Fielder v. Lakesite Enterprises, Inc.

871 S.W.2d 157, 1993 Tenn. App. LEXIS 599
CourtCourt of Appeals of Tennessee
DecidedSeptember 15, 1993
StatusPublished
Cited by11 cases

This text of 871 S.W.2d 157 (Fielder v. Lakesite Enterprises, Inc.) 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
Fielder v. Lakesite Enterprises, Inc., 871 S.W.2d 157, 1993 Tenn. App. LEXIS 599 (Tenn. Ct. App. 1993).

Opinion

OPINION

CANTRELL, Judge.

The appellant in this case is asking for relief from a judgment of the Stewart County Chancery Court, under Tenn.R.Civ.Proc. 60.-02. That court divided the proceeds from a foreclosure sale of real property between the appellant and his co-plaintiffs in the foreclosure suit. The appellant argues he should be granted relief from the judgment because of mistake, excusable neglect and unfair surprise. For reasons set out below, we affirm the decision of the chancellor.

I.

In 1970, appellant Neil Brown and Mr. O.W. Fielder became co-owners and tenants in common of 154 acres of real property adjoining Kentucky Lake. They together developed the property into a recreational area known as “Brownfield Resort.” In 1978, they sold the property to Lakesite Enterprises Inc., which planned to subdivide the parcel into smaller tracts, for development and sale to third parties.

In payment for the property, the president of Lakesite Properties executed a promissory note in the amount of $400,000, payable to Mr. Brown and Mr. Fielder, which was secured by a deed of trust on the property. The note contained a provision that the par[159]*159ties would release their security interest in specific portions of the property as they received payment from Lakesite Enterprises or assignments of notes procured by Lake-site from third-party purchasers of lots.

The appellant and Mr. Fielder maintained a joint checking account in the Bank of Dickson, which required the signatures of both in order to withdraw or transfer funds. Funds received from Lakesite Enterprises were deposited into the account and divided from time-to-time between the appellant and Mr. Fielder on an equal basis.

Lakesite sometimes forwarded to the parties a mixture of cash and promissory notes, acquired through the sale of lots. On three occasions, appellant Brown, who had a need for cash, agreed in writing to take all the cash, in exchange for which he released his interest in a total of twenty-one (21) promissory notes to Mr. Fielder. The bookkeeper for Lakesite Enterprises notified the makers of those notes that they should make payment to Mr. Fielder alone. She also kept a ledger, where she recorded which lots Mr. Fielder and Mr. Brown both retained an interest in (noted as “Brown and Fielder” lots) and which lots Mr. Fielder alone had an interest in (noted as “Fielder only” lots). Mr. Fielder opened an account in the First American National Bank in his name only, to hold the funds received from payments on the promissory notes on which Mr. Brown had relinquished his interest.

Mr. Fielder died in 1981. His wife, Bama Fielder, and the Trust Department of First American National Bank, were named co-executors of the estate.

Eventually, Lakesite abandoned the business of selling lots and defaulted on its promissory note. On September 1, 1988, Mrs. Fielder, the bank, and the appellant Mr. Brown brought suit to foreclose on the unreleased property. The parties realized $131,-625 on the foreclosure sale. On August 10, 1990, the chancellor ordered that all funds in the account in the Bank of Dickson, and the account in the First American National Bank be transferred to the clerk and master, to be held by her pending distribution to Mr. Brown and the estate of Mr. Fielder. At the final hearing on February 4, 1992, the chancellor heard proof as to the appropriate distribution of funds realized from the foreclosure sale. He issued an order on February 28, 1992, dividing the money realized from the “Brown and Fielder” lots equally between Mr. Brown and the estate of Mr. Fielder, and allocating all funds realized from the “Fielder only” lots to the estate.

The appellant filed a motion for new trial on March 30, 1992. The chancellor found that the matters set forth in Mr. Brown’s motion were of a nature that should be addressed, not in a motion for new trial, but in a Rule 60.02 motion for relief from judgment. Mr. Brown filed a Rule 60.02 motion on August 7, 1992. After a hearing,' the chancellor issued an order, filed on October 20, 1992, declaring that Mr. Brown had failed to offer sufficient evidence for the court to grant his motion. Mr. Brown appealed the chancellor’s order to this Court.

In his motion and in this appeal, Mr. Brown claimed that he did not realize that the proceeds from the foreclosure sale were not going to be divided on an equal basis, and that he therefore had no opportunity to prepare to meet the proof advanced by the estate of Mr. Fielder. He further alleged that he had been denied access to a ledger kept by the bookkeeper for Lakesite Enterprises, which ledger was used to determine his and the estate’s rights to the foreclosed lots. He also contended that he suffered from a hearing impairment that prevented him from understanding the proceedings in chancery court.

II.

We note at the outset that relief under Rule 60.02 is considered “an exceptional remedy.” Nails v. Aetna Insurance Company, 834 S.W.2d 289, 294 (Tenn.1992). Its function is “to strike a proper balance between the competing principles of finality and justice.” Jerkins v. McKinney, 533 S.W.2d 275, 280 (Tenn.1976). It operates as “an escape valve from possible inequity that might otherwise arise from the unrelenting imposition of the principle of finality imbedded in our procedural rules.” Thompson v. Fireman’s Fund Ins. Co., 798 S.W.2d 235, [160]*160238 (Tenn.1990). But, “[b]ecause of the ‘principle of finality,’ the ‘escape valve’ should not be easily opened.” Banks v. Dement Construction Company, 817 S.W.2d 16, 18 quoting Toney v. Mueller Co., 810 S.W.2d at 146 (Tenn.1991).

A decision on a Rule 60.02 motion is in the sound discretion of the trial judge. “The scope of review on appeal is limited to whether the trial judge abused his discretion.” Toney v. Mueller Co., 810 S.W.2d 145, 147 (Tenn.1991). In the case before us, we see no evidence that the chancellor abused his discretion in denying Mr. Brown’s motion.

Mr. Brown contends that he was unprepared to testify as to his business relationship with Mr. Fielder at the final hearing on February 4, 1992, because of “mistake, surprise or excusable neglect.” But the record shows that after the judicial foreclosure, notice was properly sent to Marshall S. Stuart, Jr., of White, Regen and Stuart, attorneys for Mr. Brown, to the effect that a hearing would be held to distribute the money under the direction and control of the court.

The notice states that “certain conflicts and discrepancies may exist between the plaintiffs as to the equitable distribution of such money.” If Mr. Brown did not know that he might be required to testify as to business dealings with Mr. Fielder, he certainly should have been alerted to that possibility by the language of the notice. Mr. Stuart was present at the hearing and represented the interests of Mr. Brown. It may be that he failed to effectively communicate to his client the nature of the proceedings, but if this is so, it is not the sort of mistake that Rule 60.02 is designed to correct.

Mr.

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Bluebook (online)
871 S.W.2d 157, 1993 Tenn. App. LEXIS 599, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fielder-v-lakesite-enterprises-inc-tennctapp-1993.