FILED

November 1, 1995

Cecil Crowson, Jr.

Appellate Court Clerk

 I N THE COURT OF APPEALS OF TENNESSEE

EASTERN SECTI ON

J ERRY COLLI NS, d/ b/ a WESTSI DE ) C/ A NO. 03A01- 9507- CH- 00216

EQUI PMENT COMPANY, I NC. , ) 

) GREENE CHANCERY

Pl a i ntif f - Appe lla nt , )

) HON. DENNI S H. I NMAN,

v. ) J UDGE

)

GREENE COUNTY BANK, ) AFFI RMED I N PART,

) VACATED I N PART,

De f e nda nt - Appe l l ee. ) AND REMANDED

J . RONNI E GREER, Gr e e ne ville , for Pl a i ntif f - Appe lla nt .

KENNETH CLARK HOOD, ROGERS, LAUGHLI N, NUNNALLY, HOOD & CRUM,

Gr eene vi l l e , f or De f e nda nt - Appe l l ee.

O P I N I O N

Fr a nks . J .

I n t hi s di s put e be t we e n pl a i nt i f f bor r owe r a nd

de f e nda nt l e nde r , t he Tr i a l Cour t e nt e r e d s umma r y j udgme nt f or

t he de f e nda nt a nd pl a i nt i f f ha s a ppe a l e d.

Pl a i ntif f Collins be ga n ope r a ting We s t Si de Tr a c t or

Compa ny, I nc . ( WST) f or i t s owne r , Ke nne t h Ma l one i n 1986.

Pl a i nt i f f a nd Ma l one a gr e e d t ha t Pl a i nt i f f woul d be c ome t he

owne r of WST i n e xc ha nge f or pa yi ng t he c ompa ny' s de bt s .
2

Pl a i nt i f f s i mul t a ne ous l y owne d a nd r a n We s t Si de Equi pme nt

Compa ny ( WSE) , a us e d e qui pme nt t r a di ng bus i ne s s . The

bus i ne s s a r r a nge me nt be t we e n Pl a i nt i f f a nd Ma l one c ont i nue d

unt i l 1992, whe n WST be c a me de l i nque nt wi t h i t s de a l e r s a nd

s uppl i e r s a nd c l os e d. 

I n 1990, Pl a i nt i f f pl e dge d hi s home a nd f a r m a s

c ol l a t e r a l f or a $125, 000 l oa n f or WST f r om de f e nda nt Gr e e ne

Count y Ba nk. Ul t i ma t e l y, de f e nda nt f or e c l os e d on t he pr ope r t y

a nd pl a i nt i f f ' s e f f or t s t o pr e ve nt t he f or e c l os ur e t hr ough

l i t i ga t i on f a i l e d. 

Pl a i ntif f the n f ile d thi s a c tion a lle gi ng tha t

i l l e ga l hol ds ha d be e n pl a c e d on hi s c he c ki ng a c c ount , t ha t

or a l r e pr e s e nt a t i ons r e ga r di ng t he cr os s - c ol l a t e r a l i zat i on

c l a us e i n t he de e d of t r us t c ons t i t ut e d f r a udul e nt i nduc e me nt

t o e nt e r a c ont r a c t , a nd t ha t s t a t e me nt s by ba nk of f i c i a l s

c ons t i t ut e d t or t i ous i nt e r f e r e nc e wi t h t he bus i ne s s

r e l a t i ons hi p be t we e n pl a i nt i f f a nd Ma l one .

The Tr i a l Cour t gr a nt e d s umma r y j udgme nt on a l l

i s s ue s . Af t e r gi vi ng Appe l l a nt a n a ddi t i ona l t wo we e ks t o

f i l e not i c e s of hol ds t ha t ha d be e n pl a c e d on hi s a c c ount , t he

Cour t f ound t ha t none of t he hol ds pr oduc e d we r e wi t hi n t he

r e gul a t i on' s one ye a r l i mi t a t i ons pe r i od. The Cour t a l s o

c onc l ude d t ha t r e s j udi cat a and col l a t e r a l es t oppe l ba r r e d t he

c l a i m of f r a udul e nt i nduc e me nt t o e nt e r a c ont r a c t . Fur t he r ,

t he c our t de t e r mi ne d t ha t t he bus i ne s s r e l a t i ons hi p a l l e ge dl y

i nt e r f e r e d wi t h wa s pr os pe c t i ve i n na t ur e a nd t hi s

j ur i s di c t i on doe s not r e c ogni z e a c a us e of a c t i on f or

pr os pect i ve i nt e r f e r e nce. 

Pl a i nt i f f c l a i ms t ha t Gr e e ne Count y Ba nk vi ol a t e d 12
1

 12 C. F. R. 229. 21 i s ent i t l e d " Av a i l a b i l i t y of Funds and Co l l e c t i on of

Ch e c k s " and gove r n s t h e pr o c e dur e s wh i c h banks mu s t f o l l o w i n ma k i n g

d e p o s i t s avai l a b l e t o cu s t o me r s .

3

C. F. R. 229

1

 e t . s e q. ( c ommonl y known a s Re gul a t i on CC) by

pl a c i ng i mpr ope r hol ds on hi s c he c ki ng a c c ount s . The s t a t ut e

of l i mi t a t i ons f or Re gul a t i on CC pr ovi de s t ha t a c t i ons mus t be

br ought " wi t hi n one ye a r a f t e r t he da t e of t he oc c ur r e nc e of

t he vi ol a t i on i nvol ve d. " 12 C. F. R. 229. 21 ( 1992) . At t he

he a r i ng on t he mot i on f or s umma r y j udgme nt a nd a f t e r be i ng

gi ve n a n a ddi t i ona l t wo we e ks , pl a i nt i f f c oul d not pr oduc e a ny

hol d not i c e s da t e d wi t hi n one ye a r of t he f i l i ng of t he s ui t .

Pl a i nt i f f a r gue s t ha t t he hol ds r e pr e s e nt e d a

c ont i nui ng oc c ur r e nc e a nd t he s t a t ut e of l i mi t a t i ons be ga n t o

r un, f or a l l vi ol a t i ons , f r om t he da t e of t he l a s t hol d. Thi s

a r gume nt is without me r it. The la s t hol d notic e is da t e d mor e

t ha n one ye a r f r om t he f i l i ng of t he s ui t a nd i s i t s e l f

out s i de t he l i mi t a t i ons pe r i od, a nd whi l e a " c ont i nui ng 

vi ol a t i on" t he or y ha s be e n us e d t o pr e ve nt t he s t a t ut e of

l i mi t a t i ons f r om ba r r i ng e mpl oyme nt di s c r i mi na t i on, s ee, e. g. ,

Hav e ns Re al t y Cor p. v . Col e man, 455 U. S. 363, 71 L. Ed. 2d 214,

102 S. Ct . 1114 ( 1982) , t he c a s e s c i t e d by pl a i nt i f f f a i l t o

pr ovi de a ny r a t i ona l e f or a ppl i c a t i on of t he t he or y t o t he s e

c i r c ums t a nc e s . Pl a i ntif f r e c e i ve d wr itte n notic e s inf or mi ng

hi m of e a c h a l l e ge d vi ol a t i on. The r e wa s no c onc e a l me nt of

hi s r i ght s or l a c k of oppor t uni t y t o pur s ue t he s e c l a i ms a s

s oon a s t he y a r os e a nd we f i nd no r e a s on why t he s t a t ut e of

limita tions s houl d not ba r thi s c l a i m.

Pl a i ntif f a s ke d the Tr i a l Cour t to a lte r or a me nd

t he s umma r y j udgme nt on t he ba s i s of hi s di s c ove r y of a not i c e
2

 Th e al l e g e d al t e r a t i o n s of t h e b a n k d o c u me n t ar e ev i d e n ced b y t h e 

d i f f e r e n t t ype wr i t e r pr i n t us e d f o r t h e l a s t s e n t e n c e . ( De pos i t i on of

Dr . Al f ons o Lu c e r o , Ph . D. ) .

4

of a hol d on hi s ba nk a c c ount t ha t ha d oc c ur r e d wi t hi n t he one

ye a r s t a t ut e of limita tions pe r i od, a nd a lle ge d a lte r a tions

2

of a ba nk doc ume nt . The mot i on wa s de ni e d.

Whe t he r t o gr a nt a ne w t r i a l ba s e d on ne wl y

di s c ove r e d e vi de nc e i s di s c r e t i ona r y wi t h t he t r i a l j udge .

Se ay v . City of Knox v ille , 654 S. W. 2d 397 ( Te nn. App. 1983) .

The movi ng pa r t y mus t de mons t r a t e t ha t t he ne w e vi de nc e wa s

not known pr i or t o or dur i ng t r i a l a nd t ha t i t c oul d not ha ve

been as cer t a i ne d by t he exe r c i s e of r eas ona bl e di l i ge nce.

Al s o t o be c ons i de r e d by t he Tr i a l J udge i s whe t he r a ne w

t r i a l ba s e d on s uc h e vi de nc e woul d c ha nge t he r e s ul t . Leepe r

v . Cook , 688 S. W. 2d 94 ( Te nn. App. 1985) .

Pl a i nt i f f f ound t he hol d s l i ps by s e a r c hi ng t hr ough

hi s r e c or ds a nd t he ba nk doc ume nt , a l l e ge dl y a l t e r e d, wa s

t ur ne d ove r t o pl a i nt i f f dur i ng di s c ove r y. Ac c or di ngl y,

pl a i nt i f f wa s i n pos s e s s i on of t he r e c or ds a nd doc ume nt whi l e

t he c a s e wa s be i ng litiga t e d. He wa s gi ve n a dditiona l time

a f t e r t he he a r i ng on t he s umma r y j udgme nt t o t i me l y pr oduc e

hol d notic e s . We a gr e e with the Tr i a l J udge tha t pl a i ntif f

di d not e xe r c i s e r e a s ona bl e di l i ge nc e i n pr e s e nt i ng t he s e

c l a i ms a nd a f f i r m hi s de ni a l of t he mot i on t o a l t e r or a me nd

t he j udgme nt .

Ne xt, pl a i ntif f ins i s t s r e s j udi c at a and col l a t e r a l

e s t oppe l s houl d not ba r hi s a c t i on. 

A de t e r mi na t i on of whe t he r a n a c t i on i s ba r r e d by

r e s j udi c at a i s a n a ppr opr i a t e us e of s umma r y j udgme nt . By r d
5

v . Hal l , 847 S. W. 2d 208 ( Te nn. 1993) . 

Re s j udi c at a ba r s a s econd s ui t be t ween t he s a me

pa r t i e s on t he s a me caus e of act i on as t o al l i s s ue s whi c h

we r e or c oul d ha ve be e n l i t i ga t e d i n t he f or me r s ui t . Sc al e s

v . Sc al e s , 564 S. W. 2d 667 ( Te nn. App. 1977) . The pa r t y

a s s e r t i ng t he de f e ns e mus t de mons t r a t e : ( 1) t ha t t he

unde r l yi ng j udgme nt wa s r e nde r e d by a c our t of c ompe t e nt

j ur i s di c t i on; ( 2) t ha t t he s a me pa r t i e s we r e i nvol ve d i n bot h

s ui t s , ( 3) t ha t t he s a me c a us e of a c t i on wa s i nvol ve d i n bot h

s ui t s , a nd ( 4) t ha t t he unde r l yi ng j udgme nt wa s on t he me r i t s .

 Lee v. Hal l , 790 S. W. 2d 293, 294 ( Te nn. App. 1990) . 

Col l a t e r a l e s t oppe l , i n c ont r a s t , ba r s a s e c ond s ui t

be t ween t he s a me pa r t i e s on a di f f e r e nt caus e of act i on whe r e

t he is s ue s we r e a c t ua lly litiga t e d a nd de t e r mi ne d in the

f or me r s ui t . Sc al e s . Pl a i ntif f a r gue s the judge inc or r e c tly

gr a nt e d s umma r y j udgme nt be c a us e t he t hi r d e l e me nt of re s

j udi c at a, i . e . , t he s a me caus e of act i on, wa s not me t .

The pr i or l i t i ga t i on s ought t o e nj oi n t he

f or e c l os ur e on Appe l l a nt ' s f a r m a nd home . Thos e pr ope r t i e s

ha d be e n pl e dge d unde r a 1990 l oa n a gr e e me nt . A c r os s -

c ol l a t e r a l i zat i on cl a us e i n t ha t agr eeme nt s t a t e d t ha t t he

c ol l a t e r a l f r om t he l oa n wa s al s o t o be us e d as s ecur i t y f or

ot he r l oa ns out s t a ndi ng t o WSE a nd WST, a nd t he de e d of t r us t

wa s not t o be r e l e a s e d unt i l t he l oa ns out s t a ndi ng ha d be e n

pa i d. Pl a i ntif f c l a i ms tha t he wa s not a wa r e of thi s c r os s -

c ol l a t e r a l i zat i on cl a us e whe n he s i gne d t he doc ume nt . 

Pl a i nt i f f a r gue s t he pr e vi ous l i t i ga t i on s ought t o

pr e ve nt f or e c l os ur e on hi s f a r m be c a us e t he Ba nk ha d i mpa i r e d

hi s a bi l i t y t o pa y t hr ough t he wr ongf ul r e pos s e s s i on of hi s
6

e qui pme nt . He di s t i ngui s he s t he pr e vi ous c l a i ms f r om hi s

pr e s e nt cl a i m, whi c h i s cha r act e r i zed as f r a udul e nt i nduceme nt

t o e nt e r i nt o t he De e d of Tr us t c ont a i ni ng c r os s -

c ol l a t e r a l i zat i on l a ngua ge . He ar gue s t ha t t he or a l

r e pr e s e nt a t i ons we r e ma de t o hi m i ndi c a t i ng t ha t hi s f a r m a nd

home woul d be r e l e a s e d upon r e pa yme nt of t he l oa n. 

The Tr i a l Cour t de a ling with the pr i or litiga tion

a ddr e s s e d t he cr os s - c ol l a t e r a l i zat i on cl a us e dur i ng t he

pl a i nt i f f ' s e f f or t t o e nj oi n t he f or e c l os ur e : 

Now the f i r s t ma tte r - tha t is , the of f e r to

di s c ha r ge t he not e di r e c t l y s e c ur e d by t he de e d of

t r us t - tha t, of c our s e , is the c r os s -

c ol l a t e r a l i z a t i on c l a us e iss ue . I ' ve de a l t wi t h it . 

The Cour t of Appe a l s ha s de a l t wi t h i t . I ' m bound

by i t . Thos e cl a us e s ar e va l i d, and f a i l ur e t o r ead

t he la ngua ge , a nd I ' m s ur e Mr . Collins is te lling

t he t r ut h. He di dn' t r e a d t he l a ngua ge . He di dn' t

r eal i ze t he s i gni f i cance of i t , but t he case ar e

lite r a lly le gi on in thi s s t a t e tha t s a y tha t f a ilur e

t o r e a d l a ngua ge t ha t i s t he r e t o r e a d i s not a

de f e ns e t o e nf or c e me nt of t ha t l a ngua ge .

The Tr i a l Cour t he l d t hi s c l a i m wa s ba r r e d unde r

e i t he r r e s j udi cat a or col l a t e r a l es t oppe l becaus e t he pr i or

act i on' s

s ol e pur pos e [ wa s ] t he e nj oi ni ng of t he f or e c l os ur e

by t he ba nk on t he de e d of t r us t . At t ha t t i me ,

e ve r yt hi ng t ha t c oul d ha ve be e n known a bout t ha t

s i t ua t i on wa s known. The r e we r e no be l a t e d

r e ve l a t i ons of f a c t . The onl y t hi ng t ha t oc c ur r e d

a f t e r t ha t s ui t wa s t he f or ecl os ur e and i t occur r e d

be c a us e the Cour t r e f us e d to e nj oi n it.. . Collins '

c l a i m t ha t t he ba nk f r a udul e nt l y i nduc e d hi m t o

e nt e r i nt o t ha t cr os s col l a t e r a l i zat i on agr eeme nt or

mi s r e pr e s e nt e d f a c t s t o hi m s uc h t ha t he s i gne d i t

wi t h a mi s a ppr e he ns i on of i t s e f f e c t . . . c oul d a nd

s houl d ha ve be e n r a i s e d a t t ha t t i me wi t hi n t he

c onf i ne s of t ha t s ui t s i nc e i t di d ha ve a s i t s s ol e

pur pos e . . .tha t f or e c l os ur e s a l e . . . Mr . Collins is

ba r r e d by c ol l a t e r a l e s t oppe l i n tha t r e ga r d...." 

The s t a t ut e gove r ni ng i nj unc t i ons of f or e c l os ur e s

r e qui r e s t ha t :
7

Cont e nt s of Appl i c a t i on f or I nj unc t i on. - - The pa r t y

a ppl yi ng f or r e l i e f i n s uc h c a s e s ha l l di s t i nc t l y

s t a t e how, whe n, a nd t o whom t he de bt or a ny pa r t of

de bt s e c ur e d a f or e s a i d ha s be e n pa i d, or a ny

c i r c ums t a nces of f r a ud whi c h vi t i a t e the c ont r a c t " . 

T. C. A. 29- 23- 202 ( 1980) ( e mpha s i s a dde d) .

The e s t oppe l of a j udgme nt or de c r e e e xt e nds t o a l l

ma t t e r s ma t e r i a l t o t he deci s i on of t he case whi c h t he pa r t i e s

e xe r c i s i ng r e a s ona bl e di l i ge nc e mi ght ha ve br ought f or wa r d a t

t he ti me . Mc Ki nney v. Wi dne r , 746 S. W. 2d 699 ( Te nn. App.

1987) . A pl a i nt i f f ma y not r e s e r ve a t he or y whi c h s uppor t s

hi s a c t i on f or a s e c ond l a ws ui t . I d.

Pl a i ntif f ' s c l a i m s e e ks r e lie f on the ba s i s of

f r a udul e nt i nduc e me nt i n e nt e r i ng i nt o t he Tr us t De e d. By t he

t e r ms of t he s t a t ut e , t he i s s ue of f r a ud s houl d ha ve be e n

l i t i ga t e d i n t he pr i or pr oc e e di ng. I n t he pr e vi ous

pr oceedi ng, t he i s s ue of t he cr os s - c ol l a t e r a l i zat i on cl a us e

wa s act ua l l y l i t i ga t e d and de t e r mi ne d. The r e ar e no ne w f act s

whi c h we r e not known or ne w i s s ue s whi c h c oul d not ha ve be e n

pr e s e nt e d a t t ha t t i me . Ac c or di ngl y, t he Tr i a l J udge pr ope r l y

gr a nt e d s umma r y j udgme nt on t hi s i s s ue .

Fi na lly, p l a i ntif f c ont e nds the Tr i a l J udge wa s in

e r r or i n gr a nt i ng s umma r y j udgme nt on t he i s s ue of t or t i ous

i nt e r f e r e nc e wi t h pl a i nt i f f ' s bus i ne s s r e l a t i ons hi p. 

Pl a i nt i f f a l l e ge d t ha t t he ba nk, t hr ough i t s a ge nt s a nd

e mpl oye e s t or t i ous l y de s t r oye d " t he bus i ne s s r e l a t i ons hi p

be t we e n J e r r y Col l i ns . . . a nd Ke nne t h Ma l one . . ." . The

i nt e r f e r e nc e c ompl a i ne d of oc c ur r e d i n 1991 whe n a ba nk

of f i cer r e f us e d t o ma ke a l oa n t o We s t Si de Tr act or and

a lle ge dl y tol d Ma l one tha t pl a i ntif f wa s s t e a ling hi m blind

a nd " c a r r yi ng [ hi m] of f . " Pl a i ntif f te s tif i e d tha t a s a
3

Th e el e me n t s of t h e t o r t o f i n t e r f e r e n ce wi t h b u s i n ess r e l a t i o n s ar e : 

t h e exi s t e n c e of a va l i d bus i n e s s r e l a t i on ( not nec e s s a r i l y evi d e n c e d by

a n enf o r c e a b l e cont r a c t ) or expe c t a n c y ; knowl e dge of t h e r e l a t i ons h i p

o r ex p ect a n c y o n t h e p a r t o f t h e i n t e r f e r e r ; an i n t e n t i o n a l

i n t e r f e r e n c e i nduc i ng or ca u s i ng a br e a c h or t e r mi n a t i on of t h e

r e l a t i ons h i p or expe c t a n c y ; and r e s u l t a n t dama g e t o t h e par t y whos e

r e l a t i ons h i p or expe c t a n c y had be e n di s r upt e d . Kan Cons t r u c t i on and

Cl e ani ng Co r p . I n c . , v. Ta t u m, 1993 WL 434741 ( Te nn. App. 1993) , c itin g

45 Am. J u r . 2d I n t erf erence 50 ( 1969) .

4

 T. C. A. 28- 3 - 104 ( 1980) r e a d s : " Pe r s o na l t o r t act i o ns . -

(a) Ac t i o n s fo r l i b e l , fo r i n j u r i e s t o t h e p e rso n , fal s e i mp r i s o n me n t ,

ma l i c i ous pr o s e c u t i on, cr i mi n a l conve r s a t i on, s e duc t i on, br e a c h of

ma r r i a g e p r o mi se, act i o n s and sui t s agai n s t at t o r n e y s f o r ma l p r act i c e

wh e t h e r s u c h ac t i ons ar e gr ounde d or bas e d i n cont r a c t or t o r t , ci v i l

a c t i ons f o r comp e n s a t o r y or puni t i v e dama g e s , or bot h , br ought under t h e

f e d e r a l ci v i l r i g h t s s t a t u t es, an d act i o n s f o r st a t u t o r y p e n a l t i es s h a l l

b e comme n c e d wi t h i n one ( 1 ) yea r af t e r ca u s e of ac t i on ac c r u e d . "

8

r e s ult Ma l one a nd hi s f a mily woul d not a s s i s t pl a i ntif f in

t a ki ng out a l oa n, woul d not pl e dge a ddi t i ona l c ol l a t e r a l t o

a l l ow hi m t o bor r ow mor e mone y, a nd e ve nt ua l l y e vi c t e d

pl a i nt i f f ' s bus i ne s s f r om t he pr ope r t y. The bus i ne s s

s ubs e que nt l y f ol de d. 

The Tr i a l Cour t c onc l ude d t he di s i nt e gr a t i on of t he

bus i ne s s r e l a t i ons hi p wa s pr os pe c t i ve a nd t he r e i s no c a us e of

a c t i on i n Te nne s s e e f or t or t i ous i nt e r f e r e nc e wi t h a

pr os pe c t i ve bus i ne s s r e l a t i ons hi p.

The r e ar e di s put e d i s s ue s of ma t e r i a l f act as t o

whe t he r t he a l l e ge d i nt e r f e r e nc e wa s wi t h a n e xi s t i ng bus i ne s s

r e l a t i ons hi p. Ac c or di ngl y, i t i s a ppr opr i a t e t o r e ma nd t hi s

cas e f or a de t e r mi na t i on of whe t he r t he el e me nt s of t hi s t or t

e xi s t . 3

Appe l l e e r e s ponds t ha t i n a ny e ve nt t he a c t i on i s

ba r r e d by t he one ye a r s t a t ut e of l i mi t a t i ons §28- 3- 1044. The

a pplic a bl e s t a t ut e of limita tions is de t e r mi ne d by the

a l l e ga t i ons of t he compl a i nt . He r e t he da ma ge al l e ge d i s t he

l os s of Ma l one ' s bus i ne s s r e l a t i ons hi p a nd f i na nc i a l ba c ki ng,

whi c h le d to the c l os e of the bus i ne s s . Pl a i ntif f ' s c l a i m
9

de a l s wi t h bus i ne s s a nd pr ope r t y l os s e s whi c h a r e gove r ne d by

t he t hr e e - ye a r l i mi t a t i on pe r i od of T. C. A. §28- 3- 105, a nd t he

l i mi t a t i ons pe r i od f or t he a na l ogous t or t of i nt e r f e r e nc e wi t h

a cont r act ua l r e l a t i ons hi p i s t hr ee year s . We conc l ude t he

t hr e e - ye a r s t a t ut e of li mi t a t i ons woul d a ppl y. Se e Car r ut he r s

Re ady - Mi x , I nc . v . Ce me nt Mas ons Loc al 520, 779 F. 2d 320 ( 6t h

Ci r . 1985) ; Giffor d v . City of Gatlinbur g, 900 S. W. 2d 293

( Te nn. App. 1995) .

Fi na l l y, de f e nda nt a r gue s pl a i nt i f f ' s c l a i m woul d be

ba r r e d unde r t he doc t r i ne of j us t i f i c a t i on. I t a r gue s i t s

a c t i ons we r e pr i vi l e ge d a nd j us t i f i e d, a nd i n f a c t i t ha d s uc h

dut y unde r a ny of t he s e c i r c ums t a nc e s , i . e . , whe n a pe r s on

s t a nds i n a pos i t i on of r e s pons i bi l i t y t o a not he r , whe n t he

i nt e r f e r e nc e i s t o pr ot e c t t he publ i c we l f a r e , a nd whe n one

ha s a dut y t o pr ot e c t t he we l f a r e of a not he r . Me ffor d v . City

of Dupont oni a, 49 Te nn. App. 349, 354 S. W. 2d 823 ( 1961) . 

Es s e ntia lly, De f e nda nt a r gue s it ha d the r i ght to te l l

Ma l one of Col l i ns ' act i vi t i e s becaus e Ma l one wa s a cus t ome r

a nd s t oc khol de r i n t he ba nk a nd wa s a gua r a nt or of WSE a nd WST

not e s . De f e nda nt f ur t he r a r gue s s umma r y j udgme nt i s

a ppr opr i a t e on t hi s i s s ue becaus e t he al l e ge d s t a t e me nt s t ha t

Col l i ns wa s s t e a l i ng Ma l one bl i nd a r e i na dmi s s i bl e he a r s a y a nd

a r e not s ubj e c t t o c ons i de r a t i on on a mot i on f or s umma r y

j udgme nt , T. R. C. P. Rul e 56. 06 a nd t ha t t he r e ma i ni ng

a dmi s s i bl e e vi de nc e woul d be a r out t he e l e me nt s of

j us t i f i c a t i on. 

We cannot agr ee. Fi r s t , Me ffor d t eache s t ha t

j us tif i c a tion is a ppr opr i a t e if :

One who i s c ha r ge d wi t h r e s pons i bi l i t y f or t he
10

we l f a r e of a not he r i s pr i vi l e ge d pur pos e l y t o c a us e

hi m not t o pe r f or m a c ont r a c t , or t o e nt e r i nt o or

c ont i nue a bus i ne s s r e l a t i on, wi t h a t hi r d pe r s on i f

t he a c t or ( a ) doe s not e mpl oy i mpr ope r me a ns a nd ( b)

a c t s t o pr ot e c t t he we l f are of t he ot her. " 

I d. , c iting Re s t a t eme nt of Tor t s, Vol. 4, Se c . 770. 

Advi s i ng s ome one t ha t t he i r bus i ne s s a s s oc i a t e i s

s t e a l i ng t he m bl i nd i s a que s t i ona bl e ma nne r of i nf or mi ng of

pr obl e ms wi t h a l oa n. Mor e ove r , t he e vi de nc e t ha t ba nk

of f i c e r s s a i d Collins wa s " s t e a ling [ hi m] blind" is not

ne c e s s a r i l y i na dmi s s i bl e . Thos e s t a t e me nt s c oul d be

nonhe a r s a y ope r a t i ve f a c t s whi c h a r e a dmi s s i bl e . N. Cohe n, D.

Pa i ne , S. She ppear d, Te nne s s ee Law of Ev i de nc e , Second

Edi t i on, 801. 5 ( 1990) . " Ve r ba l a c t s " ma y c a us e l e ga l

c ons e que nc e s whol l y a pa r t f r om t he t r ut h or f a l s i t y of t he

wor ds . An a na l ogy c a n be dr a wn t o a de f a ma t i on a c t i on, whe r e

t he pl a i nt i f f mus t pr ove t he de f e nda nt s poke or wr ot e t he

de f a ma t or y wor ds . The pl a i nt i f f ' s pur pos e i s t o e s t a bl i s h

t ha t the s t a t eme nt wa s ma de , n ot to of f e r it to pr ove the

t r ut h of the ma t t e r a s s e r t e d in the s t a t eme nt. Te nne s s ee Law

of Ev i de nce, I d.

The r ecor d pr e s e nt s an i s s ue of ma t e r i a l f act as t o

wha t ve r s i on of e ve nt s oc c ur r e d. Summa r y j udgme nt on t he

i ss ue of jus t i f i c a t i on is not a ppr opr i a t e . 

For t he f or e goi ng r e a s ons we a f f i r m t he Tr i a l

Cour t ' s j udgme nt i n pa r t a nd va c a t e i n pa r t a nd r e ma nd f or

f ur t he r pr oc e e di ngs i n a c c or da nc e wi t h t hi s opi ni on.

Cos t s of appeal ar e as s e s s e d one - ha l f t o each pa r t y.
11

________________________

He r s c he l P. Fr a nks , J .

CONCUR:

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Don T. Mc Mur r a y, J .

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Cha r l e s D. Sus a no, J r ., J .