the true owners of the vehicles. On February 23, 2016, the trial court entered an order
consistent with its oral ruling. From that order, the Sullivans now appeal.
ISSUES
The issues to be considered are as follows:
1. Whether the trial court erred in failing to consider the affirmative defenses raised
by the Sullivans and in finding Tenn. Code Ann. § 45-15-101 to -120 did not
apply to the loans made by Mr. Holland.
2. Whether the evidence supports finding Mr. Sullivan liable for breach of contract.
3. Whether the evidence supports finding the Sullivans jointly and severely liable for
slander of title.
4. Whether the evidence supports finding that the Sullivans conspired to commit
slander of title resulting in each being jointly and severely liable for the actions of
the other.
5. Whether the trial court erred in awarding punitive damages.
STANDARD OF REVIEW
“In all actions tried upon the facts without a jury, the court shall find the facts
specially and shall state separately its conclusions of law and direct the entry of the
appropriate judgment.” Tenn. R. Civ. P. 52.01. If the trial court makes the required
findings of fact, appellate courts review the trial court’s factual findings de novo upon the
record, accompanied by a presumption of the correctness of the findings, unless the
preponderance of the evidence is otherwise. Kelly v. Kelly, 445 S.W.3d 685, 692 (Tenn.
2014) (citing Tenn. R. App. P. 13(d)). “For the evidence to preponderate against a trial
court’s finding of fact, it must support another finding of fact with greater convincing
effect.” State ex rel. Flowers v. Tennessee Trucking Ass’n Self Ins. Grp. Trust, 209
S.W.3d 595, 598-99 (Tenn. Ct. App. 2006).
(b) Notwithstanding subsection (a), the doctrine of joint and several liability remains in
effect:
(1) To apportion financial responsibility in a civil conspiracy among two (2) or more at-
fault defendants who, each having the intent and knowledge of the other’s intent,
accomplish by concert an unlawful purpose, or accomplish by concert a lawful purpose
by unlawful means, which results in damage to the plaintiff;
Tenn. Code Ann. § 29-11-107(a) & (b)(1).
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Requiring trial courts to make findings of fact and conclusions of law is
generally viewed by courts as serving three purposes. First, findings and
conclusions facilitate appellate review by affording a reviewing court a
clear understanding of the basis of a trial court’s decision. Second, findings
and conclusions also serve “to make definite precisely what is being
decided by the case in order to apply the doctrines of estoppel and res
judicata in future cases and promote confidence in the trial judge’s
decision-making.” A third function served by the requirement is “to evoke
care on the part of the trial judge in ascertaining and applying the facts.”
Indeed, by clearly expressing the reasons for its decision, the trial court
may well decrease the likelihood of an appeal.
Lovlace v. Copley, 418 S.W.3d 1, 34-35 (Tenn. 2013) (internal citations and footnotes
omitted).
While there is no bright-line test by which to assess the sufficiency of the trial
court’s factual findings, the general rule is that “the findings of fact must include as much
of the subsidiary facts as is necessary to disclose to the reviewing court the steps by
which the trial court reached its ultimate conclusion on each factual issue.” Id. at 35.
“Simply stating the trial court’s decision, without more, does not fulfill [the Rule 52.01]
mandate.” Gooding v. Gooding, 477 S.W.3d 774, 782 (Tenn. Ct. App. 2015) (quoting
Barnes v. Barnes, No. M2011-01824-COA-R3-CV, 2012 WL 5266382, at *8 (Tenn. Ct.
App. Oct. 24, 2012)).
If the trial court fails to explain the factual basis for its decisions, the appellate
court “may conduct a de novo review of the record to determine where the preponderance
of the evidence lies or remand the case with instructions to make the requisite findings of
fact and conclusions of law and enter judgment accordingly.” Gooding, 477 S.W.3d at
783) (citing Lovlace, 418 S.W.3d at 36); Ganzevoort v. Russell, 949 S.W.2d 293, 296
(Tenn. 1997); Nashville Ford Tractor, Inc. v. Great Am. Ins. Co., 194 S.W.3d 415, 424
(Tenn. Ct. App. 2005)).
Our review of a trial court’s determinations on issues of law, however, is de novo,
without any presumption of correctness. Lind v. Beaman Dodge, Inc., 356 S.W.3d 889,
895 (Tenn. 2011).
ANALYSIS
I. AFFIRMATIVE DEFENSES AND THE TITLE PLEDGE ACT
The trial court found that the Sullivans failed to plead affirmative defenses.
Specifically, the court found that the Sullivans waived the Tennessee Title Pledge Act
issue due to their “failure to plead such cause of action or defense.” Moreover, the court
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found the issue was first raised during final arguments at trial, which was too late. The
court also found that “an accord or satisfaction of the debt is not a defense because such
defense was not plead by the [Sullivans] prior to trial.” We agree.
The Sullivans’ answer to the complaint does not contain any affirmative defenses,
at least none titled as “affirmative defenses” in the answer. More specifically, the
Sullivans’ answer to the complaint does not specifically identify the Tennessee Title
Pledge Act or Tenn. Code Ann. § 45-15-101 to -120. In fact, their only reference to any
type of loan in their answer is in Paragraph 66 which reads: “The contents of Paragraph
#66 of the Complaint is denied and demand strict proof thereof. Mr. Holland and Mr.
Sullivan’s agreement was a loan with a repayment plan, not a purchase agreement.”
There are, however, vague references to “a title loan” in the prayer for relief in the
Sullivans’ Verified Counter-Complaint, which reads, “[The Sullivans] assert that if these
transactions are deemed a title loan, that it is illegal and unenforceable for the amount is
over the limits allowed by Tennessee Law.” The trial court found that these statements
failed to set forth an affirmative defense or a cause of action. We agree with the trial
court.
Tenn. R. Civ. P. 8.03 sets the standard for raising an affirmative defense. It reads:
In pleading to a preceding pleading, a party shall set forth affirmatively
facts in short and plain terms relied upon to constitute accord and
satisfaction, . . . fraud, illegality . . . and any other matter constituting an
affirmative defense. When a party has mistakenly designated a defense as a
counterclaim or a counterclaim as a defense, the court, if justice so requires,
shall treat the pleading as if there had been a proper designation.
(emphasis added).
In their pleadings, the Sullivans fail to provide a short and plain statement of the
facts or law relied upon to constitute an illegal loan transaction.
Also significant to the issue is Tenn. R. Civ. P. 8.05, which sets the standard for
stating a claim or defense relying upon the violation of a statute. The rule states:
Each averment of a pleading shall be simple, concise and direct. . . . Every
pleading stating a claim or defense relying upon the violation of a statute
shall, in a separate count or paragraph, either specifically refer to the statute
or state all of the facts necessary to constitute such breach so that the other
party can be duly apprised of the statutory violation charged.
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Tenn. R. Civ. P. 8.05(1) (emphasis added). The Sullivans’ pleadings, whether treated as a
defense or a claim, do not identify the Tennessee Title Pledge Act or Tenn. Code Ann. §
45-15-101 to -120 as is required by Tenn. R. Civ. P. 8.05.
“Pleadings play an important role in litigation.” In re Estate of Baker v. King, 207
S.W.3d 254, 265 (Tenn. Ct. App. 2006). The pleadings required by the Tennessee Rules
of Civil Procedure provide the parties and the trial court with notice of the claims and
defenses involved in the case. Rawlings v. John Hancock Mut. Life Ins. Co., 78 S.W.3d
291, 300 (Tenn. Ct. App. 2001) (citing Poster v. Andrews, 189 S.W.2d 580, 582 (Tenn.
1943); Hammett v. Vogue, Inc., 165 S.W.2d 577, 579 (Tenn. 1942)). Therefore, a
defendant must put forth more than a conclusory statement that “X” defense applies. See
ACG, Inc. v. Southeast Elevator, Inc., 912 S.W.2d 163, 170 (Tenn. Ct. App. 1995)
(holding that defendant waived the defense of estoppel even where the defendant
explicitly stated the defense in the answer because the statement provided only
conclusory allegations).
In this case, the Sullivans’ pleadings do not set forth affirmative facts in short and
plain terms related to any of the affirmative defenses identified in Tenn. R. Civ. P. 8.03
and they do not identify the Tennessee Title Loan Act by name or by Tenn. Code Ann. §
45-5-101 to -120. Moreover, their pleadings fail to provide the bare-minimum facts the
rules require. Therefore, we find no error with the trial court’s rulings that the Sullivans
failed to properly plead any affirmative defenses, including the Tennessee Title Pledge
Act.
II. BREACH OF CONTRACT
The Sullivans agree with the trial court’s determination that the transactions at
issue were loans, not contracts to sell the automobiles. Nevertheless, they contend the
evidence does not support the finding that Mr. Sullivan is liable for breach of contract.
In their brief the Sullivans present their legal argument on this issue in one and
one-half pages. The first half of the first page correctly recites the essential elements of a
breach of contract claim with citations to the requisite authority. Unfortunately, the
remainder of their argument cites no authority whatsoever. Moreover, their argument
contains no citations to the record to identify where the relevant facts can be found,
although their argument is that the evidence does not support the trial court’s finding that
Mr. Sullivan is liable for breach of contract.
The remainder of the Sullivans’ argument on the breach of contract issue reads as
follows:
The loans were against public policy in that Mr. Holland is not licensed to
enter title pledge agreements in Tennessee under the TPA. Further, with
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respect to the 2013 BMW, Mr. Sullivan could not legally enter an
agreement to sell or encumber the vehicle because he was not the owner.
Mr. Holland was aware the 2013 BMW was owned by Mrs. Sullivan.
Regardless, Mr. Holland made the predatory loan to Mr. Sullivan secured
by the 2013 BMW.
In addition, the written contracts lack sufficient information necessary to be
enforceable. The agreements do not contain payment terms to even hint at
the respective obligations of the Defendants. For the foregoing reasons, the
evidence does not support finding Mr. Sullivan liable for breach of
contract.
The Rules of Appellate Procedure require an appellant to include in the appellant’s
brief an argument that sets forth, inter alia: “the contentions of the appellant with respect
to the issues presented, and the reasons therefor, including the reasons why the
contentions require appellate relief, with citations to the authorities and appropriate
references to the record (which may be quoted verbatim) relied on; . . .” Tenn. R. App. P.
27 (a)(7).
In addition to the foregoing, Tenn. Ct. App. R. 6 requires the following content in
a brief:
(a) Written argument in regard to each issue on appeal shall contain:
(1) A statement by the appellant of the alleged erroneous
action of the trial court which raises the issue and a statement
by the appellee of any action of the trial court which is relied
upon to correct the alleged error, with citation to the record
where the erroneous or corrective action is recorded.
(2) A statement showing how such alleged error was
seasonably called to the attention of the trial judge with
citation to that part of the record where appellant’s challenge
of the alleged error is recorded.
(3) A statement reciting wherein appellant was prejudiced by
such alleged error, with citations to the record showing where
the resultant prejudice is recorded.
(4) A statement of each determinative fact relied upon with
citation to the record where evidence of each such fact may
be found.
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(b) No complaint of or reliance upon action by the trial court will be
considered on appeal unless the argument contains a specific reference to
the page or pages of the record where such action is recorded. No assertion
of fact will be considered on appeal unless the argument contains a
reference to the page or pages of the record where evidence of such fact is
recorded.
The Sullivans’ brief fails to satisfy these requirements. Namely, their brief is
missing “authorities” to support their contentions that (1) the loans were against public
policy, (2) Mr. Sullivan could not legally enter an agreement, (3) the loans were
predatory, and (4) the written contracts lacked sufficient information necessary to be
enforceable. See Tenn. R. App. P. 27(a)(7). Moreover, their brief fails to make
“appropriate references to the record” they rely on to contend that the evidence does not
support the finding at issue. See id. Furthermore, the Sullivans’ brief fails to provide a
statement of each determinative fact relied upon with citation to the record where
evidence of each fact may be found or a reference to the pages of the record where
evidence of such fact is recorded. See Tenn. Ct. App. R. 6(a)(4) and (b). Thus, the
Sullivans’ brief fails to comply with the requisite rules.
The deficiencies here are very similar to those in Bean v. Bean, 40 S.W.3d 52
(Tenn. Ct. App. 2000), where the appellant’s “Argument” did not address the issues
raised, and it did not “provide citations to facts in the record or provide citations of
authority that support his allegations. . . .” Bean at 55. “Courts have routinely held that
the failure to make appropriate references to the record and to cite relevant authority in
the argument section of the brief as required by Rule 27(a)(7) constitutes a waiver of the
issue.” Id. (citing State v. Schaller, 975 S.W.2d 313, 318 (Tenn. Crim. App. 1997);
Rampy v. ICI Acrylics, Inc. 898 S.W.2d 196, 210 (Tenn. Ct. App. 1994); State v.
Dickerson, 885 S.W.2d 90, 93 (Tenn. Crim. App. 1993)). Courts have also held that an
issue is waived when it is “simply raised without any argument regarding its merits.” Id.
at 56. (citing Blair v. Badenhope, 940 S.W.2d 575, 576-77 (Tenn. Ct. App. 1996); Bank
of Crockett v. Cullipher, 752 S.W.2d 84, 86 (Tenn. Ct. App. 1988)).
This court is under no duty to verify unsupported allegations in a party’s brief, or
for that matter consider issues raised but not argued in the brief. Id. (citing Duchow v.
Whalen, 872 S.W.2d 692, 693 (Tenn. Ct. App. 1993); Airline Const. Inc., v. Barr, 807
S.W.2d 247 (Tenn. Ct. App. 1990)). Because of the significant deficiencies in the
argument on this issue, we decline to address the issue. See id.
III. SLANDER OF TITLE
The Sullivans contend that the trial court erred in four respects in finding they
were liable for slander of title. The grounds for this contention are that: (1) slander of title
does not apply to personal property; (2) the Sullivans made no false statement; (3) Mr.
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Holland did not perfect his lien on the Land Rover, and thus, there was no notice of any
interest possessed by Mr. Holland; and (4) Mr. Sullivan did not have legal authority to
convey title of the BMW, and therefore, Mr. Holland could not have had legal title
because it remained with Mrs. Sullivan.
To prevail on a slander of title claim, a plaintiff must prove that (1) he/she
possessed an interest in the property, (2) the defendant published false statements about
the title to the property, (3) the defendant acted maliciously, and (4) the false statement
proximately caused the plaintiff a pecuniary loss. Brooks v. Lambert, 15 S.W.3d 482,
484 (Tenn. Ct. App. 1999).
The Sullivans first contend that slander of title does not apply to personal
property; however, they provide no authority to support their contention. Although our
courts may not have determined whether slander of title applies to personal property, it is
apparent from this court’s application of the Restatement (Second) of Torts in previous
cases that slander of title does apply to personal property. See Harmon v. Shell, No. 01-
A-01-9211CH00451, 1994 WL 148663, at *4 (Tenn. Ct. App. Apr. 27, 1994) (no Tenn.
R. App. P. 11 application filed) (“Slander of title now generally refers to the publication
of false and malicious statements disparaging another’s interest in real or personal
property that the person making the statements should recognize as likely to result in
pecuniary harm through the conduct of third persons with respect to the other’s interest in
the property.” Restatement (Second) of Torts § 624 (1976) (emphasis added)). Therefore,
we are of the opinion that slander of title does apply to personal property, and in this
case, to the BMW.
For their second ground, the Sullivans contend they did not publish any false
statements. The modest evidence the Sullivans ask us to consider is not significant
enough to preponderate against the trial court’s findings. Specifically, the Sullivans assert
that it was not a false statement for Mr. Sullivan to claim that he owned the Land Rover
or for Mrs. Sullivan to claim that she owned the BMW. The Sullivans, however, fail to
mention that the published false statement stemmed not from a claim of ownership but
from their actions in obtaining duplicate titles after they had already conveyed title to Mr.
Holland in exchange for the loan.4 Therefore, the evidence supports the finding that the
Sullivans made false statements with regard to the titles to the vehicles.
4
For the Sullivans to have obtained a duplicate title, the application required the Sullivans to state
under penalty of perjury that the original was either lost, stolen, mutilated, returned due to non-delivery,
altered, or illegible. See Tenn. Code Ann. § 55-3-115. However, the Sullivans’ original titles were neither
lost, stolen, mutilated, returned due to non-delivery, altered, or illegible, but rather, the titles were
intentionally conveyed to Mr. Holland for a significant sum of money.
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The Sullivans also contend the claim must fail because Mr. Holland did not perfect
his security interest in the property. The trial court found that Mr. Holland had an interest
in the property because he held titles to the vehicles as security for the loans. We agree.
“The agreement creating a security interest can be in any form—sale,
consignment, lease, bailment—or whatever the parties can imagine. The agreement need
not say that it is granting a security interest.” In re Village Import Enterprises, Inc., 126
B.R. 307, 309 (Bankr. E.D. Tenn. 1991). Therefore, the unorthodox “Bill of Sale” may be
properly construed as a security agreement from which Mr. Holland’s security interest
arises.
The fact that Mr. Holland did not perfect his security interest is of no consequence
in this case because doing so is not necessary to protect one’s security interest against the
debtor. Perfection is only relevant as to claims by third parties. See AmSouth Bank v.
Trialer Source, Inc., 206 S.W.3d 425, 434 (Tenn. Ct. App. 2006) (“A security interest
that is unperfected but has attached is enforceable against both the debtor and general
unsecured creditors.” Rev. UCC § 9–201(a). However, an unperfected security interest . .
. still has a multitude of weaknesses.”) Therefore, Mr. Holland did have a valid security
interest in the BMW, notwithstanding the fact that he did not perfect his security interest.
For their fourth ground, the Sullivans contend that Mr. Sullivan did not have legal
authority to convey title of the BMW; therefore, Mrs. Sullivan owned the vehicle when
they applied for a duplicate title. It is important to first recognize that this ground has no
relevancy to the Range Rover because Mr. Sullivan was the registered owner of that
vehicle. Additionally, he made false claims to obtain a duplicate title for that vehicle, all
the while knowing that Mr. Holland had the original title and a security interest in the
vehicle.
As for the BMW, this argument assumes that Mr. Sullivan obtained possession of
the title without his wife’s permission, forged her signature, and delivered the original
signed title to Mr. Holland along with the bill of sale/secured loan agreement. The
problem with this assumption is that the trial court made specific findings of fact that
contradict this contention, and the evidence does not preponderate against the trial court’s
findings. More importantly, the findings of fact are principally based on the court’s
determination that the testimony of Mrs. Sullivan was not credible. Credibility
determinations are uniquely within the discretion of the trial court.
Appellate courts give great weight to a trial court’s factual findings that rest on
determinations of credibility and weight of oral testimony. State ex rel. Flowers v.
Tennessee Trucking Ass’n Self Ins. Grp. Trust, 209 S.W.3d 595, 599 (Tenn. Ct. App.
2006) (citing Estate of Walton v. Young, 950 S.W.2d 956, 959 (Tenn. 1997)); see
Woodward v. Woodward, 240 S.W.3d 825, 828 (Tenn. Ct. App. 2007). When it comes to
live, in-court witnesses, appellate courts afford trial courts considerable deference when
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reviewing issues that hinge on the witnesses’ credibility because trial courts are “uniquely
positioned to observe the demeanor and conduct of witnesses.” Kelly v. Kelly, 445
S.W.3d 685, 692 (Tenn. 2014) (quoting State v. Binette, 33 S.W.3d 215, 217 (Tenn.
2000)). “[A]ppellate courts will not re-evaluate a trial judge’s assessment of witness
credibility absent clear and convincing evidence to the contrary.” Id. (quoting Wells v.
Tennessee Bd. of Regents, 9 S.W.3d 779, 783 (Tenn. 1999)) (alteration in original).
Having reviewed the record, we find no abuse of discretion in the trial court’s credibility
determinations.
The trial court made specific findings of fact concerning each element of the
slander of title claim to conclude that Mr. Holland met his burden in regards to each of
these elements. The relevant findings of fact include:
(1) Plaintiff had an interest in property because he held the titles as
securities for the loan.
(2) Defendants published false statements about the property. Both
Defendants obtained duplicate titles and they were false statements about
the title to the property.
(3) Defendants acted maliciously because they knew Plaintiff was
attempting to gain possession of both vehicles. The BMW was in their
garage and was not revealed to the tow truck driver. After Mr. and Mrs.
Sullivan knew Mr. Holland was trying to get the vehicles back, they both
went to county court clerk and applied for duplicate titles.
(4) Those false statements caused Plaintiff’s loss because the BMW was
sold.
The evidence in the record does not preponderate against any of these findings.
Therefore, we find no error with the trial court’s decision on this issue
IV. CONSPIRACY TO COMMIT SLANDER OF TITLE
The Sullivans contend the trial court erred by holding them liable for conspiracy to
commit slander of title. They contend they could not act in concert to obtain duplicate
titles because they did not co-own the vehicles and, as a consequence, each of them had
to make a separate application for a duplicate title. They also contend Mrs. Sullivan
lacked sufficient knowledge to conspire, relying in principal part on one comment the
trial court made from the bench, that being “Doesn’t sound like she knows a lot.”
For his part, Mr. Holland contends there is sufficient evidence to support the
findings that the Sullivans jointly made the decision to obtain duplicate titles. To support
his contention, Mr. Holland asserts that the Sullivans went together to apply for and
obtain duplicate titles and that the trial court’s comment about Mrs. Sullivan’s
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knowledge, or lack thereof, appeared to be “an expression of sarcasm based upon Mrs.
Sullivan’s demeanor and lack of candor with the trial court on the day of trial.”
The elements of a cause of action for civil conspiracy are: (1) a common design
between two or more persons; (2) to accomplish by concerted action an unlawful
purpose, or a lawful purpose by unlawful means; (3) accompanied by an overt act in
furtherance of the conspiracy; and (4) a resulting injury.5 Kincaid v. SouthTrust Bank,
221 S.W.3d 32, 38 (Tenn. Ct. App. 2006) (citing Morgan v. Brush Wellman, Inc., 165
F. Supp. 2d 704, 720 (E.D. Tenn. 2001)). Upon a finding of conspiracy, each conspirator is
liable for the damages resulting from the wrongful acts of all co-conspirators in carrying
out the common scheme. Trau-Med of Am., Inc. v. Allstate Ins. Co., 71 S.W.3d 691, 703
(Tenn. 2002) (citing Brown v. Birman Managed Care, Inc., 42 S.W.3d 62, 67 (Tenn.
2001)).
Here, Mr. and Mrs. Sullivan jointly pursued a common design to deprive Mr.
Holland of his security interest in the vehicles by making false applications for duplicate
titles. The Sullivans engaged in two overt acts in furtherance of this conspiracy. First, as
the trial court correctly described it, they went together “to the county court clerk’s office
and obtained duplicate titles in an attempt to deprive Plaintiff of his security . . . .”
Second, they used one of the unlawfully obtained duplicate certificates of title to sell Mrs.
Sullivan’s BMW to a third-party, knowing all the while that Mr. Holland possessed a
security interest in the vehicle. As a result, Mr. Holland lost his security interest in the
$35,000 BMW.
The evidence supports the trial court’s finding that the Sullivans acted in concert.
At trial, Mr. Sullivan testified that he and his wife jointly decided to obtain duplicate
titles and they went together to apply for the duplicate titles. The record also supports the
court’s finding that Mrs. Sullivan knowingly participated in the conspiracy. In fact, Mrs.
Sullivan admitted at trial that the $5,000 payment was remitted with the hope that it
would extinguish the debt owed on her BMW, a fact she knew prior to applying for the
duplicate title. The record also establishes that she knew Harpeth Towing was attempting
to possess her BMW in order to deliver it to Mr. Holland. Therefore, we affirm the trial
court’s decision.
V. PUNITIVE DAMAGES
The Sullivans put forth two arguments that the trial court erred in its award of
punitive damages. First, the Sullivans argue that the trial court erred because the only
5
A civil conspiracy also requires an underlying predicate tort allegedly committed pursuant to the
conspiracy. Watson’s Carpet & Floor Coverings, Inc. v. McCormick, 247 S.W.3d 169, 186 (Tenn. Ct.
App. 2007) (citations omitted). In this case the underlying predicate tort is slander of title.
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action in which punitive damages may be awarded is slander of title. The Sullivans’
second argument is that this case is not one of the “most egregious cases” as
contemplated in Hodges v. S.C. Toof & Co., 833 S.W.2d 896 (Tenn. 1992).
In addressing the first argument, the Sullivans take issue with the trial court’s
finding by clear and convincing evidence that the Sullivans acted intentionally but not
maliciously. Specifically, the Sullivans argue that to sustain an action for punitive
damages, a plaintiff may only rely on the mental states contained within the elements of
the tort which gives rise to punitive damages. For example, the tort of intentional
infliction of emotional distress (“IIED”) requires the finding of an intentional act. While
punitive damages may be awarded when a defendant acts intentionally, fraudulently,
maliciously, or recklessly, the Sullivans would argue that under an IIED claim, a plaintiff
may only be awarded punitive damages if plaintiff proved defendant acted intentionally
by clear and convincing evidence, and therefore, the other mental states should be
ignored.
The Sullivans provide no authority to support their contention, and we find none.
A court may award punitive damages if it finds that a defendant acted intentionally,
fraudulently, maliciously, or recklessly. Id. A person acts intentionally when that person
acts with “the conscious objective or desire to engage in the conduct or cause the result.”
Id. Furthermore, “because punitive damages are to be awarded only in the most egregious
of cases, a plaintiff must prove the defendant’s . . . conduct by clear and convincing
evidence.” Id. Here, the trial court found that the Sullivans acted intentionally by clear
and convincing evidence. From a review of the record, the evidence supports this
conclusion.
In Hodges, our Supreme Court refined the type of conduct and cases for which
punitive damages could be awarded in Tennessee, but as the court explained, it was their
intent to restrict the availability of punitive damages without “dull[ing] the potentially
keen edge of the doctrine as an effective deterrent of truly reprehensible conduct.” Id. at
901 (quoting Tuttle v. Raymond, 494 A.2d 1353, 1361 (Me. 1985)). After explaining their
reasoning, the Court established the new standard, which remains in effect today:
In Tennessee, therefore, a court may henceforth award punitive damages
only if it finds a defendant has acted either (1) intentionally, (2)
fraudulently, (3) maliciously, or (4) recklessly.
A person acts intentionally when it is the person’s conscious objective or
desire to engage in the conduct or cause the result. Cf. T.C.A. § 39-11-
302(a) (1991) (criminal definition of “intentional”). . . .
Id. (emphasis added).
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The Sullivans made the intentional decision to deprive Mr. Holland of his security
interest in the vehicles after Mr. Holland attempted to possess the BMW. They
accomplished their goal by obtaining duplicate titles based on the false representations
that the titles were lost and then by using the duplicate titles to sell the BMW.
As for the Sullivans’ argument that the court should not have awarded punitive
damages because this case is not one of “the most egregious” as contemplated by
Hodges, it is apparent that they misconstrue the applicable standard. When the Court
adopted the more restrictive Hodges standard, the Court made it clear that it was the
Court’s intent to restrict the availability of punitive damages without “dull[ing] the
potentially keen edge of the doctrine as an effective deterrent of truly reprehensible
conduct.” Id. (quoting Tuttle, 494 A.2d at 1361). Further, the Court explained:
[B]ecause punitive damages are to be awarded only in the most egregious
of cases, a plaintiff must prove the defendant’s intentional . . . conduct by
clear and convincing evidence. This higher standard of proof is appropriate
given the twin purposes of punishment and deterrence: fairness requires
that a defendant’s wrong be clearly established before punishment, as such,
is imposed; awarding punitive damages only in clearly appropriate cases
better effects deterrence.
Id.
Here, Mr. Holland proved by the clear and convincing standard that the Sullivans
acted intentionally and by unlawful means to deprive him of his property interest in the
BMW. Thus, as the trial court correctly found, Mr. Holland satisfied the requirements for
an award of punitive damages. Accordingly, we find no error with this decision.
IN CONCLUSION
The judgment of the trial court is affirmed, and this matter is remanded with costs
of appeal assessed against the appellants, Brian and Tamara J. Sullivan.
________________________________
FRANK G. CLEMENT JR., P.J., M.S.
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