PNC Multifamily Capital Institutional Fund XXVI Limited Partnership v. Bluff City Community Development Corporation
2012 Tenn. App. LEXIS 288
| Tenn. Ct. App. | 2012Background
- PNC plaintiffs sue Bluff City and related entities over alleged misappropriation of partnership funds and improper transfers in Harmony Woods, April Woods, and Eagles Landing developments; Fearnley & Califf, Kimbrow and related entities provided counsel/closing services; complaint later added these defendants; trial court dismissed some counts as time-barred or pled inconclusively; appellate court must determine which counts survive under discovery rule, pleading standards, and subject-matter jurisdiction; legal malpractice vs tort/other claims; discovery rule asserted for legal malpractice against Kimbrow and firm, with partial survival; damages are liquidated for certain counts against Kimbrow, affecting jurisdiction; court analyzes Rule 12.02(6) dismissal standard and backdating/relating-back concepts; final holding reverses in part, affirms in part, and remands.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether discovery rule applies to legal malpractice claims | Appellants argue discovery rule tolls statute, shielding some claims | Appellees contend claims are time-barred as legal malpractice | Yes, claims survive under discovery rule for some defendants |
| Whether Appellees’ tort claims survive with proper pleading | Counts allege misrepresentation, fraud, aiding/abetting, conversion | Pleadings insufficiently particularized under Rule 9.02 and 8.01 | Survival for certain aiding/abetting, misappropriation against specific defendants; others dismissed |
| Whether there was attorney-client relationship to support malpractice claims against non-clients | Some plaintiffs were not clients but claims still sounding in malpractice | No attorney-client relation, thus malpractice claims fail | Malpractice claims survive against Kimbrow, Fearnley & Califf, and PLLC; no malpractice claim against Community Title |
| Whether damages for misappropriation/conversion are liquidated | Damages alleged with specific amounts; conversion claims liquidated | Unliquidated damages asserted against some defendants | Damages liquidated against Kimbrow; chancery court has jurisdiction over those claims; unliquidated claims limited |
| Whether conspiracy/civil conspiracy claims survive | Allege cooperation and common design among Appellees | Conspiracy pleadings lack specificity to satisfy Rule 8.01 | Conspiracy claims survive against some Appellees to the extent tied to misappropriation and aiding/abetting |
Key Cases Cited
- Shadrick v. Coker, 963 S.W.2d 726 (Tenn. 1998) (discovery rule elements in legal malpractice claims)
- Carvell v. Bottoms, 900 S.W.2d 23 (Tenn. 1995) (two-element discovery rule for accrual in malpractice cases)
- Robinson v. Omer, 952 S.W.2d 423 (Tenn. 1997) (negligent misrepresentation standard; Restatement §552 applicability)
- Abshure v. Methodist Healthcare-Memphis Hosps., 325 S.W.3d 98 (Tenn. 2010) (pleading standards and notice; liberal pleading vs strict requirements)
- Donaldson v. Donaldson, 557 S.W.2d 60 (Tenn. 1977) (liberality in pleading; consider substance over form)