First Tennessee Bank National Ass'n v. Trotter (In re Trotter)

266 B.R. 817, 2001 Bankr. LEXIS 1160
CourtUnited States Bankruptcy Court, E.D. Tennessee
DecidedSeptember 7, 2001
DocketBankruptcy No. 01-30856; Adversary No. 01-3081
StatusPublished

This text of 266 B.R. 817 (First Tennessee Bank National Ass'n v. Trotter (In re Trotter)) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, E.D. Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
First Tennessee Bank National Ass'n v. Trotter (In re Trotter), 266 B.R. 817, 2001 Bankr. LEXIS 1160 (Tenn. 2001).

Opinion

MEMORANDUM ON MOTION FOR SUMMARY JUDGMENT AND MOTION TO AMEND ANSWER

RICHARD S. STAIR, Jr., Bankruptcy Judge.

On June 22, 2001, First Tennessee Bank National Association (First Tennessee) filed a Complaint to Determine the Validity, Extent and Priority of Liens and Interests in Property (Complaint). By its Complaint, First Tennessee asks the court to determine the extent and priority of various parties’ interests in a commercial Lease Agreement (Lease) executed by the Debtor. Specifically, First Tennessee asks the court to find that it or any subsequent foreclosure transferee under the Lease is not required to comply with the terms of a Supply Agreement also executed by the Debtor. On August 2, 2001, First Tennessee then filed a Motion for Judgment on the Pleadings and/or for Summary Judgment and for Scheduling Order (Summary Judgment Motion).

Defendants Dallas Coffman, Jean Coff-man, Bill Green, Claudine Green, (the Landlord) and Coffman Oil Company1 (Coffman Oil) (collectively, the Coffman Defendants) filed an Answer on July 23, 2001. Coffman Oil then filed a Motion to Amend Answer and File Permissive Counter-Claim (Motion) on August 3, 2001. The Motion asks the court to allow the Coffman Defendants to amend their answer to allow Coffman Oil to assert a permissive counter-claim against First Tennessee to determine the parties’ rights relating to an Incentive Contract and Addendum to Incentive Contract between Coffman Oil, First Tennessee, and Defendant Trotter Enterprises, LLC, d/b/a Trotter Amoco (Trotter Enterprises).

Answers were also filed by the Debtor on July 24, 2001, and by Trotter Enterprises, LLC on July 25, 2001. Additionally, on August 15, 2001, the Debtor filed a Response of John Dale Trotter to Motion for Judgment on the Pleadings and/or for Summary Judgment and a Response of John Dale Trotter to Motion for Motion [sic] to Amend Answer and File Permissive Counter-Claim. Finally, on August 17, 2001, First Tennessee filed a Response and Objection of First Tennessee Bank to Motion to Amend Answer and File Permissive Counterclaim, and the Coffman Defendants filed their Response to First Tennessee Bank National Association’s Motion for Judgment on the Pleadings and/or for Summary Judgment and for Scheduling Order.2

First Tennessee, Trotter Enterprises, the Debtor, and the Coffman Defendants have briefed their respective positions. The court heard oral arguments on First Tennessee’s Summary Judgment Motion and on the Coffman Defendants’ Motion on August 28, 2001.

[820]*820First Tennessee’s Complaint is a core proceeding. 28 U.S.C.A. § 157(b)(2)(K) (West 1993). The core/noncore nature of Coffman Oil’s proposed counterclaim will be discussed herein.

I

On March 10, 1999, by execution of the Lease, the Landlord conveyed to Dean Humphrys and the Debtor, as “Tenant,” a leasehold interest (the Leasehold) in real property (the Leased Premises) located in Sevier County, Tennessee. The Debtor and Humphrys have utilized the Leased Premises to operate, either directly or through closely-held business entities, an A & W restaurant, an Amoco convenience store, and a Subway restaurant.

On February 15, 1999, the Debtor and Humphrys entered into a Supply Agreement with Coffman Oil for the provision of Amoco gasoline. The Supply Agreement references the Lease, providing in material part:

14. This Supply Agreement will run concurrently with [the] 50 year lease negotiated between tenants John Dale Trotter and Dean Humphrys and [the Landlord], dated February 15, 1999, and this Agreement shall in no wise [sic] be terminated or cancelled unless said lease shall be terminated. One of the considerations for Company [Coffman Oil] entering into said lease is Dealer’s agreement to execute this Supply Agreement, and Company [Coffman Oil] would not have agreed to said lease in the absence of this Supply Agreement. [3]

The Supply Agreement is in turn referenced at Section 10.17 of the Lease, which states:

This lease has been executed in conjunction with a Supply Agreement (between Coffman Oil Company and the Lessees, Tenants herein) and a part of the consideration for Dallas Coffman and Jean Coffman entering into this Lease Agreement is the agreement by the Tenants herein entering into said Supply Agreement dated 15 February, 1999, and made between Coffman Oil Co., Inc., and John Dale Trotter and Dean Humphreys [sic], Dealer.

An Agreed Order was entered by the court on June 13, 2001, in the bankruptcy cases of the Debtor and Trotter Enterprises, LLC. Each Order authorized assumption of the Lease by the respective Debtor and provided that the Supply Agreement was also assumed by each Debtor.4 The Orders also provided that the rights of First Tennessee were reserved and unaffected by the assumptions or the Orders.

On July 16, 1999, the Debtor, his wife, Karen Trotter, Dean Humphrys, and his wife, Tanya Humphrys, executed a Tennessee Leasehold Deed of Trust conveying the interest of the Debtor and Humphrys in the Lease and Leasehold as security for obligations of the Trotters and the Hum-phrys to First Tennessee. Contemporaneously with the execution of the Tennessee Leasehold Deed of Trust, First Tennessee and the Landlord executed a Landlord’s Agreement and a Landlord’s Waiver and Subordination. Both documents relate to First Tennessee’s rights relative to the Leasehold and Leased Premises.5 The [821]*821Landlord’s Agreement provides in material part at paragraph 5:

Landlord agrees that as long as Landlord receives in a timely fashion all rental payments as and when due, and as long as the obligations of the tenant to maintain the Premises are being fulfilled[ ] (whether by Borrower or Lessee or, at its option, Lender or any transferee of Lender), Landlord will not terminate the Lease or take any action to require Borrower [or] Lender or Lender’s transferee to surrender possession of the Premises.

The Landlord’s Agreement further recites that it is executed “in order to induce Lender to extend financial accommodations to Borrower,” and does not reference the Supply Agreement.

II

First Tennessee moves for judgment on the pleadings pursuant to Fed.R.CivP. 12(c) and Fed.R.Bankr.P. 7012 or, in the alternative, for summary judgment under Fed.R.Civ.P. 56 and Fed.R.Bankr.P. 7056. Rule 12(c) provides:

After the pleadings are closed but within such time as not to delay the trial, any party may move for judgment on the pleadings. If, on a motion for judgment on the pleadings, matters outside the pleadings are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56, and all parties shall be given reasonable opportunity to present all material made pertinent to such a motion by Rule 56.

Fed.R.Civ.P. 12(c).

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Cite This Page — Counsel Stack

Bluebook (online)
266 B.R. 817, 2001 Bankr. LEXIS 1160, Counsel Stack Legal Research, https://law.counselstack.com/opinion/first-tennessee-bank-national-assn-v-trotter-in-re-trotter-tneb-2001.