# FILED
May 9, 1997 Cecil W. Crowson Ap pellate Cou rt Clerk 

## IN THE COURT OF APPEALS OF TENNESSEE MIDDLE SECTION AT NASHVILLE

LARRY R. FOS TER an d ) LINDA H. JOHNSTON, Trustees ) of the HENRY ROGERS FOSTER ) TRUST, ) ) Plaintiff s/Appelle es, )

) Davidson C ircuit ) No. 95C- 1078 VS. ) ) Appeal N o. ) 01A01-9512- CV-00569 JAY W. SHIM, ) ) Defenda nt/Appella

nt. )
APPEAL FROM THE CIRCUIT COURT FOR DAVIDSON COUNTY

AT NASHVILLE, TENNESSEE THE HONORABLE WALTER C. KURTZ, JUDGE
For the Plaintiffs/Appellees : For t he Defendan t/Appella

nt : Philip D. Irwin James C. Hofstetter Neal & H arwell Nashville, Tennessee Nashville, Tennessee



## REVERSED AND REMANDED

WILLIAM C. KOCH, JR., JUDGE-2- 

## O P I N I O N

This appeal inv olves the le ase of a gr ocery sto re in Na shville. Following the landlord’ s death, t

he trust suc ceeding to the landlor d’s int erest filed an unlawful detainer action in th e Davidson C ounty Gene ral Sess ions Court se eking to recover

possession

of the property. The tenant appealedthe adver se judgment to the Circuit Court for Dav idson Co unty. The circ uit court granted the trust’s motionfor summa

ry judgment

after f inding that th e tenant

had breac hed the lea se by failing t o make timel y and suffi cient leas e payments
. We have determinedthat the su mmary judgment mus t be rever sed becaus e the trust has faile d to demonst rate that it was entitle d to a judg ment as a matt er of law.
I. Henry Rogers Fo ster owne d two conti guous p arce ls of prope rty at the
corner of Robertson Road and Croley Drive in Nashville . A cinder block bui lding housing a grocery store was located on one of the parcels. Mr. F osterleased the propertyto James “ Bill” Hoo d in June 1 984. The original term of the lease lasted until February 28, 1988, and the lease agreement contained four five-year renewal options. These r

enewal o ptions could b e “exerc ised automa tically w ithout the necessity of notice to Owner.” The lease agreement also required lease pay ments starting at $525 per

month but per

mitted the

landlord toraisethe lease payments by $50 per month in every odd-numbered year.
On March 27, 1987, Mr. Hood assigned the lease to Jay Shim. Three d ays later, Messrs. Foster and Shim negotiated a new le ase conta ining essent

ially the
same provisio ns as those in Mr. Hood’s lease. The initial term of Mr. Shim’s lease wa s from April 1, 1987 to Febr uary 28, 1988, and th e lease c ontained fo ur five-year automaticrenewa

l o ptions. The lease payments began at $650 per monthand could be

raised by $ 50 per month in every o dd-number

ed year. The $25 difference between Mr. Shim’s ini tial monthl y payments a nd the payments under Mr. Hoo d’s lease p lays a sig nificant r ole in thi s disput e.
In May 1988, M

r. Shim sublet the g rocery st ore to Am al G. M ehta. T he terms of this agreement tracked those in Mr. Shim’s le ase; howe ver, the sublease1 Mr. Shim’s lease required written approval before

subleasing the property. While Mr. Shim did not obta

in written approval of the sublease to Mr. Mehta, he appar ently obtained Mr. Foster’s oral aut

h orizati on. Mr. Fos ter acc epted Mr . Mehta’ s lease p ayments a nd appar ently decided to forego requiring written approval.

2 In October

1994, the Foster tru st

contracted to sell

the prope rty to a third p arty, de spite the provision in the 1987 lease giving Mr. Shim a first option to purchase. Thetrust warranted in the contr

act that “ Jay Shim doe s not have

an enfor ceable leasehold interest in the Property.” -3- required Mr. Meh

ta to pay Mr. Shim $850 per month and provided that Mr. Shim couldincrease

the rent $5 0 per month in odd-numbe red year s. At the out set of the sublease, Mr. Mehta sent the monthly lease payments directly to Mr. Foster. 1

Owners hip of

the property passed to the Henry Rogers Foster trust after Mr. Foster’s death in 1994 . Larr y Foster a nd Linda Johnston, Mr. Foster’s children, were the trustees. In apparent ignorance of the 1987 lease betweenher fath er and Mr. Shim, Ms . Johnston, informed Mr. Shim in August 1994 t

hat the tru st considered him to be a month-to-month tenant because he did not have an enforce able lease. 2 She also i nformed Mr. Shim that the pr operty wa s for sale

and thathe would be

required to vacate the premi ses in thirt

y days if the proper

ty sold.
Mr. Shim, like Ms. Johnsto n, did not ha ve a signed copy of

the 1987 lease. In December 1994, he began mak ing the lease payments directly to the Foster trust. His De cember 1 994 payment was consistent with the 1987 lease but was thirteen days late. After M r. Shim did not make

the Januar

y 1995 lease

payment on time, Mr. Foste

r wrote him a lett

er on Janua

ry 10, 1995, stating:
This letter se

rves as not

ification t ha t you are delinquent

on the rent

for the R obertson Ro ad Proper ty. This is the sec ond time in t he last three months that you have been in arrears. Let me remind you that payment is due on the

first of e ach month. This is also a reminder to you that on Fe br uary 1st, 1995 your monthly

payment will incr ease to 850. 00 dollars pe r month. Mr. Shim resp onded with a $775 payment - the amount required by the 1984 lease. Apparently, Mr. Shim had decided that the l ease paym

ents should be governed by the 1984 le ase beca use Ms. Johnston had informed him that he did not have an enfo rceable

lease and

because h e could not r

ecall signing the 1987 lease.3 Ms. Johnston st ated in a n affida vit filed in the cir

cu it court that her attorney provided her a copy of the 1987 lease “shortly before”the hearing in general sessions court and that Mr. Shim had indi ca ted earlier that he would provide her with a signed copy of the lease but had failed to do so. -4- Mr. Shim made the February 1995 lease payment on time but the amo unt of the payment w as $825 ra ther than $ 850 as req uired by t he 1987 l ease. On Februar y 3, 1995, M

r. Foste r sent Mr. Shim anothe

r letter stating: Thanks for sendin g your Feb. rent paym ent on time. However, your rent for Feb. ha d been increased to $850.00 per month

. We only re ceived $825 .00. This serves as notice tha

t you are $2 5.00 in ar

rears f or Feb. Also, your payment fo r Jan. 1995 sh ould have been $800.00. You only pa id $775.00. Theref

ore, you are also $25.00 in ar

rears f or Jan. Your attention t

o this matte

r would be

greatly apprecia ted.
The Foster trust’s lawyer notified Mr. Shim on Februar y 16, 1995, that the trust had termi nated the l ease bec ause the Ja nuary lea se payment

was late and insuffici ent. On Marc h 1, 1995, t he trust fi led an unla

wful deta iner acti on in the Davidson County Ge neral Se ssions Court . At the hearing in general sessions court, the Foster

trust produced a

signed copy o f the 1987 le ase, notw ithstanding its earlier insistence that Mr. Shim did not have an enforceable lease. 3 The general sessions c ourt awarded the trust possession of the property and dismissed Mr. Shim’s counterc laim for overpayment of rent. Mr. Shim perfect

ed a de novo appeal to t

he Circuit Court for

Davidson C ounty.

The Foster trust moved for a summary judgment sho rtly after the case was docketed in the cir

cuit court . On Au gust 18, 1995, the circuit court found that Messrs. Shim and Foster had en tere d into a vali d lease on o r about Ma rch 30, 1987, that Mr. Shim had defaulted by failing t o pay rent when due for

the months of January, Februar

y, and Mar

ch 1995, tha

t the Foste

r trust h ad provided Mr. Shim timely wr

itten notic e of the br

each and ha

d given him in

excess of

thirt y days t o remedy the breach, and that Mr. Shim had not remedied the breach

. Accordi ngly , the trial

court gra

nted the Fo ster trust

a summar

y judgment terminat ing the lea se and aw arding the trust posses sion of the p remises.-5- II.
We turn first to a threshold issue conce rning the circuit court’s subject matter jurisdicti on over this case. Even though Mr. Shim apparently concedes that the trial court has subjectmatter jurisdiction to hearde novo appeals from general sessions court, he

ass erts that the unlaw ful detain er action was somehow transformed into an equitable proceeding when he asserted equitable defenses against the Foster

trust’s unl awful detainer cl aim. A ccordingly , Mr. S himasserts thatTenn. Code A nn. § 1 6-10-111 (1 980) requir ed the tria

l court to t

ransfer the case to the

chancer y court wh en he objec ted to the trial court’s jurisdiction. We have determin ed that Mr . Shim’s reliance on Tenn. Code Ann. § 16-10 -111 is misplaced

.
The concept of subject matter jurisdiction rel ates to a court’ s power to adjudicate

a particular

t ype of dis pute. Turpin v. Co nner Bros . Excavating Co., 761 S.W.2 d 296, 297 (T enn. 1988) ; Standard Sur. & Casualty Co. v. Sloan, 180 Tenn. 220, 230, 173 S.W.2d 43 6, 440 (19 43). Only the c onstitution, the common law, or a legisl ative act can confer subject matter j urisdict ion on a co urt. Kane v. Kane, 547 S.W. 2d 559, 560 ( Tenn. 197 7); Computer S ho p pe, Inc. v. State, 780 S.W.2 d 729, 734 (Tenn. Ct. App. 1989). It cannot b e confer red by the a

cts or status of the parties

. Shelby Coun ty v. Ci ty of Mem phis, 211 Tenn. 410, 413, 3 65 S.W.2 d 291, 292 (19 63); Brown v. Brown, 198 Tenn. 600, 618, 2 81 S.W. 2d 492, 501 (195 5).
Unlawf ul detainer actions such as the one involved in this case may be filed in either gen eral sessi ons court , circuit cou rt, or chancer y court. Robin son v. Easter, 208 Tenn. 147, 149, 3 44 S.W. 2d 365, 365- 66 (1961). Thus, unquestionab ly, the general s ession s court had subject ma

tter juri sdiction to adjudicate

the Foster trust’s unlawful detainer warran t. See Tenn. Code Ann . § 2 9-18-107 (1980). I

t is equally

clear th at the cir

cuit court had subject

matt e r jurisdicti on to over Mr. Sh im’s de novoappeal fr om the gene

ral sessio ns judgment against h im. See Tenn. Code Ann. §§ 16-10-112 & 16-15-729 (1994).
Mr. Shim’s ar

gument on subj ect matte r jurisdic tion o verlooks two significa ntlimitation s on the appl ication of Tenn. C ode Ann. § 16- 10-111. F irst,-6-

the statute doe s not

apply to ca ses in whic h the circ uit court is exercisi ng appellat e jurisdicti on over case s appeale d from the general session s court. Riden v. Snider, 832 S.W.2 d 341, 343 (T enn. Ct. App. 1991). Se cond, the statute doe s not apply to causes of action that may be filed in either a court of law or a court of equity. Hamilton Nat’l Ba nk v. Cha mpion, 202 Tenn. 205, 212-13 , 303 S.W .2d 731, 73 4 (1957); Harris v. Buc hig nani , 199 Tenn. 105, 111 -12, 285 S .W.2d 10 8, 111 (1955); Morgan v. Layne, 165 Tenn. 513, 516-17, 56 S.W.2d 161, 162 (1933).
Unla wful de tainer actions are statutory substitutes for essentially legal actions. Newport H

ous. Auth. v. Ball

ard, 839 S.W. 2d 86, 88-89 (Tenn. 199 2 ). They may be filed in the general sessions cou rt, the c ircuit cou

rt, or the chancery court. In this case, the Foster trust ele cted to fil e its unlawful detainer claim in t he general session s court, and th e circuit court wa s exercis ing its appe llate jurisdicti on over the

case when Mr. Shim

perfect ed his de novoappeal. Accordi ngly, the trial

court had t

wo indepen dent grounds for denyingMr. Shim’s motion to tr ansfer th e case to chancer y court.
III.
Because the evidence is essentia

lly undispute d, the controlling iss ue on this appeal is whether the Foster trust demonstrated that it is entitled to a judgment as
amatter of

law. Mr. Shim asserts th at the Fost er trust w as not e ntitled to a judgment as a matt er of law because its notices of default were insuffici ent and its possessory a

ction was prematur

e. We a gree on both

counts. Among a landlord’s most basic rights is the right to receive ren t. See 5 Thompsonon Real P roperty§ 40.03(a), at 9 (D avid A. T homas, ed . 1994) (“Thompson”). Accordingl y, a landlord m ay termin ate a lease f or non-paym

ent of rent if the right has been included in the leas e. Nashville Record Prods., Inc.
v. Mr. Transmis sion, Inc., 623 S.W. 2d 281, 283 ( Tenn. C t. App. 198 1 ). Since ter minati ng a lease r

esults in fo rfeiture

of the tena

nt’s inter est in the pr

operty, landlords must comp ly strict ly with th e terminati on provi sions in the lease. Arlen Realty, Inc. v. Dozier, 393 S o. 2d 489, 4 91 (Ala. Civ. App . 1980); Korte v. National Super Mkts., Inc. , 528 N. E.2d 10, 14 (Ill. App. Ct. 1988); Thom pson, § 40.08(b)( 2), at 59.-7- L andlords must also e xercise t heir powe

r of term ination uneq

uivocall y . Jack Moritz Co. Manageme nt v. Wal ker, 429 N.W .2d 127, 13 0 ( Iowa 1988 ); Josephsonv. National Screen Serv. Group, I nc., 810 S.W. 2d 708, 709 ( Mo. Ct. App. 1991); 2 Milton R. Fri edman, Friedma n on Leases § 16.2, a t 1077 (4th

ed. 1997). Accordingly, this courthas held that a landlord ’s letter requestin g a tenant to pay delinquenttaxes wa s not an eff ective not ice of te rmination because i t did not state that the landlor

d consider ed the leas e to be in d efault. Turner v. Yow, 657 S.W.2d 9 4, 97 (Tenn. Ct . App. 1983).
The 1987 lease ag reement contained M r. Shim’ s covenant t

hat he wou ld pay rent in accord ance wit h th e provisions of the lea se agree ment. It also contained a provision governing the proce dure to be followed if Mr. Shim failed to pay his rent. This provision sta tes, in pa rt, that Should Tenant defa

ult by failure

to pay rent or failure to comply mat

erially w ith the other c onditions set forth herein, and should suc h default continue f

or a period of thirty (30) days after

written notice of such default, then Owner shall imme diately ha

ve the righ

t to take a

ction to enforce his rights as provide d herein, unless Te nant shall have, w it hin the thirty- day period, cured the default. Should tena

nt failto cure the

default w ithin the prescribed ti me, Owner m ay continue the lease

and recover damages; or enter and take pos session o f th e premises and rerent same, h olding Tena nt responsib le for any reason ably fores eeable damag es wh ich occurre d because of

the defau lt. Ms. Shim’s lease clearly c on ditions the r ight to term

inate on the

landlord f

irst giving clear, unequivocal notice of default an d on affor ding the tena

ntthirty days within which to cure

the defau lt.
Neither the January 10, 1995 letter nor the February 3, 1995 letter stated clearly that the F oster trus t consider ed Mr. S him to bei n default or that it had elected to exerci se its right toterminat e the lea se. Both

letters c ould reason ably have been interpreted as simple rem in ders rega rding the pr

ompt payme nt of the correct amount of r

ent. Th e first formal notice Mr. Shim received that the Foster trust had elect ed to term

inate the l ease wa s the Febr uary 16, 1995 letter

from the trust’s lawyer. It follow s that the Foster trust’s unlawful

detainer action fil ed on March 1, 1995 was p remature. See Coin Laundry Equip. C o. v. G ilbert, 597 So. 2d 926, 927 (Fla. Dist. Ct. App. 1992).4 Even though the courts may grant a summaryjudgment to a non-moving party, March

Group, Inc. v. B ellar, 908 S.W.2d 956, 958- 59 (Tenn . Ct. App. 1995), we declineto grant Mr. Shim a summary

judgment b ecause

he did not seek a

summary judgment in the trial court. We also preter

mit Mr. Shim’ s remaining issues in light of our decis io n tha t the Foster trust’s unlawful detainer action was premature. IV.
We r everse the summary judgment and remand the case for fu rthe r proceedin gs consistent with this op inion. 4 We also t ax the cost s of this app eal to the Henry Rogers Foster trust for which execution, if necessary, may issue.

_________________

_____ ______ WILLIAM C. KOCH, JR., JUDGE
CONCUR:

_________________

_______________ HENRY F. TODD, P.J., M.S.

_________________

_______________ BEN H. CANTRELL, JUDGE