IN THE COURT OF APPEALS OF TENNESSEE

AT NASHVILLE

December 4, 2018 Session

ROBERT EUGENE HULAN ET AL. V. COFFEE COUNTY BANK

Appeal from the Circuit Court for Coffee County

No. 41665 Vanessa Jackson, Judge

No. M2018-00358-COA-R3-CV

A bank extended a line of credit to a husband and wife in 2007 and obtained as security a 

parcel of undeveloped property. The bank foreclosed on the property in 2009 upon the 

couple’s default on the loan and filed suit in 2010 to collect a deficiency judgment. The 

trial court’s award of a deficiency judgment was reversed on appeal. The husband and 

wife then filed a complaint against the bank in 2014, based on the same line of credit 

agreement, claiming the bank had engaged in fraud and breach of contract. The trial 

court granted the bank’s motion for summary judgment and dismissed the 2014 

complaint, and the couple appealed. We affirm the trial court’s judgment, finding (1) the 

couple waived their breach of contract claim by failing to assert it as a compulsory 

counterclaim in the 2010 litigation and (2) the couple’s fraud claims are barred by the 

statute of limitations. 

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed

ANDY D. BENNETT, J., delivered the opinion of the Court, in which FRANK G. CLEMENT,

JR., P.J., M.S., and RICHARD H. DINKINS, J., joined.

Anne Maddux Frazier and Thomas Anderton Wiseman, III, Nashville, Tennessee, for the 

appellants, Robert Eugene Hulan and Sherry Renee Hulan.

Lynda Motes Hill, Nashville, Tennessee, and Shawn Carter Trail, Manchester, Tennessee, 

for the appellee, Coffee County Bank.

OPINION

I. FACTUAL AND PROCEDURAL BACKGROUND

Robert Eugene Hulan and Sherry Renee Hulan entered into a revolving line of 

credit agreement with Coffee County Bank (“the Bank”) on August 29, 2007. The 

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Hulans owned two parcels of land in Morrison, Tennessee, at that time: a developed 

5.13-acre lot located at 307 Clayton Lane and a nearby undeveloped 11.29-acre lot 

located on Chris Lee Lane. The Hulans resided in a house on the Clayton Lane property 

and secured the line of credit with their land located on Chris Lee Lane. The parcel on 

Chris Lee Lane did not have a street address, and the Bank used the Hulans’ residential 

address on Clayton Lane to contact them with regard to the line of credit or the property 

securing it.

By letters dated September 9 and October 13, 2009, the Bank informed the Hulans 

that their loan was in default and that their failure to cure the default would result in the 

Bank’s foreclosure on the property securing the loan. In both letters, the Bank 

mistakenly identified “307 Clayton Lane” as the property subject to foreclosure rather 

than the 11.29-acre property located on Chris Lee Lane. On December 4, 2009, the Bank 

foreclosed on the property that secured the line of credit, on Chris Lee Lane, which was 

sold at auction for $30,000. On December 9, 2009, the Bank filed an unlawful detainer 

action in the Coffee County General Sessions court. Again, the Bank mistakenly 

identified “307 Clayton Lane” as the address that the Hulans were possessing unlawfully. 

Following a trial on March 17, 2010, the general sessions judge awarded the Bank 

possession of the property at issue.1 There is no evidence in the record that the Hulans 

appealed this judgment to the circuit court.

The Bank filed a complaint against the Hulans in July 2010 to recover the balance 

owed on the line of credit. The trial court awarded the Bank a deficiency judgment in the 

amount of $4,448.18, which the Hulans appealed. We reversed the judgment on appeal 

because the Bank relied on two different versions of a credit agreement and was unable to 

prove the existence of an enforceable contract with definite terms. See Coffee Cnty. Bank 

v. Hulan, No. M2012-00109-COA-R3-CV, 2013 WL 395981 (Tenn. Ct. App. Jan. 30, 

2013).

On November 10, 2014, the Hulans filed a complaint against the Bank based on 

the 2007 line of credit agreement that was the subject of the Bank’s 2010 complaint 

against the Hulans. In their complaint, the Hulans asserted a breach of contract cause of 

action, claiming that the Bank “materially and fraudulently alter[ed] the [line of credit] 

contract” and then wrongfully foreclosed on their property on Chris Lee Lane that 

secured the line of credit. The Bank moved for a more definite statement, and the Hulans 

filed an amended complaint on May 29, 2015. The causes of action identified in the 

amended complaint include wrongful foreclosure, breach of contract, and fraud, all 

stemming from the line of credit agreement dated August 29, 2007.

 

1According to the Bank, the general sessions judge was informed at trial that the property at issue was 

located on Chris Lee Lane, not 307 Clayton Lane. The Hulans do not dispute this, and the record does 

not reflect that the Hulans were dispossessed of their residence at 307 Clayton Lane as a result of this 

judgment. The Bank included the following in its answer to the amended complaint in this case: “The 

Bank did not seek to possess 307 Clayton Lane and never foreclosed on that property.” 
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The Bank filed a motion for summary judgment on May 8, 2017. The Bank’s 

primary arguments were that (1) the Hulans’ wrongful foreclosure and fraud claims were 

barred by the three-year statute of limitations and (2) the Hulans were required to assert 

any breach of contract claim they had related to the 2007 line of credit agreement as a 

compulsory counterclaim in the action the Bank initiated in 2010. By failing to assert a 

counterclaim in the earlier action, the Bank contends, the Hulans waived their right to 

assert the breach of contract claim in the current litigation. The Bank also argued that the 

trial court lacked subject matter jurisdiction over the breach of contract claim to the 

extent it was based on the misidentification of the Hulans’ residential property on the 

detainer warrant because the Hulans failed to appeal the general sessions order and that 

the breach of contract action was barred by the doctrines of equitable and collateral 

estoppel.

The trial court held a hearing on the Bank’s motion on November 13, 2017, and it 

entered an order on February 1, 2018, granting the Bank summary judgment on all issues

and dismissing the Hulans’ amended complaint. The trial court found the Hulans “were 

well aware of the alleged wrongful and fraudulent actions of the Defendant more than 

three years prior to the filing of the original Complaint in this case on November 10, 

2014,” and that the statute of limitations had, therefore, run on these claims. With respect 

to the Hulans’ breach of contract claim, the trial court concluded that it should have been 

asserted as a compulsory counterclaim to the Bank’s 2010 action seeking a deficiency 

judgment. The trial court wrote:

[T]he undisputed facts establish that on July 20, 2010, Coffee County Bank 

filed a Complaint against Plaintiffs seeking a judgment for the amount 

owing the Bank pursuant to [the] Line of Credit contract (after application 

of the proceeds from the foreclosure sale). Plaintiffs did not file a 

counterclaim seeking damages against the Bank alleging breach of the Line 

of Credit contract. Tenn. R. Civ. P. 13.01 provides that a pleading shall 

state as a counterclaim any claim, other than a tort claim, which at the time 

of serving the pleading the pleader has against any opposing party, if it 

arises out of the transaction or occurrence that is the subject matter of the 

opposing party’s claim. The transaction or occurrence that was the subject 

matter of the Bank’s claim was the Hulans’ default or breach of the Line of 

Credit contract. In the present case, Plaintiffs’ claim that [the] Bank 

breached the Line of Credit contract arises out of the same transaction that 

was the subject matter of the Bank’s suit to collect the deficiency judgment. 

. . . Robert Hulan’s deposition testimony establishes that, at the time Coffee 

County Bank brought suit to collect the deficiency judgment, Plaintiffs 

were contesting the validity and enforceability of the Line of Credit 

agreement. Plaintiffs’ failure to file a compulsory counterclaim bars them 

from raising their breach of contract claim in this suit. 
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The Hulans appeal the trial court’s judgment dismissing their amended complaint. 

They argue that (1) the trial court erred in granting the Bank summary judgment on their 

fraud and breach of contract claims and (2) the trial court’s order failed to state 

sufficiently the facts and legal grounds upon which it relied in granting the Bank’s 

motion for summary judgment as required by Tenn. R. Civ. P. 56.04. The Bank raises 

the following additional issues on appeal: (1) whether the trial court lacked subject 

matter jurisdiction to consider the Hulans’ breach of contract and fraud claims to the 

extent they related to the Bank’s misidentification of the property described on the 

detainer warrant filed in general sessions court; and (2) whether the Hulans were 

estopped by the doctrines of equitable and collateral estoppel from asserting a breach of 

contract claim.

II. ANALYSIS

A. Standard of Review

Summary judgment is appropriate “if the pleadings, depositions, answers to 

interrogatories, and admissions on file, together with the affidavits, if any, show that 

there is no genuine issue as to any material fact and that the moving party is entitled to a

judgment as a matter of law.” TENN. R. CIV. P. 56.04; see also Rye v. Women’s Care Ctr. 

of Memphis, MPLLC, 477 S.W.3d 235, 261-62 (Tenn. 2015) (quoting TENN. R. CIV. P.

56.04). If the party moving for summary judgment does not bear the burden of proof at 

trial, as here, the movant will be entitled to succeed on the motion if he or she

“affirmatively negat[es] an essential element of the nonmoving party’s claim or . . . 

demonstrate[es] that the nonmoving party’s evidence at the summary judgment stage is 

insufficient to establish the nonmoving party’s claim or defense.” Rye, 477 S.W.3d at 

264; see also Tenn. Code Ann. § 20-16-101.

A court ruling on a motion for summary judgment is required to take the 

“strongest legitimate view of the evidence” in favor of the non-moving party “and discard 

all countervailing evidence.” Davis v. McGuigan, 325 S.W.3d 149, 157 (Tenn. 2010) 

(citing Blair v. W. Town Mall, 130 S.W.3d 761, 768 (Tenn. 2004)). A genuine issue of 

material fact exists “if the undisputed facts and inferences drawn in the [non-movant’s] 

favor permit a reasonable person to reach more than one conclusion.” Id. ‘“Then, if

there is a dispute as to any material fact or any doubt as to the conclusions to be drawn 

from that fact, the motion must be denied.”’ Johnson v. City Roofing Co., No. W2003-

01852-COA-R3-CV, 2004 WL 1908794, at *2 (Tenn. Ct. App. Aug. 25, 2004) (quoting 

Byrd v. Hall, 847 S.W.2d 208, 211 (Tenn.1993)); see also Dooley v. Everett, 805 S.W.2d 

380, 383 (Tenn. Ct. App. 1990). 

A trial court’s award of summary judgment is not entitled to a presumption of 

correctness on appeal. Biancheri v. Johnson, Nos. M2008-00599-COA-R3-CV, M2007-

02861-COA-R3-CV, 2009 WL 723540, at *5 (Tenn. Ct. App. Mar. 18, 2009) (citing 
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BellSouth Adver. & Publ’g Co. v. Johnson, 100 S.W.3d 202, 205 (Tenn. 2003)). 

Appellate courts review a trial court’s decision on a motion for summary judgment de 

novo. Rye, 477 S.W.3d at 250 (citing Bain v. Wells, 936 S.W.2d 618, 622 (Tenn. 1997)). 

B. Fraud Claims

The Hulans assert in their amended complaint that the Bank “fraudulently initiated 

foreclosure proceedings against Robert and Sherry Hulan and their property at 307 

Clayton Lane, Morrison Tennessee” and that the Bank “wrongly and fraudulently altered 

the Revolving Line of Credit Agreement, and, upon information and belief, is unable to 

present an original of the Revolving Line of Credit Agreement.” Both of these causes of 

action sound in fraud and are subject to the statute of limitations for fraud claims. 

The statute of limitations for fraud claims in Tennessee is three years. See Tenn. 

Code Ann. § 28-3-105(1); Vance v. Schulder, 547 S.W.2d 927, 931-33 (Tenn. 1977); Am. 

Fid. Fire Ins. Co., 671 S.W.2d 837, 841 (Tenn. Ct. App. 1983); see also Findley v. 

Hubbard, No. M2017-01850-COA-R3-CV, 2018 WL 3217717, at *8 (Tenn. Ct. App. 

July 2, 2018) (citing Fortune v. Unum Life Ins. Co. of Am., 360 S.W.3d 390, 401 (Tenn. 

Ct. App. 2010)); Prism Partners, L.P. v. Figlio, No. 01A01-9703-CV-00103, 1997 WL 

691528, at *4 (Tenn. Ct. App. Nov. 7, 1997). Under the discovery rule, “a cause of 

action accrues and the statute of limitations begins to run not only when the plaintiff has 

actual knowledge of a claim, but also when the plaintiff has actual knowledge of ‘facts 

sufficient to put a reasonable person on notice that he [or she] has suffered an injury as a 

result of wrongful conduct.’” Redwing v. Catholic Bishop for the Diocese of Memphis, 

363 S.W.3d 436, 459 (Tenn. 2012) (quoting Carvell v. Bottoms, 900 S.W.2d 23, 29 

(Tenn. 1995)).

The Hulans were aware that the Bank erroneously identified 307 Clayton Road as 

the property that was subject to foreclosure in 2009, when they received letters from the 

Bank dated October 9 and October 13, 2009. In these letters, the Bank notified the

Hulans that their note was in default and threatened to initiate foreclosure proceedings 

against their property located at 307 Clayton Road. The Hulans were required to file

their wrongful foreclosure action against the Bank no later than October 14, 2012, to 

comply with the three-year statute of limitations applicable to their claim for wrongful 

foreclosure. Because they did not file their complaint until November 10, 2014, they 

waived their right to pursue this claim against the Bank.

With respect to their claim that the Bank fraudulently altered their line of credit 

agreement, the Hulans rely on three different photocopies of the agreement that they 

claim prove the Bank’s fraudulent acts. The Hulans attached these photocopies to their 

amended complaint as Exhibits A-C. The Hulans allege that the Bank filed Exhibit A 

with the General Sessions Court of Coffee County on March 17, 2010, that the Bank filed 

Exhibit B with the Chancery Court of Coffee County on April 20, 2011, and that the 
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Bank filed Exhibit C with the same chancery court on June 14, 2011. More than three 

years passed from the latest of these dates before the Hulans filed their complaint against 

the Bank on November 10, 2014. The Hulans knew, or should have known, no later than 

June 14, 2011, of the facts supporting their claim that the Bank fraudulently altered their 

line of credit agreement, and they were required by the statute of limitations to file any 

claim they had no later than June 15, 2014, to preserve their rights. Because they did not 

initiate this action until November 10, 2014, they are barred by the three-year statute of 

limitations from pursuing this fraud claim against the Bank.

2

The Hulans’ argument that “the Bank has displayed a pattern of fraud that 

continues into the current litigation at hand” to justify tolling the statute of limitations is 

incorrect and is not well-taken. To support this argument, the Hulans rely on deposition 

testimony by Kenneth Kirby, an officer of the Bank. On May 27, 2016, Mr. Kirby 

testified at his deposition as follows:

Q: Is your testimony today that this document entitled “Revolving Line of 

Credit Agreement,” which is attached to your affidavit and is Exhibit 1 to 

your deposition, is a copy of the actual original note that was executed by 

Robert Hulan?

A: I would say yes.

It is evident from this excerpt that the Hulans’ attorney was questioning Mr. Kirby about 

the 2007 line of credit agreement, and Mr. Kirby responded that he believed the 

document was a copy of the original note. Despite the fact that we reversed the trial 

court’s award of a deficiency judgment to the Bank in 2013, the basis of our decision in 

that case was that the Bank relied on two inconsistent versions of the line of credit 

agreement, not that the Bank had engaged in fraudulent activity. See Coffee Cnty. Bank, 

2013 WL 395981, at *4. Thus, Mr. Kirby’s testimony that the document he was shown 

during his deposition was a copy of the original agreement is not inconsistent with our 

earlier holding against the Bank and is not evidence of any “continuing fraud.”

The Hulans also rely on the following deposition testimony by Mr. Kirby for their 

continuing fraud theory:

Q: Do you agree that Coffee County Bank wrongfully started foreclosure 

proceedings on the Clayton Road property of Mr. Hulan?

 

2We also note evidence in the record showing that Mr. Hulan was aware of the facts underlying this claim 

on June 3, 2011, when he was giving a deposition and described the line of credit agreement as “a 

fraudulent document” and “a piece of fraud.” 
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A: No.

The Hulans’ attorney was questioning Mr. Kirby here about the Bank’s foreclosure on the 

Chris Lee Lane property back in 2009. As discussed above, the Bank has acknowledged 

that it misidentified the Clayton Road property as the property that secured the Hulans’ 

line of credit in their letters to the Hulans dated September 9 and October 13, 2009, and 

in the detainer warrant they filed with the general sessions court. However, it is 

undisputed that the Bank properly foreclosed on the Chris Lee Lane property and did not 

dispossess the Hulans from their residence on Clayton Road. 

Contrary to the Hulans’ argument, neither Mr. Kirby’s testimony that the 

document he was shown at his deposition was a copy of the original nor his testimony 

that the Bank did not initiate foreclosure proceedings on the Clayton Road property 

“display[s] a pattern of fraud” that justifies tolling the three-year statute of limitations. 

The Hulans point to no independent actions by the Bank to support their continuing fraud 

theory, and we reject their argument that the Bank’s responses to questions posed by the

Hulans’ attorney constitutes fraud. 

C. Breach of Contract Claim

The Hulans’ breach of contract claim is based on the same line of credit agreement 

that was at issue in the Bank’s 2010 action. Tennessee Rule of Civil Procedure 13.01 

addresses compulsory counterclaims, and it provides, in pertinent part:

A pleading shall state as a counterclaim any claim, other than a tort claim, 

which at the time of serving the pleading the pleader has against any 

opposing party, if it arises out of the transaction or occurrence that is the 

subject matter of the opposing party’s claim and does not require for its 

adjudication the presence of third parties of whom the court cannot acquire 

jurisdiction, except that a claim need not be stated as a counterclaim if at 

the time the action was commenced the claim was the subject of another 

pending action. 

As the Tennessee Supreme Court has explained, the purpose of compulsory 

counterclaims is “to insure that only one judicial proceeding [is] required to settle all 

those matters determinable by the same facts or law, that is, to bring all logically related 

claims into a single litigation, thereby avoiding multiplicity of suits.” Quelette v. 

Whittemore, 627 S.W.2d 681, 682 (Tenn. Ct. App. 1981) (quoting 20 AM. JUR. 2D

Counterclaim § 15 (1965)). This Court has written that “if a party fails to file a 

counterclaim, other than those excluded by the Rule itself, in response to a pleading in 

accordance with Rule 13.01 and the controversy results in a final judgment, then that 

party would be precluded from filing suit on that claim.” Crain v. CRST Van Expedited, 

Inc., 360 S.W.3d 374, 379 (Tenn. Ct. App. 2011). This rule “promotes the efficient and 
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expeditious determination of all issues in a single proceeding and discourages needless 

litigation.” Lowe v. First City Bank of Rutherford Cnty., No. 01-A-01-9305-CV00205, 

1994 WL 570082, at *3 (Tenn. Ct. App. Oct. 19, 1994) (citing Clements v. Austin, 673 

S.W.2d 867, 869 (Tenn. Ct. App. 1983); Quelette, 627 S.W.2d at 682); see also Walker v. 

Duracell U.S.A., 717 S.W.2d 579, 580 (Tenn. 1986); Philadelphia Indem. Ins. Co. v. 

Lacey, No. 3:18-cv-38, 2018 WL 3999821, at *3 (E.D. Tenn. Aug. 21, 2018).

The Hulans argue on appeal that they should not have to comply with Rule 13.01 

for the following reasons:

In rendering its decision, this Court only considered whether the Bank 

presented an enforceable contract for the limited purpose to enforce a 

deficiency judgment and attorney’s fees based on two versions of the 

RLOC [revolving line of credit] Agreement presented before the trial court. 

This Court did not consider the version of the RLOC Agreement attested to 

as valid and correct by Bank President, Kenneth Kirby, on April 19, 2011, 

nor did this Court consider the Detainer Summons and Coffee County 

Bank’s representation to the General Sessions Court that the Clayton Lane 

property secured the RLOC. Additionally, this Court did not consider the 

court order, signed by Judge Ledsinger, evicting the Hulans from their 

home property at 307 Clayton Lane.

(Citations omitted.) With all due respect, this Court addressed all issues the parties 

properly presented for review on appeal. If the Hulans believed that we did not address 

an issue that was properly raised on appeal, their recourse was to file a petition for 

rehearing in accordance with Rule 39 of the Tennessee Rules of Appellate Procedure, not 

to file a new case and then assert as a reason for not complying with Tenn. R. Civ. P. 

13.01 that this Court failed to address one or more issues in an earlier case.

Despite the Hulans’ attempt to show that their breach of contract claim “stem[s] 

from a different occurrence” or “embodies a different cause of action, different issues of 

fact, and requires different proof than the Bank’s 2010 Complaint,” the fact remains that 

the contract at issue in the Bank’s 2010 action and in the Hulans’ 2014 action is the same. 

The theories of liability, of course, are different, but the contract is the same. Thus, the 

Hulans were required by Tenn. R. Civ. P. 13.01 to assert a counterclaim in the 2010 

litigation initiated by the Bank to pursue their breach of contract claim. We reject the 

Hulans’ request that we excuse them from complying with Rule 13.01 to “protect them 

from injustice.” The Hulans had a full and fair opportunity to defend the Bank’s claim 

against them in 2010 and nothing prevented them from asserting a counterclaim against 

the Bank as part of that litigation.
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D. Tenn. R. Civ. P. 56.04

The Hulans’ final argument is that the trial court failed to comply with Tenn. R. 

Civ. P. 56.04, which requires a trial court ruling on a motion for summary judgment to 

“state the legal grounds upon which the court denies or grants the motion, which shall be 

included in the order reflecting the court’s ruling.” Contrary to the Hulans’ contention, 

the trial court did, in fact, specify the legal grounds upon which it relied in granting the 

Bank’s motion for summary judgment. As described in more detail above, the trial court 

concluded that the Hulans’ fraud claims were barred by the applicable three-year statute 

of limitations and that their breach of contract claim was barred by the Hulans’ failure to 

assert a compulsory counterclaim in the 2010 litigation as required by Tenn. R. Civ. P. 

13.01. This case is not like Church v. Perales, 39 S.W.3d 149, 157 (Tenn. Ct. App. 

2000), where the trial court failed to explain the basis for its decision to grant the 

defendants’ motions for summary judgment. See also Range v. Baese, No. M2006-

00120-COA-R3-CV, 2008 WL 186645, at *2-3 (Tenn. Ct. App. Jan. 22, 2008) 

(remanding case where trial court failed to state the legal basis for its decision granting 

motion for summary judgment). Despite the Hulans’ argument to the contrary, Rule 

56.04 does not require the trial court to address each argument the parties made in 

rendering its decision.

E. Subject Matter Jurisdiction

The Bank argues that the trial court lacked subject matter jurisdiction to hear the 

Hulans’ breach of contract claim and fraud claims to the extent they were based on the 

Bank’s misidentification of the property listed on the general sessions detainer warrant. 

The Bank contends, and the Hulans do not dispute, that the Hulans did not appeal the 

general sessions judgment awarding the Bank possession of the Hulans’ property that was 

identified on the detainer warrant as 307 Clayton Road. Although the Hulans allude to 

the Bank’s misidentification in the general sessions court of the property that secured the 

line of credit and that the Bank was entitled to possess, we do not believe the Hulans 

were asking the trial court to rehear that case. The Bank fails to cite any authority that 

suggests a court is without subject matter jurisdiction to consider a party’s representation 

made in a different case, and we are aware of no such authority. Thus, the Bank cannot 

prevail on this argument.

In light of our affirmance of the trial court’s decision awarding the Bank summary 

judgment on all issues, we need not address the other issues the Bank raises on appeal 

and find they are pretermitted.
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III. CONCLUSION

The judgment of the trial court is affirmed, and this matter is remanded with costs 

of appeal assessed against the appellants, Robert Eugene Hulan and Sherry Renee Hulan, 

for which execution may issue if necessary.

________________________________

 ANDY D. BENNETT, JUDGE