James M. Robinson v. Pulte Homes Tennessee Limited Partnership, M2016-01208-COA-R3-CV

Background

In 2000 Pulte Homes conveyed "Unit No. 3" in Beacon Hill Village Phase III to Howard Lipman by warranty deed that described the property as a "Unit" under the Master Deed for Beacon Hill Village Condominium. In 2005 Lipman sold the same parcel to James and Martha Robinson.
The Beacon Hill Master Deed defined a "Unit" as "the fee simple estate within a Building" and provided that Phase III would be incorporated into the single Beacon Hill condominium project under a February 1999 Phase III Agreement between Pulte and the Condominium Association.
The Robinsons knew before purchase that Unit 3 was part of Phase III and subject to condominium governance (fees, architectural review), but believed they held a fee simple interest in the land/building rather than only a condominium unit.
In Stillwell (a 2009 class action to which the Robinsons were class members), the trial court held the nine detached Phase III parcels were condominiums (not "private elements") and ordered Pulte to record the Phase III Agreement; the plaintiffs did not appeal that judgment.
In 2013 the Robinsons sued Pulte for breach of the covenant of title, alleging the Stillwell judgment effectively evicted them of fee simple ownership; Pulte moved for summary judgment asserting res judicata, estoppel by deed, statute of limitations, laches, and related defenses.
The trial court granted summary judgment to Pulte on multiple grounds (res judicata, collateral estoppel, estoppel by deed, notice via Phase III Agreement, statute of limitations, laches); the Court of Appeals affirmed, disposing of other issues as pretermitted.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the Robinsons' breach of warranty claim is barred by res judicata	Robinsons argued their title-damage claim arose only after the Stillwell judgment and thus was not litigated there	Pulte argued Stillwell and the Robinsons' suit arise from the same transaction and the claim could/should have been raised in Stillwell	Court held res judicata bars the claim; the warranty claim could have been litigated in Stillwell and is claim-precluded
Whether estoppel by deed prevents Robinsons from denying Pulte's deed recitals	Robinsons contended they held fee simple title and were "evicted" by Stillwell	Pulte argued its 2000 deed described the conveyance as a "Unit" per the Master Deed and subsequent purchasers are estopped by that recital	Court held estoppel by deed applies: the deed recitals and chain of title preclude Robinsons from denying they received a condominium unit
Whether unrecorded Phase III Agreement or lack of recording defeated Pulte's defenses / actual notice issue	Robinsons argued the Phase III Agreement was unrecorded at closing and therefore could not bind them	Pulte argued Robinsons had actual knowledge of the Master Deed and Phase III incorporation and thus were bound despite nonrecording	Court held Robinsons had notice and the Phase III Agreement was effective as to them; they purchased subject to the condominium regime
Whether other defenses (statute of limitations, laches, class certification) preclude relief	Robinsons contested the defenses and challenged denial of class certification	Pulte asserted six-year limitations, laches for unreasonable delay, and opposed class certification	Court noted additional defenses (statute of limitations, laches) supported dismissal but primarily affirmed on res judicata and estoppel; class-cert denial left unaddressed due to disposition

Key Cases Cited

Creech v. Addington, 281 S.W.3d 363 (Tenn. 2009) (explaining claim preclusion and transactional test for res judicata)
Jackson v. Smith, 387 S.W.3d 486 (Tenn. 2012) (elements plaintiff must prove to invoke res judicata)
Davidson v. Bredesen, 330 S.W.3d 876 (Tenn. Ct. App. 2009) (res judicata bars issues that could reasonably have been litigated previously)
Penn-America Ins. Co. v. Crittenden, 984 S.W.2d 231 (Tenn. Ct. App. 1998) (claim that could have been joined in prior action barred by res judicata)
Bilbrey v. Smithers, 937 S.W.2d 803 (Tenn. 1996) (defining estoppel by deed and its effect on privies)
Blevins v. Johnson Cnty., 746 S.W.2d 678 (Tenn. 1988) (effect of deed recital on subsequent purchasers)