# FILED March 1, 1996 Cecil Crowson, Jr. App ellate C ou rt Clerk I N THECOUR

TOFAPPEALSOFTENNES SEE EA STER N SEC TI O N

J A M ESM I LLER ) M ONR OECOUNTY ) 03A 01- 9504- C

H
- 00123 Pl a i ntif f

- A

pp e lla nt )

) ) v. ) HON. EAR LH. HENLEY, ) C HANC ELLOR ) M I LLER BRO

TH ERSFA RM S , I N C. ) LA R R Y L. M I LLER , ) GAR R Y M I LLER a n d ) A LLEN M I LLER ) ) D e f e nd a nt s - A

pp e l l ees ) AFFI R M ED AND R

EM ANDED

J OHN W . C LEVELAND OFSW

EETW ATER FOR APPELLANT J EFFR EY L. C

UNNI NGHAM

OFATHENSFOR

APPELLEES

O PI N I O N

G odda r d, P. J .

Thi s i s t he s e c ond a ppe a l i n a c ont i nui ng di s put e be t w e e n f our of t he s ons of A ndr e w K . M i l l e r , de c e a s e d; na m e l y, J a m e s M ille r , La r r yL. M ille r , G

a r r yM ille r a n dA

lle nM ille r .2 The s ui t gi vi ng r i s e t o t he pr e s e nt a ppe a l w a s f i l e d by J a m e s M ille r a g a i n s t M

ille r Br o t he r s Fa r m s , Inc . , a n dhi s thr e e br o t he r s , La r r yL. , G a r r y , a n dA

lle nM ille r . The or i g i n a l c om pl a i nt c ont a i ne d t he f ol l ow i ng t hr e e c ount s : C ount O ne s ought t ot e r m

i n a t e a cer t a i nl eas e ent e r e di nt ob e t w eenA n dr e w K . M ille r a n dM

ille r Br o t he r s Fa r m s , Inc . , pr e di c a t e dup o nthe l e s s ee' s f a i l ur e t op a yr e nt as r e qui r e db yt he l eas e . A t t r i a l a nd on a ppe a l f our ot he r de f i c i e nc i e s w e r e a s s e r t e d: non- pa ym e nt o f t a x e s , f a i l ur e t om a i nt a i nr e p l acem

e nt co s t i n s ur a nce, f a i l ur e t o m a i nt a i n pr ope r t y, a nd f a i l ur e t o de l i ve r i ns ur a nc e pr oc e e ds t o t he l e s s or . C ount t w

o s ought a pa r t i t i on of t he l a nds ow ne d by A ndr e w K . M i l l e r w

hi c h w e r e i nhe r i t e d by hi s s ons , t he i ndi vi dua l pa r t i e s t o t hi s s ui t . C ount t hr e e s ought a j udi c i a l di s s ol ut i on of t he c or por a t i on be c a us e t he a c t i ons of t he D e f e nda nt di r e c t or s w e r e " unl a w

f ul , oppr e s s i ve a nd f r a udul e nt , a nd t ha t t he y w

e r e m i s a ppl yi ng or w

a s t i ng t he c or por a t e a s s e t s . "

The C h a ncel l or r e f u s e dt odecl a r e a f or f e i t ur e o f t he l e a s e or a j udi c i a l di s s ol ut i on of t he c or por a t i on, r e s ul t i ng i n t hi s a ppe a l by J a m e s , i ns i s t i ng he w a s i n e r r or i n bot h r e s pe c t s .
A t t he out s e t , t w

o m a t t e r s ne e d t o be a ddr e s s e d. Fi r s t , t he de c r e e i n t hi s c a us e i s not a f i na l one i n t ha t c ount t w o ha s not be e n r e s ol ve d a nd r e m a i ns pe ndi ng. H

ow e ve r , be c a us e t he v a lidityo f the le a s e is s i g ni f i c a nt inde t e r m i ni n gthe v a l u e of t he pr ope r t y i f s ol d f or a pa r t i t i on unde r c ount t w o, w e de e m i t a ppr opr i a t e t o t r e a t t hi s a ppe a l bot h a s t o c ount s one a nd3

t hr e e a s a R

ul e 9 I nt e r l oc ut or y A ppe a l a nd s us pe nd a l l unc om pl i e d w i t h r e qui r e m

e nt s ne c e s s a r y f or s uc h a n a ppe a l .
Se c ond, t hr e e m

ot i ons t o c ons i de r pos t - j udgm e nt f a c t s ha ve be e n f i l e d, one by J a m e s M i l l e r a nd t he ot he r t w o by t he A dm i ni s t r a t or , C. T. A . , f or the Es t a t e o f A n dr e w K . M ille r . A

l l t hr ee ar e de ni e db ecau s e ei t he r t he ydon o t m eet t he r e qui r e m

e nt s of R ul e 14 of t he Te nne s s e e R ul e s of A

ppe l l a t e Pr oc e dur e f or s uc h m ot i ons , or do not a ddr e s s m a t t e r s ge r m

a ne t o t he i s s ue s r a i s e d i n t hi s a ppe a l .

A s tothe is s u e r e l a tingtof or f e itur e o f the le a s e , t he pe r t i ne nt pr ovi s i ons t he r e of a r e a s f ol l ow s :
1. . . . . Shoul d a ny m

ont hl y i ns t a l l m

e nt r e m

a i n i n de f a ul t t hi r t y ( 30) da ys , t he n a nd i n t ha t e ve nt t he O w ne r m a y gi ve t he Te na nt s a t hi r t y ( 30) da y w r i t t e n not i c e m

a i l e d by c e r tif i e dm

a il tothe i r la s t kn o w na ddr e s s , d i r e c ting t he Te na nt s t o c ur e t he de f i c i e nc y a nd br i ng t he pa ym e nt t o da t e w

i t hi n t hi r t y ( 30) da ys of t he w r i t t e n not i c e , a nd i n t he e ve nt t ha t t he y f a i l t o do s o t hi s c ont r a c t or a ny ba l a nc e t he r e on, or a ny une xe r c i s e d r i ght s t he r e unde r , s ha l l be f or f e i t e d a nd t he ba l a nc e of t he c ont r a c t de c l a r e d nul l a nd voi d a t t he opt i on of t he Owne r . 2. The Le s s ee agr ees : ( a ) Th a t it w

ill p a ythe s a i dr e nt a t the tim e s a nd i n t he m

a nne r a f or e s a i d. ( b) D

ur i ng t he t e r m

he r e of t he Le s s e e s ha l l pa y a l l o f t he r eal es t a t e t a x e s andi nt he ev e nt t he yf a i l t o do s o, t he Le s s or s ha l l pa y t he t a xe s a nd t he a m ount t hus pa i d s ha l l be a dde d a nd be pa i d a s a pa r t of t he r e nt a l he r e i n pr ovi de d. ( c ) Th a t it w

ill dur i n gthe s a i dte r m in s ur e a nd ke e p i ns ur e d i n t he na m e of t he l e s s or a ny a nd a l l4

bui l di ngs on t he pr e m i s e s f r om

l os s a nd ke e p t he m i ns ur e d i n t he na m e of t he Le s s or f r om l os s or da m

a ge b yf i r e i nat l eas t a s um equ a l t ot he co s t t or e p l ace s a i d bui l di ngs i n i ns ur a nc e c om pa ni e s t o be a ppr ove d by t he Le s s or , a n dth a t it w ill p a ya ll the pr e m i um s ne c e s s a r y f or t hos e pur pos e s pr om pt l y a f t e r t he s a m e s ha l l be c om

e due , a nd w

i l l pr om

pt l y de l i ve r t o t he Le s s or t he pol i c i e s of i ns ur a nc e a nd t he r e c e i pt s f or s uc h pr e m

i um s : Pr ovi de d, t ha t i f t he Le s s e e s ha l l a t a ny t i m

e f a i l t o i ns ur e or ke e p i ns ur e d a s a f or e s a i d, t he Le s s or m

a y do a l l t hi ngs ne c e s s a r y t o e f f e c t or m a i nt a i n s uc h i ns ur a nc e , a nd a ny m one ys e xpe nde d t o hi m f or t h a t p ur c h a s e s h a l l b e r e p a y a b l e b yt he Le s s ee on de m a nd , andm

a yb e r eco v e r e das r e nt i nar r ear .

. . . . ( g) Tha t i t w

i l l ke e p a l l bui l di ngs a nd pr e m i s e s , i nc l udi ng t he pl um bi ng a nd e l e c t r i c a l s ys t e m s , i n s uc h r e p a i r as t he s a m e ar e at t he com

m e ncem e nt o f t he s a i d t e r m or m a y be put i n dur i ng t he c ont i nua nc e t he r e of , r eas o n a b l e w

ear andt ear andd a m a g e b yf i r e or o t he r una voi da bl e c a s ua l t y onl y e xpe c t e d [ s i c ] a nd w i l l pr om pt l y r e pl a c e a l l gl a s s t he r e of br oke n dur i ng t he s a i d t e r m

by ot he r of t he s a m e s i z e a nd qua l i t y.

. . . . 4. I f t he Le s s ee or i t s r e pr e s e nt a t i v e s or as s i g n s s ha l l ne gl e c t or f a i l t o pe r f or m a nd obs e r ve a ny c ove na nt w

hi c h on t he Le s s e e ' s pa r t i s t o be pe r f or m e d, or i f hi s l e a s e hol d e s t a t e s ha l l be t a ke n on e xe c ut i on, or i f t he Le s s e e s ha l l be de c l a r e d ba nkr upt or i ns ol ve nt a c c or di ng t o l a w , or s ha l l m

a ke a n a s s i gnm

e nt f or t he be ne f i t of i t s c r e di t or s ot he r t ha n Sw e e t w a t e r V a l l e yBa nk , t he nt he Le s s or m a y , i m m e di a t e l yor at any t i m e t he r e a f t e r , but onl y w i t h not i c e or de m a nd t o a nd t he expr e s s w

r i t t e nco n s e nt o f Sw eet w a t e r V a l l e yBa nk , e nt e r i nt o a nd upon t he pr e m i s e s or a ny pa r t t he r e of , a ndr e p o s s e s s t he s a m e as o f t he i r f or m e r es t a t e , and e xpe l t he Le s s e e a nd t hos e c l a i m i ng unde r hi m

a nd r e m o v e t he i r ef f ect s , f or c i b l y , i f n ecess a r y , w i t h o ut be i ng t a ke n or de e m e d t o be gui l t y of a ny m a nne r of t r e s pa s s , a nd t he r e upon t hi s l e a s e s ha l l t e r m i na t e , but w i t hout pr ej udi c e t o a ny r e m e di e s w

hi c h m i ght ot he r w

i s e be us e d by t he Le s s or f or a r r e a r s of r e nt or a ny br e a c h o f t he Le s s ee' s co v e n a nt s . 5. I ncas e t he pr e m i s e s or anyp a r t t he r e o f s h a l l at a ny t i m

e dur i ng t he s a i d t e r m be de s t r oye d or da m a ge d by f i r e or ot he r una voi da bl e c a s ua l t y, t he Le s s or m a y ke e p a ny i ns ur a nc e pr oc e e ds w hi c h c om

pe ns a t e f or s a i d l o s s , b ut thi s le a s e w ill c o ntinu e inf u ll f or c e a n d5

e f f e c t f or t he pr e m i s e s i n i t s da m

a ge d or uni m

pr ove d c ondi t i on.

I t w i l l be not e d f r om t he f or e goi ng t ha t t he r e nt t o be pa i d w a s t o be a gr e e d upon by t he pa r t i e s a nnua l l y. The pr oof s how e d t ha t t he l e s s e e s pa i d $1000 pe r m ont h pl us pa ym

e nt s on a c e r t a i n i nde bt e dne s s pr e vi ous l y i nc ur r e d by A ndr e w M i l l e r , a s w e l l as i n s ur a nce andt a x e s . A f t e r t he deat ho f A n dr e w M i l l e r t he $1000 pe r m

ont h pa ym

e nt s w e r e not m

a de a nd r e m

a i ne d unpa i d unt i l t he he a r i ng be f or e t he C ha nc e l l or on N

ove m be r 17, 1994. A f t e r t he hear i n ghe or de r e dt h a t t he ar r ear a g e as t ot he m o nt hl y p a ym e nt s b e m

a de i m m e di a t e l yt ot he Es t a t e o f A n dr e w M i l l e r , and a l s o t he e ns ui ng m ont hl y pa ym

e nt s , w

hi c h he f i xe d a t $1000.

A s tothe f i r s t in s i s t e n c e r e l a tiv e tof a ilur e top a y r e nt , t he D

e f e nd a nt s co nt e ndt h a t b ecau s e t he l eas e r e qui r e dt he r e nt a l a m

ount t o be de t e r m i ne d a nnua l l y, i t w a s not pa i d be c a us e no s uc h de t e r m

i na t i on ha d be e n m a de . W

e a gr e e w

i t h t he C h a n c e llor th a t it w a s a ppr opr i a t e , inlight o f the f a c t th a t $1000 c a s h pl us ot he r pa ym e nt s ha d be e n m

a de i n t he pa s t , t hi s w oul d be a n a ppr opr i a t e a m ount t o pa y pe ndi ng a de t e r m i na t i on of t he annu a l r e nt . H o w e v e r t h a t m

a yb e , i t i s cl ear f r o m t he l eas e a gr eem e nt t h a t b e f or e t he l eas e canb e decl a r e dv o i df or f a i l ur e t o pa y r e nt , not i c e m us t ha ve be e n gi ve n by t he l e s s or t o t he l e s s e e . I n t he pr e s e nt c a s e no s uc h not i c e w a s gi ve n a nd t he l e a s e m

a y not be f or f e i t e d f or t hi s r e a s on.1 Th e l e a s e us e s t h e w o r d " e xpe c t e d " r a t h e r t h a n " e x c e p t e d " ; how e v e r , i t i s cl e a r f r o m t h e cont e x t t h a t t h i s i s a t ypogr a phi c a l er r o r .

6 A s t o t he ne xt t w

o i ns i s t e nc e s r e l a t i ve t o non- pa ym e nt of t a xe s a nd f a i l ur e t o obt a i n a ppr opr i a t e i ns ur a nc e , t he l e a s e s p eci f i cal l ypr o v i de s t he l e s s or m a ycur e anyde f i c i e nc yand c h a r g e t he s a m

e t ot he l e s s ee.

Becau s e t he s p eci f i c r e l i e f accor de db yt he l eas e t o t he le s s or , a s di s ting ui s he df r o m the g e n e r a l r e lie f r e l a tiv e to br e a c h of a ny c ove na nt s , a nd t he f a c t t ha t f or f e i t ur e s a r e not f a vor e d unde r our j ur i s pr ude nc e , H oot on v. N

a c a r a t o G

M C Tr uc k, I nc . , 772 S . W

. 2d 41 ( Te nn. A

pp. 1989) ; H

a s de n v. M

c G i nni s , 5 4 Te nn. A pp. 39, 387 S . W

. 2d 631 ( 1964) , w e a r e i nc l i ne d t o be l i e ve t ha t t he l e s s or s ' r e m e dy w oul d be a s s pe c i f i c a l l y s e t out i n t he l eas e r e l a t i v e t ot he s e t w oi t e m s , andt h a t t he C h a ncel l or w

a s c or r e c t i n r e f us i ng t o voi d t he l e a s e on t hos e gr ounds .

W i t h r e ga r d t o t he f a i l ur e t o m a i nt a i n t he pr ope r t y, t he pr i n c i p a l co m p l a i nt i s t h a t r e p a i r s w e r e n o t m

a de af t e r w

i n d s t or m d a m a g e . It w

ill b e n o t e d , h o w e v e r , th a t the le a s e s p eci f i cal l yex cept e d 1una voi da bl e c a s ua l t y.

A s t o s e c t i on 5 of t he l e a s e r e ga r di ng i ns ur a nc e pr oc e e ds , i t w

i l l be not e d t ha t t he pr ovi s i on i s not l i s t e d unde r c ove na nt s of t he l e s s e e a nd doe s not r e qui r e t he l e s s e e t o de l i ve r i ns ur a nc e pr oc e e ds t o t he l e s s or . I t onl y gi ve s t he l e s s or t he r i ght t o r e t a i n t he m , w hi c h e nvi s i one d t he i r be i ng pa i d t o t he l e s s or r a t he r t ha n t he l e s s e e . C ons e que nt l y, t he7

l e s s e e di d not br e a c h t hi s pr ovi s i on. M or e ove r , i t s houl d a l s o be not e d t ha t Se c t i on 5 i s s e pa r a t e a nd a pa r t f r om Se c t i on 4, gi vi ng t he l e s s or t he r i ght of r e - e nt r y f or f a i l ur e t o pe r f or m t he c ove na nt s e num e r a t e d i n Se c t i on 2. Fi na l l y a s t o t hi s poi nt , w e n o t e t h a t cer t a i nr e p a i r s w e r e m a de b yt he i n s ur a nce pr o ceed s r ecei v e db yt he l e s s ee ando t he r s w e r e cont e m

p l a t e dde p e ndi n g upon a de t e r m

i na t i on of t he e xt e nt of t he da m a ge t o a ba r n.

A s t o t he i s s ue s c onc e r ni ng di s s ol ut i on of t he c or por a t i on, our r e vi e w of t he r e c or d pe r s ua de s us t ha t t hi s i s a n a ppr opr i a t e c a s e f or a f f i r m a nc e unde r R

ul e 10( a ) of t hi s C our t .
For t he f or e goi ng r e a s ons t he j udgm e nt of t he Tr i a l C our t i s a f f i r m

e d a nd t he c a us e r e m a nde d f or c ol l e c t i on of c os t s be l ow . C os t s of a ppe a l a r e a dj udge d a ga i ns t t he Pl a i nt i f f a nd hi s s ur e t y.

_______________________________ H ous t on M

. G odda r d, P. J . CONC UR:

________________________________ H e r s c he l P. Fr a nk s , J .

________________________________ C h a r l e s D

. Su s a n o , J r ., J .