Diane Mauriello v. Branch Banking and Trust Company

CourtCourt of Appeals of Tennessee
DecidedJanuary 4, 2024
DocketE2023-00098-COA-R3-CV
StatusPublished

This text of Diane Mauriello v. Branch Banking and Trust Company (Diane Mauriello v. Branch Banking and Trust Company) is published on Counsel Stack Legal Research, covering Court of Appeals of Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Diane Mauriello v. Branch Banking and Trust Company, (Tenn. Ct. App. 2024).

Opinion

01/04/2024 IN THE COURT OF APPEALS OF TENNESSEE AT KNOXVILLE September 20, 2023 Session

DIANE MAURIELLO v. BRANCH BANKING AND TRUST COMPANY

Appeal from the Chancery Court for Campbell County No. 11-067 Elizabeth C. Asbury, Chancellor

No. E2023-00098-COA-R3-CV

The plaintiff in this action, alleging mutual mistake, sought rescission and nullification of a promissory note and deed of trust related to the plaintiff’s 2005 purchase of multiple parcels of unimproved real property. Upon the defendant bank’s counterclaim and motion for summary judgment, and following a hearing in which the plaintiff participated pro se after the court denied her motion for continuance, the trial court granted summary judgment in favor of the bank. The court dismissed the plaintiff’s complaint with prejudice and awarded a judgment to the bank in the amount of $306,392.14, inclusive of the principal owed on the promissory note, accrued interest at the time of the hearing, reasonable attorney’s fees, and expenses. The plaintiff has appealed. Discerning no reversible error, we affirm.

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 D. MICHAEL SWINEY, C.J., and JOHN W. MCCLARTY, J., joined.

Jordan Long, Tazewell, Tennessee, for the appellant, Diane Mauriello.1

W. Morris Kizer, Knoxville, Tennessee, for the appellee, Branch Banking and Trust Company.

1 In the notice of appeal and the appellant’s brief, the appellant’s surname is spelled as “Maurielo” with one “l.” However, throughout the record, in the final order, and in documents in the record that were personally executed by the appellant, her name is spelled as “Mauriello.” We have therefore utilized the latter spelling in this Opinion. OPINION

I. Factual and Procedural Background

On May 31, 2005, the plaintiff, Diane Mauriello, a New Jersey resident, purchased title to several parcels of unimproved real property located in Campbell County, Tennessee (“the Property”), from Villages at Norris Lake, LLC (“Villages”). Ms. Mauriello purchased the Property for a total price of $1,015,000.00. She financed $812,000.00 of the purchase price through a line-of-credit loan from the defendant, Branch Banking and Trust Company (“BB&T”), executing a promissory note (“the Note”) secured by a deed of trust. In June 2007, Ms. Mauriello filed a complaint against Villages and Land Resource Companies, LLC (“Land Resource”), in the United States District Court for the Eastern District of Tennessee, alleging, inter alia, that those corporations had misrepresented the value of the Property, had failed to provide promised amenities for lots in the corresponding development, and had failed to honor a commitment to tie individual lots to the LaFollette Utilities sewer system.2

Acting through attorney Arthur F. Knight, III, Ms. Mauriello initiated the instant action by filing her complaint in the Campbell County Chancery Court (“trial court”) on May 24, 2011, naming BB&T as the defendant3 and alleging that the Note should be rescinded, nullified, or modified “on the grounds of mutual mistake.” Ms. Mauriello averred that she had purchased the Property “based upon her reliance on multiple false representations by personnel affiliated” with Villages and Land Resource and that in financing her purchase, BB&T had “relied on the same false representations as well as inaccurate appraisals based upon the aforementioned false representations.” She thereby alleged that “her transaction with [BB&T] was based upon a mutual mistake of fact as to the value of the purchased land.” While acknowledging that she had stopped making monthly interest payments on the Note in the fall of 2010, Ms. Mauriello maintained that she had been “forced” to do so because “illness and injuries she suffered made it impossible for her to work.” She further acknowledged that BB&T had initiated foreclosure proceedings set to take place in June 2011. Ms. Mauriello requested that the court “rescind and nullify” the Note and deed of trust or modify them “in accordance with the [Property’s] true value on the grounds of mutual mistake.”

2 According to Ms. Mauriello’s complaint in the instant action, she subsequently filed an amended complaint in the federal case and prepared for trial set for June 2009, but following a suggestion of bankruptcy filed by the federal case defendants in November 2008, the case was stayed until July 2010. Ms. Mauriello stated that at the time of the instant complaint’s filing in 2011, she was in the process of filing further claims against the federal case defendants. 3 As the trial court noted in its final order, “BB&T is now known as Truist Bank by operation of the merger of BB&T and SunTrust.” -2- BB&T filed a motion to dismiss on June 27, 2011, pursuant to Tennessee Rule of Civil Procedure 12.02(6), asserting that Ms. Mauriello had filed a claim upon which relief could not be granted because “rescission cannot be granted against an innocent third party based on the fraudulent conduct of someone else.” BB&T also argued that Ms. Mauriello’s alternate request for reformation could not be granted because there was no mutual mistake in the agreement between the parties. BB&T further argued that Ms. Mauriello’s claims should be barred by the doctrines of estoppel and laches because she had not filed the complaint within a reasonable time following the original transaction. Ms. Mauriello filed a response objecting to the motion to dismiss on July 26, 2011.

Ms. Mauriello filed an amended complaint on August 10, 2011, adding an alternative allegation that BB&T had “acted in concert” with employees of Villages and Land Resource “to provide [Ms. Mauriello] with a line of credit to purchase [the Property].” She averred that BB&T “either knew or should have known about the planned activities to usurp the development, change the development to grossly devalue the properties, and/or abandon the development as described herein, but issued the line of credit based on [Ms. Mauriello’s] then existing financial status.” Following a hearing, the trial court entered an order on August 17, 2011, granting Ms. Mauriello’s motion to amend her complaint and also granting BB&T’s motion to dismiss as to all claims except the one added by the amended complaint.

On September 1, 2011, BB&T filed an answer and counterclaim, denying all substantive allegations against it and requesting a judgment in the total amount of $859,439.36, inclusive of $812,599.99 owed on the principal balance due on the loan, interest to the date of the counterclaim, late charges and fees, and reasonable attorney’s fees pursuant to a provision of the Note. BB&T also requested interest accruing on the principal balance of the loan after the date of the counterclaim. Ms. Mauriello filed a reply to the counterclaim on October 25, 2011, with an amended reply filed the same day, again acknowledging that she had ceased making timely payments on the Note in October 2010 but averring that the counterclaim should be dismissed and that she should not be held responsible for BB&T’s attorney’s fees.

Nearly five years later, following a July 15, 2016 docket sounding, the trial court, noting in an order that only BB&T’s counsel had appeared, set the case for a status hearing. On August 2, 2017, the court entered an agreed order allowing Mr. Knight to withdraw as Ms. Mauriello’s counsel. Although no documentation of Mr. Knight’s re- engagement is the record, it is undisputed that Ms. Mauriello again retained his services at some point.

On August 19, 2021, the trial court issued a notice of trial setting for December 13, 2021, which was signed by counsel for both parties. Upon Mr.

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