Court Opinion

ID: 4183197
Source: CourtListenerOpinion
Date Created: 2017-07-03 21:13:16.453246+00
Date Added: 2024-06-11T14:40:20.865271
License: Public Domain

07/03/2017
                IN THE COURT OF APPEALS OF TENNESSEE
                            AT NASHVILLE
                                  April 13, 2017 Session

   GLOBAL MALL PARTNERSHIP v. SHELMAR RETAIL PARTNERS,
                       LLC, ET AL.

                Appeal from the Chancery Court for Davidson County
                  No. 14-0384-II    Carol L. McCoy, Chancellor

                             No. M2016-01383-COA-R3-CV

The landlord of a shopping mall commenced this action against a commercial tenant for
breach of a lease. The tenant claimed it had an enforceable oral agreement to terminate
the lease with the former landlord. The landlord contended that the original lease
contained a “no oral modification” clause; thus, the oral agreement to terminate the lease
was unenforceable. After the landlord presented its proof at trial, the court dismissed the
case pursuant to Tenn. R. Civ. P. 41.02(2), ruling that the oral termination agreement
between the tenant and the former landlord was enforceable despite the “no oral
modification” clause in the lease. This appeal followed. When a defendant files a Tenn.
R. Civ. P. 41.02(2) motion for involuntary dismissal at the conclusion of the plaintiff’s
proof at trial, the only evidence the trial court may consider in determining whether the
proof was sufficient to demonstrate a right to the relief is “the plaintiff’s proof” at trial.
Tenn. R. Civ. P. 41.02(2). We have determined that the trial court erroneously considered
facts and documents not found in the plaintiff’s proof. Excluding the extraneous facts and
documents, the evidence presented at trial preponderates against the trial court’s factual
findings and its conclusion that the landlord’s predecessor in interest and the tenant
entered into a binding lease termination agreement. Accordingly, we reverse and remand
for further proceedings.

 Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Reversed
                                  and Remanded

FRANK G. CLEMENT, JR., P.J., M.S., delivered the opinion of the Court, in which
RICHARD H. DINKINS and W. NEAL MCBRAYER, JJ., joined.

James W. White, Nashville, Tennessee, for the appellant, Global Mall Partnership d/b/a
Global Mall at the Crossings.
Randall J. Fishman and Richard S. Townley, Memphis, Tennessee, for the appellee,
Shelmar Retail Partners, LLC d/b/a City Gear, LLC.

                                              OPINION

       The plaintiff, Global Mall Partnership (“Global Mall”), owns and operates Global
Mall at the Crossings (“the Mall”), which was formerly known as Hickory Hollow Mall.
CBL & Associates Management, Inc. (“CBL”) managed Hickory Hollow Mall, LP
(“Hickory Hollow”) and acted as its agent at all times material to this action. Global Mall
purchased the Mall from Hickory Hollow. The closing occurred on October 30, 2012, at
which time Hickory Hollow assigned six commercial leases to Global Mall. The
defendant, Shelmar Retail Partners, LLC d/b/a City Gear, LLC (“City Gear”), was a
tenant at the time of the closing, and its lease was assigned to Global Mall.

       City Gear entered into a five-year lease agreement with Hickory Hollow in March
2005 for the purpose of operating a retail clothing store at the Mall. In August 2010, City
Gear and Hickory Hollow executed an agreement extending the lease through June of
2015. In addition to paying a minimum annual rent, City Gear agreed to pay 5% of any
gross sales exceeding $1.3 million per year. If less than two anchor tenants remained, and
the non-anchor tenants occupied less than 65% of the square footage in the Mall, the rent
would be reduced to 5% of City Gear’s gross sales. The lease prohibited City Gear from
operating another store within a three-mile radius of the Mall during the lease term. It
also stated that the lease could not be modified “in any manner other than by agreement
in writing signed by all the parties hereto or their successors in interest.”

       By May 2012, all of the anchor tenants had departed from the Mall, and CBL
presented City Gear with a proposed lease termination agreement. The effective date of
termination was left blank on the proposal. Moreover, the proposal included a disclaimer
in bold type, “This transmittal is not an offer to enter into the Agreement, and until
the Agreement has been approved and fully executed by [Hickory Hollow], the
Agreement is not an enforceable contract.” For reasons not explained in the proof
presented at trial, City Gear did not sign the May termination agreement.1

       Although City Gear did not have a duly executed written termination agreement
with Hickory Hollow, City Gear entered into a lease agreement in June of 2012 with
another of CBL’s clients, The Courtyard at Hickory Hollow Limited Partnership. City
Gear intended to relocate to The Courtyard at Hickory Hollow (“the Courtyard”) as soon
as construction at the Courtyard was completed. Even though the Courtyard lease, like

        1
          As revealed in more detail later in this opinion, facts and documents were submitted in support
of and in opposition to motions for summary judgment prior to trial that shed light on this circumstance;
however, this information is not to be found in the proof presented by the plaintiff at trial.

                                                  -2-
the Hickory Hollow lease, prohibited City Gear from operating another store within a
three-mile radius, the Courtyard lease was not contingent upon City Gear obtaining a
contemporaneous termination of its lease with Hickory Hollow.

      On September 13, 2012, CBL provided City Gear with an unsigned, second draft
of a proposed termination agreement. This proposal also stated in bold type, “This
transmittal is not an offer to enter into the Agreement, and until the Agreement has
been approved and fully executed by [Hickory Hollow], the Agreement is not an
enforceable contract.” As was the case with the May proposal, City Gear did not sign or
respond to the September proposal even though CBL sent two follow-up emails urging
City Gear to sign and return the proposed termination agreement.

       The very next day, on September 14, Hickory Hollow entered into a contract to
sell the Mall to the plaintiff, Global Mall. Prior to the closing, CBL sent an email to
Global Mall’s attorney on September 28 informing Global Mall that City Gear would be
relocating to the Courtyard. The parties closed on the purchase of the Mall on October
30. As part of the closing, Hickory Hollow assigned six commercial leases to Global
Mall, including its lease with City Gear. As of the date of closing, City Gear still had not
executed a written lease termination agreement, and Global Mall had not seen any draft
of a proposed termination agreement with City Gear. The day after the closing, Hickory
Hollow notified City Gear that its lease had been assigned to Global Mall and that all
future rent payments should be made to Global Mall.

        Six weeks later, on December 20, 2012, City Gear signed and delivered to CBL
the proposed lease termination agreement. On the same day, CBL delivered the
agreement to Global Mall’s attorney, Mark Nobles, with instructions for Global Mall to
sign the agreement. Acting on behalf of Global Mall, Mr. Nobles promptly notified CBL
and City Gear that Global Mall would not sign the agreement and that it would enforce
City Gear’s lease. Shortly thereafter, City Gear moved out of the Mall and relocated its
retail store to the Courtyard. It also stopped paying any rent to the Mall.

       Global Mall commenced this action by filing a complaint against City Gear for
breach of contract. City Gear responded by filing an answer and a third-party claim
against Hickory Hollow, CBL, and the Courtyard for indemnification should the court
rule that City Gear breached its lease with Global Mall. It based its defense to the
complaint and its claims against the third-party defendants on the theory of promissory
estoppel. City Gear alleged that Hickory Hollow and CBL promised City Gear that they
would terminate its lease contemporaneous with its relocation to the Courtyard. City Gear
further alleged that it reasonably relied on that promise to its detriment by signing the
new lease with the Courtyard and by building the new space at that location. City Gear
also contended that its lease with the Courtyard contained an implied contractual term
that the Hickory Hollow lease would terminate when the Courtyard lease became
effective.

                                           -3-
       The third-party defendants filed answers denying any liability. Following
discovery, they filed a joint motion for summary judgment arguing, inter alia, that the
oral agreement between Hickory Hollow and City Gear was unenforceable. The trial
court agreed and summarily dismissed City Gear’s claims against them.

       In its memorandum and order granting summary judgment, the court found that
City Gear’s lease with Hickory Hollow contained a “no oral modification” clause and did
not terminate until June 30, 2015. It found that CBL attempted to obtain City Gear’s
signature on a lease termination agreement in May 2012 and then, again, in September
2012 to no avail. It also found that each of the proposed lease termination agreements
provided that neither proposal served as an offer to terminate the lease unless Hickory
Hollow signed it, and Hickory Hollow failed to sign either agreement.

       Further, despite having no duly executed written termination agreement with
Hickory Hollow, City Gear signed a lease with the Courtyard in June 2012, expecting to
relocate in late 2012 or early 2013. The court also found that the Courtyard lease was not
contingent upon the execution of a lease termination agreement with Hickory Hollow.
Moreover, the court noted that Hickory Hollow sold the Mall and assigned City Gear’s
lease to Global Mall on October 30, 2012. Finally, Global Mall never signed the lease
termination agreement with City Gear; nevertheless, City Gear vacated the Mall premises
and stopped paying rent.

       Considering the “no oral modification” clause in the Hickory Hollow lease and the
disclaimers in the written proposals, the trial court held that it could not enforce an oral
agreement to terminate the lease, and that the Hickory Hollow lease “remained valid and
binding after it was assigned” to Global Mall. Based on these undisputed facts, the trial
court summarily dismissed City Gear’s claim against Hickory Hollow, CBL and the
Courtyard. Thereafter, the only remaining parties to this action were Global Mall and
City Gear.

        The case was tried without a jury on January 25, 2016. The only witness to testify
at trial was Dr. Rajesh Aggarwal. He stated that he and his wife own Global Mall
Partnership d/b/a Global Mall at the Crossings, and he was the manager of Global Mall.
The most relevant evidence elicited from Dr. Aggarwal during direct examination is
summarized as follows:

       Global Mall entered into a contract to purchase the Mall from Hickory Hollow on
September 14, 2012. The purchase of the Mall closed on October 30, at which time
Hickory Hollow assigned six commercial leases to Global Mall, including Hickory
Hollow’s lease with City Gear. The term of City Gear’s lease went through June 30,
2015. At no time prior to the closing did Hickory Hollow or CBL inform Dr. Aggarwal of
the agreement to terminate City Gear’s lease, nor did they ask him to agree to an early

                                           -4-
termination of City Gear’s lease. Moreover, at no time prior to the closing did Dr.
Aggarwal see a proposed lease termination agreement with City Gear.

        On December 20, 2012, almost two months after Hickory Hollow assigned City
Gear’s lease to Global Mall, CBL forwarded a proposed termination agreement to Global
Mall signed by City Gear on the same date, with a request that Global Mall sign and
return it to CBL. On behalf of Global Mall, Mr. Nobles promptly informed CBL it would
not sign the agreement. Shortly after Dr. Aggarwal received the December 20 letter, City
Gear moved out of the Mall and relocated to the Courtyard and ceased paying rent under
the Hickory Hollow lease. Dr. Aggarwal testified that neither he nor his attorney
communicated with City Gear prior to receiving the December 20 letter. In response,
counsel for Global Mall sent a letter informing City Gear that its lease at the Mall was in
full force and effect, and Global Mall expected City Gear to fulfill its obligations under
the lease.

        On cross examination Dr. Aggarwal acknowledged that he saw the September
2012 email CBL sent to Mr. Nobles, which was thirty-two days before the closing, in
which CBL indicated that City Gear would be leaving the Mall. Other relevant evidence
elicited from Dr. Aggarwal during cross examination is summarized as follows:

       Dr. Aggarwal stated that he did not reply to the email because neither he nor Mr.
Nobles was asked to take any action, and the email did not say that City Gear would be
terminating the lease early. Moreover, the email did not indicate that City Gear intended
to leave the Mall on a certain date, only that City Gear would be leaving: “[The notice]
did not say when and it was not an agreement.” While acknowledging that the assignment
agreement required Global Mall to assume the legal obligations of Hickory Hollow, Dr.
Aggarwal insisted that no obligation existed concerning an early termination of City
Gear’s lease at the time the City Gear lease was assigned to Global Mall. As he
explained, Global Mall had an obligation to do whatever Hickory Hollow had agreed to
do, but as of October 30, 2012, the date the lease was assigned to Global Mall, there was
no agreement to terminate City Gear’s lease, and “no such document existed.”

       The following colloquy was elicited by counsel for City Gear, Randall Fishman,
during Global Mall’s case-in-chief:

      Q. Dr. Aggarwal, I want to talk to you about the assignment, agreement
      assignment and assumption, a document that was entered as Exhibit 2,
      assignment 10/30/12. Do you see that portion that I’ve highlighted?
      A. Yes, sir.
      Q. All right. “Assignee hereby assumes and agrees to perform, fulfill, and
      comply with all covenants and obligations to be performed, fulfilled, or
      complied with by the landlord under the lease with respect to deposits on
      and after the effective date.” You see that?

                                           -5-
       A. Yes, sir.
       Q. And you see the language in “obligations to be performed”?
       A. Yes, sir.
       Q. So you agree with me that you had an obligation to do whatever
       [Hickory Hollow] had agreed to do, correct?
       A. Yes, sir.
       Q. All right. And if [Hickory Hollow] had an understanding and an
       agreement to terminate City Gear, then you, likewise, had the same
       obligation; isn’t that right?
       A: On October 30th, 2012, no such document existed.
       ....
       Q. I’ve asked if you agree with me that if [Hickory Hollow] had an
       obligation under an agreement to terminate, you, likewise, had the same
       obligation?
       A. If the obligation was in writing and they had provided me that
       obligation, yes.
       Q. Your lawyer got an email a month ahead of time that said they were
       leaving?
       A. It did not say when and it was not an agreement.2

       Following cross examination of Dr. Aggarwal, Global Mall’s counsel asked a few
additional questions on redirect and then rested his case by telling the court Dr. Aggarwal
was his only witness. Immediately thereafter, City Gear’s counsel, Mr. Fishman, moved
for a “directed verdict” on behalf of City Gear. 3

       2
          During cross examination, Mr. Fishman mistakenly referred to Hickory Hollow, the former
landlord, as CBL on several occasions. Mr. Nobles corrected this by stating that CBL was not the
landlord. More specifically, Mr. Nobles explained that “City Gear had leases with the Hickory Hollow
Mall Limited Partnership. . . . It’s not CBL. CBL is merely an agent.”
       3
          Counsel for City Gear erroneously identified it as a “motion for directed verdict.” It was his
intent to make a motion for involuntary dismissal pursuant to Tenn. R. Civ. P. 41.02(2). The parties
concede that the trial court correctly treated it as a motion for involuntary dismissal. The distinct
differences in the two motions was succinctly stated in Burton v. Warren Farmers Co-op., 129 S.W.3d
513, 520 (Tenn. Ct. App. 2002) as follows:

       A Tenn. R. Civ. P. 41.02(2) motion for involuntary dismissal differs markedly from a
       Tenn. R. Civ. P. 50 motion for a directed verdict. The most obvious, yet most overlooked,
       difference is that motions for directed verdicts have no place in bench trials, while Tenn.
       R. Civ. P. 41.02(2) motions have no place in jury trials. Cunningham v. Shelton Sec.
       Serv., Inc., 46 S.W.3d 131, 135 n. 1 (Tenn. 2001); City of Columbia v. C.F.W. Constr.
       Co., 557 S.W.2d 734, 740 (Tenn. 1977); Scott v. Pulley, 705 S.W.2d 666, 672 (Tenn. Ct.
       App. 1985). Beyond this obvious procedural difference, motions for involuntary
       dismissal serve a different purpose than motions for directed verdict and require the
       courts to employ a substantially different method of analysis.

                                                  -6-
        In support of his motion, Mr. Fishman explained, inter alia, that Dr. Aggarwal was
aware that City Gear was “intending to move,” that the assignment of the leases required
Global Mall to fulfill all of Hickory Hollow’s obligations, that City Gear entered into a
lease with the Courtyard, and that City Gear had partially performed on the Courtyard
lease. Therefore, Global Mall was “required to release [City Gear] from the old lease.”
Mr. Fishman further argued that Global Mall could receive no more than Hickory Hollow
could receive because Global Mall stepped in Hickory Hollow’s shoes: “[Global Mall]
has no greater right and must fulfill each and every obligation that [Hickory Hollow] had
to fulfill.” In closing, he stated that his client was principally relying on Gurley v. King,
183 S.W.3d 30 (Tenn. Ct. App. 2005).

       Counsel for Global Mall responded to the motion for involuntary dismissal by
stating, in pertinent part:

       We have proof that Hickory Hollow Mall Limited Partnership sold the
       property to Global Mall. We have proof that the lease was assigned [to
       Global Mall], and we have Dr. Aggarwal’s testimony, uncontroverted, that
       [City Gear] did move out, that they left the mall and failed to pay rent.
       There’s nothing that excuses their action for doing so at this time. There’s
       no evidence that gives them any excuse for abandoning their property. I do
       not think a directed verdict is appropriate. I have nothing else, Your Honor.

       Following a lunch break, the trial judge returned and ruled from the bench. In
pertinent part the court stated that it had read the Gurley opinion during the recess and
found it persuasive. The court then stated:

       Much has been made of the absence of an executed lease termination
       agreement. As it appears, Hickory Hollow Mall had a tenant, City Gear,
       which was in Antioch. The plaintiff, Global Mall, purchased the interest of
       Hickory Hollow Mall Limited Partnership and contends that in so doing it
       acquired the existing lease that City Gear had with Hickory Hollow Mall
       and that lease did not terminate until June of 2015, that the sale occurred on
       October 30th, 2012.

       In December of 2012, City Gear moved from the premises at Hickory
       Hollow Mall Limited Partnership to the premises of The Courtyard at
       Hickory Hollow, not a great distance but a new location, and did not pay
       any rents to the new owner, Dr. Aggarwal, who in turn has filed a lawsuit
       seeking recovery of damages for unpaid rents from 2012 to the June 2015
       date in which the lease was to have expired. In the absence of an executed
       lease termination agreement, the plaintiff contends that he is entitled to
       recover.

                                            -7-
       The trial court then discussed the Gurley decision and its analysis of two types of
preliminary agreements and found one of them, the second type, applicable. As the trial
court explained:

      The second and different sort of preliminary and final agreement is one that
      expresses mutual commitment to a contract on agreed major terms while
      recognizing the existence of open terms that remain to be negotiated.
      Although existing, an open term would generally suggest that the binding
      agreement has not been reached. That is not necessarily so. For the parties
      can bind themselves to a concededly incomplete agreement in the sense that
      they accept a mutual commitment to negotiate together in good faith an
      effort to reach a final agreement within the scope that has been settled in
      the preliminary agreement. To differentiate the sort of preliminary
      agreement from the first, it must be referred to as a binding preliminary
      commitment. Its binding obligations are of a different order than those
      which arrive of the first type discussed above. The first type binds both
      sides to their ultimate, contractual objective in recognition that the contract
      has been reached despite the anticipation of further formalities.

      The second type, the binding preliminary commitment does not commit the
      parties to their ultimate, contractual objective but rather to the obligations
      to negotiate the issues in good faith and as an attempt to reach the alternate
      objective within the agreed frame. In this case, part of the overall
      agreement to relocate City Gear to The Courtyard involved the parties to
      the Hickory Hollow lease agreeing in principal to all the terms of the lease
      termination agreement, except for the termination date itself as early as the
      first draft of the agreement on May 17th, 2012. At that time the preliminary
      agreement between City Gear and Hickory Hollow Mall Limited
      Partnership and through its agent, CBL, contained at least one open and
      essential term, the termination date. By June of 2012, however, City Gear
      had executed the new lease for retail space at The Courtyard. And the agent
      for Hickory Hollow Mall, CBL, began the construction process to prepare
      the new retail space for City Gear. Under the rationale articulated in
      Gurley, the part performance by both parties in reliance on their agreement
      to terminate the Hickory Hollow lease obligated them from that point
      forward to negotiate in good faith on the remaining unsettled terms, namely
      the termination date. Even if the original parties never agreed on the
      termination date, the landlords’ assignee, Global Mall, would have had an
      obligation to negotiate a termination date in good faith because of the
      party’s performance and reliance by City Gear.

                                           -8-
Prior to closing, City Gear and its original landlord agreed on a termination
date to coincide with City Gear’s occupation of the new retail space at The
Courtyard; and the assignee, Global Mall, was bound by that agreed
termination date. The Hickory Hollow lease and The Courtyard lease
contained mutually exclusive retail restrictions, meaning simultaneous
operation of City Gear’s stores in both locations would automatically result
in a breach of both leases. This circumstance demonstrates that on or before
September 13th, 2012, the date of the email in Exhibit -- excuse me, that’s
not the date in Exhibit 4 -- I mean before September 13, 2012, the parties
entered into a fully enforceable and binding lease termination agreement
with the understanding that they would subsequently execute the written
memorialization in accordance with the terms of the original lease. Global
Mall on purchasing the Hickory Hollow property took over rights and
obligations of the landlord in the assignment of leases, which included the
obligation to execute the lease termination agreement as mutually assented
to by City Gear and Hickory Hollow Mall Limited Partnerships and CBL.
Global Mall’s failure and refusal to do so when it had knowledge of City
Gear’s planned relocation to The Courtyard prior to closing constitutes a
breach of the applied covenant of good faith and fair dealings, which is
implied in every contract in the state of Tennessee. In the context of the
applied covenant of good faith and fair dealings, good faith is best
understood in the absence of bad faith. The implied duty of good faith and
fair dealings was breached when one party uses discretion conferred by the
contract to act outside of accepted commercial practices to deprive another
party the benefit of the contract. City Gear -- excuse me, Global Mall was
on notice that City Gear was relocating out of Hickory Hollow and into The
Courtyard by virtue of an email to plaintiff’s attorney dated September
28th, 2012. Despite this knowledge, plaintiff did not seek an estoppel
certificate from City Gear prior to closing, did not seek further clarification
from Hickory Hollow Mall as to the status of the City Gear lease being
assigned with the sale. Instead, Global Mall waited until after closing had
taken place. Global Mall refused to execute the lease termination agreement
when it was tendered by CBL in December of 2012. Had the sale to Global
Mall never taken place and had Hickory Hollow Mall refused to sign the
lease termination agreement so that it would place City Gear into mutually
exclusive leases, such refusal would indisputably constitute bad faith on the
part of Hickory Hollow Mall Limited. Hickory Hollow Mall Limited’s
obligation to execute the lease termination agreement flowed to Global
Mall as the assignee of the original lease. Global Mall was placed on notice
of City Gear’s relocation prior to closing by virtue of the email to its
attorney, and it had an obligation to act in good faith and in a commercially
reasonably manner. Dr. Aggarwal acknowledged that when his attorney
received that email in September of 2012, there was notice of the intent to

                                     -9-
       relocate, but what was missing was the date when it would transpire. As I
       have just referenced, Hickory Hollow Mall Limited Partnership could not
       refuse to execute the lease termination agreement in good faith with its
       understanding that when the premises were ready at The Courtyard, City
       Gear would be moving to The Courtyard. That duty also fell on the new
       purchaser who was assigned that lease, Global Mall. And on that basis the
       Court enters a directed verdict in favor of City Gear.

       Thereafter, Global Mall filed a motion to alter or amend the judgment, arguing
that the court’s factual findings and legal conclusions in its order granting summary
judgment did not comport with the factual findings and legal conclusions in its order
granting the involuntary dismissal. Specifically, Global Mall noted that in the summary
judgment order, the court found that the oral lease termination agreement between City
Gear and Hickory Hollow was not enforceable. To the contrary, in the order granting
involuntary dismissal, the court found that the oral agreement was enforceable. The court
denied Global Mall’s motion to alter or amend, stating that its factual findings and legal
conclusions in both orders were consistent with one another.

       After considering the above, the trial court issued its final order dismissing the
case. In that order, the trial court expressly incorporated the findings of fact and
conclusions of law contained in its order granting summary judgment. It also expressly
incorporated the findings of fact and conclusions of law contained in the initial order
granting the motion for involuntary dismissal. Global Mall appealed.

                                             ANALYSIS

        Global Mall presents six issues on appeal. We have determined that the dispositive
issue is whether Global Mall introduced sufficient evidence at trial to render the granting
of a Tenn. R. Civ. P. 41.02 motion for involuntary dismissal improper.4 As an integral

       4
         Global Mall presented the following issues in its brief:
       1. Whether the trial court made conflicting findings of fact and conclusions of law in granting
           third-party defendants’ motion for summary judgment on the ground that under the
           undisputed facts the lease was not terminated by the defendant and granting defendant’s
           motion for involuntary dismissal on the ground that the lease was terminated by the
           defendant, resulting in contradictory rulings adjudicating the rights of the parties.
       2. Whether any evidence was presented after the trial court’s order on summary judgment that
           would serve as the basis for the court’s reversing its findings of fact and conclusions of law
           on summary judgment.
       3. Whether the trial court erroneously concluded that there was no contradiction between its
           ruling on summary judgment and its ruling on defendant’s motion for involuntary dismissal.
       4. Whether the trial court’s order on summary judgment precluded the granting of defendant’s
           motion for involuntary dismissal.
                                                                                         (continued…)
                                                - 10 -
part of this analysis, we also find it necessary to consider whether the trial court
erroneously considered extraneous facts and documents City Gear relied on in opposition
to the third-party defendants’ motion for summary judgment that were not introduced at
trial.

        Motions for involuntary dismissal pursuant to Tenn. R. Civ. P. 41.02(2) challenge
the sufficiency of the plaintiff’s proof. Burton v. Warren Farmers Co-op., 129 S.W.3d
513, 520 (Tenn. Ct. App. 2002) (citations omitted). “A claim may be dismissed pursuant
to a Tenn. R. Civ. P. 41.02(2) motion to dismiss if, based on the law and the evidence, the
plaintiff has failed to demonstrate a right to the relief it is seeking.” Id. (citing City of
Columbia, 557 S.W.2d at 740). When faced with a Tenn. R. Civ. P. 41.02(2) motion, the
court weighs the evidence “just as it would after all the parties had concluded their cases
and may dismiss the plaintiff’s claims if the plaintiff has failed to make out a prima facie
case by a preponderance of the evidence.” Id. (citing Thompson v. Adcox, 63 S.W.3d 783,
791 (Tenn. Ct. App. 2001)).

       When a trial court grants an involuntary dismissal under Tenn. R. Civ. P. 41.02,
we use the familiar Tenn. R. App. P. 13(d) standard of review “because the trial court has
used the same reasoning to dispose of the motion that it would have used to make a final
decision at the close of all the evidence.” Id. (citations omitted). Thus, we must review
the record de novo, presuming that the trial court’s factual findings are correct unless the
evidence preponderates otherwise. See Shore v. Maple Lane Farms, LLC, 411 S.W.3d
405, 414 (Tenn. 2013) (citing Bldg. Materials Corp. v. Britt, 211 S.W.3d 706, 711 (Tenn.
2007)). In contrast, we review the trial court’s legal conclusions de novo without a
presumption of correctness. Bldg. Materials Corp., 211 S.W.3d at 711.

        Because the case was involuntarily dismissed pursuant to Tenn. R. Civ. P.
41.02(2) at the conclusion of Global Mall’s case-in-chief, the only evidence the trial court
could consider to determine whether the proof was sufficient to demonstrate a right to the
relief the defendant was seeking was “the plaintiff’s proof” at trial. Tenn. R. Civ. P.
41.02(2); Burton, 129 S.W.3d at 520; City of Columbia, 557 S.W.2d at 740. And as noted
above, the trial court was required to weigh the evidence just as it would after all of the
parties had concluded their cases. Burton, 129 S.W.3d at 520 (citing Thompson, 63
S.W.3d at 791). Therefore, we shall review the proof pursuant to Tenn. R. Civ. P. 41.02,
presuming that the trial court’s factual findings are correct unless the evidence
preponderates otherwise.

       5. Whether plaintiff presented sufficient evidence at trial, and whether sufficient evidence was
          in the record, to render the granting of an involuntary dismissal improper under the evidence
          in the record.
       6. Whether defendant presented any additional or new evidence after the court’s ruling on
          summary judgment that would justify different findings of fact and conclusions of law on
          defendant’s motion for involuntary dismissal.

                                               - 11 -
        Dr. Aggarwal was the only witness to testify, and without repeating the testimony
summarized earlier, we find it important to note what is in the plaintiff’s proof and what
is not. Global Mall presented proof that the purchase of the Mall closed on October 30,
2012, at which time Hickory Hollow assigned City Gear’s lease to Global Mall. The term
of City Gear’s lease went through June 30, 2015. At no time prior to the closing did
Hickory Hollow or its agent ask Dr. Aggarwal to agree to an early termination of City
Gear’s lease, nor did Dr. Aggarwal see a proposed lease termination agreement.
Moreover, City Gear did not sign a termination agreement until almost two months after
Hickory Hollow had assigned City Gear’s lease to Global Mall. Immediately following
receipt of the proposed termination agreement, Global Mall rejected the agreement and
refused to sign it.

       While acknowledging that his agreement with Hickory Hollow required Global
Mall to assume the legal obligations of Hickory Hollow, Dr. Aggarwal insisted that there
was no obligation concerning an early termination of City Gear’s lease when Hickory
Hollow assigned City Gear’s lease to Global Mall. As he explained, at the time of the
assignment, there was no agreement to terminate City Gear’s lease, and “no such
document existed.”

      As noted earlier, when a defendant files a motion for involuntary dismissal at the
conclusion of the plaintiff’s proof, the only evidence the trial court may consider to
determine whether the proof was sufficient to demonstrate a right to the relief it is
seeking is “the plaintiff’s proof” at trial. Tenn. R. Civ. P. 41.02(2); Burton, 129 S.W.3d at
520; City of Columbia, 557 S.W.2d at 740. The trial court’s ruling is problematic because
some of the material facts the court relied on in granting the motion did not appear
anywhere in the plaintiff’s proof.

      In its order granting the involuntary dismissal, the trial court relied on three
documents presented to the trial court in support of and in opposition to the third-party
defendants’ motion for summary judgment to find that City Gear and Hickory Hollow
had “entered into a fully enforceable and binding lease termination agreement with the
understanding that they would subsequently execute the written memorialization in
accordance with the terms of the original lease.” The three documents that formed the
basis of this finding were the May proposal to terminate the lease, the September
proposal to terminate the lease, and the Courtyard lease; however, none of these
documents were presented in “the plaintiff’s proof” at trial.5 Moreover, a number of facts
        5
           We acknowledge that these documents and other evidence were presented to the trial court in
support of the third party defendants’ motion for summary judgment, thus, the documents and facts are in
“the record.” Nevertheless, they were not introduced in the plaintiff’s proof at trial and only the plaintiff’s
proof at trial may be considered when a Tenn. R. Civ. P. 41.02 motion for involuntary dismissal is under
consideration.

                                                    - 12 -
the court referred to and relied on in making its ruling at trial only appear in the record as
part of the motion for summary judgment. Nevertheless, the trial court relied on these
documents and facts to find that Hickory Hollow and City Gear attempted to memorialize
their oral agreement in May 2012 and, again, in September 2012 in accordance with the
“no oral modification” clause in the Hickory Hollow lease.

       The trial court also relied on these documents and extraneous facts to make three
important findings. First, it found that City Gear signed a lease with the Courtyard in
reliance on the oral agreement. Second, it found that prior to the October 30 closing,
“City Gear and its original landlord agreed on a termination date to coincide with City
Gear’s occupation of the new retail space at The Courtyard.” Third, it determined that
Global Mall’s predecessor in interest, Hickory Hollow, had an implied duty of good faith
and fair dealing to sign the September proposal because City Gear partly performed in
reliance on the oral agreement by signing a lease with the Courtyard.

        Because the plaintiff did not present this evidence at trial, it may not be considered
in the context of a Tenn. R. Civ. P. 41.02 motion. Therefore, we must review the
evidence presented in the plaintiff’s proof at trial, to determine whether there is a
sufficient evidentiary foundation to support the trial court’s findings of fact and
conclusions of law. Having done so, we have determined that, without these documents
and extraneous facts, no evidentiary foundation exists upon which to conclude that City
Gear and Hickory Hollow had entered into a fully enforceable and binding lease
termination agreement in September 2012 “with the understanding that they would
subsequently execute the written memorialization in accordance with the terms of the
original lease.” We have also determined that, without these documents and extraneous
facts, no evidentiary foundation exists upon which to conclude that prior to the October
30, 2012 closing, City Gear and Hickory Hollow “agreed on a termination date to
coincide with City Gear’s occupation of the new retail space at The Courtyard; and the
assignee, Global Mall, was bound by that agreed termination date.” Moreover, without
this extraneous evidence, no factual or legal basis exists upon which to conclude that
Global Mall had the “obligation to execute the lease termination agreement.”

       For the foregoing reasons, we have determined that the evidence preponderates
against the trial court’s findings of fact and the legal conclusions based thereon.
Accordingly, we reverse the trial court’s decision to dismiss and remand with instructions
to reinstate the complaint.

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                                    IN CONCLUSION

       The judgment of the trial court is reversed and this matter is remanded for further
proceedings consistent with this opinion. Costs of appeal are assessed against Shelmar
Retail Partners, LLC d/b/a City Gear, LLC.

                                                   ________________________________
                                                   FRANK G. CLEMENT JR., P.J., M.S.

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