Court Opinion

ID: 1078832
Source: CourtListenerOpinion
Date Created: 2013-10-09 20:28:41.772324+00
Date Added: 2024-06-11T13:02:21.077238
License: Public Domain

IN THE COURT OF APPEALS OF TENNESSEE
                              AT KNOXVILLE

   AMERICAN MATERIALS TECHNOLOGIES, LLC.,v. THE CITY OF
   CHATTANOOGA and THE CHATTANOOGA CITY COUNCIL, and
         ADAMS LITHOGRAPHING COMPANY, ET AL.

               Direct Appeal from the Chancery Court for Hamilton County
               No. 98-0991- Part 1   Hon. W. Frank Brown, III, Chancellor

                    No. E1999-00806-COA-R3-CV - Decided Jun 2, 2000

This is an appeal from the Chancellor’s refusal to allow movants to intervene in the case. Movants
filed a motion to intervene after the parties had entered a consent judgment, and the Chancellor
overruled the motion. On appeal, we affirm the Chancellor’s determination.

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

FRANKS, J., delivered the opinion of the court, in which GODDARD, P.J., and SUSANO, J., joined.

John R. Anderson, Harry R. Cash and B. Allison Edgmon, Grant, Konvalinka & Harrison, P.C.,
Chattanooga, Tennessee for Plaintiff-Appellee.

Phillip A. Noblett, City Attorney’s Office, City of Chattanooga, Tennessee, for Defendants-
Appellees.

John W. Murrey, III, Hugh J. Moore, Jr., Philip B. Whitaker, Jr., and William R. Hannah, Witt,
Gaither & Whitaker, P.C., Chattanooga, Tennessee for Intervening Defendants/Appellants.

                                           OPINION

                On August 24, 1998, plaintiff purchased property intending to conduct a quarry
business. At the time the property was purchased, it was zoned M-1, a designation that would allow
for the operation of a quarry. On September 22, 1998 and December 15, 1998, the Chattanooga City
Council adopted two ordinances which removed rock quarries and other outdoor uses from the M-1
zone, and placed them in a new M-4 zone. These ordinances had the effect of prohibiting the
plaintiff from conducting a quarry business on its land. Plaintiff filed this action on September 30,
1998, and on July 22, 1999, the Chancellor entered a Memorandum Opinion and Order declaring the
two ordinances to be invalid, and enjoined defendants from enforcing any part of them.

                On August 31, 1999, the Chattanooga City Council voted to approve a settlement of
the dispute presented by its attorney. The Chancellor entered a consent judgment on September 1,
1999, stating that the parties had agreed to a compromise and settlement of the issues. The judgment
held the second of the two ordinances under consideration to have been validly enacted as to all
businesses other than the plaintiff’s, and that the plaintiff was entitled to operate a rock quarry and
other activities in accordance with the zoning ordinances that had been in effect at the time of the
purchase. The judgment also provided that plaintiffs were not entitled to any damages for the delays
caused in procuring its right to operate a quarry.

              On September 28, 1999, the movants filed a motion to intervene. The movants are
nine businesses located in close proximity to the proposed quarry, and opposed the development
because of negative impact on their business, and the potential danger of physical harm to their
property.

               The movants applied to intervene as of right, or alternatively for permissive
intervention pursuant to Rules 24.01 and 24.02 of the Tennessee Rules of Civil Procedure.
Intervention as of right is governed by Tenn. R. Civ. P. 24.01, which provides:

               24.01. Intervention as of Right. - Upon timely application anyone shall be
               permitted to intervene in an action: (1) When a statute confers an unconditional right
               to intervene; or (2) when the applicant claims an interest relating to the property or
               transaction which is the subject of the action and the applicant is so situated that the
               disposition of the action may as a practical matter impair or impede the applicant’s
               ability to protect that interest, unless the applicant’s interest is adequately represented
               by existing parties; or (3) by stipulation of all the parties.

                Our courts have not expressly adopted a standard of review for the denial of a motion
to intervene as of right. However, a Sixth Circuit case arising out of this State adopted the following
standard of review articulated by the Ninth Circuit:

               The Ninth Circuit . . . deploys an abuse of discretion standard for the timeliness
               prong of the intervention of right requirements, and reviews de novo the remaining
               Rule 24(a)(2) factors.

Grubb v. Norris, 870 F.2d 343, 345 (6th Circ. 1989); also see Geier v. Sundquist, 94 F.3d 644 (6th
Circ. 1996). While the Sixth Circuit concerns itself with the Federal Rules of Procedure, the
Tennessee Rule on intervention is substantially identical to the Federal rule. Moreover, the abuse
of discretion standard appears to be the universal rule. See Annotation, ALR 2d §1306, §§4[a]8[b],
12[b]; 57 ALR Fed. 150 §3[b].

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                The timeliness of an intervention is governed by equitable principles, and is
determined by the facts and circumstances of each particular case. In determining whether an
intervention is timely, courts consider the following factors:

               (1) the point to which the suit has progressed; (2) the purpose for which intervention
               is sought; (3) the length of time preceding the application during which the proposed
               intervener knew or reasonably should have known of his interest in the case; (4) the
               prejudice to the original parties due to the proposed intervener’s failure after he knew
               or reasonably should have known of his interest in the case to apply promptly for
               intervention; and (5) the existence of unusual circumstances militating against or in
               favor of intervention.

Velsicol Chemical Corp. v. Enenco, Inc., 9 F.3d 524, 531 (6th Cir. 1993); Triax Co. v. TRW, Inc., 724
F.2d 1224, 1228 (6th Circ. 1984).

               The general rule relating to the matter before us is well stated in 59 Am.Jur.2d
Parties, §162, p. 648:

                      A judgment or decree entered by consent of the original parties is a final
               judgment or decree and accordingly, in the absence of special circumstances,
               precludes intervention under the general rule against intervention after entry of a final
               judgment or decree.

               Special circumstances can create an exception to the general rule, and this Court has
recognized that intervention may be timely, after judgment, depending upon the facts. See Hamilton
National Bank v. Woods, 238 S.W.2d 109, 112 (Tenn. Ct. App. 1948).

                The parties contend that the would-be interveners did not attempt to intervene earlier,
and that their delay should make intervention unavailable. Generally, an applicant for intervention
must show proper diligence, and the right to intervene may be lost by unreasonable delay or laches
after knowledge of the suit. See EEOC v. United Air Lines, Inc., 515 F.2d 946 (7th Cir. 1975)
(holding denial of intervention depends in part on time during which applicant knew of interest in
case but failed to apply to intervene.)

              Movants contend that they made no attempt to intervene earlier, because the City had
adequately represented their interest until the consent judgment was entered, and that their efforts
to intervene were timely because their motion was filed within thirty days from the entry of the
compromise judgment.

               The Chancellor’s memorandum opinion entered some six weeks before the
compromise judgment was filed, invited the parties input as to an appeal pursuant to Tenn. R. Civ.
P. Rule 54, and their positions on the issue of any damages for the delay suffered by plaintiff. More
importantly, the Chancellor dissolved the temporary injunction which had prevented plaintiff from
proceeding with development of its quarry. Movants knew, or should have known, that the

                                                 -3-
Chancellor had invalidated the two ordinances, and that the City’s options were either to
compromise or appeal the Chancellor’s decision. It is clear that subsequently the City negotiated
with plaintiff and reached a proposed settlement which was publicly approved by the City
Commission, followed by the entry of the compromise judgment. There is no showing that movants
inquired into the status of the matter during the six weeks between the entry of the memorandum
opinion and the consent judgment. Prejudice has resulted to the original parties by movants’ failure
to promptly move to intervene during the parties’ negotiations and before entry of the consent
judgment. On the basis of the record before us, we cannot say the Chancellor abused his discretion
in denying intervention.

               Accordingly, we affirm the judgment of the Trial Court and remand with the cost of
the appeal assessed to the appellants.

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