### IN THE COURT OF APPEALS OF TENNESSEE AT NASHVILLE January 3, 2001 Se ssion THOMAS W. HARRISON, ET AL 

### . v. EARL LAURSEN, ET AL 

### .

Appeal from the Chancery Court for Giles County No. 7581 Robert L. Jones, Judge

No. M2000-00482-COA-R3-CV - Filed August 5, 2003

This is the fourth a

ppeal regarding the sa

le of a 12 8-acre

farm in G iles County . The sell ers orig inally sued the buyer s in the Cha ncery Court f or Giles County in 1991, alleging that the buyers ha

d breached the contr act by default ing on the

ir pay ments. The buy ers counterclaimed, asserting that the s ellers h ad breached the contract by failing to provide city

water to the property

and that the sellers had committed fraud and violated the Tennessee C onsumer Pr

otection Act. On th

e first appeal, this court af

firmed th e trial c ourt’s jud

gment r escinding the sa

le but re manded th

e case with directions to address the question of damages. The case wa s tried five more times and was appealed twice. In the sixth trial, a jury awarded thebuy ers $32,4 44.42. On

this the fo

urth appe al, the buyers take issue with the trial court’s exclusion of evidence regar ding the sellers’ alleged fraud, the jury’s cal culation of the inc

reased value of the prope

rty , and the t

rial cou rt’s ref usal to aw ard th e m prejudgment inter

est. We af

firm the j udgmen

t. Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed
W IL LI AM C. K OCH , J R ., J., delivered the opinion of the court, in which B EN H. C ANT RELL , P.J., M.S., and W IL LI AM B. C AIN , J., joined.
Earl Laursen and D olorita Laursen, Pulaski, Tennessee , Pro Se.
M. Andrew Hoover, Pulaski, Tennessee, for the a ppellees, Thomas W. Harrison, Terry Harrison, and Brenda Kennamore.
OPINION
I.
In January 1988, Earl and D olorita Laursen approa che d Thom as Harr ison about buying a 128-acrefarm in

Giles Coun ty known a s the “ McCas kell p lace.” Alth ough Mr. Harrison told them initially that the f arm was not fo r sale, the Laursens e ventually persua

ded him to sell the farm for1 The Laursens clai m they we re never told t hat Terry Harrison a nd Brenda Harrison Kennamore, M r. Ha rrison’s children, also had owne rshi p inte rest s in t he far m. However, t

heir owne rshi p is not

disput ed and both chi ldren are parti es to thi s appeal al ong with the es tate of Mr. Harris on, who died at an unspeci fied t

ime aft er the fourt

h tri al i n thi s case.
2 By this tim e, the La ursens had a ppa rently de cided to de velop the pro perty. -2- $1,000 per acre. 1 On January 26, 1988, the partiesexecuteda contract in which the La ursens agreed to pay the $128,000 purc

hase price by

paying $5,500 down, assuming an $86,797.67 mortgage, a nd repay ing the r emaining $35,702.3 2 at eight perce nt intere st.
The Laursens’ neg otiations with the Harri sons led them to believe that the property was going to be served by

city water. 2 In August 1990, after they discovered that there were no plans to extend city water to the pr

operty, the L

aursens stopped

paying for the property

because they

believedthat the Harrisons hadmade false representations to them. The Harr isons declared the contract breached and re-occupied the property in November 1990.
In January 1991, the Harrisons filed suit against the L aursens in the Chancery Court for Giles County seeking rescission, damages, a nd forfeitureof the payments the L aursens had already

made. The Laursens responded with a counterclaim for rescission or for specific performance

. Following a bench trial in April 1991, the trial court rescinded the contract, awarded the Harrisons $10,775.27 in lost interest, and ordered the forfeiture of the mortgage pay

ments the Laursens had alre ady made to the Harrisons. On appeal, this court affirmed the judgment of rescission but v acated the da mage awards because they

were inconsistent with the remedy of rescission. We remanded the case for a trial on th e issue of damage s with the f

ollowing directio ns: the Laursens are e

ntitled to recover the amounts pa id on the pu

rchase price plus the taxes. The Harrisons are entitled to be compensated for the use of the

land while

it was i n the Laursen s’ possession. If the changes ma de on th e property by the L aursens increased its value, they are entitled to the increase; if the ch angescaused t he prope rty to depreciate, the Harrisons are entitled to rec over the amount of the depreciation.
Harrison v. Laursen , No. 01A01-9204-CV-00177, 1992 WL 301309, at * 4 (Tenn. Ct. App. Oct. 23, 1992) (No Tenn. R. App. P. 11 application filed).
The second tr

ial of thiscase occurred in May 1993, this time before a jury . The jury re turned a verdict for the Harrisons in the amount of $10,558.46; however, the trial court suggested an additur that, if acce

pted, would have r

esulted in a $13,000 .00 judg ment for t h e Ha rrisons. Rather than accepting the suggested

additur, the Laursens requested a new trial. The third trial was held in May 1994, and on this occasion, the jury r eturned a verdict for

the Laursens in the amount of $11,934.46. Both parties filedpost-trial motions challenging the verdict, and the trial court granted the Harrisons a new tri al on the g

round tha t the evid ence did not suppor

t the jury ’s verdi ct.
The fourth trial took place in December 1994. The trial court declined to empanel a jury on this occasion and awarded the Harr isons $22,000.00. The Laursens appea led t o this court for the3 The jury aw arde d the L aurse ns $3 2,27 7.75 [the tota l of their p ayme nts and pro perty taxes] + $1,300 .00 [the

appreci ati on in the prope rty due to the Laurse ns’ improvem ents] - $1,133.33 [the rental value of the property while t

he Laursens possessed it].

4 In additi on to th e thre e earli er appeals in t his ca se, t

he Laursen s als o appealed anoth er judg men t award ing their former attor

ney preju dgm ent intere st on an unpa id attor ney’s fee. Harrison v. Laursen , No . M2 001 -0 007 3- COA- R3- CV, 200 2 W L 83 610 , at *1 (T enn. C t. App . Jan. 2 2, 20 02) (No Te nn. R. A pp. P . 11 a pplic ation filed ). -3- secondtime, and we reversed the judgment and again ordered a

new trial, this time because the trial court had disregarde d the L aursens ’ reque st fo r a ju ry. Harrison v. Laursen , No. 01A01-9505-CH00192, 1996 WL 221862, at * 7 (Tenn. Ct. App. May 3, 1996) (No Te nn. R. App. P. 11 application filed).
The parties t

ried this c ase for

the fifth ti me in October

1996. On this occasion, a jury returned a verdict for the H arrison s in the amo unt of $32, 901.54. B oth partie s app ealed, a nd this case returned to this court for the third time. We were required to rever se the jud gment a gain because the trial court had erred by declining to set aside the judgment aga inst Ms. Laursen and by refusing to permit Mr. Laursen, who wasrepresenting himself, from testify ing. Harrison v. Laursen , No. 01A01-9705-CH-00238, 1998 WL 70635, at * 4-6 (Tenn. Ct. App. Fe b. 20, 1998) (No Tenn. R. App. P. 11 application filed).
The trial judg e who had

preside d over the

five ea rlier tr ials was r epla ced prior to th

e sixth trial which was held in January 2000 . Thi s time, a jury returned a $32,444.42 judgment for the Laur sens. 3 The trial court denied the Laursens’ r

equest for prejudgment interest. The L aursens have perfected an appeal, and this case returns to this court yet ag ain. 4

II. T HE E XCLUSION OF THE E VIDENC E OF A LLEGE D F RAUD
We turn firs t to the Laursens’ claim that the trial court erred by

excluding evidence regar ding their allegations that the Harrisons had made materia l misrepresentations during the negotiations regarding the extension of city water to the pr

operty. This arg

ument reflects the Laur sens’ failure to understandthe legal significance of our original 1992 opinion which limited, as a matter of law, the issues to be triedon remand. We have determined that the trial court did not err by excluding this evidence.
In their initial counterclaim, the Laursens a lleged that Mr. Harrison committed fraud and violat ed Tennessee’s Consumer Protection Act, Tenn. Code Ann. § 47-18-101, et seq. (2001), by making material misrepresentations that induced them to sign the purchase contract. The y claim Mr. Harrison told them city water would soon be a va ilable on the property. The y also claim that he showedthem how close the water lines were to the property a

nd pointed out a fence he had removed to make way

for the final extension of the water lines onto theproperty. When asked why the water lines were no t mentione d in the pur chase c ontract , Mr. Har

riso n al legedly

told the Laursens that language providing f

or “128 acres and all improvements located on Haywood Road”included the water line extens ion. The L

aursensalso cla

imthey were

defrauded

by Mr. Harr

ison’s alleged failure5 Along with these allegatio ns, the La ursens intimate a br each of f idu ciary dut y cl aim by po rt ray in g t hei r cl aim s along side th e f

act th at Mr. Harri son was a l ice nse d rea l e st ate age nt at th e t ime of their land deal. However, they have wisel y chosen not to pr ess t his cl aim to any

of th e courts that

have hear d this case. -4- to inf orm them that his children, Terry Harrison and Brenda Harr ison Kennamore, also had ow ne rs hi p i nt er es ts in th e p ro pe rt y. 5 Notwithstanding the clear instructions in our 1992 opinion regarding the scope of the issues to be tried on remand, the parties participated in fou r mor e tri als ov er the next

seven yea

rs in which our opinion ap

pears to have be en larg ely

ignored. Prior to the sixth trial, the Harrisons filed a motion in limine seeking to bar the La ursens from presenting evidence r egarding their fra

ud, misrepresentation, and violation of the Te nnessee Consumer A

ct claims . The tria

l court g ranted t his motion, and we will review this decision using the “abuse of discretion” standa rd. McDaniel v. CSX Transp., Inc. , 955 S.W.2d 2 57, 258 (Tenn. 1997 ); Heath v. Memphis Radiological Prof’l Corp. , 79 S.W.3d 550, 558-59 (Tenn. Ct. App. 2001).
The ruling o f an appe

llate court becomes the law of the case that is binding on the parties and the trial court on remand. State ex rel. Size more v. U

nited Phy sicians Ins. Risk

Retention Group , 56 S.W.3d 557, 566 (Tenn. Ct. App. 2001). The law of the case doctrine general ly p rohibits reconsiderationof issues actually decided or necessarily decided by

implication in a prio

r appea l in the same case. State v. Jef ferson , 31 S.W.3d 558, 5 60-61 (T enn. 2000 ); Memphis Pub. Co. v. Tennessee Petroleum Underground Storage Tank Bd. , 975 S.W.2d 303, 3 06 (Tenn . 1998); Ladd v. Honda Moto r Co., Ltd. , 939 S.W.2d 83, 90 (Tenn. Ct. App. 1996); 18B Charles A. Wright et al., Federal Practice and Procedure § 4478, at 649-60 (2d ed. 2002). The rule promotes finality a nd efficiency of litigation, ensures consistent results in the same litigation, and assuresthat lowe

r courts follow appellate decisions. State v. Jefferson , 31 S.W.3d at 56 1; Memph is Pub. Co. v. Tennessee Petro le um Underground Storage Tank Bd. , 975 S.W.2d at 306; 1B James W. Moore, Moore’s Federal Practice ¶ 0.404 [1] ( 2d ed. 199 5). Thus, except in certain limited situ ations, tr

ial cour ts cannot re-visit issues decided

by a prior ap peal. State v. Jefferson , 31 S.W.3d a t 561; Memphis Pub. Co. v. T enne ssee Petroleum Underground Storage Tank Bd. , 975 S.W.2d a t 306; 18B Wright, Federal P ractice

& Procedu re § 4478, at 670-72.
The viability of

the Laursens’ damage claims for misrepresentation, fraud, and violation of the Tenness ee Consum

er Prote ction Act

ended withour 1992 opinion in which we affirmed the trial court’s decision

to gran t both par ties’ requests for rescission and to return them to the position they were in before t

he y entered into the January 1988 c ontract. Our remand instructions did not auth orize the parties to pursue any other substantive remedies that the trial court had not granted and, in fact, left only f

ive factual questions for a jury to decide: (1) the pay

men ts the L aursens made towardthe purchase o f the property, ( 2) the amount of property taxes the Laursens paid for the pr op er ty, (3) the fair rental value of the prope rty while the L aursenspossesse d it, (4) th e incre ase in value of the property , if any, due to improveme nts made by

the Laursens, and (5) the depreciation in the value of the property , if any, ca used by the Laursens’ use of the pr operty. The tria

l court’s order granting the Har

rison s’ motion in limine removed legally e xtraneous issues from the proceeding and finally forc ed the parties to direct their attention to the issues at hand. Rather than abusing its discre

tion with r

egard to the sco

pe of adm

issible ev idence, th e tri al court

was simply keeping the scope of the evidence within perm issible bou

nds.6 Mr. Laursen claimed that he had spe nt $6,50 0.00 to im prove the prop erty. Howev er, these “improv ements”

con siste d of a w heat crop that M r. Laur sen p lanted and h arves ted in 1 989 . Thu s, this exp end iture did nothing to perm anen tly impro ve the v alue o f the pro perty, an d the ju ry was ju stified in disr egard ing it. -5- III. T HE J URY ’ S A SSESSMENT FOR THE A PPRECIATION IN THE V ALUE OF THE P ROPERTY
The L aursensalso assert th at the jur y’ s decisio n that the

ir improve

ments had increased the value of the property by

$1,300.00 was erroneous. They insist that their improvements had increased the value of the pr op erty

by $ 19,000.00

and that t

he jury should hav e awar

ded them t

hat amoun

t. After reviewing the record in acc ordance with Tenn. R. App. P. 1 3(d), we have no basis for concluding that there is no evidence to support the jury ’s verdict.
T he Laursens’ $19,000.00 claim re sts solely on the testimony of their appraiser, Mike Wilson, who testified that he had appraised the property in 1985 at $70,000.00 and in 199 3 a t $89,000.00. Howeve

r, Mr. Wilso n also tes tified tha t his 1993 a

ppraisa l was based, at lea st in part, on the fact that the rundown house that had been on the property ha

d been destroyed by

fire in 1991. In Mr. Wilson’ s opinion, t he value of the pr operty was enha nced by the destr ucti on of the ho use. In add ition, Ms. Laursen testified that the house wa s in essentially the same condition when the Harrisons reclaim

ed it in 1990 as it had been in 1988 when the Laur sens took possession of it. 6 The testimonyof both Ms. Laursen and Mr. Wilson provides material evidence that supports the jury ’s decision that the p roperty had appr eciate d $1,300.0 0 while the Laur sens posse ssed it.
IV. T HE L AURSENS ’ R EQUES T FOR P RE - JUDGMEN T I NTEREST
The Laursens’ major complaint on this appea l involves the trial court’s refusal to award them prejudgment

interest. They c ontend that equity demands an award of preju dgment interest b ecause the Harrisons have had beneficial use of their purcha se money since January 1988 while they

have hadneither the benefit of those funds nor the expected benefit from their planned development of the property. We have

concluded that the

trial cou rt did not e

rr when it denied the L aursens ’ reque st for pre judgmen t interes t.
Tennessee’s courts have al wa ys had the c ommon-law power to award p rejudg ment inter

est. However, early

in the nine

teenth century, the legislature began codify ing that power. Scholz v. S.B. Int’l, Inc. , 40 S.W.3d 78 , 81 (Ten n. Ct. App. 2000). Th

e modern statute pr ovides, in part: Prejudgment

interest, i.e., interest as an element of, or in the nature of, d amages, as permitted by the statutory and common laws of th e state as of April 1, 1979, may be awar ded by courts or

juries in accordance

with the principles of equity a t any rate not in excess of a maximum effective rate of ten percent (10%)per annum . . .. Tenn. Code Ann. § 47-14-123 (2001).7 The tri al court faul ted the Harri sons fordela yi ng t he proc eedin gs by maki ng deman ds t hat excee ded th e bounds of credibili ty and the judici al system for letti ng this case get out of hand by approving resci ssi on in a cas e that instead should hav e been decided agai nst t he Laursen s in t

he fi rst inst ance. -6- The common-law power to award prejudgment interest has consistently bee n viewedas an equitabl e matter entrusted to th e j ud ge ’s di sc re ti on . A cc or di ng ly, Tenn. Code Ann. § 47-14-123 has been construed to preserve the discretionary character of these decisions. Alexander v. Inman , 974 S.W.2d 689, 697- 98 (Tenn . 1998); Spencer v. A-1 C rane Serv., Inc. , 880 S.W.2d 938, 944 (Tenn.1994); Brandt v. BIB Enter., Ltd. , 986 S.W.2d 5 86, 595 (Tenn. Ct. App. 19 98 ). Ac co rd in gl y, appellate courts will not disturb a trial court’s decision rega rding prejudgment interest “unless the record reveal s a manife st and pal pable abuse of discretion.” Myint v. Allstate Ins. Co. , 970 S.W.2d 920, 927 (Ten

n. 1998); York v. Vulc

an Materi als Co. , 63 S.W.3d 384, 390 (Tenn. Ct. App. 2001).
The primary

purpose in award

ing pre judgmen t interes t is to assure

that the p laintiff

is fully compensated for thelost use of funds to which he or she was entitled. Francisco v. United States , 267 F.3d 303, 310 (3d Cir. 2001) ; Scholz v. S.B. Int’l, Inc. , 40 S.W.3d at 83. However, allowing trial courts to award prejudgment interest also serves a seconda ry purpo se of hastening settlement and the conduct of litigation. Val-U Constr. Co. v. Ros ebud Sioux Tribe , 146 F.3d 573, 582 (8th Cir. 1998). “De lay damag es” provide an incentive for parties to avoid delay ing trial by a

llowing the losing par ty to limit its damages. Francisco v. United States , 267 F.3d at 311; Batchelde r v . Tweedie , 294 A.2d 443, 444 (Me. 1972) . This sec ondary purpose i s further served by considering the parties’ respective fault for delay s, Francisco v. United States , 267 F.3d at 311, as the party who ultimat ely

loses will p ay

more inte

rest if it i s found to h ave cau sed dela ys in the tria

l w hile th e prevailing party may

lose its right to interest for delay ing the proceedings. Batcheld er v. Tweedie , 294 A.2d at 444.
Our courts have recognized that the trial courts canconsider the unusual duration of litigation as a factor in reducing prej udgment interes t

. Scholz v. S.B. Int’l, Inc. , 40 S.W.3d a t 83; Varner Constr. Co. v. Mar

rs , No. W2000-01029-COA-R3-CV, 2002 WL 818234, at *14 (Tenn. Ct. App. Apr. 18, 2002) (No Tenn . R. App. P. 1 1 applica ti on fil ed). Although we have never a llowed the complete denial of prejudgment interest because of the plaintiff’s behavior during litigation, we have alloweda denial of interest when the plaintiff’s business methods led to the lawsuit. Craftbuilt Mfg. Co v. United Window Co., No. E1999-01529-COA-R3-CV, 2000 WL 28165 9, at * 3 (Te nn. Ct. A pp. Mar. 16, 200 0) (No Tenn. R. App. P. 11 application filed). In a ddition, other courts have recognized that the plaintiff’s responsibility for delay ing the proceedings may

justify the denial of prejudgment

interest. E.g. , General Motors Corp. v. Devex Corp. , 461 U.S. 648, 656-57, 1 03 S. Ct. 2058, 2063 (1983); Val-U Constr. Co. v. Rosebud Sioux Tribe , 146 F.3d at 582; Locricchio v. Legal Servs. Corp. , 833 F.2d 1352, 1360 (9th Cir. 1987); Stroh Container Co. v. Delphi Indus. Inc. , 783 F.2d743, 752 ( 8th Cir. 198 6). We follow these courts in exte nd ing the equitable considerations regar ding pre judgmen t interes t.
Alth ough some authority exists to support the La ursens’ argument tha t they should not be deniedinterest

where the trial court and the defe ndant ca used the d

elay s, 7 Foley v. City of Lowe ll , 948 F. 2d 10 , 1 7- 18 (1 st Ci r. 19 91 ), th ey are n ot blameless in this case. Trial courts can deny prejudgment interest when both parties are r esponsible for delay s. Uniroyal, Inc. v. Rudkin-Wiley Corp. , 939 F.2d 1540, 1546 (Fed. Cir. 1991) (deny ing interest

where b oth partie s agreed to a stay).-7-

The trial court concluded that the La ursens delayed this case by refusing to stay

focused on the issues andrepeatedly

addressing extraneous matters. Accordingly, the L aursens’ partial responsibility for delaying the conclusion of this litigation justified the trial court’s decision to d eny pr ejudgment interest

. V.
We affirm t he judgment and remand the case to the trial c ourt for whatever further procee dings consiste

nt with this o

pinion may

be requi red. We ta

x the costs o f this appeal to Earl and Dolorita Laursen and their sur ety for whic

h execution, if necessary , may issue.

_____________________________ WILL IAM C. KOCH, JR., JUDGE