IN THE COURT OF APPEALS OF TENNESSEE

AT JACKSON

June 22, 2016 Session

CENTRAL BANK v. JEFF WILKES, ET AL.

Appeal from the Chancery Court for Hardin County

No. CH179 Donald E. Parish, Judge

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No. W2015-02079-COA-R3-CV – Filed July 21, 2016

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This case arises from a delinquent loan. Appellee is one of the principals of a development 

company that obtained a loan in the amount of $250,000 from Appellant bank. Appellee was 

allegedly unaware of this loan. Subsequent to the $250,000 loan, Appellant bank gave the 

company another loan in the amount of $300,000, which all of the company‟s principals, 

including Appellee, personally guaranteed. The guaranty agreement provided that the 

principals would personally guarantee all of the company‟s debts which “may now or at any 

time hereafter” be owed to the Appellee bank. Appellee paid the $300,000 loan in full in 

exchange for Appellant bank releasing a lien on 32 acres of land owned by the development 

company. A year later, Appellant bank brought suit against all three principals for the 

$250,000 loan. The trial court granted judgment in favor of the Appellee, finding that the 

Appellee affected an accord and satisfaction with Appellant bank. Appellant appeals. 

Affirmed and remanded. 

Tenn. R. App. P. 3; Judgment of the Chancery Court

Affirmed and Remanded

KENNY ARMSTRONG, J., delivered the opinion of the court, in which J. STEVEN STAFFORD,

P.J., W.S., and WILLIAM B. ACREE, SP. J., joined.

Terry Abernathy, Selmer, Tennessee, for the appellant, Central Bank.

Dennis W. Plunk, Savannah, Tennessee, for the appellee, Leon Easley.
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MEMORANDUM OPINION1

I. Background

The basic facts of this case are not in dispute. Jeff Wilkes, Leon Easley, and Fred Tull 

are the principals of Riverstone Estate Utilities, Inc. (“Riverstone”). On November 10, 2008, 

Mr. Wilkes obtained a $250,000 loan on Riverstone‟s behalf from Central Bank (“the bank” 

or “Appellant”). Mr. Wilkes personally guaranteed this loan, but Messrs. Easley and Tull 

had no knowledge of the loan.2 On March 25, 2010, Central Bank gave Riverstone a second 

loan in the amount of $300,000. Also on March 25, 2010, Mr. Easley (“Appellee”), in his 

individual capacity, signed a Guaranty Agreement (“the agreement”) in favor of Central 

Bank, wherein he personally guaranteed Riverstone‟s obligations. The agreement provides

that Appellee would guarantee “to [Central Bank] the payment and performance of each and 

every debt...which [Riverstone] may now or at any time hereafter owe to [Central Bank] 

(whether such debt...now exists or is hereafter created or incurred....)” The agreement also 

provides that the guaranty is “an absolute, unconditional, and continuing guaranty of payment 

of the Indebtedness and shall continue to be in force and be binding upon the Undersigned, 

whether or not all Indebtedness is paid in full, until this guaranty is revoked by written notice 

actually received by the lender....” Riverstone‟s other principals, Messrs. Wilkes and Easley,

also signed individual guarantees in conjunction with the $300,000 loan. These guaranty 

agreements contained language identical to that set out above. 

Sometime in 2012, Central Bank discovered that its president at the time had been 

engaging in questionable business practices.3 He left the bank shortly thereafter, and Bob 

Adkisson became interim president of Central Bank in April of 2012. Because of the former 

president‟s activities, regulators from the Federal Deposit Insurance Corporation (“FDIC”) 

began overseeing Central Bank‟s business. As a result, Mr. Adkisson began efforts to collect 

on several of the loans the bank‟s former president had made during his tenure, which 

 

1

Rule 10 of the Rules of the Court of Appeals of Tennessee provides:

This Court, with the concurrence of all judges participating in the case, may affirm, 

reverse or modify the actions of the trial court by memorandum opinion when a 

formal opinion would have no precedential value. When a case is decided by 

memorandum opinion it shall be designated “MEMORANDUM OPINION”, shall 

not be published, and shall not be cited or relied on for any reason in any unrelated 

case.

2

It is unclear from the record whether or not Messrs. Easley and Tull were principals of Riverstone when the 

bank made this loan.

3

The record does not reveal the exact nature of Central Bank‟s former president‟s activities, but they are not 

relevant to this appeal.
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included both of the loans made to Riverstone. In his efforts to collect on the loans, Mr. 

Adkisson met with Riverstone‟s principals to discuss payments of the loans. Mr. Adkisson 

also had one conversation with Mr. Easley‟s banker, Stephen Gobbell. As a result of the 

conversation between Mr. Adkisson and Mr. Gobbell, Mr. Easley tendered a check to Central 

Bank on May 24, 2012 for $321,495.02, reflecting the principal amount of the debt, 

penalties, and interest on the $300,000 loan. In return for the payment of the loan, Central 

Bank‟s board of directors agreed to release a lien it held on 32 acres of land belonging to 

Riverstone.

On July 30, 2013, Central Bank filed its complaint against Messrs. Easley, Wilkes, 

and Tull,

4

seeking a judgment for the principal amount of the $250,000 loan plus penalties 

and interest. Central Bank relied on the language of the guaranty agreement, which was 

executed in conjunction with the $300,000 loan to affix liability to Riverstone‟s principals for 

the $250,000 loan. On October 31, 2013, Mr. Easley filed his answer to the complaint. 

Therein, Mr. Easley asserted several affirmative defenses, including fraud and accord and 

satisfaction. 

On June 20, 2014, Central Bank filed a motion for summary judgment against Mr. 

Easley; Mr. Easley opposed the motion. The trial court heard the motion for summary 

judgment on April 27, 2015. On May 27, 2015, the trial court granted Central Bank‟s motion 

for summary judgment in part with respect to Appellee‟s defense of fraud. The trial court

also found, however, that there was a dispute of material fact concerning whether the parties 

had reached an accord and satisfaction. Accordingly, the trial court denied Appellant‟s 

motion for summary judgment regarding that defense. 

Following a trial on July 29, 2015, the trial court entered an order dated September 18, 

2015. In that order, the trial court found that “the defense of accord and satisfaction...is 

made out.” The trial court credited Messrs. Easley and Gobbell‟s testimony, finding that 

their testimony, along with Mr. Adkisson‟s testimony,supported Appellee‟s version of events 

that the parties intended to affect and accord and satisfaction. The trial court noted that 

Mr. Easley made a payment to the bank that he was led to believe via the 

information that he received from...Mr. Adkisson, which would take him 

completely out of owing anything to the bank, and in response to that 

information, he went within hours made that payment, and it also appears that 

the bank believed that that was true.

The trial court also noted that Central Bank “didn‟t take any other position [on Mr. Easley‟s 

obligations] until it appears sometime down the road when the FDIC became involved and 

maybe counsel became involved...but the intention of the parties was at the time that [the 

 

4 Mr. Tull has filed a separate appeal in this case. See case No. W2015-02399-COA-R3-CV.
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$321,495.02] would clear any obligations of Mr. Easley to Central Bank....” 

The trial court went on to state that “Central Bank agreed to not just accept the payoff 

for that note...they agreed to release the mortgage that they held on a Riverstone piece of 

property....” “The Court looks at that with the understanding that Central Bank of course 

knew that they were having trouble with this loan.” “Central Bank took the full amount of the 

note, but they gave something too.” “In other words...had this been just Mr. Easley just 

coming into the bank just to pay what he owed, there would have been no reason for the 

Board of Directors to have to meet about that.” “If that was the end of the matter, there 

would have just been no reason for the bank Board of Directors to have to weigh in and 

discuss this, and that tends to indicate to the Court that Mr. Easley‟s version of the accord 

and satisfaction theory is accurate here.” On October 16, 2015, Central Bank filed its notice 

of appeal.

II. Issues

Appellant presents two issues for our review:

1. Whether the trial court erred when it did not grant Appellant‟s motion for summary 

judgment in full. 

2. Whether the trial court erred when it found that Appellee proved that the parties 

affected an accord and satisfaction.

III. Standard of Review

The issue of accord and satisfaction was tried without a jury. Accordingly, we review 

the findings of fact made by the trial court de novo, with a presumption of correctness unless 

the preponderance of the evidence is to the contrary. Tenn. R. App. P. 13(d). The trial 

court‟s conclusions of law, however, are reviewed de novo and “are accorded no presumption 

of correctness.” Brunswick Acceptance Co., LLC v. MEJ, LLC, 292 S.W.3d 638, 642 

(Tenn. 2008). “Because the trial judge is in a better position to weigh and evaluate the 

credibility of the witnesses who testify orally, we give great weight to the trial judge‟s 

findings on issues involving credibility of witnesses.” Randolph v. Randolph, 937 S.W.2d 

815, 819 (Tenn. 1996).

IV. Analysis

A. Denial of Summary Judgment

Appellant argues that the trial court erred in denying its motion for summary judgment 

in full, including the issue of accord and satisfaction. Specifically, Appellant argues that the 
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trial court should have granted its summary judgment motion because Appellee did not set 

forth specific facts showing a genuine issue of material fact pursuant to Tennessee Rule of 

Civil Procedure 56. Appellee argues that because the trial court held a hearing on the merits 

of whether the parties reached an accord and satisfaction, the issue of whether the trial court 

erred in failing to grant Appellant‟s motion for summary judgment in full is not reviewable 

by this Court. 

We note that “„[a] trial court‟s denial of a motion for summary judgment, predicated 

upon the existence of a genuine issue of material fact, is not reviewable on appeal when a 

judgment is subsequently rendered after a trial on the merits.‟” Franklin v. Swift Transp. 

Co., Inc., 210 S.W.3d 521, 526 (Tenn. Ct. App. 2006) (quoting Bradford v. City of 

Clarksville, 885 S.W.2d 78, 80 (Tenn. Ct. App. 1994)). In this case, on the summary 

judgment motion, the trial court concluded that as to the affirmative defense of accord and 

satisfaction, “there are material disputed facts and issues that can be resolved only by a trial 

on the merits....” The trial court subsequently rendered a judgment after a trial on the merits 

of the factual issue of accord and satisfaction. Accordingly, the issue of whether the trial 

court erred in not granting Appellant‟s motion for summary judgment in toto is not 

reviewable on appeal.

B. Accord and Satisfaction

Appellant also argues that the trial court erred after the bench trial when it found that 

Appellee had proven the affirmative defense of accord and satisfaction. Specifically, 

Appellant argues that Appellee did not prove the element of intent required to show an 

accord and satisfaction. Appellee argues that the evidence shows that the parties did in fact 

intend to affect an accord and satisfaction as to all of his obligations to Central Bank.

“An accord and satisfaction is a type of contract and is governed by the law of 

contracts.” R.J. Betterton Management Services, Inc. v. Whittemore, 733 S.W.2d 880, 882 

(Tenn. Ct. App. 1987). “Whether there has been an accord and satisfaction is a question of 

fact ....” Lindsey v. Lindsey, 930 S.W.2d 553, 557 (Tenn. Ct. App. 1996). “When a debtor 

clearly indicates that a check is offered upon a condition of satisfaction of a debt, the 

creditor‟s endorsement and collection on the check generally operate as an accord and 

satisfaction.” R.J. Betterton Management Services Inc., 733 S.W.2d at 882. Parties may 

reach an accord and satisfaction via oral agreement. See Belcher v. Belcher, No. E2004-

02712-COA-R3-CV, 2005 WL 2333607, at *3, *5 (Tenn. Ct. App. Sept. 23, 2005).

Tennessee Code Annotated Section 47-3-311 defines what constitutes an accord and 

satisfaction. In pertinent part, the statute provides:

(a) If a person against whom a claim is asserted proves that (i) that person in 

good faith tendered an instrument to the claimant as full satisfaction of the 

claim, (ii) the amount of the claim was unliquidated or subject to a bona fide 
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dispute, and (iii) the claimant obtained payment of the instrument, the 

following subsections apply.

(b) [...T]he claim is discharged if the person against whom the claim is 

asserted proves that the instrument or an accompanying written communication 

contained a conspicuous statement to the effect that the instrument was 

tendered as full satisfaction of the claim.

Tenn. Code Ann. § 47-3-311. A claim is not discharged under subsection (b) if “[t]he 

claimant...proves that within (90) days after payment of the instrument, the claimant 

tendered repayment of the amount of the instrument to the person against whom the claim is 

asserted.” Id. § 47-3-311(c)(2). 

Appellant‟s argument focuses on the intent element required to affect an accord and 

satisfaction. 

To constitute a valid accord and satisfaction it is...essential that what is given 

or agreed to be performed shall be offered as a satisfaction and extinction of 

the original demand; that the debtor shall intend it as a satisfaction of such 

obligation, and that such intention shall be made known to the creditor in some 

unmistakable manner. It is equally essential that the creditor shall have 

accepted it with the intention that it should operate as a satisfaction. The 

intention of the parties, which is of course controlling, must be determined 

from all the circumstances attending the transaction. 

R.J. Betterton Management Services, Inc., 733 S.W.2d at 882 (quoting 1 C.J. Accord and 

Satisfaction §§ 1 and 16 (1914)). “The party asserting accord and satisfaction as a defense 

bears the burden of showing „by a preponderance of the evidence that the parties intended to 

[a]ffect a satisfaction.‟” Liberty Mut. Ins. Co. v. Friendship Home Health Agency, LLC, 

No. M2007-02787-COA-R3-CV, 2009 WL 736659, at *5 (Tenn. Ct. App. March 19, 2009) 

(quoting Pinney v. Tarpley, 686 S.W.2d 573, 578 (Tenn. Ct. App. 1984)). 

 

At trial, Appellee testified that he

discussed with [Mr. Adkisson] if I was – if I would pay the $320,000...that I 

would have a – exclude me from any other obligations of Riverstone or Jeff 

Wilkes and that banker called and verified and then in the meantime, I went to 

Mr. Adkisson and negotiated if I paid that, I‟d be relieved of everything, plus I 

would get the 30 acres of property so I paid it.

Appellee also testified that he “negotiated with Mr. Adkisson. I told him if I paid that, I 

would like to have some of the land and he said...they would release [the land] and release 
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me of all other obligations.” Appellee reiterated later in his testimony that his understanding 

of the transaction was that he “paid the check and got the property and that would release me 

of all obligations on Riverstone or Jeff Wilkes, and I would have paid my portion of it for it 

to be released.”

Mr. Easley‟s testimony supports the trial court‟s finding that he intended to affect an 

accord and satisfaction, and the bank does not dispute that it was Mr. Easley‟sintent to clear 

all of his obligations to the bank. Rather, the bank relies on Mr. Adkisson‟s testimony to 

show that Central Bank never intended to affect an accord and satisfaction. Specifically, 

when asked if Mr. Easley was supposed to be “off the hook on the $250,000 note” if he paid 

the $300,000 loan, Mr. Adkisson stated “[t]hat was not my intent.” The bank argues that Mr. 

Adkisson‟s statement is proof that Appellant never intended to affect an accord and 

satisfaction.

The intent of the parties is determined “from all the circumstances attending the 

transaction.” R.J. Betterton Management Services, Inc., 733 S.W.2d at 882. The trial court 

found that “both Mr. Gobbell and Mr. Adkisson recalled their conversation being in 

substance the same, that is, that Mr. Easley was obligated only on one debt to the bank and 

that was on the $300,000 note.” Mr. Gobbell testified that Mr. Adkisson told him that Mr. 

Easley did not have an obligation to Central Bank other than for the $300,000 loan. Mr. 

Gobbell also testified that Mr. Adkisson informed him that Mr. Easley was not a guaranty on 

the $250,000 note. Mr. Adkisson‟s testimony mirrors Mr. Gobbell‟s. 

The trial court observed that “Central Bank agreed to not just accept the payoff for 

that note...they agreed to release the mortgage that they held on a Riverstone piece of 

property....” “The Court looks at that with the understanding that Central Bank of course 

knew that they were having trouble with this loan.” “Central Bank took the full amount of the 

note, but they gave something too.” “In other words...had this been just Mr. Easley just 

coming into the bank just to pay what he owed, there would have been no reason for the 

Board of Directors to have to meet about that.” “If that was the end of the matter, there 

would have just been no reason for the bank Board of Directors to have to weigh in and 

discuss this, and that tends to indicate to the Court that Mr. Easley‟s version of the accord 

and satisfaction theory is accurate here.” Upon review of the record, the testimony of the 

witnesses does not preponderate against these findings by the trial court. 

While the bank is correct that both parties must intend to affect an accord and 

satisfaction, “[t]he intention of the parties, which is of course controlling, must be determined

from all the circumstances attending the transaction.” R.J. Betterton Management Services, 

Inc., 733 S.W.2d at 882 (quoting 1 C.J. Accord and Satisfaction §§ 1 and 16 

(1914))(emphasis added). We agree with the trial court‟s finding that Central Bank would 

have had no obligation to release its lien on Riverstone‟s property if Mr. Easley was simply 

tendering repayment of the $300,000 loan. Mr. Easley has never disputed that he was liable 
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for the $300,000 loan, and the bank‟s Board of Directors would not need to hold a meeting 

regarding a mere payment of an outstanding loan. Instead, the Board of Directors agreed to 

accept the payment and release 32 acres of Riverstone-owned property it held as collateral to 

Mr. Easley. These circumstances indicate that the parties reached an agreement that Mr. 

Easley had fulfilled his obligations to Central Bank, thus affecting an accord and satisfaction.

In viewing all the circumstances surrounding the transaction, we conclude that the

evidence does not preponderate against the trial court‟s finding that the parties reached an 

accord and satisfaction. Even though Mr. Adkisson stated he did not intend to release Mr. 

Easley from his obligation on the $250,000 loan, the trial court clearly did not find this

statement credible; otherwise, it would have found that the parties did not affect an accord 

and satisfaction. We afford great weight to the trial court‟s credibility determinations. See 

Randolph v. Randolph, 937 S.W.2d 815, 819 (Tenn. 1996). Mr. Adkisson‟s statement, 

which the trial court implicitly found not to be credible, does not preponderate against the 

trial court‟s finding that the parties intended to affect an accord and satisfaction. Because the 

evidence does not preponderate against the trial court‟s findings, we affirm. 

V. Conclusion

For the foregoing reasons, the judgment of the trial court is affirmed. The case is 

remanded for such further proceedings as may be necessary and are consistent with this 

opinion. Costs of the appeal are taxed to the Appellant, Central Bank, and its surety, for all 

of which execution may issue if necessary.

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 KENNY ARMSTRONG, JUDGE