# FILED May 5, 1 995 Cecil Crowson, Jr . Appellate Court Clerk WILL IAM B. DEMONTB REUN, ) ) Plaintiff /Appella nt, )

) Robertson Chancery ) No. 11799 VS. ) ) Appeal No. ) 01-A-01-9411-CH-00550 FIRST CUMBERL

AND BANK AND ) G. WAYNE DETRING, Substitute Trustee, ) ) Defend ants/Appe

llees. )
IN THE COURT OF APPEALS OF TENNESSEE MIDD LE S EC TION AT N AS HVILLE
APPEAL FROM THE CHANCERY COURT OF ROBERTSON COUNT Y AT SPRINGFI

ELD, TENNESSEE
HONORABLE JAMES E. WALT ON, JUDGE ALAN MARK TURK 200 Four th Avenue , North Suite 820 Nashville, Tennessee 37219 ATTORNEY FOR PLAI

NTIFF/APPEL

LANT
G. WAYNE DETRING 177 East Main Street Hendersonville, Tennessee 37075 ATTORNEY FOR DEFENDANTS/APPEL LEES
AFFIRMED AND

REMANDED HENRY F. TODD PRESIDING

JUDGE, MIDDL

E SECTION CONCUR: BEN H. CANTRELL , JUDGE CORNELI

A A. CLARK, SPECIAL JUDGE-2-

WILL IAM B. DEMONTB REUN, ) ) Plaintiff /Appella nt, )

) Robertson Chancery ) No. 11799 VS. ) ) Appeal No. ) 01-A-01-9411-CH-00550 FIRST CUMBERL

AND BANK AND ) G. WAYNE DETRING, Substitute Trustee, ) ) Defend ants/Appe

llees. )

O P I N I O N The captioned plaintiff has appealed from a jury verdict and judgment in his favor and agains t the def

endant, F irst Cumbe

rland B ank for $ 4,600 as d amage s for bre ach of c ontract . No judgment was entered ag ainst the other defendant, G. Way ne Detring, who has no interest in this app eal exce

pt as coun sel of re cord for First Cumb erland B ank, whic h will hereaf ter be r eferr ed to as the defendant.

Plaintiff present s for review the f

ollowing issues: 1. That the Trial Court erred in failing to instruct the jury that recklessness had to be proven by clear and convincing evidence and also erred in directing a ver dict on the issue of punitive damage s. 2. That the

Trial Cour

t erred when it exc luded adm

issible evidenc e as to recovera

ble compe

nsatory damage s.
Plaintiff 's brief contai ns no "Sta

tement of the Case" as requi

red by T.R.A.P. Rule 27(a)(5). This is understandable but not excusable when the technica l record is composed of four volu mes conta

ining 487 pages .

On Dece mber 6 , 1991 , plai ntiff filed his co mplai nt all eging: 1. On Septe

mber 28, 1 989, plain

tiff executed a de ed of tru st to secu re an " Equity Line of Credit " extende d to plainti ff by defenda nt.-3- 2. During the following y ear, plaintiff paid more than the agre ed installments due on the debt. 3. In November, 1990, the pre sident of defendant promised that he would be allowed the full te rm of 60 mo nths for p ayment of the debt. 4. Two days later , defendant began forec losure by notice of a sale on December 12, 1990. 5. Fore closure

was prevented by

a bankru ptcy petition w

hich was dismissed i n September, 1991. 6. On November 6, 1991, defendant caused the publica tion of a notice of foreclosure sale on December 11, 1991.
The complaint sought a restraining order , injunction, damages for wrongful initiation of fore closure

"and its breach

of its implie d covena

nt and fa ir dealin g," a

nd a jury trial.
The Trial Judge denied the requested restra ining order, but ordered: [T]hat the de

fendant s may

convey the prope rty only to First Cumberland Bank, the beneficiary of the Deed of Trust, and the defenda nts shall not convey

the prope rty to any other pa rty ; it is, further, Ordered that the property and any c onveyanc e thereof, including to First Cumberland Bank, shall be subject to further orders of this Court or the final decision in this cause. The prop erty

was sold a

nd conve ye d to defe

ndant.
On July 15, 1992, the Trial Court entered an or der excluding recovery

of damages for loss of reputation, embarrassment or humiliation, or for loss of contract to sell adjace nt pr op er ty.

On Octobe

r 6, 1993, plaintiff

was allow ed to ame

nd his comp laint to as sert rec kless, maliciousand inten

tional ac ts of def

endant in breach of contr act and " covena

nt of goo d faith and fair dealing " and to p

ray for comp ensator

y a nd punitive

damage s.-4- On January 3, 1994, the Trial Judge e ntered an order bifurcating the trial of the case, the first trial to be

limited to th

e issue of plaintiff 's defa ult in pay ment of hisdebt to defenda nt. At a tr

ial on Apr

il 18 and 19 , 1994, the

jury found tha

t plaintif f was not in default. After completion of the second trial, the jury reported a verdict in favor of plaintiff for "expenses related to bankruptcy , $2,800.00, loss of income $1,800.00." Judgment was rendered for $4,600.00.

-First Iss ue: Punit ive DamagesPlaintiff filed no motion for a new trial. Accordingly , plaintiff's complaint of failure to instruct the jury on punitive damag es cannot be considered on appeal. T.R.A.P. Rule 3(e).
The issue of granting a directed verdict may be considered on appeal despite the failure to move for a new trial. T.R.C.P. Rule 50.05.
An action for "breach of oblig ation of good faith" is not a tort action, but an action for breach of contract. Solomon & Sands v. F irst American National Bank of Nashville, Tenn. App. 1989, 774 S.W.2d 939.
This Court agrees with the Trial Judge that this is essentially an action for breach of contract. It is a g eneral rule that punitive damages ar e not allowed in cases founded on breach of contract. Bland v. Smith, 197 Tenn. 683, 277 S.W.2d 377, 49 A.L.R.2d 1212 (1955); B.F. Myers & Son of Goodlettsville v. Evans, Tenn. App. 1980, 612 S.W.2d 912.
No ground of reversal is found in plaintiff' s first issue.

-Second Issue: Exclusion of EvidencePlaintiff complains of an order entered on July 15, 1992, which contains the follo wing:-5- ORDERED that pursuant to the statement and agreement of counsel for the plaintiff, the plaintiff's alleg ed damages do not include any da

mage or loss to his personal reputation or for embarrassment, humiliation, or similar personal loss, so that any facts or allegations regarding the plaintiff's personal reputation or embarrassment, humiliation, or similar personal lo ss or da ma ge , a re no t r el ev an t, an d n ot su bj ec t t o d is co ve ry, except to th

e extent tha

t these fa cts or all egatio ns may

relate t o any loss of income by

the plaintiff; [emphasis a dded] and i

t is, theref ore, o rdered that t he pla inti ff's ob jecti on to defend ant's interrogatory

#7 is well taken, and the plaintiff shall not be required to respond to this interrogatory , except to state the details of any criminal convicti ons which

would be a

dmissible for impeachment purposes pursuant to the Rules of Evidence. (R. Vol. I, p.106)
The sec ond issue d

oes not me

ntion a pr otective order g ranted u nder T.R. C.P. Rule 26.03, but only the exclusion of evidence. No pa rt of the record is cited or found where the Trial Court excluded the evidence mentioned or where such e vidence was tendered. Moreover, exclusion of evidence is included in T.R.A.P. 3(e) which require s a motion for new trial to obtain appellate review.

Plaintiff complain s of the r

efusal o f the Tri al Judge t o instruc t the jury

on recov erable damages as requested by

plaintiff, and a requested interroga tory to the jury

regarding "expenses related to bankruptcy " and loss of income. Neither of these complaints can be consider ed on app eal without a motion f or new tr ial.

Plaintiff complain s of a pre -trial r uling de nying plain

tiff's m otion to be

allowed t o introduce evidence of various elements of dama ge. This is an "exclusion of evidence" included in T.R.A.P. Rule 3(E), and cannot be considered on appea l without a motion for new tria l.
It is regre ttable that plaintiff's failure to preserve his exceptions by motion for new trial haslarge

ly p revente d review

of his com

plaints. H owever , in the vie w of this Court, justice has not been defeated.-6- From the allegations of the complaint, it is evident that plaintiff complains of two distinct w rongs: 1. The first notice of foreclosure which alleg edly nece ssitated a petition for bankruptcy c ausing the postponement of the foreclosure until the dismissal of the bankruptcy
. The evid ence sho wed that t

here wa s a bona f

ide disput e as to whether the secur

ed debt w as in default at the time of the first attempted foreclosure, but the jury resolved this issue in favor of the plaintiff and awarded damag es for this unjustified attempt to foreclose. 2. The second foreclosure was initiated one y ear later during which additional installme nts of the secure d debt bec ame due. Defend ant's e vidence showed th at, on the

date of the second foreclosure notice, the sec ured debt was in default. The original complaint alleges the renewed ef

fort to foreclose, but does not deny that the debt was in default at that time. The

verbati m alleg ations of

the original comp laint in thi s rega rd are a s follows: 16. The w

rongfu l actions o f the Ba

nk and thr

ough its a gents have damaged DeMontbreun a nd now, because the Bank has again initiated f

oreclos ure proc eeding s, DeMont breun wi ll suffer immediate

and irre parable injury , loss or da

mage should the fore closure

sale not b e enjoine d. A copy of the Subs titute Trustee's Notice of Sale is attached a s Exhibit 5. 17. Specifically, De

Montbreun alleges that the farm has the fair market value of $120,000. I n support hereof, DeMontbreun, less than one month ago, was give n a verbal offer of $40,000 for tracts 2 and 5 only . Upon information and belief, the total c laim of the Bank, e ven inclu ding all

of its forecl osure expe

nses and a

ttorney 's fee s, includi ng those associated with DeMontbreun's bankruptcy , to which DeMontbreun denies the Bank is entitled, does not exceed $45,000. 18. For these reasons, DeMontbreun alleg es that issuance of a temporary r

estraining order and, then, a temporar y injunction enjoining the Ban k from fo reclosing on the

farm will not cause undue inconvenience or loss to the Bank but will prevent irreparable injury , loss or damage to DeMontbreun, including the loss of his farm and the substantial equity in the sa me. In respect to the sec ond foreclosure, the amended complaint restates the pa ragraphs of the original complaint stated above and adds three ne w paragraphs, all of which re ad as follows:-7- Amended Parag raph 16. The inten

tional, ma

licious, r eckless and wrongful actions of the Bank a nd through its agents have damaged DeMontb

reun and now, bec ause the

Bank ha s again initiated foreclosure proceedings, De Montbreun will suffer immediate and irreparable injury , loss or damage should the forecl osure sa

le not be e

njoined. A

copy of the Subs titute Trustee's Notice of Sale is attached a s Exhibit 5. 19. Since Decemb er 11, 19 91, the B ank has c ontinued its intentional, malicious, reckless and wrongful conduct toward DeMontbreun and has continued to breach its covenant of good faith an d fair de aling in

its contra ct and re lationship with DeMontbreun by r

efusing to allow reasonable restrictive covena nts to be pl aced on

the far m so adjac ent prope

rty could be sold and by

refusin g to allo w him rec eipt of pr oceeds f rom a subsequent auction sale of his property . DeMontbreun alleges that t hese ac tion s of th e Bank, which began wi th th e Bank's initial, wrongful attempt at foreclosure have c aused further damage to DeMontbreun as below desc ribed. 20. All of s aid actio ns of the B ank cons titute an i ntentiona l, malicious , reckle ss and wr ongful a ttempt by the Ban k to wrongf ully dis poss ess De Mont breun of his farm an d/or c hange its contra ct with him t

o his detr iment and to its bene

fit. 21. All of said actions of the Bank were done e ither intentionally, maliciously , or recklessly , and for such punitive damages should be awarded to plaintiff as the proof may dictate. In neither origina

l nor amended complaint has plaintiff alleged that the sec ond forecl osure wa s initiate d or car ried out w ithout a de

fault in pa

yme nt of the s ecured

debt.
The Statement of Facts in plaintiff's brief conta ins no allegation that the second foreclosure was initiated or carried out without defa ult. It must be presumed that no evidence was introduced that the debt was not in default when the second f oreclosure occurred, and that ther e was no e

vidence to support

a verdict to that ef

fect.

Accord ingly , it must be c oncluded that the f irst issue present ed to the j ury

and its fir st verdict related only

to the lack of default at the time of the first attempted forec losure, for which damages were asse ssed.-8- No evidence is cited or found to support a verdict of liability for the second, completed, foreclosure.
Thus, it appears that plaintiff has received his just desserts and deser ves no more.
Defendant's application for finding of frivolous appeal is denied.
The judgment of the Trial Court is affirmed. Costs of this appeal are taxed against the appellant. The cause is remanded to the Trial Court for a ny further pr

oceedings which may be necessary

and appropriate.

Affirmed and Remanded.

_______________________________________ HENRY F. TODD PRESIDING

JUDGE, MIDDL

E SECTION
CONCUR:

_____________________________________ BEN H. CANTRELL , JUDGE

_____________________________________ CORNELI

A A. CLARK, SPECIAL JUDGE