### IN THE COURT OF APP EALS OF TENNESS EE AT JAC KSON JA N U A RY 18, 200 6 S es sio n LE SL Y N EL IZ A BE TH M IL LE RBA LL EW v. JOHN MIC HAE L BA LLEW
Direc t Appeal from the Chancer y Court for Shelby Cou nty No. CH-04-1512- 3 D. J. Alissand ratos, Chancellor

No. W2005-00337-C OA-R3-C V - F iled March 22, 2006

I n this a ppeal, we are asked to de termine the validity of a conse nt judgment e ntere d by the chancery c ou rt g ranti ng a

div or c e to the pa

rt ie s. At trial, thepa

rt ie s v olu nta

ri ly su bmi tte d th e ir

c a se to mediation. At the conc lusion of the mediation, the mediator dictated the se ttlement terms onto a tape rec order , and the pa

rties ac knowledg ed onto the tape rec order that thes e t er m s werethe unders ta n d ing of the pa

rties. The c hance ry

court found that this acknowledg ment was a modification of the mediation ag ree ment and that the parties enter ed int o a settlement a g ree ment. On appe al, the husband asse rts that the cha ncery court err ed finding a settlement a g ree ment beca use the mediation ag ree ment specific ally require d that the parties would not be bound unless a w ri t t en , executed settlement ag ree ment was entered into by the parties. Second, the husband contends that, even if an oral settlement a g ree ment was eff ective a g ainst the parties in this case , he had pr operly repudiated t h e a g r e e m e n tt o h i s w i f

e a n d t h e c h a n c e r y

c o u rtb e f o r e t h e c h a n c e r y

c o u rte n t e r e d i t s j u d g m e n t

. In addition, both parties have reque sted attorney ’s fees on appea l. We reve rse and rema nd for f urther p r o c e e d i n g s a n d d e c l i n e t o a w ar d a t t o r n e y’ s f e e s t o e i t h e r

p art y.

Te nn. R . A pp. P . 3 ; A ppe al a s o f Rig ht ; J udgm e nt of t he Cha nc e r y C our t R e ve r se d and Rem anded
A L AN E. H I G H ERS , J. , d e li v e r e d th e o p in io n o f th e c o u rt, inw h ic h W. F RAN K C RAW FORD , P.J ., W.S ., and D AVI D R. F ARMER , J ., joined.
Ba rry J . McWhirter, B radle y

W. Eskins , Memphis, TN, for A ppellant Kay Fa rese Turner , Martin W. Cash, J r., Memphis, TN, for Appellee-2- OP IN ION
I. F A C TS & P R OC EDU R A L H I S T ORY On J uly 29, 2004, L esly n Eliz abeth Miller B allew (“Wife” or “Appe llee”) filed for divorce from her husband, J ohn Michae l Ba llew (“Husband” or “Appe llant” or, collectively with Wife, the

“ Part ie s” ). Th e re a ft e r, Hu sb a ndfi le d a n a ns we r andc ou nte r c la im f or div or c e . Ins te a d o f g oin g to trial for their divorce , Husband a nd Wife entere d into an ag ree ment entitled “Matrimonial Mediation Ag ree ment” (“ MMA”) w here the Parties ag ree d to mediate their divorc e and r educethe subsequent ag ree ment to writing. A fter the Parties purporte dly rea ched an amicable solution at the mediation and ag ree d to be divorce d, the mediator ve rbally announce d onto a tape r ecor d er t h e t er ms of the settlement ag ree ment instead o f re d u ci ng the settlement ag ree ment to writing a s require d by the MMA. When the mediator finished announcing the terms of the settlement ag ree ment onto the tape rec order , the Parties and the ir respe cti ve counse l acknowle dg ed on the taperec order that the ag ree ment as stated by

the mediator w as the unde rstanding of the Parties. Approxim ately

one month afte r the mediation, Husband, throug h his counsel, informed Wife that he believe d that no settlement ag ree ment had bee n rea ched, and that, even if it had, he repudiated the ag ree ment. During the month prec eding Husband’s repudiation, according to Wi fe, while Wife beg an sepa

rating the Parties’ pe rsonal prope rty that was to be divided ac cording to the terms of the settlement ag ree ment and continued to pay for Husband’s wee kly apartment and provide Husband support, Wife’s c ounsel beg an dra ft ing a marital dissolution agr eeme nt, a permanent pare nting plan, an aff

idavit f or Wife, a quit c laim de ed to conve y Husband’s inter est in the marital home to Wife, and a f

inal decr ee of

divorce

. There afte r, W ife filed a mot ion to enfor ce the settlement ag ree ment with the chanc ery court in which she soug ht to have the terms of the settlement ag ree ment that wer e rec ited by the mediator onto the tape r ecor der e nforc ed. Husba nd filed a r esponse to Wif e’ s m otion which stated that no ag ree ment had bee n rea ched be cause the Parties never reduc ed their a g ree ment to writing a s require d by the MMA, an d , i n t h e al t ernative, that if the chancery court found that an ag ree ment had bee n rea ched, H usband wa s providing notice to the chancery court that he has re pudiated any ag ree ment betwee n the Parties. The chanc ery court found that the settlement ag ree ment ex isted and wa s enfor cea ble, and, de spite Husband’s r epudiation of the settlement ag ree ment, enter ed a f inal divorce decr ee and perma nent par enting plan base d on the ora l settlement ag ree ment.-3- II. I SSU ES P R ESENTED Appellant has timely filed hi s notice of a ppeal and prese nts the following issues f or re view: 1. Whether an a lleg ed ora l ag ree ment rea ched at medi at i on that was not re duced to a signe d writing and wa s repudiate d prior to an y judicial consideration is an e nf or c e ablec on tr a c t; 2. Whe the r A pp e llant i s e nti tle d to a tto rn e y ’s fe e s a ndc os ts i nc ur re d a s a re su lt o f this app e a l. Additionally , Appellee prese nts the following issue f or re view:
3. Whe the r A pp e lle e is e nti tle d to a tto rn e y ’s fe e s a nd c os ts inc ur re d a s a re su lt o f this app e a l.
For t h e fo llowing r easons, wereve rse the de cision of the chancery court a nd rema nd for f

urther proce eding s. I n addition, we dec line to awar d attorney ’s fe es to either A ppellant or Appe llee.
III . S TA N D A R D O F R EVIEW
T h is Co u rt r e v ie w s f

in d in g s o f f

a c t b y a tria l c o u rt s itti n g w ith o u t a ju r y u n der a d e novo s tan d ar d w ith a

p r e s u mp ti o n o f

c o rr e c tn e s s f

o r th o s e f in d in g s
. T e n n
. R. Ci v . P. 1 3 ( d ) ( 2 0 0 5 )

. We re view a trial court’s c onclusions of law unde r a de novo s tan d ar d u p o n th e r e c o r d with no presumption of correc tness for the trial court’s c onclusions. Union C arbide Corp. v. Huddleston , 8 5 4 S

. W

. 2 d 8 7 , 9 1 (T en n
. 1 9 9 3 ) ( ci t i n g Estate of Adkins v. W hite Consol. Indus., Inc. , 788 S.W .2d 815, 817 (Tenn. Ct. App. 1989))

. IV. D I S CUS S I ON A. Se ttl

e ment Ag re e ment On appe al, Appellant a sserts that the chancery court e rre d when it enf

orce d a sett l em ent ag ree ment b et we en the parties and ente red a divorce decr ee ba sed on that settlement ag ree ment. First, Appe llant contends that the chance ry court e rre d when it enter ed a divor ce de cre e base d on the Parties’ or al ag ree ment beca use the MMA spec ifically require d that [n] o party shall be bound by

anything sa id o r d o n e at the mediation unless a written statement i s reache d and executed by all nece ssary pa rt ie s. I f a se ttl e me nt i s r e a c he d, thea g re e me nt s ha ll b e re du c e d in writing in written form by the Mediator and in leg al form by counsel for the parties. Eac h of the parties expressly ag ree s that they rese rve their rig ht to a trial in the event they are unable to re ach a settlement of the ir iss ue s.-4-

At tria l, the c ha nc e ry c ou rt

fo un d th a t th e Part ie s o ra lly mod if ie d th e abo ve pr ov isi on of theMMA to a llo w the Part ie s to e nte r i nto a n o ra l se ttl e me nt a g re e me nt. Although the MMA stated t hat any settlement ag ree ment had to be in writing in orde r to bind thePartie s, theMMAdidno t ha ve a pr ov isi on re qu iring that any mod if ic a tio n of the MMAha d to be in writing

.

“ Af te r a writt e n c on tr a c t is ma de , it ma y be mod if ie d by thee xpre ss w or ds of thepa rt ie s in writing , as we ll as by

parol.” Ga lbr

e ath v . Ha rri

s , 811 S.W .2d 88, 91 (Tenn. Ct. App. 1990) (c iting Co-Operative Stores Co. v. U.S. Fid. Guar. Co. , 195 S.W

. 177, 180 (1917))

. Howeve r, “[w]hether written or oral, modi fications of written contra cts must be with the conse nt of both parties.” Id. at 9 2 (c i t i n g V.L. Nicholson Co. v. T ranscon Inv. & Pin. Ltd., Inc. , 595 S.W .2d 474, 482 (Tenn. 1980)

. Further, “[t] he modification of a contra ct, being a new contra ct, require s consideration to support it.” 17A C.J .S. Con tra c ts § 411 (1 99 9) . “ Anor a l c on tr a c t c ha ng ing thete rm s o f a writt e n c on tr a c t mu st b e o f s u ch s p ec i fi ci t y

an d d i re ct n es s as t o l ea v e n o d o u b to f t h e i n t e n t i o n o f t h e p ar t i es t o ch an ge what they previously

solemniz ed by

formal doc ument.” 17A C.J.S

. Con tra c ts § 412 (1999). At trial, neither pa

rty prese nted ev i d ence at trial a s to the alleg ed ora l modification of the MMA

. R ather, the cha ncery court re lied on statements of c ounsel as to what transpired at the mediation when r endering its dec ision.
“Statements of c ounsel are not evidenc e or a subst itute for testim ony , and judgment base d upon neither e vidence nor stipulation of the parti es m aybe vac ated if e vidence is the basis of the holding.” Hathaw ay v. Hathaway , 98 S.W .3d 675, 681 (Tenn. Ct. App. 2002) ( cit i n g S t ate v. Cleveland , 959 S.W. 2d54 8, 55 5 ( Te nn . 1 99 7) ; Me tro . G ov 't of Nas hv ill e v . Sha c k le tt , 554 S.W .2d 60 1, 60 5 ( Te nn . 1 97 7) ; Va lle y Ut il. Di st. v . Ca ntw e ll , No. M2001-00627-R3-CV, 2002 Te nn. App. LEXI S 30 (Tenn. Ct. App. J an. 15, 2002))

. At the hea

ring on Appellee ’s motion to enforcethe set t l em en t ag ree ment, counsel for the Parties stipulated that the mediator ha d relay ed all the terms of the ag ree ment onto the tape r ecor der and that the Parties acknow ledg ed that these wer e the terms they had ag ree d upon at the mediation. These statements areinsufficient to show that the Parties intended to modify the MMA.
Howeve r, “[m] anife stations of assent that ar e in themselves suff icient to conclude a contr act wi ll n ot b e pr e ve nte d f

ro m so op e ratin g by

thefa c t th a t th e pa

rt ie s a lso ma nif

e st an in te nti on to pr e pa rea nda do pt a

writt e n me moria l th e re of ; bu t th e c ir c ums ta nc e s may sh ow that th e a g re e me nts are preliminary

neg otiations.” R E S TA TE ME NT (S EC OND ) O F C O N T RA CT S § 27 (1979). Thus, [p] arties who plan t o make a final written instrument as the expression of their contra ct nec essarily discuss the proposed terms of the contra ct befor e they

enter into it and often, befor e the f inal writing is m ade, agre e up on a ll the te rm s w hic h th e y plan to inc or

po rateW e a r e mi n df u l t h a t pa r t of

t h e s e t t l e me n t a g r e e me n t r e qu i r e s Appe l l a n t t o s e l l h i s i n t e r e s t i n t h e ma r i t a l h om e 1
t o Appel l ee
. N or mal l y , t h e s t at u t e of f r au ds w ou l d ba r an or al ag r ee men t for t h e s al e of l an d. T en n
. Code An n
. § 29- 2- 101( 4) ( 2000)

. “ T h e s t at u t e of f r au ds , how ev er , does not r en der or al c on t r ac t s for t h e s al e of l an d v oi d a b in iti o . I n s t ea d,
s uch co nt r act s are mere l y voi dabl e at t he el ect i on of ei t her par t y . ” A n d erso n v. H a ck s C ro ssi n g P a rt n ers , 3 S. W

. 3d 482, 4 8 5 (T e n n . C t. A p p
. 1 9 9 9 ) (c itatio n s o m itt e d ). “If o n e o f t h e p a rtie s fails to ra ise the sta tute o f f ra u d s a s a d e fen se , . .

. t he cour t i s requi r ed t o enf orce an ora l cont r act for t he s al e of l and. ” Id. a t 4 8 5 -8 6 (c itatio n s o m itt e d ). H e re , a t t ria l, nei t her Ap pel l ant nor Ap pel l ee r ai s ed t he s t at ut e of f r auds as a def

ens e. -5- there in. This they

may d o o rally. . . . It is possi ble thus to make a c on tr a c t th e te rm s o f w hic h in c lude a n o bli g a tio n to e xec ute su bs e qu e ntl y

a fi na l w ri tin g wh ic h s ha ll c on ta in c e rt a in p ro vis ion s. I f parties have de finitely

ag ree d that they

will do so, and that the final writing shall contain those provisions and no others, they have the n conclude d the contra ct. Id. § 27 cmt. a. F urther,

[ i ] t i s quite possible for parties to make an e nforc eable contra ct bin din g the m to pr e pa

rea nde xecut e a subse qu e nt f ina l a g re e me nt. I n order that s u ch m ay be the e ffe ct, it is necessa ry that ag ree ment shall have be en expressed on a ll essential t er ms that are to be incorporated in the document. That document is understood to be a mere memorial of the a g ree ment alre ady rea ched. I f the doc ument or contra ct that the parties ag ree to make is to contain a ny materia l term that is not already

ag reed o n , no contra ct has y et bee n made; the so -c a lle d “ c on tr a c t to make a c on tr a c t” is n ot a

c on tr a c t at a ll. Engeni us En tm ’t

, Inc. v. Herenton , 9 7 1 S

. W

. 2 d 1 2 , ( T e n n
. C t

. A p p
. 1 9 9 7 ) ( q u o t i n g 1 A rt h u r L. Corbin et al., Cor

bin on Con tra c ts § 2.8, at 133-34 (Re v. ed. 1993) ( footnotes omitted)). In addition,

“ if e ith e r p arty

kn ow s o r h a s r e a so n to kn ow that th e oth e r party re g ard s the a g re e me nt as inc omp le te and intends that . . . until t h e wh o l e h as been r educe d to another w ritten form, the pr eliminary neg otiations and ag ree ments do not constitute a contra ct.” R E S TA TE ME NT (S EC OND ) O F C ON TR AC TS § 27 cmt. b (1979).
I n this case, while the Parties intended to be bound only by a executed w ritten ag ree ment, the Parties stipulated at trial that they ag ree d on all essential terms, reac hing a s et t l em en t

. Thus, the Parties have made a

contra ct, the terms of which include an obligation t o execute a f inal, written a g re e me nt. 1
Se c on d, Ap pe llant c on te nd s th a t if a se ttl e me nt a greement di d e xist, Ap pe llant p ro pe rl y repudiated the settlement a g ree ment, prec luding the e nteri n g o f a consent judgme nt based on that se ttl e me nt a g re e me nt.
As the Tenne ssee Supre me Court noted in Harbour v. Brow n for Ulrich , 732 S.W .2d 598 (T e nn . 1 98 7) , “ a

va lidc on sen t ju dgment c a n n ot [s ic ] be e nte re d b y a c ou rt wh e n o ne pa

rty-6-

withdraws his conse nt and this fact i s comm unicated to the c ourt prior to entry of the judg ment.” Id. at 599 (c itations omi tted). Howe ver,

[m ]arital dissolut ion ag ree ments are contracts. Johnson v. J ohnson , 37 S.W. 3d89 2, 89 6 ( Te nn . 2 00 1) ; W ade v. W ade , 115 S.W .3d 917, 924 (Tenn. Ct. App. 2002). Th ey provide a vehicle f or divorcing parties to, among other things, provide “for the equitable se ttlement of any property rig hts betwee n the parties.” See Tenn. Code Ann. § 36-4-103( b) (2001) . Whil eth e s ec o n tr acts be come a bsolutely binding and enf orce able a fter a

pproval by t h e t rial court, this court has re c og nize d th a t pa

rt ie s may be pe rm itt e d to wi thdraw fr om the se ag ree ments befor e they

have be en appr oved by

the court, as long as on e or bo th p art ies have n ot r e lie d o n th e a g re e me nt t o th e ir d e trim ent. De nbow v. Denbow , 1996 Tenn. App. L EXI S 278, No. 02A01-94 1 0-CH-00238, 116 WL 243894, at *1-2 (T enn. Ct. App. May 9, 19 96 ) ( No Te nn . R. Ap p. P. 11 app li c a tio n f ile d) ; Sutton v. Sutton , 1 994 Tenn. App. L EXI S 171, No. 03A01-9309-CH-00315, 19 94 WL 10 89 27 , a t *1 (T e nn . Ct . A pp . M ar. 31 , 1 99 4) (N o T e nn . R. App. P. 11 application filed).
Altm an v . Altm an , No. M 2003-02707-COA- R3-CV, 2005 Tenn. App. L EXI S 207, at *5-6 (Te nn. Ct. Ap p. Ap r. 7, 20 05 ) ( pe rm . a pp . d e nie d) ; see also Nahon v. Nahon , 2 0 0 5 T e n n
. A p p
. LE X IS 780, at *11-12 (T enn. Ct. App. Dec . 14, 2005) (no pe rm. app. filed)

. I n this case, Appe llant, throug h his c o u n s el , informed Appe llee that, if a ny settlement ag ree ment had bee n rea ched, he was expressly repudiating the a g ree ment. Appellant communicated this repudiation to the chancery court in his memorandum of law in response to Appellee’ s motion to enfor ce the settlement ag ree ment. On appe al, Appelleeconce des this fac t. Howeve r, Appe llee also contends that she partially perf orm ed t o h er d etrim ent her duties pursuant to the settlement ag ree ment.
I n her motion to enfor ce the settlement ag ree ment at trial and in her brief on a ppeal, Appe llee has alleg ed diffe rent actions that she completed to pa rtially perf orm the settlement ag ree ment to herW e a re m in d fu l t h a t, in a d d iti o n to the a c tio n s a lleg e d in h e r m o tio n to e n fo rc e the se ttl e m e n t ag re e m e n t, 2 A p p e llee ha s a lso li ste d se v e ra l ac tio n s b y A p p e llan t tha t sh e a lleg e s c o n stitute p e rfo rm a n c e o f t h e se ttl e m e n t ag re e m e n t. H owever , Ap pel l ant per formed t hes e a ct i ons pur s uan t t o t he di vor ce decr ee e ntere d by t he cha nce r y cour t

. Ap pel l ee as s er t s t hat becau s e App el l ant f ai l ed t o s t ay t he j udgment of t he ch anc er y co ur t and has co mp l i ed wi t h t he di vor ce decr ee i n a ll re sp e ct s, t he o ral s et t l em ent agreem ent i s enf o rceab l e. I t was Ap p el l ant ’ s cho i ce t o s t ay t he d eci si o n of t he cha nce r y cour t

. Ap pel l ant was not req uired to stay t he cha nce r y cour t ’ s deci s i on. Fur t her , we decl i ne t o hol d t hat A pp el l ant ’ s comp l i anc e woul d c ons t i t ut e per formanc e on h i s par t t o f orm a c ont r act

. Si nce Ap pel l ant ch ose not t o s t ay t he chancery co urt ’ s d eci si o n, he wo ul d have b een i n co nt em p t had he no t co m p l i ed wi t h t he chancery co urt ’s o rd er. G i ven t hat ch oi ce, we can not conc l ude t hat hi s act i ons cons t i t ut ed part i al per formanc e t o precl ude h i m f r om s t at i ng t hat
a bi n di n g s et t l eme n t a g r ee men t w as n ot r ea ch ed.
-7- detriment. Appellee prese nted no e v i denceat trial, howe ver, to support he r alleg ations that she

2 partially perf ormed he r oblig ations under the se ttlement ag ree ment.

“ Al le g a tio ns in p le a din g s ar e no t, of c ou rs e , ev ide nc e of the fa c ts av e rr e d. Un le ss s uc h f a c ts are admitted or stipu l at ed , t h ey must be proved by documents, af

fidavits, oral testimony

or other competent e vidence .” Hil lha v e n Cor

p. v . St ate , 565 S.W .2d 210, 212 (Tenn. 1978) . Thus, we cannot say that Appellee detrimentally relied on the s ettlement agr eeme nt as t o preve nt Appellant from re pudiating the ag ree ment. Ac co rd i n g ly , we r ever se the de cision of the chancery court a nd re ma ndfo r f

urthe r p ro c e e din g s. B. Attorney’s fe es on Appeal Both Appe llant and Appe llee havereque sted attorney ’s fe es on appe al. “Attorne y ’s fe es ar e only awa rded if provided for by contra ct, s tatute, or a rec og nized gr ound of equity .” Parchm an v. Parchm an , No. W 2003-01204-COA- R3-CV, 2004 Tenn. App. L EXI S 768, at *15 (Tenn. Ct. App. No v . 1 7 , 2 0 0 4 ) ( q u o t i n g Austin Powder Co. v. Thompson , No. 03A01-9607- CV-00229, 1996 Tenn. App. LEXI S 805, at *5 (Tenn. Ct. App. De c. 16, 1996))

. Neither Appellant nor A ppellee ha s reque sted attorney ’s fe es for frivolous appe al pursuant to section 27-1-122 of

the Tenne ssee Code. Instead, it appe ars that both Appe llant and Appellee have r equeste d at t o rney ’s fe es base d on the fa ct that this is a divorce c ase. “ I n divorce case s the rec overy of attorne y ’s fee s is pe rmitted by statute, which provides that a spouse seeking enfor ceme nt of an a limonyor custody awa rd may b e g rante d attorney ’s fe es.” Id. (citing Tenn. Code Ann. § 36-5-103( c) ( 2003)). This appea l, however , does not dea l with the enforc ement of the p ro v i s i o n s o f a divorc e decr ee. Rather, this appea l deals with t he validity of the c onsent judg ment g ranting divorce

. “The de c isi on of

wh eth er to award atto rn e y ’s fe e s o n a pp e a l r e sts so le ly

wi thi n th e dis c re tio n o f this Court.” Id. a t *1 5- 16 (c iti ng Te nn . Co de An n. § 3 6- 5- 10 3( c ) ( 20 03 ); Archer v . Archer , 907 S.W .2d 412, 419 (Tenn. Ct. App. 1995)) . As such, when this Court consider s whether to awar d attorney ’s fe e s o n a pp e a l, w e mus t bemin df

ul o f “ theabil ity

of there qu e sti ng pa

rty to pay th e a c c ru e d f

e e s, the re questing party ’s succ ess in the appe al, whethe r the requesting party soug ht the appeal in g ood faith, and any

other e quita b l e fa ct o r that need beconsidere d.” Dul in v . D ulin , No.-8-

W2001-02969-COA-R3-CV, 2003 Tenn. A pp. LEXI S 628, at *26-27 (Tenn. Ct. App. Sept. 3, 2003) (c i t i n g Fol

k v . Fo lk , 2 10 Te nn
. 36 7, 35 7 S.W. 2d 82 8, 82 9 ( Te nn . 1 96 2) ); see also Parchman , 2004 Te nn . A pp . L

EX I S 76 8 at *1 5- 16 . In th is c a se , w e fi ndit equi tab le to de c lin e to a wa rdbo th Ap pe llant andAp pe lle e a tto rn e y ’s fe e s o n a pp e a l.
V. C ONCL US I ON
For the afor ementioned rea sons, we re verse the dec ision of the chanc ery court a nd rema nd for f urther pr ocee dings. Further , we de cline to awa rd attorne y ’s fe es to either A ppellant or Appe llee. Cost of this appea l a

re ta x ed to Appellee , L esly n Eliz abeth B allew, f or which e x ecution may

issue i f n e c e s s ar y.

___________________________________ ALAN E. HI GHERS, J UDGE