Court Opinion

ID: 9928758
Source: CourtListenerOpinion
Date Created: 2024-01-31 21:11:21.46965+00
Date Added: 2024-06-11T09:54:29.171158
License: Public Domain

01/31/2024
                IN THE COURT OF APPEALS OF TENNESSEE
                           AT KNOXVILLE
                                 August 17, 2023 Session

         MATTHEW SWILLEY ET AL. v. WILLIAM THOMAS ET AL.

                Appeal from the Chancery Court for Hamilton County
                  No. 21-0437      Pamela A. Fleenor, Chancellor
                      ___________________________________

                            No. E2022-01801-COA-R3-CV
                        ___________________________________

Appellants Matthew Swilley (“Swilley”) and Samuel Barr (“Barr”) entered into two
agreements to purchase mobile home parks from William Thomas (“Thomas”). The buyers
had not secured financing in order to close on the originally agreed upon closing date. The
seller granted the buyers a number of extensions of the closing date; however, the buyers
were ultimately unable to obtain financing in time to close by any of the dates demanded
by the seller. As a result, the seller rescinded the agreements and shortly thereafter sold
the properties to unrelated third parties for a higher price than provided for in the
agreements with Swilley and Barr. Swilley, Barr, and their purported assignee, SB Capital
LLC (“SB Capital” or, together with Swilley and Barr, “Plaintiffs”), brought suit against
the seller for breach of contract and for a declaratory judgment as to the proper
disbursement of the earnest monies held in escrow. The trial court granted summary
judgment in favor of the seller on Plaintiffs’ breach of contract claim, finding that Plaintiffs
were the first to materially breach the agreements. Discerning no error, we affirm the
judgment of the trial court.

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

KRISTI M. DAVIS, J., delivered the opinion of the Court, in which D. MICHAEL SWINEY,
C.J., and JOHN W. MCCLARTY, J., joined.

Matthew A. Grossman and Richard E. Graves, Knoxville, Tennessee, for the appellants,
Matthew Swilley, Samuel Barr, and SB Capital, LLC.

Robert G. Norred, Jr., Cleveland, Tennessee, for the appellee, William Thomas.
                                               OPINION

                                            I. Background1

        On January 19, 2021, “Samuel Barr & Matthew Swilley and/or as assigned,”
collectively as Buyer, and Thomas, as Seller, entered into two Real Estate Purchase
Agreements (the “Purchase Agreements”) for the purchase and sale of two mobile home
parks, one located in Hamilton County (the “Hamilton County Park”) and another located
in Bradley County (the “Bradley County Park” or, together with the Hamilton County Park,
the “Parks”). On January 22, 2021, Swilley & Barr deposited $1,000 per Purchase
Agreement ($2,000 total) as earnest money in escrow with Foothills Title Services, Inc.
(“Foothills Title”). Each Purchase Agreement provided that Thomas would deliver the
relevant property free and clear of any liens, debts, or encumbrances to Buyer. The closing
of each transaction was contingent upon Buyer “obtaining suitable financing” and
contingent upon the closing of the other transaction. Each Purchase Agreement provided
for a closing date of March 5, 2021 and required that “[a]ny extension of this date and time
must be agreed in writing by Buyer and Seller[;]” however, the Purchase Agreements did
not state that time was of the essence.

       Swilley and Barr were not able to close by March 5, 2021 because they had not
secured financing for the transactions. Thomas agreed to extend the closing date to March
29. In exchange for this extension, Swilley and Barr deposited additional earnest money
of $4,000 per Purchase Agreement ($8,000 total) in escrow with Foothills Title. Swilley
and Barr still had not secured financing by March 27, so on that date, they and Thomas
executed “Amendment No. 1” with respect to each Purchase Agreement. Each
Amendment extended the closing date for the transactions to April 30, 2021. In exchange,
Swilley and Barr paid directly to Thomas additional earnest money of $2,500 per Purchase
Agreement ($5,000 total).

       On March 30, 2021, Barr executed an “Assignment to Purchase Real Estate,” (the
“Assignment”) which purported to transfer to SB Capital all of Swilley’s and Barr’s
“equitable interest” in the Parks. In addition to executing the Assignment in his individual
capacity as Assignor, Barr also executed the Assignment in his purported capacity as
Manager of SB Capital as Assignee. Barr executed the Assignment with the consent and
permission of Swilley, though Swilley did not execute the Assignment himself. SB Capital
gave no consideration to Swilley or Barr for the Assignment and several provisions of the
Assignment were apparently included by mistake. There is no dispute among SB Capital,
Swilley, and Barr that SB Capital held the rights of “Buyer” under the Purchase

        1
           Except as otherwise noted, these facts are taken from the Agreed Stipulation of Facts and exhibits
thereto filed by the parties in the trial court.

                                                    -2-
Agreements after the execution of the Assignment; however, Thomas disputes this
assertion.

       Though not mentioned in the Agreed Stipulation of Facts filed by the parties nor in
the parties’ briefs to this Court, both Thomas’s Statement of Undisputed Material Facts
and Plaintiffs’ response thereto reflect that on April 6, 2021, the following text message
exchange occurred between Thomas and Swilley:

      Thomas: I got 3 calls today from people wanting these properties.
      Swilley: We will close
      Thomas: No more extensions
      Swilley: I got you don’t worry

(Emphasis added). In a subsequent text message exchange on April 26, 2021, Swilley
again stated that they were prepared to close the transactions that week. However, they did
not close. Instead, on April 29, 2021 at approximately 6:30 p.m., Swilley emailed Thomas,
with a copy to Barr, to notify him that Swilley and Barr were “elect[ing] to exercise the
option to extend [the Purchase Agreements] 15 days as provided in section 9c of [the
Purchase Agreements].” Specifically, Paragraph 9(C) of the Purchase Agreements
provided:

      In the event that any Third-Party Reports are required by Buyer or Buyer’s
      lender, and these Third-Party Reports are not completed during [the] initial
      Forty-Five (45) day inspection period [following the Effective Date of the
      Purchase Agreements2], the inspection period may be extended for an
      additional Fifteen (15) day period at Buyer’s option if Buyer deposits an
      additional $4,000 non-refundable Deposit with [Foothills Title].

Swilley stated that this extension was necessary because “[o]ur lender . . . requires
additional time to complete the appraisal” and notified Thomas that an additional $4,000
per Purchase Agreement ($8,000 total) had been deposited with Foothills Title “as required
by [the Purchase Agreements].”

       Thomas responded at 11:13 p.m. on April 29, 2021, and notified Swilley and Barr
that he would declare them in default of the Purchase Agreements if they did not close on
or before April 30, 2021. Thomas referenced the language of Paragraph 9(C) regarding an
extension of the initial forty-five-day inspection period and maintained that he was “under
no obligation whatsoever to grant a 3rd extension under the terms of [the Purchase
Agreements].” Thomas was unwilling to close on the Purchase Agreements at any time
after April 30, 2021.

      2
          It is undisputed that the Effective Date of the Purchase Agreements was January 19, 2021.

                                                  -3-
       On May 25, 2021, counsel for Thomas wrote to counsel for Swilley and Barr
notifying them that the Purchase Agreements were terminated and that Thomas had
requested that Foothills Title disburse the $18,000 in earnest money to him. On May 27,
Swilley and Barr, through counsel, made a written demand that Thomas close on the
Purchase Agreements on June 4, 2021. Thomas maintained that the Purchase Agreements
had been terminated and refused to close on June 4.

       On June 18, 2021, two weeks after the demanded June 4 closing date, Plaintiffs filed
a Complaint against Thomas and Foothills Title in the Chancery Court for Hamilton
County (the “trial court”). Plaintiffs sought damages against Thomas for breach of contract
and a declaratory judgment that Plaintiffs were entitled to a return of the full $18,000 in
earnest money held by Foothills Title. Thomas answered the Complaint, asserted various
affirmative defenses, and filed a counterclaim against Plaintiffs for breach of contract and
a crossclaim against Foothills Title demanding that the earnest money instead be disbursed
to him.

        Plaintiffs’ Complaint referenced, for the first time, an Affidavit and Memorandum
of Purchase and Sale Agreement (the “Bailey Capital Affidavit”) that was filed with the
Register’s Office of Hamilton County, Tennessee, in October 2020, approximately three
months prior to the execution of the Purchase Agreements. The Bailey Capital Affidavit
stated that Thomas and an unrelated third party, Bailey Capital LLC (“Bailey Capital”),
had entered into an agreement for the sale of the Hamilton County Park to Bailey Capital.
The Bailey Capital Affidavit stated that, as a result, Bailey Capital had “the exclusive right
to the purchase” and “an equitable interest in” the Hamilton County Park. A release of the
Bailey Capital Affidavit was recorded on June 15, 2021, three days before Plaintiffs filed
their Complaint but eleven days after their demanded June 4 closing date.

       Thomas sold the Bradley County Park to an unrelated purchaser in September 2021,
for $25,000 more than the purchase price provided in the relevant Purchase Agreement and
sold the Hamilton County Park to an unrelated purchaser in March 2022, for $115,000
more than the purchase price provided for in the relevant Purchase Agreement.

        On June 23, 2022, Thomas moved for summary judgment as to Plaintiffs’ breach of
contract claim. Thomas argued that Swilley and Barr have no individual cause of action
against him due to their purported assignment to SB Capital of their rights under the
Purchase Agreements and that SB Capital “is not a proper party plaintiff” because the
Assignment “is an illusory and unenforceable document because the assignment is not
supported by consideration and SB Capital has no quantifiable damages.” He also argued
that Plaintiffs’ claimed damages “for future value of the subject real estate and income . . .
is not the proper measure of damages and . . . SB Capital failed to present any quantifiable
claim for damage[s] . . . other than a bonus depreciation tax write off which has to be
supported by expert testimony which is not present.” Finally, Thomas argued that the

                                            -4-
Purchase Agreements were not enforceable as they had lapsed as of April 30, 2021 and,
alternatively, that Plaintiffs did not deposit any additional earnest money to extend any
closing after May 15, 2021.3

         In response, Plaintiffs argued that Thomas lacks standing to contest the validity or
effect of the Assignment to which he is not a party. They argued that the intent of Plaintiffs,
as the parties to the Assignment, controls with regard to the Assignment, and that it is
undisputed among Plaintiffs that Swilley and Barr effectively assigned to SB Capital their
right to enforce the Purchase Agreements. Alternatively, they argued that, in the event
such right was not effectively assigned to SB Capital, Swilley and Barr retain the right to
enforce the Purchase Agreements, and they are proper party plaintiffs. Next, Plaintiffs
argued that their failure to close by April 30, 2021 did not result in the Purchase
Agreements lapsing because the Purchase Agreements did not make time of the essence.
Additionally, Plaintiffs argued that they were never under an obligation to close because
Thomas could not satisfy his obligations under the Purchase Agreements. Specifically,
Plaintiffs argued that, until it was released, the Bailey Capital Affidavit “precluded []
Thomas from delivering marketable title to Plaintiffs[.]” Finally, Plaintiffs argued that
there is “substantial and material evidence” that they sustained damages in the amount of
$140,000.00, equal to the difference between their total purchase price under the Purchase
Agreements and the total sales price Thomas ultimately received for his sale of the Parks
to third parties later in 2021. In support of their argument that Thomas was unable to
deliver marketable title, Plaintiffs attached a Declaration of Eugene R. McCullough, Esq.,
NTP, TNLTP, CIPP/US (the “McCullough Declaration”). Mr. McCullough is a licensed
Tennessee attorney with over twenty years of employment with various title insurers. He
opined that, as a result of the Bailey Capital Affidavit: equitable title to the Hamilton
County Park had been transferred from Thomas to Bailey Capital, and any legal title
previously held by Thomas would be deemed to be held exclusively in trust for the benefit
of Bailey Capital; equitable legal title remained in Bailey Capital from the time the
purchase agreement between Thomas and Bailey Capital was executed until June 14, 2021;
title to the Hamilton County Park would be deemed unmarketable if sold to a buyer other
than Bailey Capital and would subject the parties to such sale to a threat of litigation; any
reasonably prudent title insurer would refuse to issue title insurance for the Hamilton
County Park to any purchaser other than Bailey Capital so long as the equitable title was
deemed to be vested in Bailey Capital; and any reasonably prudent real estate attorney
and/or title insurer would conclude that Thomas never possessed marketable title that he
was obligated to convey under the Purchase Agreements.

       The trial court granted summary judgment in favor of Thomas on August 24, 2022,
finding that the first antecedent breach of the Purchase Agreements was by Plaintiffs due

        3
         May 14, 2021 is the date to which Plaintiffs attempted to extend the closing in their April 29,
2021 correspondence to Thomas.

                                                 -5-
to their failure to close by April 30, 2021 and that the Purchase Agreements expired
thereafter. The trial court did not consider the Bailey Capital Affidavit because the copy
filed with the trial court was not properly authenticated, although Plaintiffs had asked the
trial court to take judicial notice of the document and Thomas had no objection. The trial
court further found that, even if it had considered the Bailey Capital Affidavit, the issue of
Thomas’s purportedly unmarketable title was “a phantom argument since Plaintiffs never
brought any potential cloud of title to [Thomas’s] attention at any of the times material,”
and the issue of Thomas allegedly being the first to breach “was not raised in the Plaintiffs’
Complaint or any of the pleadings prior to Plaintiffs’ response to [Thomas’s] Motion for
Summary Judgment.” Moreover, the trial court held that Plaintiffs could not raise this
argument because the closing was not prevented by the alleged cloud on the title but instead
by Plaintiffs having not yet secured financing. The trial court found that time was not of
the essence in this case because it was not written into the Purchase Agreements but that
this argument by the Plaintiffs was inapplicable because they breached by failing to close
by April 30, 2021. Finally, the trial court held that the Purchase Agreements were not
effectively assigned to SB Capital by Swilley and Barr, and thus SB Capital is not a proper
party plaintiff. Because the trial court found that Thomas was entitled to summary
judgment as a matter of law, it made no ruling on Plaintiffs’ alleged damages.

       On November 4, 2022, a bench trial was held on the parties’ opposing claims for
disbursement of the earnest money. In their opening statement at trial, Plaintiffs
acknowledged that the only way they could prevail on their remaining claim for
disbursement would be for the trial court to make a ruling inconsistent with the summary
judgment order. Plaintiffs then argued that there were a number of issues with the summary
judgment order, namely those issues raised on appeal and discussed below. Plaintiffs
argued that the trial court had the authority to modify the summary judgment order as it
was not yet a final order. Thomas objected to this opening statement as an attempt to
reargue the summary judgment motion. At the conclusion of opening statements, the trial
court stated that it construed Plaintiffs’ opening statement as a motion to alter or amend
the summary judgment order and held it was not timely because Plaintiffs did not file a
motion pursuant to Rules 59 or 60 of the Tennessee Rules of Civil Procedure within thirty
days after the entry of the summary judgment order. As such, the trial court declined to
alter or amend the summary judgment order. At the conclusion of trial, the trial court
awarded Thomas $10,000 of the earnest money and Swilley and Barr $8,000 of the earnest
money. This timely appeal followed.

                              II. Issues Presented on Appeal

       Plaintiffs raise the following issues on appeal, which we restate and consolidate:

     1.      Whether the trial court erred in granting Thomas’s motion for summary
judgment as to Plaintiffs’ breach of contract claim.

                                            -6-
       2.    Whether the trial court erred in holding there was no effective assignment of
the Purchase Agreements to SB Capital.

      3.    Whether Plaintiffs were damaged by Thomas’s purported breach of the
Purchase Agreements.

       4.     Whether the trial court’s purported errors in the summary judgment order
require reversal of the subsequently entered judgment.

     5.      Whether the trial court erred in holding that the summary judgment order
became a final order prior to the entry of the judgment.

                                 III. Standard of Review

       A trial court may grant summary judgment only if the “pleadings, depositions,
answers to interrogatories, and admissions on file, together with the affidavits . . . show
that there is no genuine issue as to any material fact and that the moving party is entitled
to a judgment as a matter of law.” Tenn. R. Civ. P. 56.04. The propriety of a trial court’s
summary judgment decision presents a question of law, which we review de novo with no
presumption of correctness. Kershaw v. Levy, 583 S.W.3d 544, 547 (Tenn. 2019).

       “The moving party has the ultimate burden of persuading the court that there are no
genuine issues of material fact and that the moving party is entitled to judgment as a matter
of law.” Martin v. Norfolk S. Ry. Co., 271 S.W.3d 76, 83 (Tenn. 2008). As our Supreme
Court has instructed,

       when the moving party does not bear the burden of proof at trial, the moving
       party may satisfy its burden of production either (1) by affirmatively negating
       an essential element of the nonmoving party’s claim or (2) by demonstrating
       that the nonmoving party’s evidence at the summary judgment stage is
       insufficient to establish the nonmoving party’s claim or defense.

Rye v. Women’s Care Ctr. of Memphis, 477 S.W.3d 235, 264 (Tenn. 2015). “[I]f the
moving party bears the burden of proof on the challenged claim at trial, that party must
produce at the summary judgment stage evidence that, if uncontroverted at trial, would
entitle it to a directed verdict.” TWB Architects, Inc. v. Braxton, LLC, 578 S.W.3d 879, 888
(Tenn. 2019) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 331 (1986)).

       When a party files and properly supports a motion for summary judgment as
provided in Rule 56, “to survive summary judgment, the nonmoving party may not rest
upon the mere allegations or denials of its pleading, but must respond, and by affidavits or
one of the other means provided in Tennessee Rule 56, set forth specific facts . . . showing

                                            -7-
that there is a genuine issue for trial.” Rye, 477 S.W.3d at 265 (internal quotation marks
and brackets in original omitted). “Whether the nonmoving party is a plaintiff or a
defendant – and whether or not the nonmoving party bears the burden of proof at trial on
the challenged claim or defense – at the summary judgment stage, ‘[t]he nonmoving party
must demonstrate the existence of specific facts in the record which could lead a rational
trier of fact to find in favor of the nonmoving party.’” TWB Architects, 578 S.W.3d at 889
(quoting Rye, 477 S.W.3d at 265).

       “This court will affirm the trial court’s summary judgment if it finds that the trial
court reached the correct result, ‘irrespective of the reasons stated.’” Wood v. Parker, 901
S.W.2d 374, 378 (Tenn. Ct. App. 1995) (quoting Clark v. Metro. Gov't of Nashville &
Davidson Cnty., 827 S.W.2d 312, 317 (Tenn. Ct. App. 1991)).

       Like motions made pursuant to Rules 59 and 60 of the Tennessee Rules of Civil
Procedure, motions made pursuant to Rule 54.02 are reviewed under an abuse of discretion
standard. Discover Bank v. Morgan, 363 S.W.3d 479, 487 (Tenn. 2012). “A trial court
abuses its discretion when it causes an injustice by applying an incorrect legal standard,
reaching an illogical decision, or by resolving the case ‘on a clearly erroneous assessment
of the evidence.’” Henderson v. SAIA, Inc., 318 S.W.3d 328, 335 (Tenn. 2010) (quoting
Lee Med., Inc. v. Beecher, 312 S.W.3d 515, 524 (Tenn. 2010)). “The abuse of discretion
standard does not permit the appellate court to substitute its judgment for that of the trial
court.” Id. (citing Eldridge v. Eldridge, 42 S.W.3d 82, 85 (Tenn. 2001)). “Indeed, when
reviewing a discretionary decision by the trial court, the ‘appellate courts should begin with
the presumption that the decision is correct and should review the evidence in the light
most favorable to the decision.’” Id. (quoting Overstreet v. Shoney’s, Inc., 4 S.W.3d 694,
709 (Tenn. Ct. App. 1999)).

                                        IV. Analysis

                              A. Motion for Summary Judgment

      Plaintiffs argue that the trial court erred in granting Thomas’s motion for summary
judgment because (1) the Purchase Agreements did not make time of the essence, and (2)
Thomas was not able to deliver marketable title on April 30, 2021. Plaintiffs contend they
were damaged by Thomas’s refusal to close on a later date.

       “[A] party who commits the first uncured material breach of contract may not
recover damages for the other party’s material breach.” Madden Phillips Constr., Inc. v.
GGAT Dev. Corp., 315 S.W.3d 800, 812 (Tenn. Ct. App. 2009) (citing United Brake Sys.,
Inc. v. Am. Env’t Prot., Inc., 963 S.W.2d 749, 756 (Tenn. Ct. App. 1997)). In their
Complaint, Plaintiffs aver that Thomas breached the Purchase Agreements “first by failing
to obtain and provide Buyers or SB Capital LLC with necessary information and

                                            -8-
documentation to effect a release of record lines [sic], debts, and encumbrances, and
second by failing to close on June 4, 2021.” Conversely, Thomas argues in his motion for
summary judgment that he was entitled to terminate the Purchase Agreements when
Plaintiffs were not ready to close on April 30, 2021, or alternatively May 14, 2021.

                                                i.

       “Ordinarily, the inability of a party to close a real estate sales contract on a particular
date is not considered to be a material breach of the contract since the general rule is that
time is not of the essence in a real estate sales contract, unless otherwise specified in the
contract.” Lewis v. Muchmore, 26 S.W.3d 632, 639 (Tenn. Ct. App. 2000) (quoting
Crye-Leike Realtors, Inc. v. Hay, No. 02A01-9104-CV-00057, 1991 WL 192493, at *3
(Tenn. Ct. App. Oct. 1, 1991)). However, even when a real estate sale contract does not
expressly make time of the essence, “it may be made such by subsequent conduct of the
parties, as by one party giving notice that he will insist on the contract by a certain date,
provided the time allowed is reasonable, which depends on the circumstances of the
particular case.” Thompson v. Menefee, 6 Tenn. App. 118, 128 (Tenn. Ct. App. 1927).
Reasonable time “is that time within which the party obligated can with reasonable
diligence, under the circumstance, do the thing required.” Id. “When time is of the essence,
the failure of a party to [timely perform] gives the other party a basis to rescind the
contract.” Seaton v. Wise Properties-TN, LLC, No. E2011-01728-COA-R3-CV, 2012 WL
2362144, at *6 (Tenn. Ct. App. June 22, 2012) (citing 77 Am.Jur.2d Vendor and Purchaser
§ 80 (1975); 91 C.J.S. Vendor & Purchaser § 104b (1955)).

       The Purchase Agreements did not expressly provide that time was of the essence.
However, Thomas made time of the essence when he demanded that Plaintiffs close on or
before April 30, 2021. Plaintiffs argue that this demand was not reasonable because it was
made on April 29, 2021; however, this argument ignores the fact that Thomas expressly
informed Swilley on April 6, 2021 – twenty-four days prior to April 30 – that he would not
grant Plaintiffs another extension of the closing date. The Purchase Agreements were
executed on January 19, 2021 and originally included an agreed upon closing date of March
5, 2021. Given this, and the relatively straightforward nature of these transactions, it was
reasonable for Thomas to demand that Plaintiffs close on or before April 30, 2021,
especially when Thomas gave Plaintiffs twenty-four days’ notice of such demand. Because
Thomas made time of the essence and Plaintiffs failed to close on April 30, 2021, Thomas
was entitled to rescind the Purchase Agreements.

                                               ii.

       In defense of their failure to close, Plaintiffs rely on two recent cases from this Court
to argue that they were not required to close on any date prior to June 15, 2021 because
Thomas was unable to deliver marketable title to Plaintiffs until the release of the Bailey

                                              -9-
Capital Affidavit was recorded. See Bowers v. Est. of Mounger, No. E2020-01011-COA-
R3-CV, 2021 WL 2156929 (Tenn. Ct. App. May 27, 2021), no perm. app. filed, and
Houston Humphreys LLC v. Houston St. Partners, LLC, No. M2021-00235-COA-R3-CV,
2022 WL 3573404 (Tenn. Ct. App. Aug. 19, 2022), perm. app. denied, not for citation
(Tenn. Feb. 13, 2023).4 However, Bowers and Houston Humphreys are both easily
distinguishable from this case because each of those cases involved a seller that had notice
of a purported cloud on their title and failed to cure the defect. Conversely, Thomas was
neither timely provided with notice of the purported cloud on his title nor provided an
opportunity to cure such defect.

        “The law in Tennessee is that ‘a party alleging defects in the performance of a
contract is required to give notice and a reasonable opportunity to cure the defects.’” Greg
Calfee Builders LLC v. MaGee, 616 S.W.3d 545, 554 (Tenn. Ct. App. 2020) (citing Forrest
Const. Co., LLC v. Laughlin, 337 S.W.3d 211, 229 (Tenn. Ct. App. 2009)). While this
principle is applied most often in cases involving construction contracts, it applies equally
in this situation. See Hobbs v. Nottingham, No. E2013-002602-COA-R3-CV, 2015 WL
399216, at *9 (Tenn. Ct. App. Jan. 30, 2015) (noting that “Tennessee courts recognize the
right of sellers to be given an opportunity to remedy any defects in title after execution of
sales contracts” (citing Rogers v. Roop, 92 S.W.2d 423, 429 (Tenn. Ct. App. 1935))).
Because Thomas did not have notice of the purported cloud on his title and a reasonable
opportunity to cure the defect, he cannot be found to have committed the first breach of the
Purchase Agreements.

        It is undisputed that the purported cloud was not the reason the transactions failed
to close. Indeed, it appears the Plaintiffs were not even aware of the purported cloud on
the title until after Thomas rescinded the Purchase Agreements. The parties did not close
because Plaintiffs had not secured financing to fund the purchases. This was the first
material breach, and Thomas was entitled to rescind the Purchase Agreements. The trial
court did not err in granting summary judgment to Thomas as to Plaintiffs’ breach of
contract claim.

                                         B. Rule 54.02 Motion

      Following the grant of summary judgment to Thomas, the parties proceeded to a
bench trial on their respective claims for a declaratory judgment that they were entitled to
some or all of the escrowed earnest monies held by Foothills Title. In their opening
statement at trial, Plaintiffs orally made a motion for the trial court to modify the summary

        4
          By order of the Tennessee Supreme Court, to the extent this Court’s Opinion in Houston
Humphreys “could be interpreted as holding that any unauthorized encroachment of a building on adjoining
property per se makes the title to the building’s property unmarketable, [such Opinion] is designated ‘Not
For Citation’ in accordance with Supreme Court Rule 4, § E.” Order, Houston Humphreys LLC v. Houston
St. Partners, LLC, No. M2021-00235-SC-R11-CV (Tenn. Feb. 13, 2023).

                                                  - 10 -
judgment order due to the issues discussed above. The trial court denied Plaintiffs’ motion,
holding in its judgment:

       Plaintiffs attempted at trial to reargue conclusions of law set forth in the [trial
       c]ourt’s August 24, 2022 Order on the basis that the [trial c]ourt’s August 24,
       2022 Order was an interlocutory order subject to modification under Rule
       54.02 prior to entry of a final judgment. The [trial c]ourt finds that the August
       24, 2022 Order became a final judgment thirty (30) days after its August 24,
       2022 entry. After that time, the Order could only be set aside by way of a
       Rule 60 motion, which Plaintiffs have not filed. Accordingly, based on
       Plaintiffs’ failure to file a Rule 60 motion and the rationale of the [trial c]ourt
       set forth and [sic] pages 2-9 of the attached transcript, which is incorporated
       as part of this Order, the [trial c]ourt finds that the Plaintiffs’ attempt at trial
       to orally re-argue against the [trial c]ourt’s August 24, 2022 Order is belated
       and the [trial c]ourt will not modify its August 24, 2022 Order.

We disagree with the trial court’s findings on this issue, but we conclude that any error is
harmless. As explained by the Tennessee Supreme Court:

       Pursuant to Tennessee Rule of Civil Procedure 54, “any order or other form
       of decision, however designated, that adjudicates fewer than all the claims or
       the rights and liabilities of fewer than all the parties . . . is subject to revision
       at any time before the entry of the judgment adjudicating all the claims and
       the rights and liabilities of all the parties.” Tenn. R. Civ. P. 54.02; see also
       Tenn. R. App. P. 3(a) (“[A]ny order that adjudicates fewer than all the claims
       or the rights and liabilities of fewer than all the parties is not enforceable or
       appealable and is subject to revision at any time before entry of a final
       judgment adjudicating all the claims, rights, and liabilities of all parties.”).
       Thus, motions seeking relief from a trial court’s decision adjudicating fewer
       than all the claims, rights, and liabilities of all the parties, should be filed
       pursuant to Rule 54.02.

Discover Bank, 363 S.W.3d at 488 (internal footnotes omitted) (emphasis added).
Although Rule 54.02 provides a mechanism by which a trial court may certify that a
judgment resolving fewer than all the claims is final and appealable pursuant to Tennessee
Rule of Appellate Procedure 3(a), the trial court did not make such certification with
respect to the summary judgment order in this case. “Because the trial court did not
adjudicate all the claims between all the parties, or certify the [summary judgment order]
as final pursuant to Rule 54.02, neither Rule 59 nor Rule 60[] applied.” Id. at 490.

                                              - 11 -
       As further set forth by the Tennessee Supreme Court:

               When additional evidence is submitted in support of a Rule 54.02
       motion to revise a grant of summary judgment, a trial court should consider,
       when applicable: 1) the movant’s efforts to obtain evidence to respond to the
       motion for summary judgment; 2) the importance of the newly submitted
       evidence to the movant’s case; 3) the explanation offered by the movant for
       its failure to offer the newly submitted evidence in its initial response to the
       motion for summary judgment; 4) the likelihood that the nonmoving party
       will suffer unfair prejudice; and 5) any other relevant factor. . . .

              Accordingly, we hold that the “newly discovered evidence” standard
       need not be satisfied before a trial court revises a partial summary judgment
       under Rule 54.02 on the basis of additional evidence. When additional
       evidence is offered by a litigant to overcome a grant of summary judgment
       pursuant to Rule 54.02, trial courts must undertake the above-stated
       balancing analysis and should make adequate findings of fact and
       conclusions of law on the record to support their rulings.

Harris v. Chern, 33 S.W.3d 741, 745 (Tenn. 2000) (collecting cases). The only potential
additional evidence offered by Plaintiffs in support of their oral Rule 54.02 motion was the
live testimony of Eugene R. McCullough, which was made as an offer of proof outside the
presence of the trial court judge. However, the substance of Mr. McCullough’s testimony
did not differ from his opinions set forth in the McCullough Declaration, which had been
filed by Plaintiffs in opposition to the motion for summary judgment.

         Although the trial court did not undertake the Harris balancing analysis, Plaintiffs
reargued the same position already considered and ruled upon by the trial court as part of
its initial decision on the motion for summary judgment. Like Rules 59 and 60, Rule 54.02
is not intended to allow a party to simply reargue its position already considered by the
trial court with respect to a summary judgment motion. See Guo v. Rogers, No.
M2020-01209-COA-R3-CV, 2022 WL 1220917, at *12 (Tenn. Ct. App. Apr. 26, 2022),
perm. app. denied (Tenn. Sept. 29, 2022) (considering the Harris factors and noting that
“a mere bid to re-argue the [t]rial [c]ourt’s grant of summary judgment in favor of [a
d]efendant . . . is an insufficient basis for granting [a p]laintiff’s motion to amend”). Given
the circumstances of this case and our conclusion that the trial court did not err in granting
summary judgment in favor of Thomas, we further conclude that the trial court’s
misstatements were harmless as they did not “more probably than not” affect the judgment
and did not result in prejudice to the judicial process. See Tenn. R. App. P. 36(b).
Therefore, we affirm the trial court’s denial of the Rule 54.02 motion.

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                                     C. Remaining Issues

       Our affirmance of the trial court’s grant of summary judgment and denial of the
Rule 54.02 motion are dispositive; as a result, Plaintiffs’ remaining issues are pretermitted.
See O’Dneal v. Baptist Mem’l Hosp.-Tipton, 556 S.W.3d 759, 774 (Tenn. Ct. App. 2018)
(“[W]hen presented with multiple issues on appeal, one of which is dispositive, we have
consistently found the remaining issues to be pretermitted.” (quoting In re Jamie B., No.
M2016-01589-COA-R3-PT, 2017 WL 2829855, at *7 (Tenn. Ct. App. June 30, 2017))).

                                       V. Conclusion

       For the aforementioned reasons, we affirm the judgment of the Chancery Court for
Hamilton County, and this case is remanded for proceedings consistent with this opinion.
Costs of this appeal are taxed to the appellants, Matthew Swilley, Samuel Barr, and SB
Capital, LLC, for which execution may issue if necessary.

                                                     _________________________________
                                                     KRISTI M. DAVIS, JUDGE

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