FILED

July 15, 1998

Cecil W. Crowson

Appellate Court Clerk

HARPETH VALLEY UTILITIES ) C/A No. 01A01-9712-CH-00699

DISTRICT OF DAVIDSON AND ) DAVIDSON COUNTY

WILLIAMSON COUNTIES, TENNESSEE ) CHANCERY NO. 97-737-III

)

Plaintiff-Appellant )

)

) 

v . )

)

)

METROPOLITAN GOVERNMENT )

OF NASHVILLE AND DAVIDSON )

COUNTY, TENNESSEE )

)

Defendant-Appellee )

IN THE COURT OF APPEALS AT NASHVILLE

APPEALED FROM THE CHANCERY COURT OF DAVIDSON COUNTY, PART THREE 

AT NASHVILLE, TENNESSEE

THE HONORABLE ELLEN HOBBS LYLE, CHANCELLOR

ROBERT E. PARKER

L. MARSHALL ALBRITTON

PARKER, LAWRENCE, CANTRELL & DEAN

Fifth Floor, 200 Fourth Avenue, North

Nashville, TN 37219

Attorneys for Plaintiff-Appellant

PAUL D. KRIVACKA

Department of Law

204 Metropolitan Courthouse

Nashville, TN 37201

Attorney for Defendant-Appellee

REVERSED AND REMANDED

 

 Houston M. Goddard, Presiding Judge

CONCUR:

FRANKS, J.

McMURRAY, J.
1

Metropolitan Government paid to Harpeth Valley the $75,000

deposit.

2

This is a suit by Harpeth Valley Utilities District, a

municipal corporation organized under the Utility District laws

of 1937--T.C.A. Title 7, Chapter 82, against Metropolitan

Government of Nashville and Davidson County, Tennessee. Harpeth

Valley--advancing two theories, breach of contract and unjust

enrichment--seeks to recover interest it asserts it is due as to

$75,000 1 paid to Metropolitan Government by owners of lots in two

separate subdivisions to insure that the subdivisions could

receive approval by the Metropolitan Planning Commission by

providing the funds necessary to install water and waste water

treatment services in the event such services were not provided

by the developers or the Utility District.

By its issues on appeal Harpeth Valley insists the

Chancellor was in error in granting Metropolitan Government's

motion for summary judgment.

The brief of Metropolitan Government more specifically 

states certain salient facts relative to this dispute:

Harpeth Valley is a regional utility created

pursuant to Tenn. Code Ann. § 7-82-101, et seq . 

Harpeth Valley is charged with providing water and

sewerage treatment services to customers within the

geographic boundaries of its service area, which

includes portions of Davidson County, Tennessee.

The Metropolitan Government is a municipal

corporation with a metropolitan charter created

pursuant to Tenn. Code Ann. § 7-1-101, et seq . The

Metropolitan Planning Commission (hereinafter "Planning
3

Commission") is the commission within The Metropolitan

Government responsible for the approval of subdivisions

of Davidson County, Tennessee.

The Metropolitan Government, through the Planning

Commission, entered into two (2) agreements that bonded

the future installation of water and sewer improvements

(hereinafter "Agreements") with the owners of the

Dunaway Woods Subdivision (hereinafter "Dunaway Woods")

and the BV 1776 Estates Subdivision (hereinafter "BV

1776 Estates"). Both Agreements required administration of escrow funds by the Planning Commission for

the future installation of sewer lines to serve each

lot in the subdivisions. During the years 1977 and

1978, $32,000 was paid into escrow with Planning

Commission, with respect to Dunaway Woods and $43,000

with respect to BV 1776 Estates.

The contract as to Dunaway Woods Subdivision, which is

identical--except as to the designation of the Subdivision--to

the one as to BV 1776 Estates, as pertinent to this appeal,

provides the following:

1 . The Planning Commission will cause an escrow

account to be established for the purpose of receiving

monies required for the future installation of sewer

lines to serve Dunaway Woods Subdivision, Section One.

2 . Said account will be in favor of the

Metropolitan Government for such purpose. However, in

the event Harpeth Valley Utility District provides

sewer service to the Dunaway Woods Subdivision, Section

One, prior to service by the Metropolitan Government,

then said escrow account will be assigned to said

Utility District.

The contracts, which were drawn by representatives of

Metropolitan Government, do not specifically address disposition

of the interest generated by the escrow accounts.
4

It is clear that Metropolitan Government did not comply

with the terms of the contracts in that it did not place the

funds deposited in a separate escrow account, but rather in

accounts managed by Metropolitan Government's Department of

Finance and retained the interest earned therefrom for

Metropolitan Government's other obligations.

In light of the language of the contracts, which were

drafted by Metropolitan Government, we conclude that the

Chancellor was in error in granting Metropolitan Government's

motion for summary judgment. Moreover, counsel for Metropolitan

Government conceded, when questioned by this Court during oral

argument, that had the funds been placed in a separate escrow

account Harpeth Valley would be entitled to the interest

generated. 

We also conclude that the parties under the facts of

this case, by their motions for summary judgment, concede that

there are no disputed facts and that it is appropriate to dispose

of the dispute on the record presented.

Having reviewed the record with this in mind, we find

that, as already noted, Harpeth Valley is entitled to the

interest the accounts would have generated had the terms of the

contract been followed. We also find that it is appropriate--as

suggested by counsel for Harpeth Valley--to remand the case to
5

the Trial Court for a determination of the appropriate percentage

of interest and entry of a judgment accordingly.

In light of our disposition of the breach of contract

theory, it is unnecessary that we address the unjust enrichment

theory.

For the foregoing reasons the judgment of the Trial

Court is reversed and the cause remanded for further proceedings

not inconsistent with this opinion. Costs of appeal, as well as

those below, are adjudged against Metropolitan Government.

_______________________________

Houston M. Goddard, P.J. 

CONCUR:

________________________________

Herschel P. Franks, J.

________________________________

Don T. McMurray, J.