Joseph W. Haskins Individually and as the of The Estate of Drew E. Haskins, Jr. v. Drew E. Haskins, III

CourtCourt of Appeals of Tennessee
DecidedMay 13, 2010
DocketE2009-00403-COA-R3-CV
StatusPublished

This text of Joseph W. Haskins Individually and as the of The Estate of Drew E. Haskins, Jr. v. Drew E. Haskins, III (Joseph W. Haskins Individually and as the of The Estate of Drew E. Haskins, Jr. v. Drew E. Haskins, III) 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
Joseph W. Haskins Individually and as the of The Estate of Drew E. Haskins, Jr. v. Drew E. Haskins, III, (Tenn. Ct. App. 2010).

Opinion

IN THE COURT OF APPEALS OF TENNESSEE AT KNOXVILLE November 4, 2009 Session

JOSEPH M. HASKINS, INDIVIDUALLY AND AS THE EXECUTOR OF THE ESTATE OF DREW E. HASKINS, JR., DECEASED v. DREW E. HASKINS, III

Appeal from the Chancery Court for Hamilton County No. 00-0292 Howell N. Peoples, Chancellor

No. E2009-00403-COA-R3-CV - FILED MAY 13, 2010

This case in on appeal for the second time after remand for determination of the defendant’s request for attorney’s fees, costs, and expenses. The defendant challenges the sufficiency of the trial court’s award. After reviewing the record, we reverse in part and affirm in part the trial court’s judgment.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Reversed in Part and Affirmed in Part; Case Remanded

J OHN W. M CC LARTY, J., delivered the opinion of the court, in which H ERSCHEL P. F RANKS, P.J., and C HARLES D. S USANO, J R., J., joined.

John P. Konvalinka, Chattanooga, Tennessee, for the Appellant, Drew. E. Haskins, III.

R. Wayne Peters and Robin L. Miller, Chattanooga, Tennessee, for the Appellee, Joseph M. Haskins, Individually and as Executor of the Estate of Drew E. Haskins, Jr.

OPINION

I. BACKGROUND

This matter returns to this court following a remand to the trial court. While the present appeal relates only to attorney’s fees, costs, and expenses (“fees”), the following summary from our initial opinion provides background regarding the underlying litigation: In 1983, Drew E. Haskins, Jr., and his two sons, the appellant, Drew E. Haskins, III [(“D.E.H.”)], and the appellee, Joseph M. Haskins [(“J.M.H.”)], formed a partnership designated Dayton Pike Plaza Associates (“the Plaza partnership”) to lease property in Tennessee. Later, in 1986, the three formed a second partnership designated the Capital Developers Partnership (“Capital Developers”) for the purpose of leasing a building in Catoosa County, Georgia, to Capital Bank. Each of the partners held an equal one-third interest in both partnerships. [D.E.H.] was elected and designated managing partner of Capital Developers.

In April of 1996, Drew E. Haskins, Jr., died, and on April 18, 1996, [J.M.H.] was appointed executor of the Estate of Drew E. Haskins, Jr. (“the Estate”). The Capital Developers’ partnership agreement provided as follows in the event of a partner’s death:

The Partnership shall not be dissolved by the death of a [P]artner. The remaining Partners shall have the right to continue the Partnership business under its present name following the death of a Partner, provided they elect to purchase the interest of the deceased Partner and make payments specified in Paragraphs 20 and 21. The election to purchase the interest of a deceased Partner shall be exercised by written notice delivered within three (3) months after the effective date of the appointment of a personal representative on behalf of a deceased Partner. The notice may be delivered in person or may be mailed by registered or certified mail to the personal representative of the deceased Partner. . . .

It is undisputed that, although the surviving partners did not elect to purchase the interest of Drew E. Haskins, Jr. after his death, they treated both partnerships as ongoing after that time.

In March of 2000, [J.M.H.], individually and as executor of the Estate, filed a complaint in the Hamilton County Chancery Court against his brother [D.E.H.], alleging that the latter had breached his fiduciary duties by paying himself unreasonable management fees from Capital Developers and from the Plaza partnership. The complaint sought an accounting with regard to both partnerships, requested that [D.E.H.] be required to account for management fees, demanded the expulsion of [D.E.H.] from Capital Developers, and requested that the Court dissolve the Plaza partnership.

-2- In his answer and counterclaim to the complaint, [D.E.H.] denied that any of the management fees he received were unreasonable or improper, denied all allegations of wrongful conduct, and denied the necessity of a judicial dissolution. The counterclaim contained three counts. Count one noted that because no partner elected to purchase the shares of Drew E. Haskins, Jr., as required under the Capital Developers’ partnership agreement, that partnership should have ended three months after [J.M.H.’s] appointment as personal representative of the Estate. Count one further asserted that because [J.M.H.] failed to elect to purchase the shares of his father, that [J.M.H.,] as holder of one-third of the interest in Capital Developers Partnership, did not maintain the necessary two-thirds interest to expel [D.E.H.]; and that [J.M.H.] breached his fiduciary duty by attempting to expel [D.E.H.] from Capital Developers. Finally, count one requested the court to dissolve Capital Developers and to determine the rights and interests of the parties in the assets of that entity. Count two of the counterclaim asserted that the payment of management fees for Capital Developers and the Plaza partnership was expressly recognized by the partners, that such fees were at or below fair market value for such services, and that [J.M.H.] should not be allowed to unjustly benefit by avoiding the payment of reasonable management fees. Count three of the counterclaim asserted that, pursuant to the partnership agreements, [D.E.H.] was entitled to indemnification and reimbursement for all costs, expenses, and fees, including attorney’s fees, related to the litigation.

In August of 2000, [J.M.H.] elected himself manager of Capital Developers, believing that he carried a two-thirds vote based upon his own one-third share, plus a one-third share he claimed as executor of his father’s estate. Contrary to the partnership agreement, there was no notification of a meeting of partners as to this action of [J.M.H.], and no such meeting was held.

The case was tried without a jury in November of 2002. Upon finding that the surviving partners did not elect to purchase the interest of the Estate, the trial court ruled: 1) Capital Developers was dissolved as a matter of law as of July 18, 1996, three months after the date [J.M.H.] was appointed personal representative of the Estate [due to the fact that no election was made by the remaining partners to purchase the interest of the Estate in the partnership, pursuant to the partnership agreement]; 2) there was to be an accounting and payout of appropriate partnership properties in proportions allowed under the partnership agreement as of July 18, 1996; 3) the management fees received

-3- by [D.E.H.] were reasonable and equitable;1 4) that the Plaza partnership be dissolved effective November 6, 2002; 5) that the parties prepare and exchange accountings for the partnerships on or before January 6, 2003; 6) and the request of [D.E.H.] for attorney’s fees be denied. After entry of this order, the trial court entered an additional order referring the case to the clerk and master for a determination as to the manner in which the two partnerships should be sold and as to the appropriate distribution of the net proceeds from the sale of Capital Developers. The trial court further directed that [D.E.H.], [J.M.H.], and the Estate should each receive one-third of the net sale proceeds of the Plaza partnership.

Pursuant to a ruling of the clerk and master, the partnership properties were sold at private auction on July 8, 2003, and [D.E.H.] was the successful bidder as to both partnerships. Although closing was scheduled for September 24, 2003, prior to that date, [J.M.H.] filed a motion to set aside the sale based in part upon allegations that [D.E.H.] had failed to close the sale within a reasonable period of time.

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Joseph W. Haskins Individually and as the of The Estate of Drew E. Haskins, Jr. v. Drew E. Haskins, III, Counsel Stack Legal Research, https://law.counselstack.com/opinion/joseph-w-haskins-individually-and-as-the-of-the-es-tennctapp-2010.