James R. Golden v. Holly N. Hood (Black)

• Court: Court of Appeals of Tennessee
• Decided: January 26, 2000
• Docket: E1999-02443-COA-MR3-CV
• Status: Published

Opinion

IN THE COURT OF APPEALS OF TENNESSEE

AT KNOXVILLE FILED January 26, 2000

Cecil Crowson, Jr. E1999-02443-COA-MR3-CV Appellate Court Clerk JAMES R. GOLDEN, ) C/A NO. 03A01- 9904-CV-0143 ) Plaintiff-Appellee, ) WASHINGTON LAW ) vs. ) G. RICHARD JOHNSON, ) CHANCELLOR HOLL Y N. HO OD (BL ACK), ) ) REVERSED AND Defend ant-App ellant. ) REMANDED

THOMA S H. TORBETT, TO RBETT & T ORBETT, Kingsport, for Plaintiff- Appellee.

STEVEN G. GOTT, and GUYTON O. TERRY, III, FULLER, VAUGHN & GOTT, Kingspo rt, for Defe ndant-A ppellant.

O P I N IO N

Franks, J.

The Trial Judge refused to enforce a settlement agreement between the

parties wh ich resulted f rom med iation, and this C ourt granted an appea l pursuant to

Rule 9 , T.R.A .P.

Plaintiffs bro ught an ac tion for dam ages as a re sult of a mo tor vehicle

accident, and the parties agreed to mediate the dispute. Th e mediation was b efore

Tommy Lee Hulse, and resulted in an agreement wh ich was signed by the m ediator, plaintiff and his attorney and the defendant’s attorney. The agreement provides:

The p arties he reto, J AMES R. G OLDEN, PLAINTIFF AND H OLLY N. H OOD (B LACK), DEFENDANT, having su bmitted the f acts and issu es to Tommy Lee Hulse the mutually agreed upon mediator, have fully and completely resolved the dispute as follows:

H OLLY N. H OOD (B LACK) shall pay to JAMES R. G OLDEN $9,000.00 Dollars inclusive of all costs, disbursements and attorney fees for damages, whether compensatory, liquidated and/or punitive. All payments shall be made no later than June 10, 1998.

That no party to this agreement shall at anytime hereinafter make any claims against the other, institute any lawsuit against the other or make any demands for payment from the other for any alleged reason or causes arising out of the facts and issues of the matter herein. Each party releases the other from any and all claims and/or liability arising from this matter.

That this agreement is final and binding upon any and all parties to this matter and enforceable in any court of law of general jurisdiction.

Subsequently, plaintiff refused to comply with the agreement, and the

defenda nt filed a mo tion before the Trial Jud ge to enfo rce the agre ement. Plain tiff, in

response to the motion, filed his affidavit, and stated that during the mediation he was

told by his attorney, the mediator and the defendant’s attorney, that the maximum

recovery he could expect was three times the amount of medical expenses, or

$9,000.00. He also s tated that the mediator told him a ju ry would probably not aw ard

him the full amount of his medical expenses, and that $9,000.00 was all he was

entitled to by law. Also, that his former attorney had threatened to withdraw from the

case if he did not accept the settlement. He further recounted that he had been

receiving w eekly psychothe rapy for depr ession, and attached letters from his

psychologist. Psychologist opined that plaintiff has been in weekly psychotherapy for

2 the past few months, and that part of the sessions have been spent dealing with the

trauma fro m the car a ccident, also th at part of plain tiff’s depres sion was r elated to

consequences of the accident. He further was of the opinion that a “recurrent pattern”

for plaintiff was that he becomes submissive when being unduly pressured by others,

and that the circumstances of mediation likely caused plaintiff to “compliantly sign the

mediation agreement despite his sense that it was an unfair one.”

The Trial Judge, upon hearing the motion, concluded that plaintiff was

under undue stress and duress, and was suffering from depression and for these

reasons, the motion was denied.

Fundamental principles of contract law are applicable here. Recission

of a contract “is not looked upon lightly” and “is available only under the most

demanding circumstances.” Robinson v. Brooks, 577 S .W.2d 207 (T enn. C t. App.

1978) . Furthe r, the par ty seeking recissio n bears the bur den of proof . Williamson v.

Upchurch, 768 S.W.2d 265 (Tenn. Ct. App. 1988). When a contract is valid and no

injustice will result, courts are “bound to enforce it.” Bush v. Cathey, 598 S.W.2d 777

(Tenn . Ct. Ap p. 1979 ).

Plaintiff con tends that he executed the contrac t under du ress. Dures s is

often defined in our case law as:

an unlaw ful restraint, intim idation, or co mpulsion of anothe r to such an extent and degree as to induce such other person to do or perform some act w hich he is no t legally bound to do, contra ry to his will and inclination. The alleged coercive event must be of such severity, either threatened, impending or actually inflicted, so as to overcome the mind and w ill of a person of ordinary firmness.

McClellan v. McClellan, 873 S .W.2d 350 (T enn. C t. App. 1 993). See also Federal

3 Deposit Insurance Corp. v. Ramsey, 612 F. Supp. 326 (E.D. Tenn. 198 5).

In this case, plaintiff asserts that his attorney threatened to withdraw

from the case if he did not accept the settlement. Plaintiff’s statements do not

establish prima facie duress of such nature as to vitiate the contract. Nor do the

psychologists’ s tatements rise to the level req uired to find a lack of ca pacity. In this

jurisdiction, a lack of capacity is defined as a lack of “sufficient mind to understand,

in a reasonable manner, the nature, extent, character, and effect of an act or

transaction in which he is engaged.” Knight v. Lancaster, 988 S.W.2d 172, 178

(Tenn. Ct. App. 1998). Plaintiff also avowed that “false assertions” were made by the

mediator and attorneys as to what he could hope to recover . Plaintiff’s allegations of

“false assertions” fall within the na ture of a claim of fraud or misrepresentation. "In

order to constitute fraud or be ground of rescission, there must not only be a

representation as to an existing fact but the representation must have been relied upon,

and must have been so material that it determined the conduct of the party seeking

relief." Shores v. Spann, 557 S.W.2d 67 , 72 (Tenn. Ct. Ap p. 1977). The record

before us does n ot establish that plaintiff would ha ve likely received more

compensation than $9,000.00 had he proceeded to trial. The record does not establish

that such opinions, if made, were fraudulent, or that there was a material

misreprese ntation as to h is likely recovery. Plain tiff freely signed the agreem ent with

the adv ice of c ounse l.

The Suprem e Court has recog nized that mediation and arbitration are

valuable tools which c an “make the p rocess of dispute resolution m ore efficient, more

economical, and equally fair.” See Preamble to Tenn. R. S. Ct. 31. While fraud is a

4 basis to set aside such agreements, the record does not support setting aside the

agreement signed by the plaintiff. In the absence of fraud or mistake, an agreement

reache d in me diation t o settle litig ation is c onclus ive aga inst a pa rty seekin g to voi d it.

See Vela v. Hope Lumber & Supply Co., 966 P .2d 119 6, 1198 (Okla. C t. App. 1 998).

In this case, the agreement was clear and unambiguous and establishes a

binding and enforceable settlement of plaintiff’s claim. Accordingly, we reverse the

judgmen t of the Trial C ourt and rem and for the entry of a judg ment con sistent with

this Opinion. The cost of the appeal is assessed to plaintiff.

__________________________ Herschel P. Franks, J.

CONCUR:

___________________________ Houston M. Godd ard, P.J.

___________________________ Charles D. Susano, Jr., J.