# FILED

July 1,1998 Cecil W. Crowson Appellate Cou rt Clerk 

## IN THE COURT OF APPEALS OF TENNESSEE

AT NASHVILLE

JAMES F. COOK, JR., ) d/b/a COOK PROPERTIES, ) ) Plaintiff/Appell

ant, )

) VS. ) Davidson Chancery ) No. 94-1989-III CONSOLIDATED STORES CORP., ) BELZ INVESTCO, L.P., ) URCO, INC., ) Appeal No. UNION REA

LTY CO., L

TD., and ) 01A01-9605-CH-00245 SOUTH PLAZA CO., ) ) Defendants/Appel

lees. )

APPEAL FROM THE CHANCERY COURT FOR DAVIDSON COUNTY

AT NASHVILLE, TENNESSEE THE HONORABLE ROBERT S. BRANDT, CHANCELLOR

For Plaintiff/Ap

pellant : For Defendant/Appellee Consolidated Stores Corp. : Hugh C. Howser, Jr. Kathryn J. Ladd Karyn C. Bryant Trabue, Sturdiva

nt & DeWitt Boult, Cummings, Conners & Berry Nashville, Tennessee Nashville, Tennessee For Defendants/Appellees Belz, URCO, Union Realty, and South Plaza : John M. Gillum John W. Heacock Manier, Herro

d, Hollabaugh & Sm

ith Nashville, Tennessee



## AFFIRMED AND REMANDED

WILLIAM C. KOCH, JR., JUDGE-2- 

## O P I N I O N

This appeal involves a dispu te over a real estat e commission on four r etail p roperties in Memphis. After a former client l

eased these proper

ties, a real esta

te brokerfiled suit in the Chan cery Court for Da

vidson County seeking a c ommission from its former client and the lessors of the four properties. The trial court granted the former client’s motion for summary j udgment and, follow ing a bench trial, di smissed the broker’s claims against the four lessors. On this appeal, the broker asserts that the trial court erred by granting h is former client’ s summary judgment motion and that the evidence preponderates aga inst thetrial court’s dismi ssal of his claims against the four les sors. We have dete rmined that the tria

l court prop erly granted the summary judgment motion and that the evi

dence does not preponde

rate against the trial co

urt’s judgment in fav

or of the four lessor

s.

I.

In 1988, Consolidated Stores Corporation retained Jame s F. Cook Jr., a Nashville commercial real estate

broker, to locate

retail space in N

ashville for two of its “Big Lots” stores.

While these nego

tiations were pr ogressing, Consolidated Stores authorized Mr. Cook to survey th e market in Memphis

because Consolidated Stores
was considering opening four or five stores there. By July 1990, Mr. Co ok had identified fifteen possible sit es in Mem phis, eight of which belonged to Belz Enterprises,the lessor of the property on which one of the Nashville Big Lots stores
was located. In August 1990, Consol idated Stores infor

med Mr. Cook that it

would not be ready to conside

r the Memphis marke

t until the Spring of 199 1.

Mr. Cook continued to look fo r suitable retail space in Memphis for Consolidated Stores and in October 1990 presented Consolidated St o res with proposed leases prepared by Belz Enterprises for four locations. Consolidated Stores againinformed Mr. Cook that it was delaying

its expansion into Memphis. In April 1991, representati

ve s of Belz Enterpr

ises and Consolidated S tores met to discuss possibleretail locations in Memphis but reached no agre ement. In Novemb

er 1991, Consolidated Stores informed Mr . Cook for the third

time that it h ad postpone d expanding into Memphis and all discussion between Consolidated S tores and Mr. Cook ended.1 The companies were Belz Investco, Urco, Inc., Union Realty, and South Plaza Company. -3- I n November 1993 Consolidated Stores and Belz Enterprises negotiated a renewal of the lease for one of the Nashville Big Lots stores . During these negotiations, Belz Enterprise s encouraged Consolida ted Stores to reconsider its plans to expand to Memphis,

and the parties ren

ewed their negotia

tions without involving Mr. Cook. I n e arly 1994, Mr. Coo k inquired into Consolida ted Stores’s expans

ion plans in Ten nessee and specifically in Memphis. On April 4, 1994, Consolidated Stores informe d Mr. Cook that it had lease d four properties in Memphis from Belz Enterprises on February 17, 1994. Mr. Cook demanded a commission on these transactions, and when he did not re ceive one, he file

d s uit against

Consolidated Stores and the four Belz- related companies that had leased the M

emphis space to Consolidated Stores. 1

The t rial court granted a summary j udgment for Consolida ted Stores on the groundthat there was no c ontractual or other

basis for Mr. Coo

k’s c laim that Consolidated Stores owed him a commission. Following a bench trial, the trial court entered a judgment for

the four Belz-re

lated companies base

d on its conclusion that Mr. Cook had not been the procuring cause of these leases. Mr. Co ok argues on
a ppeal that he performed enough work bringing Co nsolidated Stores a

nd Bel z Enterprises togetherthat these parties, jointly an

d severally, owe him a commission.

II. T HE C LAIMS A GAINST C ONSOLIDATED S TORES

The trial court summar ily dismi ssed Mr. Cook’s com plaint against Consolidated Stores because of the lack of evidence of an express or implied contract between Consolidated Stores and Mr. Cook or any other basis for r

ecovery. While Mr. Cook concedes that there was no oral or written contract, he argues that summary judgment was improper because t

he facts could support a finding that the parties had an implied contract

.

A summary

judgment is pro

per if the moving party demonstrates that there are

no genuine issues of m

aterial fact and that h e or she is entitled to a judgment as a matter of law. See Tenn. R. Civ. P. 56.0 4; Bain v. Wells , 936 S.W.2d 618, 622 (Tenn. 1997). When ruling on a motion for summary judgment, the

trial court mu st take the-4-

strongest legitim

ate view of the evidence in favor of the non-moving party, discard all countervailing evide

nce, and draw al

l reasonable fact

ual inferences in t

he nonmovingparty’s fav or. See M ike v. Po Group, Inc. , 937 S.W.2d 790 , 792 (Tenn. 1996); Byrd v. Hall , 847 S.W.2d 208, 210-11 (Tenn. 19 93). A court should grant a

s ummary judgment only when the undispu ted facts reasona bly support one conc

lusion

– that the moving pa

rty is entit

led t o a judgment as a matter of law. See McCall v. Wilder , 913 S.W.2d 150,

153 (Tenn. 1995); Carvell v. Bottoms , 900 S.W.2d 23, 26 (Tenn. 1995).

The only facts suppor

ting any kind of re

lationship between M

r. Cook and Consolidated Stores are: (1) that Consolidated Sto res agreed to allow

Mr. Cook to survey the Memphis market prior to the first contact be tween Consolidated Stores and Belz Enterprises, ( 2) that Consolidated Stores negotiated briefly with Be lz Enterprise s in 1991 based on the earlier propos als Belz Enterpr ises had submitte

d to Mr. Cook, (3) th at in 1990 Mr. Cook located two of the properties that Consolidated Stores eventually

leased in 199 4, and ( 4) that Consol idated Stores intent ionall y d id not involve Mr. Cook in its 1994 ne gotiations with

Belz Enterprises that ledto the four leases.

An implied-in-fa

ct contract is one th

at is inf erred from the parties’ conduct instead of from an oral

or written agreement. See V.L. Nicholson Co. v. Transcon Inv. and Fin. Lt d. , 595 S.W.2d 474, 482 (Tenn. 1980). It arises when circumstances , including the ordinary co urse of dealings and

custom, show t

hat theparties mutual

ly assented to contract, see Mefford v. Ci ty of Dupontonia , 49 Tenn. App. 349, 356, 354 S.W.2d 823, 826 (1961), and that the parties intended to contract. See Weatherly v. American Agr. C

hem. Co. , 16 Tenn. App. 613, 623, 65 S.W.2d 592, 598 (1933).

When a contract is

implied-in-fa

ct, the courts wil

l impose a corresponding duty to p ay reasonable compensation. However, a prom ise to pay will only be implied when the work was perf

ormed under cir

cumstances fr

om which the per

son seeking payment could reasonably

expect compens ation f rom the b enefit ted par ty. See V.L. NicholsonCo. v. Transcon I nv. and Fin. Ltd. , 595 S.W.2d at 482. In real estate disputes, the courts are reluctant to impose contractual liability for a broker’s services when they are th

ru st upon unwillin g recipients. See Billington v. Crowder , 553-5-

S.W.2d 590, 595 (Tenn. Ct. App. 19 77). And al thou gh we h ave ex press ed some willingness to imply a promise on the pa rt of the purchaser

to pay a com

mission when the real estate agent

is unable tocollect from the seller, see Williams v. Millsaps , No. 03A01 -9406-CH-0 0229, 1995 WL 131343, at *6 (Tenn. Ct. App. Mar. 28, 1995), perm. app. denied

(Tenn. Aug. 28,

1995), this is only

so in situations where there is

alegally enforc

eable comm

iss ion agreement bet

ween the seller a

nd agent and the purchaser, without a valid reason, interferes by preventing the sale.

The undisputed facts in the record do not provide circumstances from w hi ch either the trial court or t

his court can imply the

parties’ mutual assent to

contract. Mr. Cook test ified that Consolidated Stores never discussed with him or agreed to pay hima commission and that he never expected Consolidated Stores to pay him a commission. At all times during these negotiations, Mr. Cook testified that, as in past transactions, Belz Enterprise s would pay his co mmission if the parties reached an agreement. Similarly, Consolidated Stores’s primary representative testified that he believed that Mr. Cook worked for Belz Enterprises and that it is industry custom that the lessor pays the agen t’s commissi on. Thus, Mr. C ook never had a reas onable expectation

of payment from Consolidated Stores, a nd the trial court correct ly declined to find an implied contract ba sed on the undisp uted facts.

III. T HE C LAIMS A GAINST THE B ELZ - RELATED C OMPANIES

Mr. Cook also takes issue with the trial cour

t’s dismissal of

his claims against the four Belz-related companies that leased the Memphis retail space to Consolidated Stores in 1994. He contends that he was the procuring cause

of these leases beca

use he introduced the parti

es, provided inform

ation that became th

e foundation for the lease agr eements, and cem ented Consolidated St

ores’s interest in t

he Memphis market. We have determined that the evidence does not preponderate against the trial court’s conclusion

that Mr. Cook

was not the procuring cause of the leases between Consolidated Stores and Belz Enterpr ises.

Real estate brokers ea

rn their commission

by producing a purchaser or lessee acceptable

to the seller or lessor

who is ready, wil

ling, and able to buy or

lease on the seller’s or lessor’s terms. See Parks v. Morris , 914 S.W.2d 545, 548 (Tenn. Ct. A

pp.-6-

1995). The right to collect a c ommission depends on wh ether the broker a

ctually made the sale or lease or

was the efficient, proc

uring cause of

the sale or lease. See Pacesetter

Properties, Inc. v. Har

daway , 635 S.W.2d 382, 390 (Tenn. Ct. App

. 1981); Robinson v. Ke mmons Wils on Realty Co. , 41 Tenn. App. 297, 318, 293 S.W.2d 574, 583 (1956).

A broker is not entitle

d to a commission merely because he or she introduced the parties or showed property unsucces sfully to the ulti mate purchaser. See Miller

v. Jones , 54 Tenn. App. 31, 36-37, 387 S.W .2d 627, 630 (196 4). If t he broker abandons the listing or fails t o furnish a ready, willing, and able pu rchaser during the termof the agency, the broker is not entitled to a commiss

ion, and the owner m

ay sell the realty to a prospect who originated with the broker. See Pacesetter Prope rties, Inc. v. Hardaway , 635 S.W.2d at 388-89; Miller v. Jones, 54 Tenn. App. at 36, 387 S.W.2d at 630.

A broker may be

e ntitled to collect a c

ommission if the owne

r delays the consummati on of the s ale in bad faith until after the agency t

erminates in order

to avoidpaying a commission to the agent. See Robinson v. Ke mmons Wilson Real

ty Co. , 41 Tenn. App. at

317, 293 S.W.2d

at 583. However, we have held that an owner is not acting in bad fait

h by responding to the lat er overtures of

a purchaser withou

t the broker’s participation when the broke r has failed to proc

ure a contract and

the negotiations have broken off. See Pacesetter Properties, Inc. v. Hardaw ay , 635 S.W.2d at 390. Similarl y, when negotiations begun by a broker have broken off without an agreement, and the purchaser reop ens negotiations afte r a substantial lapse of time and closes the

deal on terms diffe

rent from the initia

l proposal, the broker is not the procuring cause of the sale. See Pacesetter Properties, Inc. v. Hardaway , 635 S.W.2d at 389.

We hold that the evidence does not preponderate against the trial court’s judgment. Even though Mr. Cook helped solidify Consoli

dated Stores’s inte

rest in the Memphis market, h

e did not bring an offe

r from a potential l

essor th at me t Consolidated Stores’s terms. He was never able to bring the parties to an agreement acceptable

to both. The discussions conce rning Consolidated Sto

res’s entrance in

to the Memphis market broke off after Consolidated Stores informed Mr. Cook for the fourth, and final, time tha t the company was not expa nding into Memph is. For two-7-

years, there was no conta ct between the par

ties and Mr. Cook

did not actively seek to renew the negotiatio ns. After this substant ial lapse of

time, Consolidated Stores and Belz Enterprise s reinstituted negotia tions for Memphis prop

erties after doing business on another property in Nashville. The eventual agreemen t betwe en Consolidated Stores and Belz E nterprises involved t

wo of the propertie s Mr. Cook originally proposed to Consolidate

d Stores, but

they were in diff

erent locations in the shopping centers, had diff erent square foota

ge, and different

lease terms and conditions. The remaining pro perties that Consolid

ated Stores leased we

re not propos ed by Mr. Cook. Accordingly, we hold that the evidence does no t preponderate

against the conclusion

that Mr. Cook was

not the procuring cau se of the lease transactions

between Consolidat

ed Stores and Belz-related companies.

IV.

We affirm the trial court’s decisions to grant the summ ary judg ment dismissing Mr. Cook’s complaint against Consolidated Stores and to awar d a judgment

in favor of the four Belz-re

lated companies. W

e remand the case

to the tria

l cou rt for whatever further proceedings may be r

equired, and we t

ax the costs of this app

eal to James F. Cook, Jr. and his surety for which execution, if necessary, may issue.

______________________________ WILLIAM C. KOCH, JR., JUDGE

CONCUR:

__________________________________ __ HENRY F. TODD, PRESIDING JUDGE MIDDLE SECTION

__________________________________ __ BEN H. CANTRELL, JUDGE