### IN THE COURT OF APP EALS OF TENNESS EE AT JAC KSON A ssi gne d on Br ie fs S ep te m be r 27, 200 6

ALLST AR CONSULTI NG GROUP,
A 

### / K 

### / A 

### ALLST AR CONSULTI NG GROUP, LLC

v. TRI NIT Y CHURCH & CHRIST IAN CENTE R AND 

### TRUSTMARK NATIO NAL BANK

An Appeal f

romthe Circ uit Court for Sh elby County No. CT-003162-04 R obert L. Childers, Judge

No. W2006-00272-C OA-R3-C V - F iled Janu ary 18, 2007

Th is i s a br e a c h o f c on tr a c t c a se

. Th e plaint if f f inanc e br ok e r andthe de fe nd a nt c hu rc h e nte re d in to an agr eeme nt under which the plaintiff broke r wa s to assist the church in obtaining a loan, a nd the churc h would pay

the plaintiff a 3% broker ’s fee for this service. The plaintiff broke r neg otiated a financ ing a

rra ng ement as r equeste d by the chur ch. I ndepende nt of the plaintiff, the c hurch obta ined fi n ancing f

rom a diff

ere nt lender. The plaintiff then cla imed a rig ht to its broker ’s fe e under the partie s ’ a g r e e me n t, c laim in g th a t i t h a d a n e xc lu s iv e arr a n g e me n t w it h th e c h u r c h

. T h e churc h ref used to pay

the fee, deny ing that it had an exclusive arr ang ement with the pl aintiff broker. The plaint if f f ile d th e ins ta nt l a ws uit

a g a ins t th e c hu rc h to re c ov e r its br ok e r’ s fe e

. Th e tr ia l c ou rt he ld in favor of

the plaintiff, conc luding that the pa rties’ a g ree ment wa s ex cl u sive. The c hurch now appea ls. W e af

firm, finding that the issue turns on the cr edibilityof the witnesse s. Tenn. R. App . P . 3 Appeal as of Right; Judgme nt of th e Circ uit Court is Aff irm ed

H OL L Y M. K I RBY , J. , d e li v e r e d th e o p in io n o f th e Co u r t, in w h ic h W. F RAN K C RAW FORD , P.J ., W.S ., and A L AN E. H I G H ERS , J ., joined.

Ted I . J ones, Memphis, Tenne ssee, f or the a ppellant, Trinity

Church & Christian Center.

L enal Ande rson, J r., Memphis, Tenne ssee, for t he appellee, Allst ar Consulting G roup, a/k/a A llstar Con su lti ng Gr ou p, LL C.T ru stm a rk N a tio n a l B a n k , a ltho u g h n a m e d a s a d e fen d a n t, w a s d ism isse d fro m the c a se a n d is no t a p a rty to 1
this a p p e a l.
-2- OP IN ION

Def endant/Appe llant T rinity Church & Christian Cente r (“the Church”) contac ted financ ial broker Connie Mathews (“ Mathews” ), the mana g er of Plaintiff/Appellee Allstar Consulti ng Group, a/k/a Allstar Consulting Gr oup, LL C (“Allstar” ), to assist the Church in obtaining a loan f or ca pital improvements. Subsequently , on J uly 4, 2003, the parties executed a br oker’ s fee ag ree ment (“the Ag ree ment”) unde r which Mathews would ar rang e for approximately

$700,000 in financing for the Chu rc h ine xch a ng e fo r a 3% br ok e r’ s f

e e . Pu rs ua nt to the Ag re e me nt, Ma the ws a tte mpt e d to

arr ang e fina ncing for the Churc h. Meanw hile, in September 2003, indepe ndent of Mathe ws, Bishop M el v i n Na l l ey(“ R ev er en d Na l l ey ”) , t h e a gen tfo r t h e C h u rc h , o b t ai n ed t h e d es i red finan ci n g t h ro u gh Trustmark National Bank. After that, Allstar claimed that it was the e x clusive broke r for the Church 1 during that time, and that it wa s entitled to a broker ’s fee under the parties’ Ag ree ment. The Churc h ref used to pay

Allstar a br oker’ s fee

.
On Novembe r 13, 2003, Allstar filed a lawsuit in ShelbyC o u n t y Ge nera l Sessions C ourt ag ainst the Church for

brea ch of contrac t. A t rial was held on M ay 12, 2004, and a judg ment was enter ed in fa vor of the Churc h.
On May 24, 2004, Allstar filed a n appea l to the Circuit Court for a de novo hearing. O n October 27, 2005, a bench trial was conducte d by the Circuit Court. Whil e the appellate rec ord does

no t in c lud e a

tr a ns c ri pt o f the tr ia l, a

State me nt o f the Ev ide nc e is i nc lud e d in ac c or da nc e wi th R ule 24(c) of the Te nnessee Rules of Appellate Procedur e.

Mathews testified at the outset of the trial. Mat h ew s s t at ed t hat she wa s retaine d by the Church to see k financ ing so that the C hurch could make improvements to its property and “f ree up”

so me c a sh . T he Ag re e me nt b e tw e e n th e pa rt ie s w a s in tr od uc e d in to e vid e nc e a ndmark e d as E xhibi t 1. Ex hibit 1 stated on its fa ce that it wa s the “orig inal” copy

. The Ag ree ment was a form docume nt which left certain contra ctual terms blank for the parties to complete . I n one provision, the parties

we r e g iv e n th e o p ti o n o f h irin g th e b r o k e r o n a n e xc lu s iv e o r n o n e xc lu s iv e b a s is , a n d box es we re place d next to eac h option f or the parties to ma

rk their choic e. The copy of the Ag ree ment marke d Ex hibit 1 had an “x” in the box beside “exclusive,” indicating that Allstar had the “exclusive” rig ht to arrang e a loa n for the Churc h for a period of nine ty

(90) day s u n d er t h e contract. Mathews testified that, under

that Agr ee m ent, All star had an exclusive ag ree ment for the br okera g e on the f i n a n c i n g

. E x h i b i t1 w a s s i g n e d b y R e v e r e n d N a l l e y.A n o the r c o p y o f the c o n tra c t w a s a lso p re se n te d a n d m a rk e d a s E x h ib it 3

. T h is c o p y w a s e x a c tly like E x h ib it 2 2, a n d i t me r e l y i l l u s t r a t e s t h e po i n t t h a t t h i s c on t r a c t w a s a t h r e e

- pa r t pu l l

- a pa r t for m.

T he si gnat ure page of t hi s exhi b i t ref l ect s t hat i t i s t he “ cust o m er cop y , ” rat her t han t he “ f i l e co p y

. ” In any 3

event , nei t her page i s p art of t he “ o ri gi nal co p y ” p res ent ed by A l l st ar.
-3- An oth e r c op y

of the pa rt ie s’ Ag re e me nt, mark e d a s Exhi bit 2, wa s p re se nte d to Mathe ws

. 2 Exhi bit 2 n ote d o n it s f

a c e that it wa s th e “ F ile Cop y ” of

the Ag re e me nt. Exhi bit 2 w a s o bv iou sly 3 the sa me c on tr a c t a s Exhi bit 1 on mos t oth e r ha nd writt e n te rm s, bu t on Exhi bit 2 th e bo xes n e xt to the “e x clusive” and “nonexclusive” options had bee n left bl ank. Mathews said that Ex hibit 2 was in fac t a copy of the Ag ree ment that she had left with Re vere nd Nalley

. She contende d, howeve r, that th e “ e xclu siv e ” bo x on th e Ag re e me nt w a s fi lle d ou t in Re ve re ndNa lle y ’s pr e se nc e a ndwi th his assent. She explained that the Ag ree ment was a pull-apart form and t h at E x h i b i t 2 was a n additional copy

of what she orig inally

left with the Church.

Mathews testified that she obtained fi n an ci n g suitable for the Church’s ne eds with the Merc hants & Fa

rmers B ank, and that Revere nd Nalley signe d and appr oved the letter and contra ct proposal on Aug ust 23, 2003. She noted t hat t he C hurch w anted a dditional funds and some other chang es, and that she worke d to obta in those

. Mathews pr oduced e vidence showing she obtained fi na nc ing in a

hig he r amou nt andwi th s lig htl y dif fe re nt t erm s th an in the fi rs t arr a ng e me nt. Th is second proposed contract, however, was never si g ned by Revere nd Nalley . Mathews state d that she h ad ad d re s s ed t h e C h u rc h ’s re q u es t s , an d fe l tt h at s h e h ad d o n e h erj o b wi t h re s p ec tt o t h e f i n an ci n g. She claimed that she had a c ontrac tual rig ht to the commission due.

Re ve re ndNa lle y

te sti fi e d th a t he didno t bel ie ve that Mathe ws ha d an “ e xclu siv e ” c on tr a c t. He sa id that he was ope n at all times to othe r offe rs, and that he had been direc ted by the B oard of Trustee s of the Church to se ek more favor able financing terms. Rever end Na lley denied that the “exclusive” box on the Ag ree ment was c hecked i n his presenc e, and a sserted that the box was chec ked without his assent. He a dmitted that he signe d the proposed f inancing arr ang ement outlined in the Merc hants & Fa

rmers Bank letter and that he had c onsidered that arrang ement for the Church. Revere nd Nalley

testified that, at that time, he a nd M at h ew s were not ge tting along on their work for the f inancing , and that he f

elt that she wa s pushy

and made too-fre quent persona l appea ranc es
a t th e Chu rc h. F or

he r p art , M a the ws de nie d a ny su c h in trus iona ndsa id that sh e wa s o nly try ing to g et the Church to do what it had promised to do.

The trial c ourt hea

rd t estimony form J ohn Crockett, an ag ent for Trustmark National Ba nk. Crockett testified that this bank e ventually loaned the Churc h “up to $700,000.”

On Novembe r 4, 2005, the trial court enter ed an orde r in favor of Plaintiff/Appellee Allstar. The trial c ourt held spec ifically that the Church ha d brea ched the Ag ree men t an d o wed Allstar damag es of $16,950 plus costs. On December 2, 2005, the C hurch filed a mot ion to alter or a mend the judg ment, for ne w or additional finding s of fa ct, or for a new trial. The Churc h arg ued, among other thi ng s, that the C hurch’ s Ag ree ment with Allstar was not exclusive. On J anuary 3, 2006, the tr ia l c ou rt e nte re d a n o rd e r d e nying the Chu rc h’ s motio n. F ro m tha t ord e r, the Chu rc h n ow app e a ls.-4-

On appe al, the Church a rg ues that the trial c ourt err ed in its implicit findi ng that the Ag ree ment betwee n the parties was “e x clusive.” The Church notes that the pa rties’ sig nature s are on both copies of the c ontrac t – Ex hibit 1, indicating exclusivi ty , and Exhibi t 2, indicating that the choice had not bee n made. The Chu rc h cl ai m s t h at this is a novel issue, beca use it involves an interpre tation of a pull -apa rt contra ct i n which the “ parts” a re diff ere nt from one a nother, c reating an ambig uity

as to the parties’ intent on this iss ue. The Church ar g ues that any ambig uity

should be construed ag ainst the party responsible for draf ting the contra ct, namely , Allstar. I n response , Allstar maintains that the tri al co u rt ’s dec ision turns on it s cre dibilit y determination in favor of Mathews

a ndhe r e xpla natio n a

bo ut the dis c re pa nc ie s be tw e e n Exhi bit 1 a ndExhi bit

2 a ndabo ut the pa

rt ie s’ intent. I t ar gu es t h at s uch cr edibilitydeterminations are within the provinc e of the trial court a nd sh ou ld n ot b e re ve rs e d o n a pp e a l.

This case was tried be fore the t rial court without a jury . There fore , we r eview the trial court’ s fi nd ing s o f f

a c t de novo , presuming those finding s to be corr ect unless the e vidence preponde rate s otherwise. Tenn. R. App. P. 13(d). We re view questions of law de novo , with no presumption of

corr ectne ss. Id. The inter p re t at i o n o f a contr act is a que stion of law, which r equire s a de novo revie w. Guilian o v. Cleo, Inc.
, 995 S.W .2d 88, 95 (Tenn. 1999) . Where a contra ct is ambig uous
a ndits me a nin g mus t be de te rm ine d f ro m e xtri ns ic evide nc e wh ic h is c on fl ic tin g , th e c ou rt is prese nted with a mix ed ques tion of law and f act. Ga rne r v . P

hil B re e de n & As so c s. , No. M2 00 2- 03 10 3- CO A - R3- CV , 2 00 4 WL 18 88 94 2, a t *3 (T e nn . Ct. App . Aug . 24, 20 04 ). Th us , w hil e the under ly ing f

acts a re r eviewe d under a de novo standard with a presumption of corre ctness, the leg al conc lusion arising f rom those fa cts is review ed de novo , witho u t s u ch a p resumpti on. See Newcomb v. Kohler Co. , N o. W20 05 -0 21 61 -C OA -R 3- CV , 2 00 6 WL 25 35 39 6, a t *2 8 ( Te nn . Ct

. App. Sept. 5, 2006).

I n a re cent de cision, the Tennes s ee S u p re me Court discussed some of the basic rule s of contra ct interpre tation applicable in this ca se, empha siz ing the importance of discerning and g iving

e ff e c t to the int e nt o f the pa

rt ie s:

. . . A c ard ina l rul e of

c on tr a c t in te rp re ta tio n is to a sc e rt a in andg ive e ff e c t to the int e nt o f the pa

rt ie s. I n inte rp re tin g c on tr a c tua l lan g ua g e , co urts l oo k to the plain meaning of the words in the document to a scertain the parties’ intent. This Court’s i n i t i al t as k

. . . i s t o d et er m i n e wh et h er t h e la n gu age i s am b i gu o u s

. I f t h e l an gu age is clear and unambig uous, the literal mea ning c ontrols the outcome of the dis p u t e. I f, ho weve r, the wo rd s in a c on tr a c t are su sc e pti ble to m or e than o ne re a so na ble interpre tation, the parties’ intent c annot be de termined by a litera l interpretation of the lang uag e. Contractual lang uag e is ambig uous only when it is of uncertain meaning and may fairly be under stood in more way s than one.
*** Whe n c on tr a c tua l la ng ua g e is f ou ndto b e a mbi g uo us , the c ou rt mus t app ly established rule s of construc tion to determine the i ntent of t he parties. An ambig uous pr ov isi on in a

c on tr a c t g e ne ra lly

wi ll b e c on str

ue d a g a ins t th e pa

rt y dr aft ing it.T he o nl y other dif ference i n the t wo c o nt ract s i s t he am o unt of t he l o an, whi ch was a handw ri t t en t erm on t he 4

cont r act

. O n t he car bo n c op y , “$ 6 8 0 ,00 0 ” i s t he amo un t of t he l oan t hat i s ha ndwr i t t en i n t he bl ank for t hi s pur po s e. O n t he o ri gi nal A greem ent , t hi s am o unt , in t he same hand wri t i ng, i s crossed o ut and “ $ 7 0 0 , 0 0 0 ” i s subst i t ut ed t hereo n. A l s o, t he ori gi nal copy i ncl udes t he amo un t wr i t t en out as “ Seven H un dred T hous and & xx / 10 0. ”
-5- F urthe rm or e , w he n a

c on tr a c tua l pr ov isi on is ambi g uo us , a cou rt is pe rm itt e d to us e parol e vidence , including the contra cting parties’ conduct a nd statements re g arding the dis pu te d p ro vis ion , to g uid e the c ou rt in c on str uin g a nde nf

or c ing the c on tr a c t.

Allst ate Ins. Co. v. Watson , 195 S.W .3d 609, 611-12 (Te nn

. 2 0 0 6 ) (citations and quotations omitted).

I n th is c a se , it

is u nd isp ute d th a t th e re wa s a n a g re e me nt be tw e e n the pa rt ie s. Th e iss ue is whether the parties intended for t h e Ag ree ment to be exclusive. I n acc ordanc e with the rule s of

co n s tru ct i o n , we l o o k

fi rs tt o t h e l an gu age i n t h e w ri t t en co n tra ct t o d et er m i n e w h et h ert h e l an gu age is clear or ambig uous on this is sue. The origina l Ag ree ment, submitt ed by Al lstar as Exhibit 1, shows clea

rly that the broker is g iven an exclusive rig ht to arra ng e a loa n with a lender . Howeve r, Ex hibit 2, a copy

of th e s am e fu l ly

executed contr act, indicates that the parties had not made a decision on this point at the t i m e the contra ct was sig ned. Thus, it appear s that, at the time the 4 contra ct was sig ned by the parties, the exclusivit y term wa s not clear ly

marke d on the contra ct, and the contra ct was later modified to pr ovide specific ally for e x clusivityas we ll as a chang e in the loan amount soug ht by

the Church. Unde r these c ircumstance s , t h e p ar t i es’ intent on the issue of exclusivi ty

must be deeme d ambig uous.

Be cause this provisions of the contrac t is ambiguous, the i n t en t of the pa rties must be dis c e rn e d f

ro m pa ro l e vid e nc e . U nd e r the pa rol ev ide nc e ru le , a

c ou rt ma y “ pe rm it t e sti mon y

to explain ambig uous terms or show a subsequent modification to a written ag ree ment. Once admitted, thi s e vid e nc e do e s n ot i n a ny way de ny wh a t th e orig ina l a g re e me nt e xpre sse d; h ow e ve r, it m e re ly demonstrates the parties may have exercised their rig ht to modify the written ag ree ment.” Golden Cons tr. , I nc ./C FW Co nstr

. Co . v . E. Luk e Gr

e e ne Caul

kin g Co ntra c tor

s , No. 54, 1987 WL

18061,

a t *1 (T e nn . Ct . A pp . O c t. 9 , 1 98 7) ; see also Comm erce St. Co. v. Goodye ar Tire & Rubber Co.
, 215 S.W .2d 4, 10 (Tenn. Ct. App. 1948) ( determining that ambig uous contra cts must be interpre ted in light of a ll the surrounding circ umstances in orde r to discern the intent of the pa rties).

I n the trial court below, Mathew s testified that she had an exclusive arrang ement with the Church, and that Revere nd Nalley signe d t h e agreement that she pr esente d. She stated that the

c arb on c op y

(E xhibi t 2) wa s the Ag re e me nt a s it re a d wh e n sh e le ft it w ith Re ve re ndNa lle y fo r h is

re vie w, a nd that th e “ e xclu siv e ” bo x wa s late r m ark e d inRe ve re ndNa lle y ’s pr e se nc e a ndwi th h is assent. Reve rend N alley , howeve r, testified that Allstar did not have an “exclusive” contra ct. He de nie d th a t th e “ e xclu siv e ” bo x wa s c he c ke d inhis pr e se nc e or wi th h is a sse nt.

The trial c ourt appa

rently cre dited the t estimony of Mathews and dis cre dited the testimony of Rever end Nalley on this issue. “When a trial court has seen and hear d witnesses, especially wher e-6-

issues of cr edibilityand we ight of oral testimony

are invol v ed , co nsiderable defe renc e must be

acc orded to the trial court’s fac tual finding s.” Seals v. Englan d/Corsair Upholstery Mfg. Co. , 984 S.W .2d 912, 915 (Tenn. 1999) (quoting Colli ns v. Howm et Corp. , 970 S.W .2d 941, 943 (Tenn. 1998)). Thus, we aff

ord g reat defe renc e to the trial c ourt’s cr ed i b ilitydetermination in favor of Mathews a nd Allstar.

The Churc h arg ues that th e am b i gu ous term of the pa rties’ c ontrac t should be construed

a g a ins t A lls tar b a se d o n th e g e ne ra l rule of c on str uc tio n that a n a mbi g uo us te rm in a c on tr a c t sh ou ld be construe d ag ainst the maker of t he contract. I n this case , howeve r, the a mbiguity was not cr eate d by the c on tr a c t la ng ua g e . Rather , th e a mbi g uit y aro se fr om the fa c t th a t th e orig ina l A g re e me nt, Exhi bit 1, ind ic a te d e xclu siv ity

a ndthe c op y

of the Ag re e me nt, Exhi bit 2, did no t. Re so lut ionof thi s ambig uity did not turn on interpretation of the lang uage; ra t h er , i t could be re solved only by determining whe ther the “ exclusive” box on the contra ct was marke d with the knowledg e and a ssent of both parties. Thus, the cre dibilit y determination by

the trial court was pivotal. Ther efor e, fr om
a re vie w o f the e vid e nc e su bmi tte d at tria l, andg ivi ng du e de fe re nc e to the tr ia l c ou rt ’s c re dib ili ty determinations, we conc lude that th e t ri al court did not err in finding that the parties intended for Al lst ar t o h a ve a n e xclu siv e re la tio ns hip wi th t he Chu rc h d uring the pe rt ine nt t ime pe ri od , a ndin

a wa rd ing da ma g e s to Al lst ar o n th a t ba sis

.
Th e de c isi onof

the tr ia l c ou rt

is a ff ir med

. Cos ts o n a

pp e a l are ta xedto A pp e lla nt T ri nity Church & Christian Center and its surety , for whic h execution may issue, if nec essary

.

___________________________________ HOLL Y M. KI RBY, JUDGE