636 B.R. 507
Bankr. M.D. Tenn.2022Background
- The Connors owned a Williamson County house subject to two deeds of trust; MEB Loan Trust IV foreclosed on the second deed and Property Fund 629, LLC purchased at the sale on Nov. 5, 2020.
- 1 Public Homes LLC filed a detainer (eviction) action on Nov. 23, 2020; a default writ for possession was entered Jan. 4, 2021; the eviction was set for Feb. 3, 2021.
- David Connor filed Chapter 13 bankruptcy on Jan. 28, 2021; his counsel notified Edward Russell (counsel for 1 Public Homes) of the bankruptcy and a pending repurchase negotiation.
- The Connors allege Russell instructed the sheriff to proceed with eviction despite the bankruptcy notice; General Sessions later found the possession order void ab initio on Mar. 3, 2021.
- The Connors brought consolidated adversary proceedings in bankruptcy court asserting multiple state-law claims against Russell and others; Russell moved to dismiss Adv. Pro. No. 21-90051.
- The court held Connor had standing (the confirmed Chapter 13 plan expressly preserved the debtor’s right to pursue these causes of action) but dismissed all claims against Russell except trespass.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to sue post-petition | Connor may pursue pre-petition/state claims in bankruptcy; his litigation affects the plan | Russell: only the Chapter 13 trustee has standing to pursue estate causes of action | Held: Connor has standing here—Confirmation Order expressly preserved debtor’s right; court may grant derivative standing if needed |
| Abuse of process | Detainer was obtained by fraud; Russell participated in enforcement | Russell lacked any improper post-issuance use of process or ulterior motive | Held: Dismissed — no facts alleging improper use of process or ulterior motive by Russell |
| Wrongful eviction (statutory/common law) | Eviction was unlawful; Russell liable for participating | Russell was not the landlord and thus cannot be liable under wrongful eviction tort/statute | Held: Dismissed — Tennessee wrongful-eviction tort requires landlord status; no authority pleaded to extend liability |
| Intentional / Negligent Infliction of Emotional Distress | Eviction and conduct were outrageous and caused severe distress | Allegations are conclusory; foreclosure/eviction alone insufficiently outrageous; no duty alleged | Held: Dismissed — no pleaded outrageous conduct, severe injury, or duty as to Russell |
| Civil conspiracy | Multiple defendants acted in concert to unlawfully evict | No specific factual allegations that Russell joined or agreed to an unlawful scheme | Held: Dismissed — conspiracy claims require particularized allegations naming co-conspirators and overt acts |
| Trespass (causing third party to enter) | Russell caused sheriff to enter Connors’ property based on defective detainer | Russell did not personally enter the property; eviction was by sheriff under process | Held: Not dismissed — trespass may be alleged by causing a third party to enter; claim survives to factual development |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (pleading plausibility standard)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (requirement of factual plausibility)
- Isaacs v. DBI-ASG Coinvestor Fund, III, LLC (In re Isaacs), 895 F.3d 904 (bankruptcy courts may grant derivative standing)
- Rugiero v. Nationstar Mortgage, LLC, [citation="580 F. App'x 376"] (discussed standing limits under Sixth Circuit precedent)
- Wilson v. Dollar Gen. Corp., 717 F.3d 337 (concurrent standing for Chapter 13 debtors endorsed by other circuits)
- Trau–Med of Am., Inc. v. Allstate Ins. Co., 71 S.W.3d 691 (Tenn. 2002) (elements of actionable civil conspiracy)