Garthright v. First Tennessee Bank of Memphis

728 S.W.2d 7, 1986 Tenn. App. LEXIS 3337
CourtCourt of Appeals of Tennessee
DecidedOctober 8, 1986
StatusPublished
Cited by12 cases

This text of 728 S.W.2d 7 (Garthright v. First Tennessee Bank of Memphis) 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
Garthright v. First Tennessee Bank of Memphis, 728 S.W.2d 7, 1986 Tenn. App. LEXIS 3337 (Tenn. Ct. App. 1986).

Opinion

CRAWFORD, Judge.

Defendants, First Tennessee Bank of Memphis and J.W. Rascoe, appeal from the judgment of the Chancery Court awarding a money judgment plus attorney fees and costs to plaintiff, James L. Garthright, Jr., Conservator for Mary Sue Hammond.

Plaintiffs complaint, filed January 12, 1981, alleges that plaintiff is entitled to recover against defendants for breach of contract, conversion of funds, money improperly had and received, and fraud and deceit involving a fiduciary relationship. The complaint avers that plaintiff is the duly appointed conservator of Mary Sue Hammond; that defendant, First Tennessee, is a banking institution; that defendant, Rascoe, is the son of Mary Sue Hammond; and that Mary Sue Hammond had two children, the defendant, Rascoe, and Virginia Gray. It further avers that on January 29,1973, plaintiff had on deposit in savings account number 00-6571042 in defendant bank the approximate sum of $1,250 and that the signature card reflected only plaintiff as a signatory on the account. There was no administration of Mary Sue Hammond’s estate after her death. The complaint also avers that for a long period of time the conservator savings account was inactive and that the conservator had not taken steps to close the estate.1 It further avers that when the probate [8]*8court requested an accounting the conservator learned for the first time that most of the funds had been withdrawn from the account by the defendant, J.W. Rascoe. The complaint also avers that the conservator discussed the matter with an attorney for defendant bank but that no solution was reached. Plaintiff further avers that Rascoe improperly converted the funds to his own use, that the defendant bank breached the debtor-creditor relationship, and that the bank improperly permitted the withdrawal by Rascoe. Plaintiff prays for judgment for the amount of the balance withdrawn and attorneys fees and costs.

The defendant bank’s answer joined issue on the material allegations of the complaint. The bank relies upon the defense of laches and further avers that the account in question was a joint account of the said Mary Sue Hammond and her son, defendant Rascoe, and that the plaintiff merely took over as one of the joint owners when he became the conservator of the said Mary Sue Hammond. The answer also averred that the account was a survivor-ship account and that Rascoe had the right to withdraw from the account.

Defendant Rascoe’s answer joins issue on the material allegations of the complaint and also relies upon the defenses of laches. Rascoe further avers that he was a joint signatory on the account, that he had a right to withdraw from the account, and that he had not converted any funds that he could not rightfully claim.

On May 1, 1985, both defendants filed motions for leave to amend their answers to rely upon the defense of the statute of limitations, T.C.A. § 28-3-105 and T.C.A. § 28-3-109. At the time the motions were filed the case had not been set for trial, and in fact the case was not tried until February 27, 1986. By order entered June 10, 1985, the trial court denied the motions to amend but with leave to file the proposed amendment “for the purpose of the appellate record only.”

The facts are virtually undisputed. In 1954, Rascoe and his mother, Mary Sue Rascoe (later Hammond) opened an account with First National Bank of Memphis, the predecessor to defendant bank. The account number was 57104, and the signature card provided that the account was a joint account with right of survivorship. In 1955, a new card was issued for the account changing the account number to 00-6571042, but the type of account remained unchanged. Through the years, Rascoe and his mother each made deposits and withdrawals.

In April, 1967, plaintiff was acting as attorney for Virginia Gray, Mrs. Hammond’s daughter, and filed a petition for Mrs. Gray to be appointed conservator for Mary Sue Hammond. The probate court, however, appointed plaintiff as conservator for Mrs. Hammond because of family friction. Some time after the appointment, the plaintiff learned of the account at defendant bank and was issued a signature card on the account number 00-6571042, which at that time had a balance of $2,081.80. Plaintiff did not know this was a joint account, and he used the account to handle the conservatorship funds of Mrs. Hammond. Mrs. Hammond died on or about September 1, 1969, and subsequent thereto plaintiff took no steps to close the conser-vatorship estate.

On January 23, 1973, Rascoe, who testified that he did not know plaintiff was using the account for the conservatorship, withdrew the balance then remaining in the account of $1,220.19. Defendant bank had been sending plaintiff quarterly statements on the account, and, although a statement showed the withdrawal of January 23, 1973, plaintiff did not look at the statements until some time in 1975, when he was required to file an accounting in the conservatorship. By order of May 6, 1975, the probate court ordered plaintiff to file suit to attempt to recover the amount withdrawn. Plaintiff did not file the suit until January 12, 1981.

Defendants have presented the following issues for review:

1. Whether the trial court erred by denying Defendants’ Motions for Summary Judgment.
[9]*92. Whether the trial court erred by denying the Defendants’ Motion for Leave to File Amended Answers.
3. Whether Plaintiffs action should have been barred by the doctrine of lach-es.
4. Whether the trial court erred by awarding Plaintiff his attorneys’ fees as an element of damages.

For reasons that are evident, we will first consider the defendants’ second issue: “Whether the trial court erred by denying defendants' motions for leave to file amended answers.”

Although the suit was filed in January, 1981, and answers were filed thereto, there was no major activity in the case until about April, 1985, when defendants filed motions for summary judgment. In May, 1985, defendants sought to amend their answer to rely in part upon the statutes of limitation in their motions for summary judgment. As heretofore noted, although the case had not been set for trial, the trial court denied the motions to amend and also denied the motions for summary judgment.

Tenn.R.Civ.P. 15.01 provides in part:

15.01 Amendments.—A party may amend his pleadings once as a matter of course at any time before a responsive pleading is served or, if the pleading is one to which no responsive pleading is permitted and the action has not been set for trial, he may so amend it at any time within fifteen (15) days after it is served. Otherwise a party may amend his pleadings only by written consent of the adverse party or by leave of court; and leave shall be freely given when justice so requires_ (Emphasis supplied.)

In Branch v. Warren, 527 S.W.2d 89, 91-92 (Tenn.1975) Justice Henry, of the Supreme Court, discussed the effect of Tenn.R.Civ.P. 15.01:

The new Rules of Civil Procedure, in this regard “come not to destroy the old law, but to fulfill.” They were designed to simplify and ease the burden of procedure under the sometimes harsh and technical rules of common law pleading.

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Bluebook (online)
728 S.W.2d 7, 1986 Tenn. App. LEXIS 3337, Counsel Stack Legal Research, https://law.counselstack.com/opinion/garthright-v-first-tennessee-bank-of-memphis-tennctapp-1986.