Clear Water Partners, LLC v. Charles e. Benson
E2016-00442-COA-R3-CV
| Tenn. Ct. App. | Jan 26, 2017Background
- Clear Water Partners, LLC contracted for an option to buy ~111 acres and alleged agreements to sell ~30 acres to Paul J. Murphy III and later to Belle Investment; development depended on rezoning, a development plan, and site work.
- Clear Water accused 23 neighbors (Defendants) of coordinated misconduct (false emails, flyers, false affidavits, blocking survey access, FWS complaint) intended to delay or stop the development, causing monetary harm and additional option-extension payments.
- Claims asserted: tortious interference with business relationships, tortious interference with contracts, and civil conspiracy; sought compensatory and punitive damages.
- Defendants moved to dismiss: some under Tenn. R. Civ. P. 10.03 (failure to attach written instruments) and others under Rule 12.02(6) (failure to state a claim; asserted privilege for communications to government bodies).
- Trial court granted both motions, dismissed certain claims, and awarded attorneys’ fees to Rule 12 defendants under Tenn. Code Ann. § 4-21-1003(c); Clear Water filed a Rule 59 motion to alter or amend, which was struck as improper; Clear Water appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether complaint stated claim under Rule 12.02(6) for civil conspiracy (with tortious interference with business relations as predicate) | Clear Water: alleged concerted acts, overt acts (false emails, flyers, affidavits, delays), and vicarious liability for attorney conduct; predicate torts support conspiracy | Defendants: complaint lacks specific factual allegations against many named defendants; communications to governmental bodies are privileged | Court: Reversed dismissal — complaint sufficiently pleaded civil conspiracy and tortious interference with business relationships (predicate tort survives) |
| Whether tortious interference with business relationships is available despite existing contracts with same third parties | Clear Water: claims target interference with future/prospective contracts and continued negotiations, not merely existing contracts | Defendants: tort applies only to noncontractual relationships; existing contracts bar the claim | Court: Held plaintiff may plead interference with prospective contractual relations even if plaintiff has existing contracts with same third parties; tort claim survives when based on future expectancies |
| Whether complaint stated tortious interference with contract and whether Rule 10.03 required dismissal for failure to attach contracts | Clear Water: alleged breach by Murphy and damages; offered to amend to attach redacted contracts and argued tort claims are not purely contract claims | Defendants: Rule 10.03 requires written instruments be attached when a claim is founded on them; failure justifies dismissal | Court: Affirmed dismissal of tortious-interference-with-contract claim — complaint failed to plead all elements (e.g., knowledge of contract, proximate causation); therefore Rule 10.03 issue need not be reached for that claim |
| Whether trial court properly awarded attorneys’ fees under Tenn. Code Ann. § 4-21-1003(c) and whether Rule 59 motion tolled appeal deadline | Defendants: communications to MPC/BZA entitled them to immunity and fees; motion to strike Rule 59 motion as improper, so appeal was untimely | Clear Water: immunity not established at dismissal stage; Rule 59 motion properly sought correction of clear error, tolling the appeal deadline | Court: Vacated fee award — immunity not established and statutory prerequisites unmet; vacated order striking Rule 59 motion and held the Rule 59 motion tolled the appeal period (appeal timely) |
Key Cases Cited
- Trau-Med of Am., Inc. v. Allstate Ins. Co., 71 S.W.3d 691 (Tenn. 2002) (adopts tort of intentional interference with business relationships and Restatement § 766B)
- Webb v. Nashville Area Habitat for Humanity, Inc., 346 S.W.3d 422 (Tenn. 2011) (standards for Rule 12.02(6) motions — construe pleadings liberally)
- Phillips v. Montgomery Cnty., 442 S.W.3d 233 (Tenn. 2014) (pleading standards and Rule 12 review de novo)
- Willis v. Tennessee Dep’t of Corr., 113 S.W.3d 706 (Tenn. 2003) (Rule 12.02(6) principles)
- Givens v. Mullikin, 75 S.W.3d 383 (Tenn. 2002) (vicarious liability for attorney when client directs or knowingly authorizes attorney conduct)
- Kincaid v. SouthTrust Bank, 221 S.W.3d 32 (Tenn. Ct. App. 2006) (elements of civil conspiracy)
- Hart v. First Nat’l Bank of Memphis, 690 S.W.2d 536 (Tenn. Ct. App. 1985) (elements for tortious interference with contract)