### IN THE COURT OF APP EALS OF TENNESS EE AT KNOXVI LLE D ec em be r 6, 200 4 S es sio n

BE A TR IC E H A R M ON M ON TG OM ER Y v. TERRY LANE MONT GOME RY, ET AL 

### . Appeal f romthe Chancer y Court for Cart er C ounty No. 24258 Thomas J. See ley, Jr., Judge

No. E2004-00403-COA- R3-CV - F ILED MARCH 17, 2005

Whil e B eatrice Ha

rmon Montgome ry

(“Plaintiff” ) and Te rry

L ane Montg omer

y ( “ D e f e n d an t” ) n e v er marrie d, they

lived toge ther for

many y ear s beg inning in 1969. Plaintiff and De fendan t had one child, Brian Montg omery . During th e ir r e la ti o n s h ip , Pl ain ti f

f an d D e f e n dant ac cumulated substantial assets and operated s ever al bus inesses. Plaintiff filed t his lawsuit seeking dissoluti on of her implied business partne rship with Defe ndant. B rian Montg omery intervene d claiming he also wa s a partner in two of the business venture s. The Tria l Court concluded that Plaintiff and Def endant we re e qual pa rt ne rs in a ll o f the ir

bu sin e ss p ur su its , a ndthat B ri a n a lso wa s a pa rt ne r in two of the m. I t is thi s
ru ling t hat for ms the b a sis fo r m os t of the nu me ro us iss ue s r a ise d o n a pp e a l. We re ve rs e in p art , va c a te in p art , a ff

ir m in pa rt a s mo dif ie d, a ndre mandfo r f

urthe r p ro c e e din g s c onsi st ent wi th thi s Opinion.

Tenn. R. App . P . 3 Appeal as of Right; Judgme nt of th e Chancer y Court Re verse d in Par t, Vac ated in Par t, and Af fi rm ed in Par t as Modifi ed; Case R em anded

D. M I CH A EL S WI NEY , J ., delivere d the opinion of the court, in which C H A RLES D. S US ANO , J R ., and S HAR ON G. LEE , J J ., joined.

T h o m a s C

. J e s s e e , J o h n s o n C i t y, T e n n e s s e e , f o r t h e A p p e l l a n tT e rr y L a n e M o n t g o m e r y.

D a v i d S

. H a yn e s , B r i s t o l , T e n n e s s e e , f o r t h e A p p e l l e e B e a tr i c e H ar m o n M o n t g o m e r y.

M ark D

. E d m o n d s , J o n e s b o r o u g h , T e n n e s s e e , f o r t h e A p p e l l e e B r i a n M o n t g o m e r y.A ltho u g h B r ia n M o n tg o m e ry is a n inte rv e n ing p la intiff in this la w su it, a n y re fer e n c e in this O p inio n to 1
“P la intiff

” re fer s o n ly t o B e a tric e M o n tgo m e ry.

Pl ai n t i f f c l ai med s h e an d D ef

en dan t h ad a v al i d common l aw ma r r i ag e bec au s e t h ey l i v ed t og et h er i n Fl or i da 2
f or a s uf f i ci ent amount of

t i me t o be cons i dere d m ar r i ed un der Fl ori da’ s t hen ex i s t i ng l aws

. Al t houg h Pl ai nt i f f adva nce d t hi s and other t heo ri es i n s up p o rt o f he r ar gum ent t hat s he and D efend ant act ual l y were m arri ed , t he T ri al C o urt fo und ot her wi s e a nd t hi s f

i ndi ng i s not ch al l eng ed on appeal

. N eve r t hel es s , dur i ng t hei r r el at i ons hi p t he part i es he l d t hems el ves
o ut as b ei ng m arri ed and we no t e t hat t he T ri al C o urt ref erred t o them as ei t her M r. or M rs

. M o nt go m ery , or T erry and B e a M o n tgo m e ry.
-2- OP IN ION

Bac kgr ound
This appea l involves the complicated dissolution of what the Trial Court found to be an implied partne rship betwee n Plaintiff an d Def endant, and at times also their only child, Brian Mo ntg ome ry

. Pla int if

f a ndDe fe nd a nt a

re fi ft y -f ive y e ars of

age. Th ey began liv ing tog e the r i n 1 1969 and their son B rian wa s born in 1970. Although the y never marrie d , Plaintiff and Def endant 2 continued to live tog ether for a p p ro x i m atelytwenty -seve n y ear s after Brian was born. I n May of 1999, Plaintiff filed this la ws u i t s ee k ing a divorce or, alternatively , dissoluti on of an implied partne rship.
The plea dings in the r ecor d comprise fi v e v o lumes and 745 pag es. It took severa l da y s to c omp le te the tr ia l a nd the tr a ns c ri pt a lon e is ov e r 12 00 pa g e s, e xclu din g the 341 e xhibi ts marke d for identific ation of which 124 we re ad m i t t ed at trial. Once the trial was c ompleted, the Trial C o u rt orally

announce d many

of its initi al finding s which later wer e tra nscribed a nd incorporated in t o t h e J u d gment enter ed in May of 2003. This J udg ment did not resolve all of the i s s u es and, in addition, several post-trial motions were filed. I n J anuary of 2004, the Trial Court

re so lve d th e re ma ini ng iss ue s a s w e ll a s th e po st- tr ia l mo tio ns wi th the e ntry of a F ina l Judg me nt, which later

was a mended in F ebrua

ry of that same y ear . The F inal J udg ment altere d few , if any , of the finding s in the i nitial J udg ment and focused primarily on how t he parties wer e to g o about selling

or a uc tio nin g so me of

the ir a sse ts.

This case involves the brea k-up of a lon g-t er m re lationship between Plaintiff a nd Def endant. During the ir rel at i o n ship, the parties a cquire d substantial assets. For example, at the time of trial the parties owned and operated a masonry business, an insurance business, a marina, a mini-mall, and an apa

rtment complex known as Eastland Apartments. The pa rties owned va

rious other business ventur es during their re lationship such as two Nautilus g y ms. The primary issues at trial involved who wa s entitled to what. Be cause Plaintiff and Def endant ne ver w ere marrie d, the statutes and re levant ca se l aw addressing distribution of marital property did not apply . Rely ing on

app lic able pr e c e de nt fr om our Sup re me Cou rt , the Tria l Court app lie d the la w g ov e rn ing bu sin e ss partners h ips when re ndering its J udg ment. I n short, the Trial Court conc luded that Plaintiff and Def endant we re e qual partners in all of their busine ss ventures with the e x ception of the marina a nd some land loca ted ac ross the road from the marina. Wit h reg ard to these two assets, i.e., the ma rina-3-

a ndthe la nd , th e Tria l Co urt he ld tha t th e pa rt ie s’ so n B ri a n w a s a lso a part ner. I t is thi s o ve ra ll conclusion by

the Trial Court which f

orms the basis for most of De fenda nt’s issues on appea l.

Whe n th e Tria l Co urt a nn ou nc e d it s in iti a l de c isi on fr om the be nc h, it m a de c e rt a in

c re dib ili ty

de te rm inatio ns a ndoth e r f ind ing s w hic h a

re imp orta nt t o th e re so lut ion of thi s a pp e a l. Specifica lly , the Trial Court stated:

As in mos t dome sti c ty

pe c a se s, c re dib ili ty in thi s c a se wa s a key issue. The Cour t fo u n d Mr. Montg omery to be eva sive and app ar e n tl y f

o r g e tf u l th r o u g h o u t h is te s ti mo n y

. H e v io late d two injunctions of the Court, one ... [prohibiti ng ] t he parties from disposin g o f any

of their a ssets ... and the injunction on J une 28, 1999 ... which said the pa rties wer e not to deny

acc ess to eac h other wi th r e sp e c t to their vari ou s p ro pe rt ie s. Mr . M on tg ome ry a lso illega lly rec orded Mr s

. M o n t go m er y ’s t el ep h o n e c onversa tions and ... [he] filed wha t this C ourt found to be a spurious $1.6 mill ion lien on the marina

.... Mrs. Montgome ry , o n the other ha nd, was g ener ally more fo rthr ig ht a ndc a nd id i n h e r t e sti mon y e ve n w he n it was a t ti me s to her disadvantag e. Mr. Montg omery did s t i p u l ate a nd ag ree to a pa rt ia l di vis ion of the ir pr op e rt y a s f oll ow s: M r. Mo ntg ome ry wa s to
re c e ive the h ou se bo a t a ndits c on te nts a ndthe ma so nry bu sin e ss. Mr s. Mo ntg ome ry

wa s to re c e ive the c on do min ium a ndits c on te nts with the debt on the condominium to be paid from the proc eeds of the

sa le of the mari na , a ndsh e was to r e c e ive he r i ns ur a nc e bu sin e ss. [C ounsel for Mr . Montgo m er y ] agr eed the se we re the stipulated

un de rs ta nd ing s be tw e e n the pa rt ie s a s to the se pr op e rt ie s, bu t he did not stipul ate that they we re partne rship properties. The Court finds that they are partne rship properties, and in that connec tion, this Court would include the one -ac re lot in M i l l i gan, which was ... used

ex cl u sively

in the masonry

business to be part of

the masonry business.

Th e Cou rt

fi nd s a ndho lds th at th e pa rt ie s d id c omb ine the ir labor a nd monies until at least September, 1999. Mr. Montg omery
c on te nd s th a t he didmor e in the way of mon ie s a ndsw e a t e qu ity to the a c qu isi tio n o f the ir va ri ou s p ro pe rt ies a ndmon ie s. Mr s. Montgome ry

... contributed monies, and the re w ere y ear s ear lier on in th e ir r e lati o n s h ip w h e n s h e e ar n e d mo r e mo n e y th a n M r. Montgome ry , and she a lso g ave materia l a ssistance in the operation of both [of the Nautilus gyms ... and] t h e E astland Apa rtments, the

ma so nry bu sin e ss w he re sh e didthe re c or d k e e pin g a ndwa s a c tiv e in-4- the oper ation of the marina prior to September, 1999. Her involvement in the development of the Florida properties was not as g re a t a s in so me of th e ot her busi ne sse s, but it w as a part of the

ov e ra ll s c he me of t

he se pa rti e s o r g oa l of

the se pa rti e s to ac qu ire assets and make substantial income

.... The Court fi nds clearly unde r the facts of this case that Mr. and Mrs. Montgomery, Terry and Bea Mo ntg om e ry we re pa rtn e rs a nd tha t th ey did

c om bin e the ir l ab or

, efforts, monies in th e acquisition of properti es and money

.... (empha sis added)

There is c onsiderable disag ree ment betwee n the parties on appea l a s to the Trial Cou rt ’s c on c lus ion a s to whe n the ir bu sin e ss part ne rs hip a c tua lly be g a n. Th e Tria l Co urt st a te d in its J udg ment that Plaintiff and Def endant “ became equa l partner s i n al l o f their business ve ntures beg inning with the Masonry business in a pproxi mately 1981.” Plaintiff c laims the y ear should have

rea d “1971" and this was mer ely a ty pog raphic al er

ror in the J udg ment. Rely ing on the y ear as set forth in the Judgment (i.e., 1981), Def endant claims the Trial Court e rre d when it c oncluded Plaintiff

wa s a n e qu a l pa

rt ne r in the ma so nry bu sin e ss, the Ea stl a ndAp art me nts , th e Mil lig a n lo t, andc e rt a in land locate d in Florida. A lternatively , Def endant a rg ues that if th e fi n d i ng of a pa rtnership wa s
c or re c t, the n h e is e nti tle d to re c ou p h is i nit ia l in ve stm e nt o f $ 18 0, 00 0 in the Ea stl a ndAp art me nts pr ior to the pa

rt ie s div idi ng a ny re ma ini ng pr oc e e ds

. De fe nd a nt a lso arg ue s the Tria l Cou rt e rr e d in finding Plaintiff to be a partne r with r eg ard to c erta in la nd titled in the names of D efe ndant and B rian Montgome ry . Next, De fenda nt a rg ues the Trial Court erre d when it conc luded B rian Montg omery
was a partne r with regar d to the marina, a nd further err ed in awa

rding Plaintiff and B rian Montgome ry

certain offse ts and cre dits on their portion of the value of the marina. Def endant f urther arg ues that the Trial Court e rre d when it or dere d the parties’ property to be sold a nd divided in such

a ma nn e r tha t di d n ot a llo w D e fe nd a nt t o r e c ou p h is i nit ia l in ve stm e nts

.

Se pa rate a ndapa

rt fr om any iss ue s inv olv ing the c la ime d p art ne rs hip a ndits a sse ts, Plaintiff also claimed De fenda nt illega lly wireta pped her telephone, the reby

entitling her

to statutory damag es. The T rial Court held that De fenda nt had violated the a ppl i ca b l e s t atut e and a war ded Plaintiff $10,000 in statutory damag es. On a

ppeal, Plaintiff cla ims there we re three se parate illeg al wireta ps and, there fore , she should have be en aw arde d $10,000 in damag es for eac h violation, for

a tot a l of $3 0, 00 0. De fe nd a nt arg ue s that th e Tria l Co urt impr op e rl y a wa rd e d Pl a int if

f $ 10 ,0 00 in damag es and c laims that any awa rd to Plaintiff for the illega l wiretap w ould constitute an abuse of discretion.

Discussion

The fa ctual finding s of the Tria l Court areacc orded a presumption of cor

rec tness, and we will not overturn those fac tual findin gs unless the evidenc e pre ponderates ag ainst them. See Te nn . R. App . P. 13 (d ); Bogan v. Bogan , 60 S.W .3d 721, 727 (Tenn. 2001). With respect to leg al issues, our review is conduc ted “unde r a pur e de novo standard of revie w, ac cording no defe renc e-5-

to the conclusions of law made by the lower courts.” So uth e rn Con str uc tor s, In c . v. Lou do n Co un ty Bd. Of Educ. , 58 S.W .3d 706, 710 (Tenn. 2001)

.

"G ener ally , what will constitute a partnership is a m at t er of law, but whethe r a part ners hi p ex is ts un der c on fl ict in g evid ence i s o ne o f fact ." Messe r Griesheim Indus., I nc. v. Cryotech of Kingsport, Inc. , 4 5 S

. W

. 3 d 5 8 8 , 6 0 5 (T en n

. C t

. Ap p

. 2 0 0 1 )( q u o t i n g W y att v . B ro wn , 39 Tenn. App. 28, 281 S.W .2d 64, 68 (1955))

. Since there is no written partne rship ag ree ment betwee n any of the pa rties to this li tigation, the party alleg ing the exis tence of the part n ership ca rries the burden of proving that fac t by

clea r and c onvincing evidenc e. See Tidw ell v. W alden , 330 S.W .2d 31 7, 31 9 ( Te nn . 1 95 9) ; Kuderewski v. Estate of Hobbs , No. E2000-02515- COA-R3-CV, 2001 Tenn. App. LEXI S 561, at ** 10-11 (Te nn. Ct. App. J uly 30, 2001), no appl. perm. appeal filed

.
The Revised U niform Partner ship Act define s a “pa rt n ership” ge nera lly

as “a n association of two ( 2) or more persons to car ry on as co- owner s of a business or othe r undertaking fo r p ro fi t .... ” Te nn

. Cod e An n. § 6 1- 1- 10 1( 6) . O ur Sup re me Cou rt

pr ov ide d f

urthe r g uid a nc e in Ba ss v . B as s , 8 14 S.W. 2d38 (T e nn . 1 99 1) wh e n it state d:

I n determining whe ther one is a partne r, no one f act or circ umstance may be pointed to as a

conclusive te st, but each c ase must be de cided upon consideration of all rele vant fac ts, a ctions, and conduct of t he parties. Roberts v. Lebanon Appliance Servic e Co. , 779 S.W .2d 793, 795 (Tenn. 1989)

. I f t h e parties' business bring s them within the scope of a joint business undertaking for mutual pr ofit – that is to say if they place their money , assets, labor, or skill in commerc e with the

un de rs ta nd ing tha

t pr of its wi ll b e sh are d b e tw e e n the m – the re su lt i s a partnership whet h er o r not the parties understood that it would be

so. Pritchett v. Thomas Plater & Co. , 144 Tenn. 406, 232 S.W. 961, 969-70 (1921)

.
Moreove r, the e x istence of a partnership dep en d s upon the int e nti on of the pa

rt ie s, a nd the c on tr oll ing int e nti on in this re g ardis th a t a s c e r ta in ab le f

r o m th e a c ts o f th e p ar tie s. W yat t v. B ro wn , 39 Tenn. App. 28, 281 S.W.2d 64, 67 (1955). Al t h oug h a contr act of partne rship, either e x press or implied, is essential to the c reation of pa rt ne rs hip status , it

is n ot e sse nti a l th a t the pa rt ie s ac tua lly int e ndto b e c o me p ar tners. W

y att , 281 S.W .2d at 67. The e x istence of a partne rship is not a question of the parties' undiscl o s ed int ention or

e ve n th e te rm ino log y the y us e to de sc ri be the ir re la tio ns hip , n or is i t
nece ssary that the parties have a n understanding of t he lega l effe ct of their ac ts. Ro be rts , 779 S.W .2d at 7 9 5 -96. It is the intent to do t he things whic h constitute a partnership that determines whether individuals are pa

rtners, r eg ardle ss i f i t is their purpose to cr eate or avoid the re lationship. W

y att , 2 8 1 S

. W

. 2 d a t6 7

. S t a t e d a n o t h e r w a y,W hen equi t abl y di s t r i but i ng mari t al propert y i n a di vor ce cas e, T enn

. Co de Ann. § 36

- 4- 12 1(c) ( 5) r equi r es 3

a t r i al c ou r t t o c o nsi d er t he “ con t r i bu t i on of e ac h pa r t y t o t h e ac qu i s i t i on , pr es er v at i on , a ppr ec i at i on , de pr ec i at i on or d i ss i p at i o n of t he m ari t al or separat e p rop ert y , i ncl ud i ng t he co nt ri b ut i o n of a p art y t o t he m arri age as hom em aker, wage
e a rn e r o r p a re n t, w ith the c o n trib u tio n o f a p a rty a s h o m e m a k e r o r w a g e e a rn e r to b e g ive n the sa m e w e igh t i f ea c h p a rty h a s fulfil le d it s ro le .”

-6-

the exist ence of a pa

rtnership may

be implied from the c ircumstance s wher e it appea

rs that the individ u al s i n v olved have enter ed into a bu sin e ss r e la tio ns hip fo r p ro fi t, c omb ini ng the ir pr op e rt y , la

bo r, sk ill , experience , or money

.
Ba ss , 814 S.W .2d at 41 (footnote omitted).

I t is important to note t hat the statutory fac tors contained in Te nn. Code Ann. § 36-4- 1 2 1 ( c ) w h i c h ar e t o b e c o n s i d e r e d w h e n d i v i d i n g m ar i t a l p r o p e r t y d o n o tap p l y i n t h i s c a s e

. In Martin v. Coleman , 19 S.W .3d 757 (Tenn. 2000) , our Supreme Court a ffirme d a conc lusion bythe trial court that ther e wa s an implied partner ship betwee n De l o re s C o leman and Robe rt Coleman. The Colemans ha d been ma rried and divorce d. They

later r eunited and lived toge ther unmarrie d for six teen more y ear s. The Supreme Court conclude d that Mr. Coleman’s re tirement bene fits were not pa rt of the Col ema ns ’ bu si ness pa rt ne rs hip a nd , th e re fo re , w e re no t pa rt ne rs hip a sse ts s ub

je c t to division. I n rea ching this conclusion, the Court specifica lly ref u s ed t o consider Ms. Coleman’ s
c on tr ibu tio ns a s a

ho me make r b e c a us e such con tr ibu tio ns we re be y on d th e pa rt ie s’ bu sin e ss relationship. Id. at 761-62. Of course , if the Colemans had been m ar ri ed , M s

. C oleman’s

c o n trib u ti o n s a s a h o me ma k e r in d e e d w o u ld h a v e b e e n r e le v a n t. See T en n

. C ode Ann. § 36- 4- 121(c) (5). The Coleman Court also ref used to hold that unmarrie d couples could cre ate a n implied 3 partne rship simplyby

their “c ontinued cohabitation.” Id

. S e e a ls o S to r y v

. La nier , No. W2003- 02194-C OA-R3-CV, 2004 Tenn. App. LEXI S 761, at * 27 (Tenn. Ct. App. Nov. 17, 2004), ap pl. perm. appe al pending , (“While we a re mindfu l o f Ms. Story ' s contributions to the [ domestic] relationship following this [ b u s i ness] transaction, we are direc ted to focus our attention upon the fac ts as they

rela t e t o t he parties' decision to enter this particular transaction, not the fa cts as they relate to domestic matters.” ).

Ou r sta rt ing po int is to de c ide wh e the r the Tria l Cou rt c on c lud e d the part ne rs hip beg an in 1971 or 1981. Af ter making the cr edibilitydeterminations quoted earlier in this Opini on, the Trial Court ma de numerous finding s of fa ct re g arding , int e r a lia , th e pa rt ie s’ va ri ou s b us ine ss
ve ntu re s, the op erat ion of the se bu sin e sse s o ve r the y e ars , a s w e ll a s c on tr ibu tio ns to the bu sin e ss
v en t u re s b y P l a i n t i f

f a n d De fe n d an tan d , wh en ap p l i ca b l e, b y Br i an M o n t go m er y

. E v en t h o u gh many of the finding s of fa ct often a re duplicated, all in all they comprise a

pproxi mately

six ty -one ( 6 1 ) p a g e s

. T h e T r i a l C o u r t ’ s J u d g m e n tw a s w e l l

- c o n s i d e r e d a n d t h o r o u g h

. A s n o t e d p r e v i o u s l y, the Tr i al C o u rt held that the parties’ business partne rship beg an with the adve nt of the masonry business. Alon g t h i s line the Trial Court’s f irst five of its many

finding s of fa ct re g arding the

ma so nry bu sin e ss a

re a s f oll ow s:-7- I n 1971, the dec ision that Terry become s el f- empl oy ed wa s j oint, and Be a Montg omery beg an to participate in the masonry bu sin e ss a s so on a s T e rry

be g a n to w or

k a s a se lf -e mpl oy e d p e rs on in 1971.

I n 1 97 3 B e a

a ndTe rry

Mo ntg ome ry

e nter e d in to a

bu sin e ss
re la tio ns hip fo r p ro fi t, c omb ini ng the ir proper ty , la

bo r, sk ill , experience , and money

. Terry and B ea be g an a ma sonry business as a self e mploy ment in Terry ’s name.

B e a w a s a tt h a tt i m e e ar n i n g m o r e t h a n T e rr y.

B e a Mo ntg ome ry ’s wo rk su pp lie d the he a lth ins ur a nc e fo r a ll three throug h 1982.

Be a b e g a n to p ar ti c ip a te in th e ma s o n r y b u s in e s s a s s o o n as Terry Mo ntg ome ry

be g a n to op e rate a s a

se lf -e mpl oy e d p e rs on in 19 71 in that the y op e ne d a joi nt a c c ou nt f or the ma so nr

y bu sin e ss i n 1971.

T h r o u g h o u t the finding s of fa ct and to the e x tent applicable , the Trial Court continued to refe renc e pertinent events with reg ard to the parties’ business venture s which had taken plac e prior to 1981. We believe it is cl ea r that the Trial Court determined Plaintiff’s a nd Def endant’ s partne rship first beg an with the masonry business in 1971 and continued ther eaf ter. The ref

ore, w e ag ree with Plainti ff that the r efe renc e in the Judgmen t t o t h e y ear when the pa

rtnership be g an as “1981" was indee d a ty

pog raphic al er

ror a nd should have re ad “1971"

.
Def endant c laims the Trial Court err ed whe n it concluded he and Plaintiff wer e equa l pa rt ne rs in: (1 ) the ma so nry bu sin e ss; (2 ) the Mil lig a n lo t; ( 3) the Ea stl a ndAp art me nts ; ( 4) c e rt a in

rea l estate located in Florida ; and (5) la nd titled in the names of De fenda nt and B rian Montg omery
a nd wh ic h is loc a te d a c ro ss fr om the mari na

. With re g ard to the ma so nry bu sin e ss, we prev iousl y h av e s et fo rt h o n l y

t h e f i rs tfi v e f ac t u al fi n d i n gs m a d e b y t h e T ri al C o u rt

. Ot h erfa ct u al fi n d i n gs detailing Plaintiff’s contributions to the masonry business include, but a re not limited to: P laintiff handled the payroll acc ount, pa id the bills and signe d all of the chec ks for the business, prepa red the 1099' s, handled the worke rs’ compensation insura nce, filed documents with the I RS i ncluding tax returns, ha ndled the book kee ping, ma de the de pos i t s , co llected the de bts, and place d order s and handled the invoices. The Trial Court a lso f ound that Plaintiff ne ver r ece ived any wag es or a

salary for he r work in the ma sonry business. I nstead, proce eds from the masonry business were deposited int o s a vin g s a ndmoney mar ke t a c c ou nts wh ic h w e re joi nt a c c ou nts he ld i n th e na me s o f b oth Pla int if f a ndDe fe nd a nt.

I n 1980, Plaintiff and Def endant pur chase d one ac re of land for $2
, 5 0 0 u s i ng joint funds. Plaintiff’s n et ea rning s at that point in ti me wer e roug hly $4,000 more pe r y ear

than-8-

Def endant’s earnings. The land was pur chase d from De fenda nt’s cousin, Gene L ewis (“ L ewis”)

. This land was titled only in D efe ndant’s name even thoug h joint funds were used for its purchase

. Plaintiff and Def

endant discusse d building apa rtments on this land and eve ntually decide d to “take

on that ve ntu re .” De fe nd a nt a nd L e wi s be g a n c on str uc tin g the apa

rt me nts in 19 80 . In 1 98 2, L e wi s
wa nte d o ut o f the apartm ent bu sin e ss. Pla int if f and De fe nd a nt a g re e d to bu y -o ut L e wi s’ int e re st, which they

did toge ther. De fenda nt continued to construct the a partments and in 1 9 8 6 they wer e completed a nd beg an to g ener ate r evenue

.

Plaintiff was working for a cre dit company

during the fi rs t y ea r o r two of the

c on str uc tio n o f the apa

rt me nts and her e arn ing s w e re de po sit e d in to j oin t a c c ou nts . B e g inn ing in 1982 and continuing afte r construction on the apartments was completed, Plaintiff de voted much of her e fforts to anot h er o n e o f the pa rties’ business ventur es. Specific ally , Plaintiff operated and

ma na g e d th e El iza

be tht on Nauti lus g y m. Pla int if f al so ma na g e d a

se c on d N a uti lus g y m lo c a te d in J ohnson Cityduring 1982 and a portion of 1983. The Johnson C ity Nautilus g y m was sold in 1983 fo r a ne t g a in o f a

pp ro xima te ly

$3 7, 00 0, of

wh ic h o ve r $ 26 ,0 00 wa s u se d to pu rc ha se L e wi s’ int e re st in the apartment complex. P laintiff assisted in manag ing the apartments once they wer e complete d. L ease s with tenants showed Plaintiff and D efe ndant as the le ssors. The lesse es made their che cks pay able to Plaintiff, who then deposited the chec ks into a joint ac count. Plaintiff r ece ived no wag es or salary for he r involvement with the apa rtments.

Much of De fenda nt’s brief is devoted to comparing and contra sting the c ontributions of ea ch partner to the va rious business ventures. We ce rt ai nly ag ree with Defe ndant that the contributions of the partners may be important whe n determining how much of an intere st eac h partne r has in an implied pa rtnership. I n the prese nt c ase there was considera ble disag ree ment over the extent of the parties’ contributions. I n resolving the conf licting testimony , the Trial Court made specific cre dibilit y determinations and ultim ately cre dited the testimony

of Plaintiff and B rian Montgome ry

over tha t of Def

endant. " Unlike this Court, the trial court obser ved the mann er and dem eano r of th e wi tn ess es and was in th e bes t p os it io n t o ev alu ate th eircred ib il it y ." Un ion Pl an te rs Nat' l Bank v. I

sland Mgmt. Auth., Inc. , 4 3 S

. W

. 3 d 4 9 8 , 5 0 2 (T en n

. C t

. Ap p

. 2 0 0 0 ). A t ri al co u rt 's determination s re gar d i ng cre dibilit y are acc orded de fer ence by this Court. Id .; Da v is v . Li be rty Mutual Ins. Co. , 38 S.W .3d 560, 563 (T enn. 2001). I n light of the fore g oing, w e ar e unable from

our re view of the rec ord to conc lude that the preponde ranc e of the e vidence weig hs ag ainst the Trial Cou rt ’s fa c tua l f

ind ing s a s to the qu a lit y

a ndqu a nti ty

of Pla int if f’ s co ntribu tio ns to the pa rt ie s’ business ventures.

Having aff

irmed the Trial Court’s fac tual finding s as to Plaintiff’s contributions, we next consider whether

the fa cts as found by

the Trial Court support its conclusion that Plaintiff proved by clea r and c onvincing evidenc e that there was a partne rship betwee n her a nd Def endant a nd that they wer e equal p ar t n ers. I n support of his claim that the Tria l Court erre d in concluding Pla int if f w a s a pa rt ne r with re g ard to the bu sin e sse s a nda sse ts at is su e on app e a l, D e fe nd a nt a g a in focuse s almost exclusivelyon eac h party ’s spec ific contributions to eac h particula r business venture

. I n so doing D efe ndant dra matically downplay s Plainti ff’ s contributions and fails eve n to mention many of the Trial Court’s fac tual finding s. For example, w hen discussing Plaintiff’s contribution-9-

to the Ea stl a ndAp art me nts , D e fe ndant st ate s that “ [a]t b e st” a ll Pl a int if

f d id w a s “ sh e ran s ome
err ands and c ollected some r ent.” We ar e puzzl ed by this chara cterization given that the land upon wh ic h th e apa

rt me nts we re bu ilt

wa s p ur c ha se d w ith joi nt f un ds and L ewis’ interest in the apa rtment complex wa s boug ht-out using funds from the sale of the J ohnson City Nautilus g y m which had be en operated solely

by Plaintiff.

Fortunately , we a

re not re quired to discuss ea ch and e very o n e o f P l aintiff’s a nd Def endant’ s co n t ri butions to each sepa rate business venture. T his is so because the Trial Court fo un d th e re wa s one implied partne rship betwee n Plaintiff and Defenda nt with one goal, “ to acquire assets and ma

ke substantial income.” I n other wor ds, the Trial Court did not find that eac h particula r business venture con s tituted a unique or sepa rate partne rship but rather that there was one pa rt ne rs hip be tw e e n Pl a int if f a ndDe fe nd a nt w hic h h a d sev e ra l bu sin e ss v e ntu re s a s p art ne rs hip assets. Since ther e wa s only one partnership with one collec tive g oal ev en though this one p ar t n er s h i p o p er at ed s ev er al b u s i n es s es , i ti s n o tat al l s u rp ri s i n g t h at P l ai n t i ff an d De fe n d an tdevoted differ ent amounts of time to the various businesse s. Thus, while Def endant wa s busy

constructing the Eastland Apa

rtments, P l ai n t i ff

was busy operating one and for

a period of time two Nautilus g y ms. I n fac t, the Trial Court found that P laintiff would beg in working at t he Elizabethton Nautilus at 7:00 a.m. and ty

pically did not le av e unti l 9:00 p.m. P laintiff taug ht aer obics classe s, etc., a nd when the g y m was closed in the evenings, she did the nec essary clea ning. When Plaintiff oper ated both N autilus gyms, she alternated her time betwee n the two fa cilities. The point being , the critical fi nd ing in this c a se is tha t bo th P la int if f and De fe nd a nt d e vo te d s ub sta nti a lly e qu a l a mou nts of

tim e
a nde ff ort to the pa

rt ne rs hip andto a c hie vin g its g oa l, n ot w he the r the y de vo te d th e e xac t sa me amount of time to eac h separ ate a spect or a sset of the pa rtnership.

As set forth in Ba ss , a

pa rt ne rs hip “ ma y

be imp lie d f

ro m the c ir c ums ta nc e s w he re it appea rs that the individuals involved have e ntere d into a business relationship for pr ofit, combining their prope rty , labor, skill, experience , or m o n ey .” 814 S.W.2d at 41 (emphasis adde d). I n the prese n t c a s e , it is c le ar to th is Co u r t, a s it w a s to th e T r ia l Co u r t, th a t th e p ar ti e s e n te r e d into a business relationship for pr ofit, and combined t heir prope rty , labor, skill, experience , and m o n e y. We ha ve discussed some but by no means all of Plaintiff’s contributions to the pa rtnership. Af

ter revie wing all of Plaintiff’s contributions and the numerous other finding s of fa ct detailed by the Trial Court, we af

firm without hesitation the Trial Court’s conc lusion that P laintiff proved by clea r and

c on vin c ing e vid e nc e that sh e a ndDe fe nd a nt w e re bu sin e ss p art ne rs , th a t th e y we re e qu a l pa

rt ne rs , that there was one partne rship betwee n Plaintiff and Def enda n t wh i ch involved all their various business pursuits, and that this partnership starte d in 1971.

Th e ne xt iss ue is De fe nd a nt’ s c la im t hat e ve n if

he a ndPla int if

f w e re bu sin e ss partne rs, the Tria l C o u rt n ev er t h eless er red w hen it failed to a llow him to recoup his initial investment of $180,000 in the Eastland Apa rtments. I n making this a

rg ument Def

endant r elies upon an ince ption date of 1981 for when the pa

rtnership beg an, a position we have reje cted. De fenda nt
a ndPla int if

f a g re e that w he n th e Ea stl a ndAp a rt me nts we re c ompletedin 1 98 6, the y we re wo rth $180,000 and ther e wa s no corr esponding debt. Def endant then claims that betwee n 1981 and 1986, all Plaintiff did to a ssist with the apartments w as “running err ands.” Ta king that one step further,-10-

Def endant then a

rg ues that since Plaintiff e ssentially did nothing betwee n 1981 and 1986, the initial investment of $180,000 must somehow be a ll his and he is entitled to recoup that initi al investment befor e any

excess value is distributed.
We rejec t this arg ument for thre e re asons. Fir st, once a g ain Def endant ove rlooks Plaintiff’s financ ial contributions to the apartment complex when the land was pur chase d with joint partne rship funds and th er ea ft er when the Johnson Ci ty Nautilus g y m being operated only by Plaintiff was sold to buy -out L ewis’ inter est in this property . Second, whe n Def endant wa s devoting so much time and ef

fort to the Ea stland Apartments, Pl ai n t iff wa s devoting an equiva lent amount of time and e ffort to other partne rship venture s. Third, the partnership beg an in 1971, not 1981, and Def endant ha s not shown that any part of his c l ai m ed i nitial investment was paid with nonpa rt ne rs hip fu nd s. Th is i ssu e is w ith ou t me ri t.

The nex t issue surrounds the marina and Def endant’ s claim that the Tria l Court erre d when it conc luded B rian Montg omery also was an equal one-third pa rtner in this business venture

. Be fore we r esolve this issue there are two points worth m en t i o n i n g . First, De fenda nt does not challeng e the Trial Court’s conclusion t hat P laintiff was a partner in the m arina

. Second, on appe al both Bria n and Plaintiff ask this C o u rt t o af fi rm the Tria l Court’s finding that Bria n was a n equal one-third pa

rtner.

I n the J udg ment the Trial Court a lso ma de many finding s of fa ct surrounding Brian Mo ntg ome ry ’s c on tr ibu tio ns to the ma ri na . So me of

the se fa c tua l f

ind ing s a re :

I t took approxi mately

3 to 4 y ear s to ge t the approva l from the TVA for the ma

rina a n d t h e ... eff

ort for this and the pa

perw ork and meeting s were primarily with Be a. All of t he conta ct with the TVA was done from the Elizabethton Nautilus office wher e B ea w as manag ing.... Corresponde nce w ith TVA was ha ndled throug h Brian

a n d B e a

. T e rr y , B r ia n a n d B e a w e n t t o th e c o u n ty

c o u r t c le rk

a nd applied for

the business license f

or the Marina. B usiness license f or the Marina was listed in their 3 names. It was discussed a nd ag ree d that Be a, Te rry

and Brian would be partners from the beg inning in the Marina. It was to be a

family business....

Brian had f

inished 3 y ear s at E ast Tenne ssee State, a nd decide d h e wa s interested in g oing a way to chiropra ctic school.... Brian, B ea a nd Terry

[l at er] decide d to forg o the expense of chiropra ctic school an d use those funds instea d in developing the Marina.... Brian’s plans chang ed afte r the conver sations betwee n Terry , Be a and B rian re lative to the partne rship in the Marina. T erry expressed that h e h at ed to see B rian lea ve home to g o to colleg e.... T er ry said to Brian, “What would it take to g et y ou to stay here and manag e the marina? ” ... Brian was told that he was to manag e it andW e no t e t hat t he T ri al C o urt al so hel d t hat P l ai nt i f f and D efend ant were ent i t l ed t o be rei m b urs ed fo r t he ir 4
initial in v e stm e n t in t h e m a rin a lan d a n d a “lar g e m e ta l b u ild ing ” lo c a te d o n the m a rin a p re m ise s. T h e se inv e stm e n ts

were m ad e p ri o r t o B ri an M o nt go m ery b eco m i ng a p art ner and it was agr eed t hat t he val ue o f t hese i nvest m ent s at t he t i me t h ey w er e made t ot al ed $100, 000. T h e T r i al Cour t or der ed Pl ai n t i f f an d D ef

en dan t ea ch t o r ec ei v e $50, 000 f r om t he sal e o f

t he m ari na p ri o r t o t he rema i ni ng pro ceed s b ei ng divi d ed one

- t hi rd am o n g e ach o f t he t hree pa rt ners

. O ur h o ld ing d o e s n o t d istur b this find ing a n d re su lti n g o rd e r b y the T ria l C o u rt.

-11- become a partner in it.... Terry and Be a told him that they would be

s h ar i n g t h e p ro fi t s wi t h h i m

. T h e i m p ro v em en t s an d t h e b u i l d i n gs
wer e all a joint ef

forts (sic) betwee n Brian and Terr yan d Bea. (citations to the trial re cord omitted)

I n addition to the fore go ing, the Trial Court also found that B rian a nd his wife, She rry , li ve d p ri mari ly

a t th e mari na

a ndtoo k re sp on sib ili ty

fo r r un nin g the da y

to d a y op e ratio ns

. Brian and Sher

ry also purcha sed equipment for the marina, including $18,177.28 for a J ohn Dee re 955 trac tor, and $7,800 for a John Deere 755 trac tor. Brian also marke ted the mar ina at boat shows and hosted boa t shows at the marina

.

For the same reas o n s s et fo rt h ea rl i er , i n cl u d i n g t h e f ac tt h at cr ed i b i l ity

deter minations signific antly

impacted the T rial Court’s finding s, we are unable to conc lude that the pre pondera nce of the evidence weig hs ag ainst these factual findings by the Trial Court. L ikewise, we further aff irm the Trial Court’s f

inding that B rian Montg omery proved by clea r and convincing evidenc e that he

wa s a on e -thir d p art ne r in the mari na , w ith Pla int if f andDe fe nd a nt e a c h o wn ing a on e -thir d in te re st
a s w e ll. 4

Another a sset at i s sue involves 33.3 ac res of land locate d acr oss the road f rom the marina. The Trial Court found this land was purc hased by Plaintiff and Def

endant f or $50,000 using funds from their joint account. This land wa s titl ed in the name s of Def endant a nd Brian Mo ntg ome ry . T he Tria l Co urt c on c lud e d th a t Pla int if f and Defen dan t ha d a n u nd ivi de d o ne -h a lf int e re st i n th is l a nd , a nd B ri a n M on tg ome ry ha d th e re ma ini ng on e -h a lf int e re st. On app e a l, Def endant c halleng es whe ther P laintiff should be consider ed a pa rtner in this asset. Since this land

wa s p ur c ha se d with Pla int if f an d De fe nd a nt’ s join t fun ds a nd be c a us e thepu rc ha se too k p la c e we ll afte r the business partnership beg an in 1971, we r eadily hold that the Trial Court proper ly conclude d that Plaintiff was a pa

rtner a s to this asset as wel l

. Ho wever, we believe the J udg ment should be modified to ref

lect that Plaintiff, Def

endant, a nd Brian Montg omery eac h own a one -t h ird partne rship interest in this property as they did in the Ma

rina itself. We also believe the J udg ment should be modified so that Plaintiff and De fenda nt are reimbur s ed for their initi al investment of $5 0, 00 0, wi th e a c h of the m re c e ivi ng $2 5, 00 0 prior to the re ma ini ng pr oc e e ds fr om the sa le of thi s land being distributed equally among Plaintiff, Defe ndant, and B ri an M o ntgome ry . As modified, the Trial Court’s c onclusion with reg ard to this asset is otherwise aff irmed.

De fe nd a nt’ s n e xt iss ue is his c la im tha t the Tria l Court er re d whe n it

faile d to app ly the Un if or m Pa rt ne rs hip Ac t a nda llo w hi m to be re pa id h is i nit ia l c on tr ibu tio ns to c e rt a in a sse ts-12-

pr ior to a ny re ma ini ng pr oc e e ds be ing dis tr ibu te d a mon g the pa rt ne rs . A s we po int e d out i n f oo tno te 4, su pr a , the Trial Court a llowed Plaintiff and Def endant to r ecove r their initial contributions t o the purcha se of the m arina land and a “larg e metal building” prior to Brian re ceiving his one-third shar e. We also have modified the J udg ment to allow P laintiff and Def endant to rec over their initial $50,000 inv e stm e nt i n th e 33 .3 a c re s of la ndloc a te d a c ro ss f ro m th e ma

ri na . T hu s, a t le a st w ith re sp e c t to the two assets whe re B rian wa s held to be a pa rtner, D efe ndant has been allowed to r ecove r his initial investments.

Wit h reg ard to De fenda nt’s partne rship with Plaintiff, Def endant does not point us to a ny wh e re in the re c or d w he re it is sh ow n that he ma de a ny ini tia l c on tr ibu tio n to the min i- ma ll or any other a sset using f

unds that were not partner ship funds. Contrary to Def endant’ s assertions in his brief, simply

beca use a pie ce of

proper t y m ay be titled only in his name does not mean that partne rship funds wer e not used to purc hase tha t pr operty or that it is not partne rship property . As to the mini-m al l , i t was purc hased in the e arly 1990' s and the down- pay ment came from an

a g re e me nt w he re by

re nt p a id f

or the E liza

be tht on Nauti lus g y m w a s to be app lie d to wa rdthi s purcha se. Thus, any

initial investment clea

rly consisted of partne rship assets and D efe ndant ca nnot claim any individual entitlement to these funds . The same result holds true for the marina

as the

reco rd i s reple te with evidenc e esta blishing the funds use d for this business venture wer e indee d funds of Plaintiff’s a nd Def endant’ s partner ship.

The ne x t gr oup of issues pertains to the sever al cr edits Plainti ff a nd Brian Montgome ry

wer e g iven ag ainst Def

endant’ s one-third interest in the marina. B eg inning in 1999, Def endant ope rate d the marina without an y assi stance from Plaintiff or B rian. The Trial Court conclude d t h at the marina partnership “terminated at that time. Whatever active inc ome Ter

ry Montgome ry

made f rom the marina

the C ourt has found is his from that ti me on, and whatever active

e xpe ns e s h e inc ur

re d a re his .” Ho we ve r, the Tria l Co urt th e n s ta te d th a t th e “ pa ssi ve inc ome ” sti ll was pa rtnership property to be divi ded equally among the three partne rs, the passive inc ome being the depr eciation deduction for income tax purposes. St ated a nother way , the Trial Court held that

e ve n th ou g h th e pa

rt ne rs hip in the mari na te c hn ic a lly ha d e nd e d, the la nd , b uil din g s, e tc ., we re sti ll partne rship property

and, ther efor e, the de prec iation deductions fo r t h at land and building s, etc., should be divided among the partne rs. Be cause Def endant deducte d on his ta x returns th e e n t ire

a ll o w ab le d e p r e c iati o n , th e T r ia l Co u r t c o n c lu d e d Pl a in ti f f a n d B r ian w e r e e n ti tl e d to a c r e d it

. We ag ree with these conc lusions up to t his point. However, in de termining the amou n t P l ai n t i ff and Br ian were e n ti tl e d to r e c e iv e a s a c r e d it , th e T r ia l C o u r t t o o k th e e n ti r e a mo u n t o f

d e p r e c iation deducte d by

Def endant f or 1999 throug h 2001 , t h en s u b trac ted from that sum the total amount of income tax pa id by Def

endant for those y ear s. The Tria l Court then divided the resulting fig ure by one-third, holding that Plaintiff and B rian e ach w ere entitled to a cr edit in the amount of $65,600.

We disag ree with the Trial Court’s method of c alculation bec ause it has the e ffe ct of tr e a tin g the de pr e c ia tio n a s a do lla r- fo r- do lla

r ta x c re dit , a s op po se d to a de du c tio n a g a ins t ta xab le income. There fore , we vacate these particular credits t o Plaintiff and Brian as calc ulated bythe Trial Court. The tax returns in the re cord show D efe ndant’s total tax li ability for 1999 throug h 2001 when he de du c te d f

ro m hi s g ro ss i nc ome 10 0% of t he dep rec ia tio n. On re ma nd , th e Tria l Co urt isB y way of ex amp l e o n ly , l et ’ s a s s u me D ef en dan t ’ s t ot al t ax l i abi l i t y for t h e t h r ee y ea r s a t i s s u e wa s $25, 000 5
when he d ed uct ed 10 0 % t he d ep reci at i o n. Let ’ s al so ass um e t hat i f D efend an t h a d only de d uct ed one

- t hi rd o f t he d ep reci at i o n, hi s t o t al t ax l i ab i l i t y fo r t he t hree y ears wo ul d have b een $ 6 0 , 0 0 0

. In t hi s hy p o t het i cal s i t uat i o n, D efend ant

sa v e d $ 3 5 ,0 0 0 b y d e d u c ting the e x tra two -third s o f t h e d e p re c ia tio n , an d P la intiff a n d B ria n w o u ld e a c h b e e n tit le d to

a c re d it fo r o n e -ha lf o f t h e to ta l sa v ing s, o r $ 1 7 ,5 0 0

. -13- instructed to determine the amount of taxes Defendant would have pa id had he de ducted onlyonethird o f th e d e p r e c iati o n

. T h e T r ia l Co u r t th e n is to d e d u c t f r o m th is s u m th e a mount of taxes Def endant a ctually

paid when he deducte d all of the a llowable depr eciation. The resulting fig ure should repre sent the amount of taxes Def endant did not have to pay beca use he c laimed the extra two-thirds of the de prec iation. This sum i s to be d i v i d ed with one- half be ing a cre dit to P laintiff,

a ndthe re ma ini ng on e -h a lf be ing a c re dit to B ri a n. We ag re e wi th the Tria l Co urt th a t th e se c re dit s should b e t ak en ag ainst Defe ndant’s intere st in the marina which w as sold for ove r $1.6 million wh i l e t h i s ap p ea l wa s p en d i n g. 5

The Trial Court also determined that Defe ndant had misappropriate d funds totaling $94,250. Fr om this t otal, $27,000 was marina funds and the Trial Court orde red D efe ndant to re- pay Plaintiff and B rian $9,000 e ach a s reimburse ment for their one-third sha re of these misappropriated funds. The Trial Court determined tha t the remaining $67,250 wa s misappropriated f rom funds belong ing to the pa

rtnership be tween Plaintiff a nd Def endant, a nd the T rial Court order ed an add i t i onal re imbursement to Plaintiff of $33,625. Def endant c halleng es the Trial Court’s order

re g ard ing the se c re dit s, c la imi ng simply that this mon e y wa s lo st i n a ba d in ve stm e nt f

or wh ic h a ll of the pa rtners must share

. We disag ree . Desc ribing the loss of the $94,250 as a “bad i nvestment” is a significa nt
un de rs ta te me nt, to sa y the ve ry le a st. Th e fa c ts sho w that the $9 4, 25 0 w a s g ive n b y De fe nd a nt t o his brother, Rev. L arry

Montgome ry , who oper ated the Gre ater Ministries I nterna tional Church of Tampa. The Trial Court found the Greater Ministries Church was “

just patently

a py ramid sche me”

a n d f u r t h e r d e t e r m i n e d t h a tR e v

. M o n t g o m e r y ’ s c r e d i b i l i t y w a s e v e n w o r s e t h a n D e f e n d a n t ’ s

. In short, the Trial Court conc luded these “donations” wer e “nothing more than a spurious scheme by Terry Montgome ry

and his brother

to keep monies an d as s et s from any claim of B eatrice Montgome ry .”

Def

endant state s in his brief:

Be atrice Montgome ry should not be allowed to benef it from the g ood investments made by

Terry Montgome ry

but not suffer the losses

ma de in the ba d inve stm e nts

. Th e Un if orm Partne rs hip Ac t ma

ke s a ll parties equally liable for debt or cla ims charg eable to the partne rship.

We a g re e wi th D e fe nd a nt’ s g e ne ra l pr o p o s i tio n th a t pa rt ne rs are re sp on sib le fo r d e bts pr op e rl y c ha rg e able to the pa

rt ne rs hip

. Ho we ve r, the Tria l Court di d n ot f indthat D e fe nd a nt s imp ly made a bad investment. The T rial Court found De fenda nt an d his brother e ng ag ed in fra udulent conduct in an attempt to hide partnership a ssets from Plainti ff

. I n order for us to alter

the Trial-14-

Court’s judgme nt with reg ard to the $94,250, Defenda nt would have to succ essfully arg ue either

that the pre pondera nce of

the evidenc e does not s u p p o rt the Tria l Court’s fac tual finding s, or that the partn e r s h ip a n d it s p ar tn e r s n e v e r th e le s s s h o u ld b e r e s p o n s ib le f o r mi s s in g f

u n d s r e s u lt in g from Def endant’ s fraudulent conduct. De fenda nt makes neither of these a

rg uments, succe ssf

ully or otherwise, a nd cites us to no authority which would support such a position. Therefor e, we aff irm the Trial Court’s judg ment with reg ard to the $94,250.

Prior to the trial, Def

endant c ashed in a life insura nce policy for $15,000. The Trial Court found this to be a violation of one of i ts previous orders and held t hat the $15,000 should be considere d partne rship assets of Plaintiff and Def endant. Acc ording ly , the Trial Court g ave Plaintiff

a c re dit of $7 ,5 00 a g a ins t De fe nd a nt’ s sh are of the pr oc e e ds fr om the sa le of the mari na

. We f a il t o
se e ho w De fe nd a nt’ s pur c ha se of a lif e ins ur a nc e po lic y , or c a sh ing in s uc h a po lic y , c a n p ro pe rl y be conside re d as part of his business partner ship with P laintiff. Def endant’ s life insuranc e policy would be akin to the r etireme nt benef its in Martin v. Coleman , su pr a , wh i ch were he ld by

the Su p re m e C ourt not to be part of the business partne rship of the Colemans who ha d lived toge ther for sixt een y ear s. There fore , we r ever se the Trial Court’s conclusion that Plaintiff is entitled to a

cre dit of $7,500 based on De fenda nt cashing in his li fe insura nce policy

.

The fina l issue i n v o l v es De fenda nt’s alleg ed illeg al wire taps in violation of Tenn. Cod e An n. § 39 -1 3- 60 1. I n it s Judg me nt, the Tria l Co urt po int e d o ut that D e fe nd a nt a dmi tte d to thi s activity once but it “a

ppear ed ” t o t h e Trial Court to have oc curr ed on thre e occ asions. The Trial Court awar ded Plaintiff $10,000 in statutory damag es.

We h a ve revi ewe d th e e vid e nc e , in c lud ing Pla int if f’ s te sti mon y , c on c e rn ing the se thr e e inc ide nts . With r e g ardto the fi rs t inc ide nt, Pla int if f state d sh e fo un d a

tape re c or de r a nd“ if

on e of us wa sn ’t

the re to ans we r the te le ph on e , th e me ssa g e s we re re c or de d. ” As be st w e c a n te ll, all Def endant wa s doing w as re cording messag es. The third incident, howeve r, cle arly involved the hidden re cording of conve rsations, not just recording messag es. It i s u n cl ear from the e vidence whether the sec ond violation mere ly rec orded messag es, or also rec orded c onversations. Base d on the fore g oing, w e conc lude that Plaintiff proved only one violation of Tenn. Code Ann. § 39-13- 601. Civil damag es under

this statute include ac t ual damag es or “ [s] tatutory damag es of one hundred do lla rs ($ 10 0) a

da y fo r e a c h d a y

of vio la tio n o r t e n th ou sa nddoll ars ($10 ,0 00 ), wh ic he ve r i s g reater” plus attorney

fee s and costs. See Te nn . Co de An n. § 3 9- 13 -6 03 (a )( 1) . O n a pp e a l, De fe nd a nt a

rg ue s th a t th e Tria l Court abu se d its disc re tio n in a wa rd ing Pla int if

f $ 10 ,0 00 in d a ma g e s. Un fo rtun ate ly fo r D e fe nd a nt, the Wes te rn Se c tio n o f this Cou rt re c e ntl y iss ue d it s o pin ion in Robinson v. Fulliton , 140 S.W .3d 312 (Tenn. Ct. App. 2003). In Robinson , we he ld that when ac tual damag es ar e les s than the statutory damag es of $10,000, a

trial court is “r equire d to awar d ... the $10,000 statutory

damag es at a

minimum .” Id

. at 324. I n any event, we would not find an abuse of discretion by

the Trial Court in awa

rding this $10,000. There fore , we a ffirm the Trial Court’s awa rd to Plaintiff of damag es i n the amount of $10,000 for the Def endant’ s single violation of Te nn. Code Ann. § 39-13-601.-15- Conclusion

Th e Judg me nt of the Tria l Cou rt is r e ve rs e d in pa

rt , v a c a te d in pa

rt , a nda ff ir me d in pa rt a s mod if

ie d. Th is c a us e is r e ma nd e d to the Tria l Co urt f or fu rthe r p ro c e e din g s c on sis te nt w ith this Opinion and for collec tion of the costs below. Exercising our discre tion, cost s o n appeal are taxed one-third ag ainst the Appellant Te rry L ane Montg omery

and his surety , one-third ag ainst the A p p e l l e e B e a tr i c e H ar m o n M o n t g o m e r y, a n d o n e

- t h i r d a g a i n s tt h e A p p e l l e e B r i a n M o n t g o m e r y.

_________________________________ D. MI CHAEL

SW I NEY, JUDGE