1 The bank co ntends M orrison signed them; M orrison insists the signatures are forgeries. 

### IN THE COURT OF APPEALS OF TENNESSEE

AT NASHVILLE Assigned on

Briefs M arch 7, 2 005
BRENDA AND STANLEY MORRISON v. CITIZEN STATE BANK

Appeal from the Circuit Court for Marion County No. 14582 Buddy D. Perry, Judge

No. M2004-00263-COA-R3-CV - Filed Septem ber 20, 2005

This is the third action between Stanley Morrison and Citizen State Bank concerning a seri es o f promissory

notes and security ag

reements. In the first ac

tion, Citizen State Bank filed a civil warrant inGenera l Sessions Co

urt aga inst Stanley Morrison to recove r a deficiency

judgment and repo ssess a truck tha

t was coll ateral on a serie s of loans . The ban k obtaine d a defa

ult judgment aga

inst M orrisonand repossessed the truck when Morrison failed to appe ar in court. Morrison f ailed t o timely appeal the default

judgmen t. There after, Morrison

and his wife filed this action challenging the validity of the defa

ult judgment and seeking d amages for fraud, misrepre sentation, and conversion

of prope rty , con tending four of six promissory notes and se curity ag reements that the judgment was based upon were forge ries. The trial court held this action was barred by res judic ata and dismissed i t on summary judgme nt. We affirm the dismissal of this action on the basis of collater al estopp el. Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court is Affirmed

F RANK G. C LEMENT , J R ., J., delivered the opinion of the court, in which W IL LI AM C. K OCH , J R ., P.J., M.S., and W IL LI AM B. C AIN , J., joined. Hallie H. McFadden, Chattanooga, Te nnessee, for the appellants, Brenda a nd Stanley Morrison. J. Harvey Cameron, Jasper, Te nnessee, for the appellee, Citizen State Bank.

OPINION

In1997, Stan

ley Morrison

executed a consume

rloan agreement with Citizen State Bank. Morrisonadmits signing the loan documents and borrowing the money evidenced by

the 1997 loan ag reemen ts. A second

and third loan ag reemen t were pu rported ly s igned by Morrison in A ugust 19 9 8 and August 1999. 1 On September 11, 1999, Morrison admits that he and his wife, Brenda Morrison , entere d into a loa n agre ement wit

h the bank

– pur porte dly the f ourth in a se riesof six –2 The fourth note is the onl y one that bears t he signature of

Brenda M orrison.

3 Morrison

conte nds he was no t prop erly served with process, cl aiming the Sherif f lef t the warrant

and summons with his m other -in-law nex t doo r. Unfo rtunate ly, the reco rd d oes n ot co ntain the s heriff’s return of pro cess.

4 Th is was the second of the thr ee related actions between Morrison and the bank concerning the loans at issue and the D odg e Ra m truc k.
-2- in the amount

of $23,000 to purchase a Dodge Ram truck. 2 The Morrisons secured this loan w

ith the Dodge Ram, their deposit accounts with the bank, and a F ord Bronco.
Thereafter, two additional loan a greem ents wer e execute d, in Dec ember 19 99, and Ap ril 2000. The Morrisons contend, however, that all but the first and fourth loan agreements wer e forged document s for which they are not liable. Specifically, the Morrisons allege a representa tive of the bank either f orged Stanley Morrison ’s signa

ture on f our of the six agreements or neglig ently allowed
someone else to commit the forgeries. The bank has conte nded thro ughout a ll three a ctions tha t all loandocuments were signed by M orrison. It is u

ndisputed that Bre nda Morr ison signed the fo

urth agreement along with her husband.

The first of the three lawsuits among the parties was in the Ge neral Sessions Court of

Marion Co un ty. It w as a civil warrant brought by the bank against Stanley Morrison for a deficiency judgment on the note s and to re cover the collate ral sec uring the note, th e Dodge Ram. The bank alleged that the Morrison loans were cross-collateralized, that one of the loans was in default, which rendered all of the loans, including the fourth that the Morrisons admit signing, in default. Thus, the bank soug

ht a deficiency

judgment and possession of the the Dodge Ram truck the Morr isons put up as colla

teral. Mo

rrison did not file a

response to the civil w arrant and did not appear at the hearing in General Sessions Co

urt. 3 Because of Morrison’s failure to appe ar, the General Sessions Courtentered a default judgment on November 27, 2000, awarding the bank a deficiency

judgment and possession of the Dodge Ram truck.

Morrisonattempted to appeal this decision by f iling his own Civil Warrant for the Recovery of Perso nal P ropert y (the Dod ge Ram truck) against Citizen State Bank, 4 accompanied by anAppeal Bond. These were filed by Morrison on December 11, 2000. Theappeal, however, came too late, after the expiration of the ten-day time limit for appe als. Uponmotion by thebank, the Circuit Court of Marion County dismissed Morrison’s civil warra n t and attem

pted appeal due to Morrison’s failure to timely appeal. Morrison then f iled a motion for new trial and, in the alternative, to set aside the default judgment, which the Circuit Court dismissed by Agreed Order in June of 2001.
Thereafter, Brenda and Stanl ey Morr ison filed this action against the bank on October 24, 2001, in which they alleg ed the bank defrauded them or neg ligently

allowed s omeone e lse to do so by forging Morrison’s signature on four of the six loanagreements. Further, they alleged the bank “illeg ally conve rted” t he Dod ge Ram, conte ndin g they were cu rrent on th e loan secure d by the Do dge5 We can only assume t

hat t he c onductto w hich t

he Morrisons ar e refer ring i s that

concerni ng the a lleg ed forger ies on the not es and th e possess ion of t he Dodge Ram. Their complai nt was not suf fici entl y speci fic o n tha t allegati on. -3- Ram, t he D odge Ram was not cross-collateralized for the other loans, and the bank’s conduct 5 violated the Tennessee Consumer Pr otection Act and the Fair D ebt Collection Act.

The bank move d for summa ry judgmen t upon the b asis o f res jud icata. The trial court grante d the motion

from whic

h the Morr

isons appe al.

S TAND ARD O F R EVIEW
The issues were resolve d in the tri al court upon summa

ry judgmen t. Summary

judgmen ts do notenj oy a presumption of cor rectness on appeal. BellSouth Advertising & Publishing Co. v. Johnson , 100 S.W.3d 20 2, 205 (Te nn. 2003) . This cou

rt must make a f resh determination that the require ments of Tenn. R. Civ. P. 56 have bee n satisfie d. H

unter v. Brown , 955 S.W.2d 49, 50-51 (Tenn. 1997). We c onsider t he evide nce in the lig ht mos t favorable to the non-moving party and resolve all inferences in that party 's favor. Godfrey

v. Ruiz , 90 S.W.3d 692, 695 (Tenn. 2002). When reviewing the evidence, we first determine whether factual disputes exist. I f a fac tual dispu te exists,
we then dete

rmine whe

ther the fact is ma

terial to the claim

or defe nse upon w

hich the s u mma ry judgment is predicated and

whether the disputed fact creates a genuine issue for trial. Byrd v. Hall , 847 S.W.2d 208, 2 14 (Tenn . 1993); Rutherford v. Polar Tan k Trailer, Inc ., 978 S.W.2d 102, 104 (Tenn. Ct. App. 1998). Summary judgments ar

e proper in virtually a

ll civil cases that

can be resolve d on the ba sis of legal i ss ue s alone, Byrd v. H all , 847 S.W.2d a

t 210; Pendleto n v. Mills , 73 S.W.3d 115, 121 (Tenn. Ct. App. 2001); however, they are not appropriate when ge nuine disputes regarding material facts exist. Tenn . R. Civ. P. 56 .04. The p arty seeking a su mmar y judgment be ars the burden of demonstrating that

no genuine disputes of material fact exist and that party is entitled to judgment
as a matter of

law. Godfrey

v. Ruiz , 90 S.W.3d at 695. Summary judgment should be gr anted at the trial court level when the undisputed facts, and the inferences reasonably drawn from the undisputed facts, support one concl usion, which is the party see king the summary

judgment is entitled to a judgment as a matter of law. Pero's Steak & Spagh etti House v. Lee , 90 S.W.3d 614, 620 (Tenn. 2002); Web ber v. Sta te Farm M utual Autom obile

Ins. Co. , 49 S.W.3d 265, 269 (Tenn. 2001). The court must take the stron

gest legitimate view of the evidence in favor of the non-moving party , allow all reasonable inferences

in favor of

that par ty, discard

all count ervailin g evide nce, and, if ther

e is
a dispu te asto an

y mater ial f act o r if t here is any doubt as to t he exi stence of a mate

rial fac t, summary judgment cannot be granted. Byrd v. H all , 847 S.W.2d at 210; EVCO Corp. v. Ross , 528 S.W.2d 20 (Tenn. 1975). To be entitled to summary judgment, the moving pa

rty must affirma tively negate an essential element of the non-moving party 's clai m or estab lishan affirmative defense that conclusi vely defeats the non-moving

party's claim. Cherry v. Williams , 36 S.W.3d 78, 82-83 (Tenn. Ct. App. 2000).-4- A NAL YSIS
The Morrison s’ alleg ations of forge ry and fra ud are se rious, y et this ca se d oes not turn on theseallegations. Instead, the disposition of this appeal hinges on the appli cability

or inappl icability of the doctrines of res judicata and collatera l estoppel.

Res judicata and collateral estoppel “promot e finali ty in litigation in order to conser ve judicial resourc es and to r elieve li tigants from the cost and

vexation of multiple lawsuits.” State ex rel. Cihlar v. Cr

awford , 39 S.W.3d 172, 178 (Tenn. Ct. App. 2000). “[P]ublic policy dictates that litigationshould be determined with reasonable expedition, and not protracted through inattention and lack of diligence on thepart of litigants or their counsel.” Henley v. Hastings , 441 S.W.2d 64, 69 (Te nn. C t. App . 1968 ) (cit ing Jordan v. Johns , 79 S.W.2d 798 (Tenn. 1935)).

“Res judicata bars a second suit between the same parties on the same

cause of action a s to all issues whi ch were

or could have been

litigated in the former suit.” Collins v. Green County Bank, 916 S.W.2d 941, 945 (Ten n. Ct. App. 1 995). Collateral estoppel “bars a second suit between the parties on a different cause of action wher e the issues were actually

litigated and

determined

in the former suit.” Collins at 945. Importantly , these doctrines apply not only to those issues that were actually determined in the prior suit, but also to all issues that could have been determined. Henley at 69.

Res judicata bars a second suit on the same cause of a ction. The first action was a civi l warrant to recover

a deficiency

judgment on a series of notes and repossess persona l propert y. T his is an action

for damages allegedly

resulting from fraud, misrepresentation, and for violations of the Tennessee Consumer Protection Act and the Fair Debt Colle ction Act . This act ion is notthe same
ac ti on as th at br ou gh t b y th e b an k i n G en er al Se ss io ns Co ur t. Th us , r es ju di ca ta do es no t a pp ly.

Collater al estopp el, howe

ver, is an issue preclusion doctrine. Hampton v. Tennessee Truck Sales, Inc ., 99 3 S .W .2 d 6 43 , 6 45 . “ On ce an is su e h as be en ac tu al ly o r n ec es sa ri ly d et er mi ne d b y a court of compe

tent juris diction, the doctri ne of col lateral

e stoppel renders that determination conclusive onthe parties and their privies in subsequent litigation, even when the claims or causes of action are different. Cihlar at 178-179 (Tenn. Ct. App. 2000).

The Morris ons’ fai lure to de fend the civil war rant in Ge neral Se ssions Co urt notwithstanding , the General Sessions Court ruled in favor of the bank on its claims that were based on the promissory notes and secu

rity agree ments at issue in this action. By g ranting a deficiency

judgment and possession of and title to the Dodge Ram truck to the bank, the Gener al Sessions Court determined that the four th promissory

note and security a

greement was validly

executed by Br

enda and Stanley Morrison, the Do dge Ram truck was security on the note, the other notes were validly executed by Stanley Morrison, and one of the notes with which the Dodge Ram truck wa s cross-collateralized
was in default. See Ingram v. Earthman, 993 S.W.2d 611, 631 (Tenn. Ct. App. 1998) (holding in a suit on a note, the holde

r makes o ut a prima

facie case by pr

oducing the note signed by the maker and by showing that ther

e is a balance due on the note.) (citing Crossland Fed. Sav. Bank v. A. Suna6 Morrison cont ends tha t he was not properl y ser ved wit h noti ce of t

his ac tion. This may be s o, and if true,
wou ld have been groun ds f or appealing the default judgment. He failed to ti mely fil e his appeal, however, and thus t he is sue of p rope r s erv ice has al so be en c oncl usi vel y de ter min ed ag ain st

hi m.
-5- & Co. , 935 F.Su

pp. 184, 19 1 (E.D.N .Y.1996) ; Smith v. Weindrop , 833 P.2d 856, 857 (Colo.Ct.App.1992); Misemer v. Freda's Restaurant, Inc ., 961 S.W.2d 120, 121 (Mo.Ct.App.1998); L. Harvey &

Son, Co. v. Jarman , 76 N.C.App. 191, 333 S.E.2d 47, 52-53 (N.C.App .1985); Judarl, L.L.C. v. Cycletech, Inc ., 246 A.D.2d 736, 667 N.Y.S.2d 4 51, 452 (1 998)); See also First State Bank & Trust Co. v. McIver , 681 F.Su pp. 1562, 1 564 (M.D. Ga. 1988) ; Reifeiss v. Barnes , 192 S.W.2d 427, 430 (Mo. Ct. App.19 46); Rubbelke v. Strecker , 53 Wash. App. 20, 765 P.2d 314, 316 (1988) (holding refusal to pay

a note when due re su lts in a breach of the terms of the note for which the maker dishonors a note, the holder may seek judicial re lief on the note itself, the underly ing obligation, if any, or

both in the alternative).

Becau se the GeneralSessions Court decided these issu

es when i t render ed judg ment ag ainst Morrisonin favor of the b ank in November of 2000, the Morrisons are now estopped fr om challenging

the validity of the notes purporte dly signed by Morrison, whether

one of the notes was indefault, and whether the Dodge Ram truck was subject to being repossessed as collateral for the notes.
When the bank

brough t its action in General Sessions Court to recover the Dodge Ram that it alleged served as collatera l on apromissory note betwee n it and Morrison, Morrison could have defended that action on the very

grounds raised in t

his a ction. Specifically, he c ould have argued that the promissory note on which the ba nk relie d was i nvalid due to forgery . He could have defended the action by ar

guing that the bank had

no right to take th e Dodge

Ram beca

use the no te secured by the Dod ge Ram was not in default. He could have also argued that the note in default was notsecured, cross-collateralized, by the Dodge Ram. Morrison could have defended thefirst action on any of these

issues, but he failed to do so.

The General Sessions Court entered a default judgment 6 , and Morrison failed to file a time ly appeal from that judgment. Therefore, the judg ment is conclusive “to all matters which might have legall y been put in issue and determined. . . .” National Cor dova Corp. v. City of M

emphis , 380 S.W.2d 793 (Tenn. 1964). We therefore affirm thetrial cou rt’s summa

ry dismissal o f the Mor

risons’ complain t on the ba sis of coll ateral e stoppel.

The judgment of the trial court is affirmed, and this matter is remanded with costs of appeal assessed against appellants Brenda and Stanley Morrison.

___________________________________ FRANK G. CLEMENT, JR., JUDGE