WISE CONSTRUCTION, LLC, ET AL. v. THOMAS BOYD, ET AL (Tenn. Ct. App. March 14, 2011)
This appeal involves a home construction dispute between an LLC contractor and the homeowners. The contractor entered into a written contract with the homeowners for the construction of a 6000 square foot home. Upon the relationship between the parties becoming strained, the homeowners claim the contractor told them to find another builder. The contractor contends it was fired from the project. The instant action was commenced by the contractor to enforce a lien. The trial court found in favor of the contractor. The homeowners appeal. We affirm.
Opinion available at:
http://www.tba2.org/tba_files/TCA/2011/wiseconstruction_031411.pdf
SWINEY dissenting
http://www.tba2.org/tba_files/TCA/2011/wiseconstruction_DIS_031411.pdf
Showing posts with label liens. Show all posts
Showing posts with label liens. Show all posts
September 28, 2010
Court Reviews Priority Issues in a Case Involving Lien Enforcement
EAST TENNESSEE GRADING, INC., v. BANK OF AMERICA, N.A., et al. (Tenn. Ct. App. September 28, 2010)
Plaintiff brought this action to enforce a lien for excavation and road work done in a residential development, because the owner had not paid for the construction work performed. An agreed judgment was entered as to plaintiff's claims against defendant, Seven Lakes Development, awarding judgment against that defendant for materials and labor performed on the property. One parcel of property, however, totaling 6.36 acres was owned by defendants Coughlins, which was subject to a deed of trust in favor of Bank of America. The Trial Court held that Bank of America had priority over plaintiff as to 1.9 acres because plaintiff had not filed its Notice of Lien timely to maintain priority over the subsequent owners pursuant to Tenn. Code Ann. section 66-11-112. The Trial Court also held that plaintiff had priority over Bank of America as to 4.46 acres because plaintiff's Notice of Lien was filed before the Amended Deed of Trust in favor of Bank of America was filed. On appeal, we affirm the Judgment of the Trial Court.
Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/easttenngrading_092810.pdf
Plaintiff brought this action to enforce a lien for excavation and road work done in a residential development, because the owner had not paid for the construction work performed. An agreed judgment was entered as to plaintiff's claims against defendant, Seven Lakes Development, awarding judgment against that defendant for materials and labor performed on the property. One parcel of property, however, totaling 6.36 acres was owned by defendants Coughlins, which was subject to a deed of trust in favor of Bank of America. The Trial Court held that Bank of America had priority over plaintiff as to 1.9 acres because plaintiff had not filed its Notice of Lien timely to maintain priority over the subsequent owners pursuant to Tenn. Code Ann. section 66-11-112. The Trial Court also held that plaintiff had priority over Bank of America as to 4.46 acres because plaintiff's Notice of Lien was filed before the Amended Deed of Trust in favor of Bank of America was filed. On appeal, we affirm the Judgment of the Trial Court.
Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/easttenngrading_092810.pdf
May 07, 2008
Res judicata bars challenge to performance bond after judgment on injunctive relief claim; Privity gives right to assert defensive collateral estoppel
TRAVELERS CASUALTY & SURETY COMPANY OF AMERICA as subrogee of SMITH MECHANICAL CONTRACTORS, INC. v. LAWYER'S TITLE INSURANCE CORPORATION, ET AL. (Tenn.Ct.App. May 7, 2008).
Travelers Casualty & Surety Company of America ("Travelers") as subrogee of Smith Mechanical Contractors, Inc. ("Smith Mechanical") sued Lawyer's Title Insurance Company ("Lawyer's Title") and First Tennessee Bank National Association ("the Bank") seeking, among other things, a judgment declaring a mechanic's lien filed by Smith Mechanical to have priority over a deed of trust held by the Bank with regard to real property located in Johnson City, Tennessee. Lawyer's Title and the Bank filed a motion to dismiss or for summary judgment.
After a hearing, the Trial Court entered an order finding and holding, inter alia, that Travelers' complaint was barred under the doctrine of res judicata; that the complaint was barred under the compulsory counterclaim rule; that Travelers never acquired Smith Mechanical's mechanic's lien rights; and, that the Bank had recorded a payment bond ("Performance Bond"), which operated to discharge Smith Mechanical's lien from the real property. Travelers appeals to this Court. We affirm.
Opinion may be found on TBA website:
http://www.tba2.org/tba_files/TCA/2008/travelerscasualty_050708.pdf
"Parties asserting a res judicata defense must demonstrate that (1) a court of competent jurisdiction rendered the prior judgment, (2) the prior judgment was final and on the merits, (3) the same parties or their privies were involved in both proceedings, and (4) both proceedings involved the same cause of action." Id. (citations omitted).
"[O]nce the judgment on the merits became final in the second lawsuit seeking injunctive relief, the doctrine of res judicata through the principle of claim preclusion operates to bar any claims involving the same cause of action which were or could have been brought by Barker Building and Travelers against the Bank in that same action. This includes any claims against the Bank challenging the validity of the Subordination Agreement and Performance Bond." Id.
"Collateral estoppel, an issue preclusion doctrine, ... bars the parties or their privies from relitigating issues that were actually raised and determined in an earlier suit. ... Collateral estoppel may be used by a defendant in the second suit (defensive collateral estoppel), or it may be used by a plaintiff in a second suit (offensive collateral estoppel). In Tennessee the offensive use of collateral estoppel requires that the parties be identical in both actions. Without saying so specifically, however, Tennessee has not required party mutuality in applying defensive collateral estoppel." Id. (citations omitted).
"The issue sought to be precluded in this instance is the issue regarding the validity of the Performance Bond. Lawyer’s Title is in privity with the Bank with regard to this issue. Given this and the fact that the issue sought to be precluded went to final judgment on the merits in [the case] discussed above, Lawyer’s Title can utilize defensive collateral estoppel." Id. (citations omitted).
Travelers Casualty & Surety Company of America ("Travelers") as subrogee of Smith Mechanical Contractors, Inc. ("Smith Mechanical") sued Lawyer's Title Insurance Company ("Lawyer's Title") and First Tennessee Bank National Association ("the Bank") seeking, among other things, a judgment declaring a mechanic's lien filed by Smith Mechanical to have priority over a deed of trust held by the Bank with regard to real property located in Johnson City, Tennessee. Lawyer's Title and the Bank filed a motion to dismiss or for summary judgment.
After a hearing, the Trial Court entered an order finding and holding, inter alia, that Travelers' complaint was barred under the doctrine of res judicata; that the complaint was barred under the compulsory counterclaim rule; that Travelers never acquired Smith Mechanical's mechanic's lien rights; and, that the Bank had recorded a payment bond ("Performance Bond"), which operated to discharge Smith Mechanical's lien from the real property. Travelers appeals to this Court. We affirm.
Opinion may be found on TBA website:
http://www.tba2.org/tba_files/TCA/2008/travelerscasualty_050708.pdf
"Parties asserting a res judicata defense must demonstrate that (1) a court of competent jurisdiction rendered the prior judgment, (2) the prior judgment was final and on the merits, (3) the same parties or their privies were involved in both proceedings, and (4) both proceedings involved the same cause of action." Id. (citations omitted).
"[O]nce the judgment on the merits became final in the second lawsuit seeking injunctive relief, the doctrine of res judicata through the principle of claim preclusion operates to bar any claims involving the same cause of action which were or could have been brought by Barker Building and Travelers against the Bank in that same action. This includes any claims against the Bank challenging the validity of the Subordination Agreement and Performance Bond." Id.
"Collateral estoppel, an issue preclusion doctrine, ... bars the parties or their privies from relitigating issues that were actually raised and determined in an earlier suit. ... Collateral estoppel may be used by a defendant in the second suit (defensive collateral estoppel), or it may be used by a plaintiff in a second suit (offensive collateral estoppel). In Tennessee the offensive use of collateral estoppel requires that the parties be identical in both actions. Without saying so specifically, however, Tennessee has not required party mutuality in applying defensive collateral estoppel." Id. (citations omitted).
"The issue sought to be precluded in this instance is the issue regarding the validity of the Performance Bond. Lawyer’s Title is in privity with the Bank with regard to this issue. Given this and the fact that the issue sought to be precluded went to final judgment on the merits in [the case] discussed above, Lawyer’s Title can utilize defensive collateral estoppel." Id. (citations omitted).
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