Court Opinion

ID: 4658529
Source: CourtListenerOpinion
Date Created: 2021-02-08 22:12:20.485279+00
Date Added: 2024-06-11T08:01:53.634832
License: Public Domain

02/08/2021
               IN THE COURT OF APPEALS OF TENNESSEE
                          AT KNOXVILLE
                              December 1, 2020 Session

             JACK W. GIBBONS ET AL. v. KYLE BENNETT ET AL.

                  Appeal from the Chancery Court for Knox County
                   No. 186806-I      John F. Weaver, Chancellor
                      ___________________________________

                           No. E2019-02188-COA-R3-CV
                       ___________________________________

This case involves the sale of a closely held corporation among family members and
enforcement of the parties’ agreement relative thereto. The trial court determined, inter
alia, that certain assets were the personal assets of the former corporate shareholders and
did not pass with the sale of the corporation. The trial court also determined that the new
sole shareholder of the corporation could not recover expenditures of corporate funds that
were allegedly for the former shareholders’ personal use when they owned the
corporation. The trial court further determined that although one of the former
shareholders had violated a covenant not to compete contained in the parties’ sale
agreement, the plaintiffs had failed to prove that such violation was the cause of the
corporation’s lost profits following the sale. The plaintiffs timely appealed. Discerning
no reversible error, we affirm the trial court’s judgment.

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

THOMAS R. FRIERSON, II, J., delivered the opinion of the court, in which ANDY D.
BENNETT and JOHN W. MCCLARTY, JJ., joined.

Dudley W. Taylor, Knoxville, Tennessee, for the appellants, Jack W. Gibbons and Top
Gun Customz, Inc.

Lewis S. Howard, Jr., and Erin J. Wallen, Knoxville, Tennessee, for the appellees, Kyle
Bennett and Kenneth Bennett.
                                              OPINION

                            I. Factual and Procedural Background

       On January 23, 2014, the plaintiffs, Jack W. Gibbons and Top Gun Customz, Inc.
(“Top Gun”) (collectively, “Plaintiffs”), filed a complaint in the Knox County Chancery
Court (“trial court”), naming as defendants Kyle Bennett; Rhonda Bennett; Burkhalter &
Associates, P.C.; Burkhalter & Yoder, P.C.; Burkhalter & Ryan, P.C.; Ted A. Burkhalter,
Jr.; Courtney J. Yoder; and Kenneth Bennett.1 In the complaint, Plaintiffs alleged that on
November 7, 2012, Mr. Gibbons had entered into a Stock Transfer Agreement (“STA”)
wherein two of the defendants, Kyle and Rhonda Bennett, had agreed to sell all of their
respective shares of stock in Top Gun to Mr. Gibbons. Prior to the STA, Kyle and
Rhonda Bennett were the sole owners of Top Gun. Plaintiffs alleged that Ms. Yoder and
her firm prepared the STA and represented Plaintiffs in the transaction.

        Pertinent to this appeal, paragraph six of the STA provides in relevant part:

        Sellers agree that all assets purchased by or on behalf of Top Gun Customz,
        Inc. or used in conducting the business of Top Gun Customz, Inc.,
        regardless of whether such assets are held, owned by, or titled in the
        personal name of Sellers, shall be deemed to be the assets of Top Gun
        Customz, Inc. and shall not be considered a personal asset or marital asset
        of Sellers (“Corporate Assets”). The Corporate Asset[s] shall include,
        without limitation, those assets identified on Exhibit A hereto.

       Exhibit A to the STA lists the following ten vehicles: (1) a 2006 Ryno; (2) a 2010
Razer; (3) a 2005 Keystone Challenger; (4) a 1967 Ford Mustang; (5) a 2004 Dodge
truck; (6) a 1994 Dodge truck; (7) a 1997 Dodge truck; (8) a 1984 Toyota truck; (9) a
1965 Ford Mustang; and (10) a 2006 Dodge Viper. Exhibit A also lists the following:
several trailers; “[c]ertain real property located at 2019 Regal Drive, Alcoa, Blount
County, Tennessee” (“Regal Drive Property”); “all leasehold and property interests in the
real property located at 3026 North Park Boulevard, Alcoa, Blount County Tennessee”;
and “[a]ll tangible personal property and commercial personal property purchased by or
on behalf of Top Gun Customz, Inc. or used in conducting the business of Top Gun
Customz, Inc.” In the complaint, Plaintiffs further alleged that after the sale, Kyle and
Rhonda Bennett had failed to execute documents transferring various assets to Top Gun
that were subject to the STA.

        Paragraph four (“Hold Harmless Clause”) of the STA provides:

1
 Inasmuch as certain parties share the same surname, we will refer to those parties by first and last name,
as necessary, to avoid confusion. No disrespect is intended.
                                                  -2-
      Buyer agrees to hold harmless Sellers for all current or potential liabilities
      or expenses incurred by the Corporation for any and all past, current and
      future operations of the business. Furthermore, Buyer agrees to be
      responsible for the payment of all taxes owed by the Corporation incurred
      on or after the transfer date of this document.

Plaintiffs averred that Mr. Gibbons had paid off some $350,000 in debt, which Kyle and
Rhonda Bennett and Ms. Yoder represented as belonging to Top Gun. However,
Plaintiffs stated that they had learned after the debt was paid that approximately $150,000
of the debt was personal in nature.

       Paragraph nine (“Noncompete Clause”) of the STA provides: “Sellers agree not-
to-compete against Buyer or Top Gun Customz, Inc. in the vehicle suspension system
industry within a one hundred (100) mile radius of Blount County for sixty (60) months
from and after date of this agreement, based upon Buyer’s assumption of all liabilities
and obligations of the company.” In the complaint, Plaintiffs asserted that Kyle Bennett
was operating a competing business, Boost Performance, within Blount County.
Plaintiffs alleged that Kenneth Bennett, Kyle Bennett’s father, was his partner in the
competing business. Plaintiffs averred, inter alia, that Kyle and Rhonda Bennett had
breached the STA and that Kenneth Bennett had induced such breach. Plaintiffs sought
declaratory and injunctive relief in addition to an award of damages. Plaintiffs attached a
copy of the STA and Exhibit A, which contains a list of assets.

       On September 12, 2014, the trial court entered an order of voluntary dismissal
with respect to defendants Burkhalter & Associates, P.C.; Burkhalter & Yoder, P.C.;
Burkhalter & Ryan, P.C.; Ted A. Burkhalter, Jr.; and Courtney J. Yoder based upon
Plaintiffs’ motion for voluntary dismissal. Following various discovery motions filed by
the parties, Plaintiffs filed a motion seeking to amend their complaint in April 2015,
adding, inter alia, averments that Kyle and Kenneth Bennett had removed certain
vehicles from the garage where the vehicles were stored. Plaintiffs also sought an award
of damages from Kyle and Kenneth Bennett as a result of their alleged conversion of
numerous assets belonging to Top Gun.

       On May 6, 2015, Kyle Bennett filed an affidavit, wherein he explained that he was
married to Rhonda Bennett, who is the stepdaughter of Mr. Gibbons, but that he and his
wife were in the process of divorcing. Kyle Bennett further explained that when Rhonda
Bennett and he separated and filed for divorce in 2012, he was the owner of a number of
vehicles, including three Dodge Vipers, and various items of personal property, including
tools. Kyle Bennett stated that later in 2012, without his knowledge or permission,
Rhonda Bennett and Mr. Gibbons, along with Mr. Gibbons’s wife and son, caused
several of the vehicles to be transferred out of Kyle Bennett’s name and into their names
and then removed the vehicles to other locations. Kyle Bennett further stated that

                                           -3-
Rhonda Bennett, Mr. Gibbons, and others removed various items of personalty that
belonged to him without his knowledge.

        With regard to the STA, Kyle Bennett indicated that the STA was negotiated by
Rhonda Bennett and Mr. Gibbons, who both represented to Kyle Bennett that the only
assets being transferred were those listed in Exhibit A to the STA. Kyle Bennett further
stated that in October 2013, the presiding judge in his divorce action entered an order
requiring Rhonda Bennett to return his personal property to him and to provide an
accounting of all marital property taken by her. According to Kyle Bennett’s affidavit, he
had filed a previous lawsuit in January 2013 against Mr. Gibbons, Rhonda Bennett, Troy
Bull (Mr. Gibbons’s son), and Jeff Browning (an employee of Top Gun who was later
dismissed from the lawsuit). Kyle Bennett explained that he had alleged in the earlier
action, inter alia, that the named defendants committed conversion and trespass to
chattels concerning certain vehicles that were not listed in Exhibit A to the STA: a 1997
Dodge Viper, a 1993 Dodge Viper, a 2005 Ford Excursion, a 1998 Toyota Supra, a 2006
Chevrolet Corvette, and a 1996 Dodge Ram (collectively, “the contested vehicles”).
Kyle Bennett also stated that in May 2013, the trial court entered an agreed order signed
by all parties to the previous lawsuit ruling that all of the contested vehicles were the
marital property of Kyle and Rhonda Bennett and should be returned to their marital
estate.

       The parties concede that this action was consolidated with Kyle Bennett’s
previously filed lawsuit in May 2015. Although the appellate record does not contain an
order of consolidation, later orders reflect such consolidation in the captions of the
pleadings. On June 8, 2015, Kyle and Kenneth Bennett filed an answer to the amended
complaint along with a counterclaim against Mr. Gibbons, a cross-claim against Rhonda
Bennett, and a third-party complaint against Mr. Gibbons’s wife and Mr. Bull.

       During the summer of 2015, the trial court conducted evidentiary hearings
spanning four non-consecutive days concerning the rights of ownership to the contested
vehicles. The court delineated the three issues to be considered during the hearings as
follows:

      1.     Whether Kyle Bennett signed and/or otherwise authorized the filing
             of tax returns for Top Gun, which return or returns claimed
             depreciation deductions for any of the contested vehicles.

      2.     Whether Kyle Bennett and/or Rhonda Bennett accepted payment
             from Top Gun for storage of the contested vehicles at the garage
             adjacent to their residence in Friendsville, Tennessee; and

      3.     Whether the contested vehicles were deemed to be the property of
             Top Gun under the STA.
                                        -4-
     On October 9, 2015, the trial court entered an order on the evidentiary hearings,
accompanied by a memorandum opinion, finding as follows in pertinent part:

              After hearing testimony of witnesses, including Kyle Bennett,
       Rhonda Cox (formerly Rhonda Bennett), and Jack Gibbons, the Court
       issued its Memorandum Opinion, a copy of which is attached hereto as
       Exhibit A and incorporated herein by reference. As more fully set forth in
       the Memorandum Opinion, the Court found the first issue in favor of Mr.
       Gibbons and Top Gun as to the 1993 Dodge Viper, 1994 Toyota Supra, and
       2006 Corvette, the Court found the second issue in favor of Mr. Gibbons
       and Top Gun, and the Court found the third issue in favor of Kyle Bennett
       and Kenneth Bennett.

       Following a hearing on a motion filed by Plaintiffs seeking to temporarily enjoin
Kyle Bennett from competing against Top Gun, the trial court entered an order on April
6, 2016, finding that Plaintiffs had established by clear and convincing evidence their
right to a temporary injunction. The court therefore enjoined Kyle Bennett from
competing against Top Gun in the vehicle suspension system industry within a 100-mile
radius of Blount County, Tennessee, for sixty months, retroactive to November 7, 2012.
On June 30, 2016, the court denied a motion filed by Kyle Bennett to dissolve the
temporary injunction.

       On July 5, 2016, Kyle and Kenneth Bennett filed a motion to exclude evidence
regarding financial damages, asserting that although they had served Plaintiffs with
discovery requests concerning calculation and itemization of damages that Plaintiffs had
alleged in the amended complaint, the requests were returned with vague information or
no information at all. On July 27, 2016, Kyle and Kenneth Bennett also filed a motion in
limine regarding damages, requesting that Plaintiffs be prevented from entering evidence
regarding financial damages in part because of their lack of complete discovery responses
and in part because of Top Gun’s status as a “Subchapter S Corporation.” Concerning
these motions, the trial court entered an order on August 11, 2016, requiring Plaintiffs to
respond to Kyle and Kenneth Bennett’s discovery requests by August 5, 2016. The court
further ordered: “To the extent any information is not provided regarding damages, such
information shall be precluded from being presented at the trial of this case[.]” In this
order, the court also reserved ruling on Kyle and Kenneth Bennett’s motion in limine
regarding damages and affirmed the finality of its prior ruling of September 15, 2015,
concerning ownership of the contested vehicles.

        Over the next several months, the trial court granted several continuances, and the
parties filed a plethora of motions, ranging from discovery motions to motions seeking
deadline extensions, none of which are particularly relevant to the issues on appeal. On
May 5, 2017, Kenneth Bennett filed a motion for summary judgment along with a
                                           -5-
statement of undisputed material facts. Plaintiffs filed a response in opposition. On July
20, 2017, the trial court entered an agreed order granting summary judgment to Ms.
Gibbons. Subsequently, on August 14, 2017, the trial court entered an agreed order
finding Kyle Bennett in civil contempt of the previously entered temporary injunction.
On November 9, 2017, the trial court issued a memorandum opinion denying Kenneth
Bennett’s motion for summary judgment.

        On December 7, 2017, Rhonda Bennett, now Rhonda Cox (hereinafter, “Ms.
Cox”), filed a motion in limine to exclude the testimony of Jeff Browning as to the
financial condition of Top Gun when he was employed there. Kyle and Kenneth Bennett
concomitantly filed a motion in limine to exclude the expert testimony of Jeffrey Day, a
certified public accountant, regarding any damages allegedly incurred by Plaintiffs.
Relative thereto, Kyle and Kenneth Bennett averred that Plaintiffs had disclosed for the
first time in September 2016 that Mr. Day planned to offer an opinion that Top Gun had
lost profits in excess of two million dollars. The Bennetts asserted that because the
August 5, 2016 discovery deadline had expired, the trial court should not allow Mr. Day
to testify regarding these damages. Plaintiffs subsequently filed a motion seeking to
modify the court’s prior order, requesting that the court extend the aforementioned
discovery deadline. The trial was subsequently continued after the parties agreed to a
continuance during a December 11, 2017 hearing.

        On June 7, 2018, Kyle Bennett filed a notice of voluntary nonsuit without
prejudice as to his claims against Ms. Cox, Jack and Kathleen Gibbons, and Mr. Bull. On
June 26, 2018, the bench trial commenced in this matter, spanning four non-consecutive
days. Witnesses included Mr. Gibbons, Kyle Bennett, Ms. Cox, and Mr. Day, who
testified both as a fact witness and an expert witness. Portions of the depositions of
Kenneth Bennett and Jeff Browning were also read into the record. Following Mr. Day’s
testimony, the Bennetts’ attorney moved for an involuntary dismissal of all claims
relating to the Noncompete Clause, arguing that there was a lack of proof of causation.
The trial court denied the motion.

       On August 13, 2019, the trial court entered a memorandum opinion containing
extensive findings of fact and an order reflecting its final judgment. In its order, the court
awarded to Plaintiffs nominal damages in the amount of $50 against Kyle Bennett due to
his breach of the STA’s Noncompete Clause. The court dismissed all of Plaintiffs’
remaining claims related to the STA, including inducement to breach, and dismissed all
claims related to expenditures by Top Gun prior to the execution of the STA. The court
further awarded to Top Gun the proceeds from the sale of the Regal Drive Property and
dismissed any pending motions and remaining claims. The court taxed court costs
equally between Plaintiffs and Kyle Bennett.

                                            -6-
       Plaintiffs subsequently filed a motion to amend or make additional findings of
fact, which the trial court denied via an order entered on November 15, 2019. Plaintiffs
timely appealed.

                                    II. Issues Presented

       Plaintiffs present the following issues for this Court’s review, which we have
restated slightly:

       1.     Whether the trial court erred by determining that certain vehicles
              were not assets of Top Gun pursuant to the terms of the STA.

       2.     Whether the trial court erred in denying Top Gun the right to recover
              expenditures made by it with respect to certain personal vehicles.

       3.     Whether the trial court erred by declining to consider the expert
              testimony of Mr. Day concerning damages sustained as a result of
              Kyle Bennett’s breach of the Noncompete Clause.

       4.     Whether the trial court erred by dismissing Plaintiffs’ claim against
              Kenneth Bennett for inducement of breach of contract without
              accompanying its dismissal with findings of fact or conclusions of
              law.

       5.     Whether the trial court erred in its allocation of court costs.

                                  III. Standard of Review

       Our review of the trial court’s judgment following a non-jury trial is de novo upon
the record with a presumption of correctness as to the trial court’s findings of fact unless
the preponderance of the evidence is otherwise. See Tenn. R. App. P. 13(d); Rogers v.
Louisville Land Co., 367 S.W.3d 196, 204 (Tenn. 2012). “In order for the evidence to
preponderate against the trial court’s findings of fact, the evidence must support another
finding of fact with greater convincing effect.” Wood v. Starko, 197 S.W.3d 255, 257
(Tenn. Ct. App. 2006) (citing Rawlings v. John Hancock Mut. Life Ins. Co., 78 S.W.3d
291, 296 (Tenn. Ct. App. 2001)). We review questions of law, including questions
involving interpretation of a contract, de novo with no presumption of correctness. See
Bowden v. Ward, 27 S.W.3d 913, 916 (Tenn. 2000); Cummings Inc. v. Dorgan, 320
S.W.3d 316, 333 (Tenn. Ct. App. 2009). The trial court’s determinations regarding
witness credibility are entitled to great weight on appeal and shall not be disturbed absent
clear and convincing evidence to the contrary. See Morrison v. Allen, 338 S.W.3d 417,
426 (Tenn. 2011); Jones v. Garrett, 92 S.W.3d 835, 838 (Tenn. 2002).

                                            -7-
                               IV. Ownership of Vehicles

        In their complaint, Plaintiffs asserted claims of ownership of certain vehicles by
Top Gun, including the contested vehicles listed above, as well as a 2006 Lamborghini
Gallardo, a 1994 Toyota Supra, a 2004 Dodge truck, a 2007 GMC Denali, a 1965 Ford
Mustang, a 1967 Ford Mustang, and a 1989 Jeep Cherokee. As Plaintiffs concede, the
six contested vehicles were the subject of Kyle Bennett’s first lawsuit and a May 2013
agreed order executed by all parties (except Top Gun), determining the contested vehicles
to be the marital property of Kyle Bennett and Ms. Cox. Plaintiffs contend, however, that
Top Gun cannot be bound by this order because it was not a party to the order. Plaintiffs
further assert that this agreed order was “the deciding factor for the trial court,
notwithstanding the language of the STA and proof introduced in the evidentiary
hearings.” Following our thorough review of the record and the trial court’s order, we
conclude that the trial court properly determined ownership of the vehicles at issue.

       In its August 13, 2019 memorandum opinion entered following the trial in this
matter, the trial court expressly stated in pertinent part:

             The final stages of this litigation concerned the claims of Mr.
      Gibbons and [Top Gun], for damages against [Kyle] Bennett and Ms. Cox,
      as well as the other defendants, relating to [Kyle] Bennett’s breach of the
      noncompetition provision of the STA and relating to expenditures made by
      Top Gun in connection with six (6) vehicles determined not to be the
      property of Top Gun but the marital property of [Kyle] Bennett and Ms.
      Cox. This litigation stems back to an agreed order entered into by [Kyle]
      Bennett, as the plaintiff, and Mr. Gibbons and Ms. Cox, as well as others,
      as the defendants, in case number 184469-1. The agreed order declares the
      vehicles to be the marital property of [Kyle] Bennett and Ms. Cox.
      Although the agreed order was entered into on May 7, 2013, after Mr.
      Gibbons had become the sole shareholder of Top Gun, Mr. Gibbons and
      Top Gun subsequently asserted in case number 186806-1 that the order was
      not binding upon Top Gun and was subject to relitigation. Next, after this
      Court in the consolidated litigation redetermined that the six (6) vehicles
      were the marital property of [Kyle] Bennett and Ms. Cox, per this Court’s
      ORDER ON EVIDENTIARY HEARING entered October 9, 2015,
      adopting its bench opinion announced September 14, 2015, Top Gun
      claimed damages for expenditures made by it relating to the vehicles. Top
      Gun also claims damages from such expenditures relating to a 2006
      Lamborghini Gallardo. The expenditures were made by Top Gun while
      [Kyle] Bennett and Ms. Cox were its sole shareholders, directors and
      officers, prior to the transfer of their stock to Mr. Gibbons under the STA.
      By one of their amended complaints, Mr. Gibbons and Top Gun alleged

                                          -8-
       that [Kyle] Bennett and Ms. Cox had made the expenditures for their
       personal benefit from the funds of Top Gun prior to the STA.

        Plaintiffs posit that the trial court erred by failing to find that all of the vehicles
referenced above belonged to Top Gun because they were used in connection with Top
Gun’s business and/or were maintained by Top Gun. As Plaintiffs point out, paragraph
six of the STA provides that “all assets purchased by or on behalf of [Top Gun] or used in
conducting the business of [Top Gun]” would be deemed corporate assets of Top Gun
“regardless of whether such assets are held, owned by, or titled in the personal name of
Sellers” and “shall not be considered a personal asset or marital asset of Sellers”
(emphasis added). Plaintiffs claim that not only were the vehicles used in “conducting
the business” of Top Gun, but certain of the vehicles were also maintained and improved
by Top Gun and depreciated on Top Gun’s income tax returns. In addition, Plaintiffs
argue that Top Gun paid Kyle Bennett and Ms. Cox monthly rental payments for the use
of their garage to store some the vehicles.

       As such, Plaintiffs’ claim is actually two-fold—first, Plaintiffs assert that the
language of the STA requires that any vehicle used in “conducting the business” of Top
Gun should be deemed Top Gun’s property, regardless of the manner in which the
vehicle was titled. Second, Plaintiffs argue that vehicles that were treated as belonging to
Top Gun, in that Top Gun expended monetary sums to maintain them, should be deemed
the property of Top Gun. We will address each argument in turn.

      Plaintiffs contend that the language of the STA requires a finding that the vehicles
previously described were assets of Top Gun because they were used in “conducting the
business” of Top Gun. Concerning interpretation of a contract such as the STA herein,
our Supreme Court has previously explained:

       In “resolving disputes concerning contract interpretation, our task is to
       ascertain the intention of the parties based upon the usual, natural, and
       ordinary meaning of the contractual language.” Guiliano v. Cleo, Inc., 995
       S.W.2d 88, 95 (Tenn. 1999). This determination of the intention of the
       parties is generally treated as a question of law because the words of the
       contract are definite and undisputed, and in deciding the legal effect of the
       words, there is no genuine factual issue left for a jury to decide. 5 Joseph
       M. Perillo, Corbin on Contracts, § 24.30 (rev. ed. 1998); Doe v. HCA
       Health Services of Tenn., Inc., 46 S.W.3d 191, 196 (Tenn. 2001).

              A court’s initial task in construing a contract is to determine whether
       the language of the contract is ambiguous. Once found to be ambiguous, a
       court applies established rules of construction to determine the parties’
       intent. “Only if ambiguity remains after the court applies the pertinent
       rules of construction does [the legal meaning of the contract] become a
                                             -9-
       question of fact” appropriate for a jury. Smith v. Seaboard Coast Line R.R.
       Co., 639 F.2d 1235, 1239 (5th Cir. 1981). . . .

              The central tenet of contract construction is that the intent of the
       contracting parties at the time of executing the agreement should govern.
       Empress Health & Beauty Spa, Inc. v. Turner, 503 S.W.2d 188, 190 (Tenn.
       1973). The intent of the parties is presumed to be that specifically
       expressed in the body of the contract. “In other words, the object to be
       attained in construing a contract is to ascertain the meaning and intent of
       the parties as expressed in the language used and to give effect to such
       intent if it does not conflict with any rule of law, good morals, or public
       policy.” 17 Am. Jur. 2d, Contracts, § 245, quoted in Turner, 503 S.W.2d at
       190. If clear and unambiguous, the literal meaning of the language controls
       the outcome of contract disputes.

              Nonetheless, a contractual provision may be susceptible to more
       than one reasonable interpretation, which renders the terms of the contract
       ambiguous. Memphis Housing Auth. v. Thompson, 38 S.W.3d 504, 512
       (Tenn. 2001), cert. denied, 534 U.S. 823, 122 S. Ct. 59, 151 L. Ed. 2d 27
       (2001). “A contract is ambiguous only when it is of uncertain meaning and
       may fairly be understood in more ways than one.” Turner, 503 S.W.2d at
       190-91. Where the terms of the contract are ambiguous, the intention of the
       parties cannot be determined by a literal interpretation of the language, and
       the courts must resort to other rules of construction.

Planters Gin Co. v. Fed. Compress & Warehouse Co., 78 S.W.3d 885, 889-90 (Tenn.
2002).

       Our Supreme Court has further explained: “An ambiguous provision in a contract
generally will be construed against the party drafting it.” Allstate Ins. Co. v. Watson, 195
S.W.3d 609, 612 (Tenn. 2006). Moreover, “when a contractual provision is ambiguous, a
court is permitted to use parol evidence, including the contracting parties’ conduct and
statements regarding the disputed provision, to guide the court in construing and
enforcing the contract.” Id.

       With regard to the STA herein, the trial court determined in its adopted findings
that although Ms. Yoder prepared the STA at the behest of Ms. Cox, Ms. Yoder
represented Plaintiffs with regard to the STA transaction.2 The court found that none of
the contested vehicles were specifically listed on Exhibit A to the STA and that none of
the vehicles were corporate assets of Top Gun as of the date of the STA’s execution.

2
  In its memorandum opinion issued on September 2, 2015, the trial court adopted certain findings
proposed by both sides while stating that the facts were “largely uncontroverted.”
                                             - 10 -
Although the trial court did not make any specific findings concerning the ambiguity of
the STA’s language that “all assets purchased by or on behalf of [Top Gun] or used in
conducting the business of [Top Gun]” would be considered corporate assets, the court
made numerous findings concerning the parties’ conduct surrounding execution of the
STA and the sale of Top Gun. Insofar as the trial court considered parol evidence,
including the parties’ statements and conduct concerning the STA transaction, we
conclude that the trial court implicitly found the phrase, “assets used in conducting the
business of [Top Gun],” to be ambiguous. We agree, determining that the language in
dispute is susceptible to more than one reasonable interpretation.

       As Plaintiffs suggest, the phrase, “assets used in conducting the business of [Top
Gun],” could refer to any assets used in connection with the promotion of Top Gun’s
business even if those assets were solely featured in advertising, trade shows, or
otherwise. On the other hand, this phrase could refer to those assets used in the actual
production of Top Gun’s products, such as tools, machinery, parts, and so on. Because
the language in dispute is capable of more than one reasonable interpretation, the
language is ambiguous, and the trial court properly considered parol evidence when
interpreting it. See Planter’s Gin Co., 78 S.W.3d at 889-90; Allstate, 195 S.W.3d at 612.

       The evidence presented in this matter demonstrated that Kyle Bennett did not
intend for the disputed language to include assets that were used solely for advertising or
promoting the business of Top Gun. Kyle Bennett testified that the contested vehicles
were purchased by him and Ms. Cox with their personal funds, with some of them having
been purchased before Top Gun existed. He further testified that none of the vehicles
were ever titled to Top Gun. Kyle Bennett related that he often placed Top Gun stickers
on his and Ms. Cox’s personal vehicles and used those vehicles in advertising materials
and at trade shows, as he likewise did with other individuals’ personal vehicles. He
explained, however, that it was not his intent for any of the vehicles in dispute to be
considered assets of Top Gun. He further stated in an affidavit his understanding that the
only assets that would transfer with the sale of the business were those specifically listed
on Exhibit A to the STA.

        As previously explained, the trial court found and Mr. Gibbons acknowledged that
Ms. Yoder drafted the STA and represented Plaintiffs with regard to the STA transaction.
Mr. Gibbons also acknowledged that he did not consider the disputed vehicles to be
assets of Top Gun at the time the STA was executed. Rather, he adopted that view after a
subsequent consultation with legal counsel who had reviewed the STA’s language
following its execution. Mr. Gibbons had, in the months leading up to the STA’s
execution, treated several of the vehicles as Kyle Bennett’s and Ms. Cox’s marital assets
by helping Ms. Cox prevent her then-husband from taking those assets or disposing of
them during the divorce proceedings. Mr. Gibbons admitted that he allowed Ms. Cox to
title some of the vehicles in his name and store them on his property during her divorce
proceedings, and he testified that this was done to preserve them as marital assets. Mr.
                                            - 11 -
Gibbons indicated that he was only keeping the vehicles for Ms. Cox and that he “never
touched them.” Moreover, he testified that when he undertook these actions, he believed
the vehicles to be marital assets of Kyle Bennett and Ms. Cox.

        Mr. Gibbons further acknowledged that he consented to entry of the May 2013
agreed order designating the contested vehicles as marital assets of Kyle Bennett and Ms.
Cox after signing the STA and upon consultation with his then-counsel. Mr. Gibbons
later signed documentation to transfer titles to the vehicles back to Kyle Bennett and Ms.
Cox. Likewise, Ms. Cox, the other party to the STA, testified that she considered those
vehicles to be marital assets at that time rather than assets of Top Gun. Ms. Cox admitted
that the vehicles were bought with personal funds and were not titled to Top Gun. She
further explained that she asked her parents and brother to “hold” the contested vehicles
“in trust” as marital assets pending her divorce so that they would not “walk off.”

       The trial court found in its memorandum opinion issued on September 2, 2015,
inter alia, that in 2012, “Rhonda Cox conspired with Jack Gibbons, Kathleen Gibbons
and Troy Bull to transfer the titles to [the contested vehicles] without Kyle Bennett’s
knowledge and to hide [the contested vehicles] from Kyle Bennett.” The court also
found that Mr. Gibbons testified under oath that he was “safekeeping” the vehicles on
behalf of Ms. Cox during her divorce from Mr. Bennett because the vehicles were marital
assets. Based on the parties’ conduct and statements, the trial court determined that the
contested vehicles were “not intended by any of the parties to the [STA] to be the
property of Top Gun and not intended to be subject to the [STA].” In addition, the trial
court specifically stated:

      [T]his Court concludes that the taking of the vehicles by the owners of the
      vehicles to promotional events for the corporate business of Top Gun also
      owned by them as its sole shareholders did not render the vehicles owned
      by the two individuals into assets used in conducting the business of the
      corporation [Top Gun].

Based on our thorough review of the evidence presented, we agree.

       The parol evidence regarding the parties’ conduct and statements at the time of the
STA’s execution clearly demonstrates that the parties did not intend for the STA’s
disputed language to be interpreted as including as corporate assets Kyle Bennett’s and
Ms. Cox’s personal vehicles that were used in advertising or promoting the business of
Top Gun. See Allstate, 195 S.W.3d at 612. At the time of the STA’s execution, none of
the parties to the STA believed that (1) the vehicles at issue were anything other than
personal assets of Kyle Bennett and Ms. Cox or (2) their ownership was transferred to
Top Gun pursuant to the STA. It was not until sometime later when Mr. Gibbons
consulted with legal counsel that he first formed a belief that the vehicles at issue could
be subject to the STA’s provisions. As such, the parol evidence supports the
                                           - 12 -
interpretation that the parties’ intent at the time of entering into this contract was for these
vehicles to remain the property of Kyle Bennett and Ms. Cox. We further note that
because the STA was drafted by Mr. Gibbons’s representative, the language used must be
construed against Mr. Gibbons. See id. We therefore affirm the trial court’s
interpretation of the STA determining that the vehicles in dispute were not subject to the
STA and were not assets of Top Gun based on the STA’s provisions.

        We will accordingly address Plaintiffs’ second argument, which is that vehicles
“treated” as belonging to Top Gun, because Top Gun expended monetary sums to
maintain them, should be deemed the property of Top Gun. The findings adopted by the
trial court in its September 2, 2015 memorandum opinion included that the contested
vehicles were purchased by Kyle Bennett and Ms. Cox personally but that Top Gun paid
for some work performed on the vehicles. The court found that the vehicles were not
registered to Top Gun and that the insurance policies were maintained in the names of
Kyle Bennett and/or Ms. Cox, although Top Gun paid some of the insurance premiums
on occasion and also paid registration fees on the vehicles. The court also determined
that at least one of the vehicles was listed as a depreciable asset on one final Top Gun tax
return, but Ms. Cox testified that this vehicle was intended for use by their son and that
she did not consider it a Top Gun asset.

       Concerning rent, the trial court found that the vehicles were stored in a detached
garage next to the former marital residence of Kyle Bennett and Ms. Cox, which garage
also contained an office space utilized by Top Gun. The court additionally found that
Top Gun paid rent to Kyle Bennett and Ms. Cox for use of the garage and also stored
tools and other items there.

       Despite the expenditure of funds by Top Gun with regard to certain vehicles
personally owned by Kyle Bennett and Ms. Cox, the trial court ultimately concluded that
these vehicles were not assets of Top Gun. We agree. Plaintiffs have provided no
authority for their contention that the expenditure of corporate funds by the sole
shareholders of a corporation on those shareholders’ personal assets would convert those
assets to corporate ownership. Although such commingling of corporate and personal
assets could constitute a questionable business practice, Plaintiffs have cited no authority
for the proposition that such action would automatically result in a change of asset
ownership. We therefore determine this argument to be unavailing.

       In support of their ownership contentions, Plaintiffs argue that the trial court
determined the issue of the contested vehicles’ ownership based solely on the agreed
order previously entered in Kyle Bennett’s related action. As the trial court elucidated in
its September 2, 2015 memorandum opinion, Mr. Bennett had filed a previous lawsuit
against Mr. Gibbons and other defendants, asserting ownership of the contested vehicles.
The court noted that Mr. Gibbons was represented by counsel in that action. As the court
determined, Mr. Gibbons authorized his attorney to enter into an agreed order decreeing
                                         - 13 -
that the contested vehicles were the marital property of Ms. Cox and Kyle Bennett. The
court further found that Mr. Gibbons was the sole shareholder, officer, and director of
Top Gun at that time; that he had knowledge of the STA, having signed it a few months
prior; and that he had commonality of interest with Top Gun when he entered into the
agreed order.

       In addition to the trial court’s numerous findings previously detailed herein
regarding the parties’ conduct and statements concerning the STA, the court continued its
findings as follows:

              The most persuasive evidence in this case as to the intent of the
       parties to the stock transfer agreement is their conduct.

              While the Court did not find Ms. [Cox] to be a particularly credible
       witness and found her to be aligned with her stepfather, Mr. Gibbons, Ms.
       [Cox] did testify that she earlier had wanted the Court to deem the vehicles,
       quote, “to be marital property to be split up the way -- however the other
       marital assets were split up,” close quotes. She also testified that when she
       transferred the vehicles to her stepfather that she believed them to be
       marital assets.

              The Court finds and concludes that the evidence preponderates in
       favor of the finding and conclusion that the vehicles were marital property
       of Rhonda [Cox] and Kyle Bennett and not intended by any of the parties to
       the [STA] to be the property of Top Gun and not intended to be subject to
       the [STA]. The evidence as construed through the conduct of the parties to
       the [STA] clearly shows that all the parties to the [STA] intended for the
       vehicles in dispute to remain as the individual and marital property of
       Rhonda [Cox] and Kyle Bennett.

        As demonstrated by the extensive findings detailed in the trial court’s
memorandum opinion, we disagree with Plaintiff’s contention that the trial court “simply
recited that it found [the ownership issue] in favor of Kyle [Bennett]” or that the court
“essentially determined that the agreed order in the prior case was binding and overrode
all factual evidence to the contrary.” The trial court clearly considered the totality of the
evidence presented before rendering its judgment. Having conducted a thorough review
of the record and the evidence presented in this matter, we conclude that the trial court’s
findings were supported by the preponderance of the evidence, and we accord appropriate
weight to the trial court’s determinations with regard to witness credibility.

       Finally, Plaintiffs assert that Top Gun should be considered a third-party
beneficiary of the STA such as to enable it to enforce the STA’s provisions. However,
having determined that the STA’s language would not require that the disputed vehicles
                                         - 14 -
be considered Top Gun assets, this argument is moot. Based on the STA’s language and
the parol evidence presented, we determine that the parties did not intend for the vehicles
at issue to be considered assets of Top Gun pursuant to the STA. We further conclude
that the actions of Kyle Bennett and Ms. Cox in expending corporate funds to improve or
maintain their personal vehicles would not result in a change in the ownership of those
vehicles. We therefore affirm the trial court’s ruling concerning the ownership of the
vehicles at issue.

               V. Recovery of Corporate Funds Spent on Personal Assets

        As an alternative to their ownership argument, Plaintiffs postulate that the trial
court erred by declining to allow Top Gun to recover the corporate funds expended on
vehicles owned personally by Kyle Bennett and Ms. Cox. As the trial court determined
in its August 13, 2019 memorandum opinion, the “expenditures were made by Top Gun
while Mr. Bennett and Ms. Cox were its sole shareholders, directors and officers, prior to
the transfer of their stock to Mr. Gibbons under the STA.” The court further found:

             The evidence establishes that Kyle Bennett and Rhonda Cox had a
      history of commingling personal and corporate income, expenses, assets
      and liabilities of themselves and Top Gun. [Plaintiffs] claim that
      expenditures by Top Gun, prior to the STA, relating to the vehicles
      previously determined by this Court to be the marital property of Kyle
      Bennett and Rhonda Cox, as well as the 2006 Lamborghini Gallardo, are
      improper and recoupable by Top Gun. If this claim were brought by Mr.
      Gibbons as a shareholders’ derivative action, it would be subject to
      dismissal because Mr. Gibbons was not a shareholder at the time of the
      challenged expenditures. See Tenn. Code Ann. § 48-17-401 and Tenn. R.
      Civ. P. 23.06.

            Presently, Mr. Gibbons, as the sole shareholder of Top Gun, has
      caused it to bring its claim for expenditures made by Top Gun while [Kyle]
      Bennett and Ms. Cox were its sole shareholders, directors, and officers.
      Neither side has cited the Court to any case discussing whether a closed
      corporation, after the transfer of all its stock from its former sole
      shareholders to a new sole shareholder, can go back and sue its former sole
      shareholders, who were also its only directors and officers, for challenged
      expenditures.

             This Court is of the opinion that the absence of any such case law is
      significant in two ways. First, the “[c]ourts recognizing the significant
      conceptual differences between the closed corporation and its publicly
      owned counterpart, hold where no competing minority interest appears, no
      fraud or apparent injury to the public or creditors is present, and no clearly
                                         - 15 -
       prohibitory statutory language is violated, there is no valid reason for
       precluding the parties from reaching any arrangements concerning the
       management of the corporation which are agreeable to all.” 18A Am. Jur.
       2d, Corporations, § 629. If [Kyle] Bennett and Rhonda Cox had taken
       action as the sole shareholders and directors to formally authorize
       expenditures, as dividends or distributions to themselves, absent injury to a
       creditor, there could be no complaint. Since Top Gun is a closed
       corporation, the same criteria is applicable to such informal action. Id.
       Second, this is not a situation where a creditor is seeking to hold a sole
       shareholder liable for the acts or debts of the corporation injurious to the
       creditor. See Id. at § 732. Considering that [Kyle] Bennett and Ms. Cox
       were the sole shareholders, directors and officers, there is no way to
       conclude that Top Gun did not have knowledge of the expenditures and
       authorized or ratified them.

       Plaintiffs assert that the trial court erred in its determination because “[u]nder
Tennessee corporation law, a corporation and its shareholders are distinct entities.” See
Cambio Health Solutions., LLC v. Reardon, 213 S.W.3d 785, 790 (Tenn. 2006).
Although we agree that a corporation and its shareholders are distinct entities, it does not
logically follow that such principle would provide authority for allowing a purchasing
shareholder to be able to hold a former shareholder liable for the expenditures of a
closely held corporation that occurred prior to the corporation’s sale. In fact, we
determine that such principle would be inapposite to the claim advanced by Plaintiffs.

      Our Supreme Court has previously elucidated the following with regard to a
corporate shareholder’s personal liability:

       Ordinarily, a shareholder of a corporation is not personally liable for the
       acts of the corporation. See Oceanics Sch., Inc. v. Barbour, 112 S.W.3d
       135, 140 (Tenn. Ct. App. 2003) (“A corporation is presumptively treated as
       a distinct entity, separate from its shareholders, officers, and directors.”)
       (citing Schlater v. Haynie, 833 S.W.2d 919, 925 (Tenn. Ct. App. 1991)). In
       appropriate circumstances, however, the corporate veil may be pierced and
       the acts of a corporation attributed to a shareholder. CAO Holdings, Inc. v.
       Trost, 333 S.W.3d 73, 88 (Tenn. 2010). “The corporate entity generally is
       disregarded where it is used as a cloak or cover for fraud or illegality, to
       work an injustice, to defend crime, or to defeat an overriding public policy,
       or where necessary to achieve equity.” 18 Am. Jur. 2d Corporations § 57
       (2004) (footnotes omitted).

              The party seeking to pierce the corporate veil has the burden of
       presenting facts demonstrating that it is entitled to relief. Barbour, 112
       S.W.3d at 140. In order to pierce the corporate veil, the proof must show
                                         - 16 -
      that “the separate corporate entity ‘is a sham or a dummy’ or that
      disregarding the separate corporate entity is ‘necessary to accomplish
      justice.’” Trost, 333 S.W.3d at 88 (quoting Barbour, 112 S.W.3d at 140).
      The question of whether the corporation’s separate identity should be
      disregarded is dependent on the specific circumstances of the case and is a
      “‘matter . . . particularly within the province of the trial court.’” Barbour,
      112 S.W.3d at 140 (quoting Elec. Power Bd. of Chattanooga v. St. Joseph
      Valley Structural Steel Corp., 691 S.W.2d 522, 526 (Tenn. 1985)). When
      determining whether the corporate veil should be pierced, the following
      factors are applicable:

             Factors to be considered in determining whether to disregard
             the corporate veil include not only whether the entity has
             been used to work a fraud or injustice in contravention of
             public policy, but also: (1) whether there was a failure to
             collect paid in capital; (2) whether the corporation was
             grossly undercapitalized; (3) the nonissuance of stock
             certificates; (4) the sole ownership of stock by one individual;
             (5) the use of the same office or business location; (6) the
             employment of the same employees or attorneys; (7) the use
             of the corporation as an instrumentality or business conduit
             for an individual or another corporation; (8) the diversion of
             corporate assets by or to a stockholder or other entity to the
             detriment of creditors, or the manipulation of assets and
             liabilities in another; (9) the use of the corporation as a
             subterfuge in illegal transactions; (10) the formation and use
             of the corporation to transfer to it the existing liability of
             another person or entity; and (11) the failure to maintain arms
             length relationships among related entities.

      Trost, 333 S.W.3d at 88 n.13 (quoting FDIC v. Allen, 584 F. Supp. 386,
      397 (E.D. Tenn. 1984)). No single factor among those listed is conclusive,
      nor is it required that all of these factors support piercing the corporate veil;
      typically, courts will rely on a combination of the factors in deciding the
      issue. Barbour, 112 S.W.3d at 140. However, in all events, the equities
      must “substantially favor” the party requesting relief, Trost, 333 S.W.3d at
      89, and the presumption of the corporation’s separate identity should be set
      aside only “with great caution and not precipitately.” Schlater, 833 S.W.2d
      at 925.

Rogers, 367 S.W.3d at 214-15.

                                           - 17 -
        In this matter, Plaintiffs have not advanced a claim seeking to pierce Top Gun’s
corporate veil in order to hold the individual shareholders liable for the corporation’s
expenditures made prior to the sale of Top Gun to Mr. Gibbons. Assuming, arguendo,
that such a claim had been advanced, the proof presented was insufficient to hold Kyle
Bennett and Ms. Cox personally liable for such corporate expenditures made while they
were Top Gun’s only shareholders. Plaintiffs have failed to show that the “corporate
entity ‘[was] a sham or a dummy’ or that disregarding the separate corporate entity [was]
‘necessary to accomplish justice.’” See id. We therefore affirm the trial court’s
declination to disregard the corporation’s separate identity in order to hold Kyle Bennett
and Ms. Cox personally liable for Top Gun’s corporate expenditures while they were its
only shareholders.

                              VI. Testimony of Expert Witness

       Plaintiffs’ next issue questions whether the trial court erred by “disregarding” the
expert testimony of Mr. Day with regard to the damages sustained by Top Gun due to
Kyle Bennett’s breach of the Noncompete Clause. We note that in the argument section
concerning this issue in their appellate brief, Plaintiffs first argue that the trial court erred
by determining that both Mr. Gibbons and Kyle Bennett had breached the STA’s
provisions. However, Plaintiffs did not raise an issue in their statement of issues
concerning the trial court’s findings with regard to Mr. Gibbons’s breach. Inasmuch as
issues not raised in the statement of issues may be considered waived, we decline to
address this argument and will only address the issue presented with regard to proper
consideration of Mr. Day’s testimony. See Ethridge v. Estate of Ethridge, 427 S.W.3d
389, 395 (Tenn. Ct. App. 2013) (“Issues not raised in the statement of the issues may be
considered waived.”).

      The trial court stated as follows with regard to the proof of damages resulting from
Kyle Bennett’s breach of the Noncompete Clause:

       [W]hile both sides breached the STA, the evidence does not sustain that
       Mr. Gibbons or Top Gun suffered any actual damages from the defendant
       Kyle Bennett’s breach of the noncompetition provision. The testimony of
       the plaintiffs’ expert and fact witness, Jeffrey Day, CPA, was the only
       proof proffered, at the hearing commencing June 26, 2018, on the issue of
       damages from defendant Kyle Bennett’s breach of the noncompetition
       provision. Mr. Day testified that Top Gun began experiencing a
       diminishment in revenues immediately following Mr. Gibbons’ acquisition
       of the company and that the decline continued on a consistent basis of
       $413,425.00 per month. Mr. Day testified that Top Gun lost profits in the
       total amount of $2,371,898.00 during the period from November 8, 2012,
       through July 31, 2016. At the rate of $413,425.00 per month, as testified
       by Mr. Day, all of the damages would have accrued in the first six months
                                          - 18 -
of Mr. Gibbons’ operation of the business. However, the defendant Kyle
Bennett did not begin conducting his competing business until the seventh
month after Mr. Gibbons’ acquisition of Top Gun. Therefore, no damages
could be attributable to the defendant Kyle Bennett’s operation of his
competing business commencing in the seventh month following Mr.
Gibbons’ acquisition of Top Gun.

       Mr. Day’s opinion of lost profits was based upon his use of a
“before-and-after method” comparing the profits before Mr. Gibbons
assumed ownership with those after Mr. Gibbons’ ownership. However,
Mr. Day was unable to attribute Mr. Gibbons’ decrease in profits to
anything in particular. There was no evidence as to what caused any
particular customer to decrease or decline purchases. Mr. Day testified that
he did not have any basis for asserting “what the cause was for the missing
sales,” but that he could only observe the revenue trends. Conversely,
Jeffrey Browning, the former general manager of Top Gun, testified, by
deposition, that Top Gun lost business because of Mr. Gibbons’ bad
business practices. Mr. Browning testified that Top Gun, under Mr.
Gibbons’ management, required more time to complete vehicles because
Mr. Gibbons restricted the ordering of necessary parts, paid some of its
parts vendors over a longer period of time, and failed to pay other parts
vendors at all. Consequently, Top Gun’s vendors would not ship necessary
parts until receipt of payment, all of which delayed the completion of its
vehicle suspension work.

        The evidence from Mr. Gibbons and Top Gun at the hearing on their
application for a temporary injunction was likewise deficient as to the basis
for determining why customers of Top Gun had declined or decreased their
purchases from Top Gun. The operations of Top Gun had been shut down
prior to the STA. Mr. Gibbons testified about the decrease in the gross
revenues of Top Gun but had no personal knowledge about transactions
between Top Gun’s customers or former customers and defendant Kyle
Bennett or his LLC. Furthermore, Mr. Gibbons did not testify in terms of
Top Gun’s lost profits but only in terms of gross revenues, which would not
be equivalent to actual damages. As set forth above, the testimony of the
plaintiffs’ expert, Mr. Day, actually demonstrates that all of the decline
occurred prior to the competition. Also, the testimony of Top Gun’s former
general manager, Mr. Browning, indicates that the decline was due to
mismanagement. In announcing its decision to grant the temporary
injunction, the Court referred to the ground for injunctive relief that actual
damages would be difficult to ascertain (leaving the plaintiff with no
remedy other than nominal damages absent injunctive relief).

                                    - 19 -
             The plaintiffs have the burden of not only showing breach of the
      noncompetition provision but also the actual damages, “which are the
      natural and proximate results of the breach.” Johnson v. Jones, 1 Tenn.
      App. Rpts. 24, 28 (Tenn. Ct. App. 1925). See also Baker v. Hooper, 50
      S.W.3d 463, 470 (Tenn. Ct. App. 2001). This Court finds and concludes
      that the plaintiffs have been unable to meet their burden of proof as to any
      actual damages from the defendant Kyle Bennett’s breach of the
      noncompetition provision.

       Plaintiffs contend that the “only reasonable inference” to be drawn from the
evidence presented was that the lost profits suffered by Top Gun were the result of Kyle
Bennett’s competing business. We disagree. The evidence in the record from Mr. Day
and Mr. Gibbons clearly demonstrates that Top Gun experienced a significant decline in
business following its sale to Mr. Gibbons and that such decline occurred immediately
after the sale. However, the evidence presented fell short of demonstrating that Kyle
Bennett’s competition was the reason for such decline.

       Mr. Gibbons acknowledged that he purchased Top Gun without performing any
due diligence and having no familiarity with the vehicle suspension system industry.
Furthermore, Mr. Gibbons stated that he believed Top Gun was financially successful
because Ms. Cox and Kyle Bennett enjoyed a lavish lifestyle. According to the testimony
of Mr. Gibbons at trial and the deposition testimony of Mr. Browning, Top Gun actually
ceased operations prior to the STA’s execution because there was no money to pay
employees or vendors. Mr. Gibbons asserted that he then began paying off Top Gun’s
debts, ultimately expending over two million dollars on such payments.

       Mr. Gibbons testified that following his purchase of Top Gun, the company lost
the business of certain car dealers with whom Top Gun had previously done business.
However, Mr. Gibbons could not say definitively whether this loss of business was the
result of any competition by Kyle Bennett. Mr. Gibbons stated that Mr. Browning was
untruthful in his deposition when Mr. Browning claimed that Top Gun failed to pay
certain vendors after Mr. Gibbons purchased the company and thus could not acquire
needed parts or complete orders in a timely fashion.

      Mr. Day testified that Top Gun lost significant profits following its sale to Mr.
Gibbons and that such decline occurred immediately after the sale occurred. Notably,
Mr. Day could not attribute the losses to any particular cause. Mr. Day opined that he did
not believe the change in ownership would have caused the decline despite Mr.
Gibbons’s lack of experience with Top Gun’s industry or with internet sales. However,
Mr. Day, having previously performed accounting work for Top Gun when it was owned
by Kyle Bennett and Ms. Cox, described Kyle Bennett as “brilliant,” a “shrewd
businessman,” and an “enthusiast” in Top Gun’s industry of vehicle suspension systems.

                                          - 20 -
       As proof concerning Kyle Bennett’s competition with Top Gun, Kenneth Bennett
stated that Kyle Bennett had been working with a friend in Bristol, Tennessee, making
suspension parts for “monster” and “baja” trucks when Kenneth Bennett decided to start
a limited liability company physically located in Maryville, Tennessee, called, “KJB,
LLC,” and operating as “Boost Performance” and later “Stealth Suspensions.”3 Kyle
Bennett and Kenneth Bennett worked together in Stealth Suspensions thereafter, with
Kenneth acting as chief manager and Kyle performing most of the day-to-day operations.
Exhibits in the record demonstrate that the LLC was formed in July 2013, although a
lessor’s letter entered as an exhibit at trial references a lease having been entered into by
Stealth Suspensions in June 2013. Ergo, as the trial court found, Kyle Bennett’s
acknowledged competition with Top Gun in violation of the Noncompete Clause began
approximately seven months after the sale of Top Gun to Mr. Gibbons in contrast to Mr.
Day’s testimony that Top Gun began to suffer significant losses immediately after Mr.
Gibbons purchased the business.

       Based on the proof presented, we agree with the trial court that Plaintiffs failed to
prove actual damages resulting from the breach of the Noncompete Clause. As this Court
has previously clarified: “Lost or expected profits are recoverable as damages if they are
shown to be a consequence of the breach [of a noncompete clause], provided the amount
can be proved with reasonable certainty.” Baker v. Hooper, 50 S.W.3d 463, 470 (Tenn.
Ct. App. 2001) (emphasis added). Additionally, “[a] plaintiff seeking lost profits bears
the burden of proving the amount lost with reasonable certainty, and that the loss was a
direct consequence of defendant’s breach.” Hurst Co., Inc. v. Bituminous Ins.
Companies, No. 03A01-9707-CH-00304, 1998 WL 283069, at *5 (Tenn. Ct. App. May
28, 1998) (citing Lamons v. Chamberlain, 909 S.W.2d 795 (Tenn. Ct. App. 1993)).
Moreover, “[w]hether a breach of contract was the proximate cause of lost profits is a
question of fact.” See Hurst, 1998 WL 283069, at *5.

        Although Mr. Day’s testimony did demonstrate that Top Gun suffered lost profits,
it did not prove that those lost profits were the consequence of Kyle Bennett’s breach of
the Noncompete Clause. Other facts were shown that also could have contributed to the
losses, such as Mr. Gibbons’s unfamiliarity with the industry, Top Gun’s cash flow issues
and lack of capital, and Kyle Bennett’s withdrawal from the business. Moreover,
Plaintiffs failed to explain why Top Gun’s losses occurred immediately following the sale
despite the fact that the Bennetts’ competing business in Blount County was not
established for approximately seven months. Based on the lack of causation shown, we

3
  We note that the Noncompete Clause specified that only competition within 100 miles of Blount
County, Tennessee, would be considered a breach thereof. No argument has been presented that work
performed in Bristol would fall within the Noncompete Clause’s geographic parameters.

                                             - 21 -
conclude that the trial court did not err in assessing only nominal damages for Kyle
Bennett’s breach of the Noncompete Clause.4

       Plaintiffs also argue that the trial court erred by ignoring evidence of Kyle
Bennett’s alleged fraudulent conduct, such as Mr. Browning’s testimony that Kyle
Bennett told him in October 2012 that he was going to run Top Gun’s business “into the
ground” before the STA was executed. We note, however, that Plaintiffs’ attorney
stipulated during the second day of trial that Plaintiffs had asserted no claims of fraud or
misrepresentation by Kyle Bennett concerning the STA.

       Plaintiffs further contend that Kyle Bennett violated the duty of good faith and fair
dealing with respect to the STA. See, e.g., Dick Broad. Co. v. Oak Ridge FM, Inc., 395
S.W.3d 653, 686 (Tenn. 2013) (“Tennessee law recognizes an implied covenant of good
faith and fair dealing in every contract.”). Although the Bennetts posit that this claim
was never mentioned until after the trial in this matter, Plaintiffs assert that the issue of
good faith and fair dealing is not necessarily separate from a claim of breach of contract
and does not have to be explicitly stated. Even assuming, arguendo, that such a claim
was advanced at trial, it would not alter the fact that Kyle Bennett’s breach of the
Noncompete Clause was not shown to be the proximate cause of Top Gun’s lost profits.
We therefore find these arguments unavailing.

                      VII. Inducement of Breach of Noncompete Clause

        Plaintiffs also contend that the trial court erred by dismissing their claim that
Kenneth Bennett induced Kyle Bennett to breach the Noncompete Clause without
making appropriate findings of fact and conclusions of law. We note, however, that the
trial court made the following findings and conclusions relevant to this claim:

       This Court finds and concludes that the plaintiffs have been unable to meet
       their burden of proof as to any actual damages from the defendant Kyle
       Bennett’s breach of the noncompetition provision. Likewise, there is
       insufficient proof of any actual damages attributable to the tortious acts of
       defendant [Kenneth] Bennett in inducing or contributing to defendant Kyle
       Bennett’s breach.       Proof of damages is an inherent weakness in
       noncompetition cases often resulting in the issuance of injunctive relief as
       the preferable and only available remedy. See Johnson v. Jones, 1 Tenn.
       App. Rpts. 24, 28 (Tenn. Ct. App. 1925) quoting Bradford & Carson v.
       Montgomery Furniture Co., 92 S.W. 1104, 1110 (Tenn. 1906) (quoting
       “[t]he chief difficulty found in actions for breach of contract of this
       character is in ascertaining the damages which the plaintiff can recover, as

4
  As the trial court found, the Noncompete Clause had expired by the time of trial such that a grant of
injunctive relief would have been ineffective.
                                                - 22 -
       they are generally uncertain, remote and speculative. For this reason, the
       most efficient remedy is an injunction inhibiting the defendant from again
       entering into the business he has contracted not to resume . . .”). However,
       the defendant Kyle Bennett has admitted that he violated the
       noncompetition provision, and previously in this case, admitted that he had
       violated the temporary injunction issued in this case to prohibit him from
       violating the noncompetition provision. Since this litigation has been
       pending, the period of the noncompetition provision has expired rendering
       the injunctive relief moot. Without an award of nominal damages, the
       plaintiff, Jack Gibbons, will have suffered a wrong without a remedy.
       Accordingly, the Court will award nominal damages to the plaintiff, Jack
       Gibbons, from the defendant, Kyle Bennett, in the amount of $50.00. See
       Johnson v. Jones, 1 Tenn. App. Repts., at 28 (The plaintiff “must be
       prepared to prove such damages as the law recognizes or otherwise he can
       receive only nominal damages.”); see also Tenn. Juris., Damages, § 3. All
       other claims for breach or inducement to breach the STA, including but not
       limited to its noncompetition provision, will be dismissed.

       Although the majority of the trial court’s findings pertain to Kyle Bennett and his
breach of the Noncompete Clause, the trial court did clearly find, inter alia, that there
was “insufficient proof of any actual damages attributable to the tortious acts of
defendant [Kenneth] Bennett in inducing or contributing to defendant Kyle Bennett’s
breach.” As the parties concede, the elements of a claim of inducement of breach of
contract require proof of damages resulting from the breach much like the actual claim of
breach. See TSC Indus., Inc. v. Tomlin, 743 S.W.2d 169, 173 (Tenn. Ct. App. 1987).
Ergo, as with Plaintiffs’ assertion concerning Kyle Bennett’s breach of the Noncompete
Clause, their claim that Kenneth Bennett induced such breach cannot be successful
without evidence that the breach caused damages to Top Gun. Inasmuch as Plaintiffs
failed to proffer sufficient proof, their claim of inducement to breach the Noncompete
Clause must also fail. Based on our review of the record and the trial court’s findings and
conclusions, we affirm the trial court’s ruling concerning this issue as well.

                              VIII. Allocation of Court Costs

       Finally, Plaintiffs argue that the trial court erred in its allocation of court costs by
assessing fifty percent of the court costs to Plaintiffs. Plaintiffs assert that Kyle Bennett
should have borne all court costs because of his breaches of the STA and violation of the
court’s temporary injunction concerning non-competition. As Plaintiffs acknowledge,
however, “[t]axation of court costs are normally within the sound discretion of the trial
court, and [the court’s] action on these issues will not be disturbed unless the record
discloses a clear abuse of discretion or where such discretion is superseded by statute.”
Carson Creek Vacation Resorts, Inc. v. State, Dep’t of Revenue, 865 S.W.2d 1, 3 (Tenn.
1993). Plaintiffs characterize themselves as the prevailing parties in this matter, noting
                                             - 23 -
that a “successful party in all civil actions is entitled to full costs” pursuant to Tennessee
Code Annotated § 20-12-101 (2009).

       As our Supreme Court has explained: “A court abuses its discretion when it
causes an injustice to the party challenging the decision by (1) applying an incorrect legal
standard, (2) reaching an illogical or unreasonable decision, or (3) basing its decision on a
clearly erroneous assessment of the evidence.” Lee Med., Inc. v. Beecher, 312 S.W.3d
515, 524 (Tenn. 2010). In the case at bar, Plaintiffs were only partially successful in their
claims against Kyle Bennett, resulting in a judgment for the proceeds from the sale of the
Regal Drive Property and nominal damages of $50. Based on our thorough review of the
record, we conclude that the trial court did not abuse its discretion in its allocation of
court costs.5

                                            IX. Conclusion

       For the foregoing reasons, we affirm the trial court’s judgment in its entirety. We
remand this matter to the trial court for enforcement of the judgment and collection of
costs assessed below. Costs on appeal are assessed to the appellants, Jack W. Gibbons
and Top Gun Customz, Inc.

                                                           s/ Thomas R. Frierson, II
                                                           _________________________________
                                                           THOMAS R. FRIERSON, II, JUDGE

5
 We note that in the argument section of their reply brief, Plaintiffs complain that there were unnecessary
delays in this matter, resulting in the case being “strung out” at the trial court level. However, because
Plaintiffs did not raise an issue in their statement of issues concerning this argument, we decline to
address it. See Ethridge, 427 S.W.3d at 395 (“Issues not raised in the statement of the issues may be
considered waived.”).

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