History
  • No items yet
midpage
578 S.W.3d 879
Tenn.
2019
Read the full case

Background

  • TWB Architects (Burrow) contracted with Progress Capital (Rankin) to design The Braxton condominium project for a fee equal to 2% of construction costs (Architect Agreement).
  • Progress Capital/Braxton lacked funds; Rankin proposed and Burrow agreed that Burrow would receive Penthouse P6 as payment. A written Condominium Agreement (stating $0 purchase price "in consideration of design fees") was executed in Feb 2006.
  • After the Condominium Agreement, TWB stopped regular billing; Burrow treated and occupied P6, made ~$40,000 in upgrades, and represented himself as owner while closings were delayed.
  • Braxton later pledged P6 as loan collateral; Burrow threatened a mechanic’s lien and ultimately TWB filed a lien for the architect fee when Braxton did not deed P6.
  • Litigation produced conflicting sworn statements: Rankin initially said the Condominium Agreement created a novation (extinguishing the Architect Agreement), later recanted; Burrow consistently claimed he never intended the Condominium Agreement to extinguish TWB’s fee rights.
  • The trial court granted summary judgment to TWB; Court of Appeals affirmed; Supreme Court reversed, holding genuine issues of material fact exist about the parties’ intent to effect a novation and remanded.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether the Condominium Agreement was a novation that extinguished TWB’s fee claim under the Architect Agreement TWB/Burrow: No novation; parties never agreed to extinguish Architect Agreement; TWB always retained right to fee and filed lien when conveyance failed Braxton/Rankin: The Condominium Agreement was intended to substitute for and discharge obligations under the Architect Agreement (novation) Reversed summary judgment for TWB: court held disputed material facts about intent to novate preclude summary judgment and require fact-finder credibility determinations

Key Cases Cited

  • Pacific Eastern Corp. v. Gulf Life Co., 902 S.W.2d 946 (Tenn. 1995) (discusses novation/substituted contract principles and effect of novation)
  • Commerce Union Bank v. Burger-In-A-Pouch, Inc., 657 S.W.2d 88 (Tenn. 1983) (intent to discharge prior obligation is a question of fact)
  • Rhea v. Marko Constr. Co., 652 S.W.2d 332 (Tenn. 1983) (party asserting novation bears the burden of proof)
  • Church v. Perales, 39 S.W.3d 149 (Tenn. 2000) (contradictory testimony may cancel unless corroborated or explained; summary judgment view of such evidence)
  • Rye v. Women’s Care Ctr. of Memphis, 477 S.W.3d 235 (Tenn. 2015) (articulates Tennessee summary judgment standard applicable to all movers)
Read the full case

Case Details

Case Name: TWB Architects, Inc. v. The Braxton, LLC
Court Name: Tennessee Supreme Court
Date Published: Jul 22, 2019
Citations: 578 S.W.3d 879; M2017-00423-SC-R11-CV
Docket Number: M2017-00423-SC-R11-CV
Court Abbreviation: Tenn.
Log In
    TWB Architects, Inc. v. The Braxton, LLC, 578 S.W.3d 879