author: W. FRANK CRAWFORD, P.J., W.S.,

text:
    Samuel HUMPHREYS v. Richard SELVEY.
    Court of Appeals of Tennessee, Western Section, at Jackson.
    Feb. 18, 2004 Session.
    April 28, 2004.
    Permission to Appeal Denied by Supreme Court Nov. 15, 2004.

      S. Russell Headrick and Jennifer Marie Eberle, Memphis, for appellant, Samuel Humphreys.
    Bill M. Wade, Memphis, for appellee, Richard Selvey.
   OPINION

W. FRANK CRAWFORD, P.J., W.S.,

delivered the opinion of the court,

in which ALAN E. HIGHERS, J. and HOLLY M. KIRBY, J., joined.

Plaintiff, Tennessee buyer, filed complaint in Shelby County, Tennessee circuit court against South Carolina seller for fraudulent, unlawful, and tortious conduct in connection with contract for purchase of antique soda dispensers. Seller filed motion to dismiss, alleging as grounds lack of personal jurisdiction and improper venue, and trial court granted motion on both grounds. Buyer appeals trial court’s finding that there were insufficient contacts to establish personal jurisdiction of seller. We reverse and remand.

The controversy in this case centers around a contract for sale of antique soda dispensers between a Tennessee resident (buyer) and South Carolina resident (seller).

In August 2001, defendant Richard Sel-vey (“Selvey” or “Defendant”), a South Carolina resident, contacted Fred Hawkins (“Hawkins”) by letter to inform Hawkins of his intent to sell a collection of antique soda dispensers. Selvey’s letter contained photos of several of the dispensers. Shortly thereafter, Hawkins contacted the plaintiff, Samuel Humphreys (“Humphreys” or “Plaintiff’), a resident of Memphis, Shelby County, Tennessee, regarding Selvey’s desire to sell the dispensers for $300,000.00. Hawkins forwarded copies of Selvey’s letter and the attached pictures to Humphreys.

Upon receipt of the letter and pictures, Humphreys authorized Hawkins to contact Selvey to arrange for a sale of the dispensers to plaintiff. In his discussion(s) with Selvey, Hawkins notified Selvey that he was arranging the sale on behalf of a third party.

During the week of August 29, 2001, Humphreys authorized Mark Kennedy (“Kennedy”), a close friend and experienced antiques dealer, to notify Selvey of plaintiffs interest in purchasing 115 dispensers. In his affidavit filed in support of Humphreys’s complaint, Kennedy testified that he contacted Selvey to discuss “the terms of the sale, and the quality and authenticity of the dispensers.” The parties ultimately agreed that Kennedy would travel to South Carolina to pick up a “sample lot of the dispensers in exchange for a down payment of one hundred thousand dollars.”

In September 1991, the parties entered into a formal contract whereby Hum-phreys agreed to purchase 115 dispensers from Selvey for a total price of $S00,000.00. At Humphreys’s request, Kennedy traveled to Myrtle Beach, South Carolina on the week of September 6, 2001, to pick up 10 to 20 dispensers from Selvey and deliver the initial down payment of $100,000.00. Upon his arrival in South Carolina, Kennedy met with Selvey and followed him to his home to pick up the sample lot of dispensers. Kennedy accepted the dispensers, which had been boxed and sealed prior to his arrival, and paid the down payment.

Approximately one week later, Hum-phreys authorized Kennedy to accept delivery of the remaining dispensers and store them temporarily in an antiques mall in Jackson, Madison County, Tennessee, where Kennedy was leasing space. Hum-phreys further authorized Kennedy to pay to Selvey the final $200,000.00 required under the contract. Soon thereafter, Sel-vey personally delivered and unloaded the remaining dispensers in Jackson, Madison County, Tennessee. Upon acceptance of the dispensers, Kennedy paid the balance owed under the contract.

Humphreys’s complaint describes the events following Selvey’s delivery of the remaining items and payment of the contract balance:

At the time of delivery, plaintiff accepted the dispensers without discovery of any nonconformities. Plaintiffs acceptance was reasonably induced by the difficulty of discovery before acceptance and/or by assurances of the defendant. Plaintiff later discovered nonconformities of the dispensers that substantially impairs their value to plaintiff. Further, the dispensers did not conform to the express representations and implied warranties made to plaintiff by defendant as to the quality and value of the dispensers.
Within a reasonable time of discovery of nonconformity, plaintiff, by letter delivered via certified mail, dated October 31, 2001, attempted to communicate revocation of his acceptance of the dispensers pursuant to T.C.A. § 47-2-608. By facsimile on November 16, 2001, plaintiff again attempted to communicate revocation of his acceptance of the dispensers pursuant to T.C.A. § 47-2-608.
Thereafter, plaintiffs letters dated October 31, 2001 were returned as either “unclaimed” or “no such number.”
On December 14, 2001, plaintiff again attempted to communicate revocation of acceptance of the dispensers pursuant to T.C.A. § 47-2-608, by letter delivered via certified mail. Again, plaintiffs letters were returned “unclaimed.”
In a final effort to communicate revocation of acceptance of the dispensers pursuant to T.C.A. § 47-2-608, plaintiff enlisted the assistance of a private process server in Myrtle Beach, South Carolina, Charles Deal (“Deal”). On Monday, January 14, 2002, at 3:43 p.m., Deal personally served upon Richard Selvey, at his home address, plaintiffs revocation of acceptance.
In each communication of revocation of acceptance, plaintiff made demand for refund, within ten (10) days of the receipt of the letter, of the entire purchase price of $300,000.00 paid for the dispensers. Plaintiff requested that his refund should be delivered to the original point of delivery of the dispensers in Jackson, Tennessee, and, if by cashier’s check, should be made payable to Rick Hum-phreys. Plaintiff further agreed to tender, upon receipt of the full amount, the dispensers to defendant, F.O.B. the dock of the original point of delivery in Jackson, Tennessee.
At the time of filing of this Complaint, defendant has not acknowledged plaintiffs revocation of his acceptance of the dispensers nor has defendant complied with plaintiffs request for a full refund. On February 18, 2002, Humphreys filed

a six count complaint against Selvey in the Circuit Court of Memphis, Shelby County, Tennessee, for damages arising from defendant’s alleged improper conduct in connection with the parties’ September 2001 agreement. Humphreys asserts that the trial court had both subject matter and personal jurisdiction over the action, stating:

This Court is vested with jurisdiction over the subject matter of this action pursuant to T.C.A. § 16-10-101 (2002). This Court has jurisdiction over the defendant by virtue of T.C.A. § 20-2-223 (2002) because the defendant transacted business in the State of Tennessee, contracted to supply services or things in the State of Tennessee, and tortiously injured plaintiff by acts which occurred in the State of Tennessee. Venue is proper by virtue of T.C.A. § 20-4-101 (2002) because Shelby County is the county where the cause of action arose.

On April 4, 2002, Selvey filed a motion to dismiss the complaint pursuant to Tennessee Rule of Civil Procedure 12.02 for lack of personal jurisdiction and improper venue. Selvey’s motion states:

All pertinent acts and agreements alleged in Plaintiffs Complaint were conducted or commenced in the State of South Carolina, and at no time did Defendant purposefully direct his business activities or efforts toward the State of Tennessee or any of its residents. The honorable courts of the State of Tennessee therefore lack jurisdiction to adjudicate Plaintiffs Complaint, and Plaintiffs Complaint warrants dismissal pursuant to Rule 12.02(2) of the Tennessee Rules of Civil Procedure.
To the extent that Defendant made any contact with the State of Tennessee or its residents, all such contact was directed solely toward Madison County, Tennessee. During all times relevant to this action, Defendant never traveled to Shelby County nor communicated nor dealt with any residents of Shelby County. Therefore, even if the State of Tennessee has personal jurisdiction over Defendant, proper venue lies in Madison County, and Plaintiffs Complaint warrants dismissal pursuant to Rule 12.02(3) of the Tennessee Rules of Civil Procedure.

Selvey filed only a memorandum of law in support of his motion, which, of course, is not part of the record on appeal. A hearing on Selvey’s motion was held on June 7, 2002, and, in an order dated June 28, 2002, the trial court granted defendant’s motion to dismiss on grounds of lack of personal jurisdiction pursuant to 12.02(2) and improper venue under 12.02(3), stating:

This matter came before the Court upon Defendant’s Motion to Dismiss on June 7, 2002. Based upon Defendant’s Motion, Defendant’s Memorandum of Law in Support of Motion, Plaintiff’s Response to Defendant’s Motion, statements of counsel, and the entire record in this matter, it appears to the Court as follows: That the basis of this cause of action is a contract formed between the parties and consummated in South Carolina; that the Defendant’s delivery of certain goods to Jackson, Tennessee does not create sufficient contacts for the State of Tennessee to exercise in personam jurisdiction over Defendant to adjudicate this cause of action; that, assuming arguendo that the State of Tennessee held sufficient contacts to exercise in personam jurisdiction over Defendant, proper venue lies in Madison County, not Shelby County, because of Defendant’s delivery of goods to Jackson, Tennessee.
THEREFORE, IT IS ORDERED, ADJUDGED AND DECREED as follows:
1. Defendant’s Motion to Dismiss is hereby granted on the grounds of lack of personal jurisdiction pursuant to Rule 12.02(2) of the Tennessee Rules of Civil Procedure.
2. Defendant’s Motion to Dismiss is hereby granted on the additional grounds of improper venue pursuant to Rule 12. 02(3) of the Tennessee Rules of Civil Procedure.
3. All costs of this matter shall be assessed directly against Plaintiff.

On July 26, 2002, Humphreys filed a motion to alter or amend the trial court’s judgment pursuant to Tennessee Rule of Civil Procedure 59.04. The trial court denied Humphreys’s motion by order dated November 12, 2002, and plaintiff filed a timely notice appeal. On appeal, Hum-phreys presents for review the sole issue of whether the trial court erred in granting Selvey’s Rule 12.02 motion to dismiss for lack of personal jurisdiction.

The plaintiff has the burden of establishing a prima facie case that personal jurisdiction over a defendant is proper. See Manufacturers Consolidation Serv., Inc. v. Rodell, 42 S.W.3d 846, 854 (Tenn.Ct.App.2000). When a defendant files a motion to dismiss challenging the trial court’s personal jurisdiction over him, the plaintiff must set out specific facts which demonstrate that the court has jurisdiction. See id. at 854-55. In Rodell, this Court noted:

In ruling on the defendant’s motion to dismiss for lack of personal jurisdiction, however, the trial court is required to construe the pleadings and affidavits in the light most favorable to the plaintiff. Chase Cavett Servs., Inc. v. Brandon Apparel Group, Inc., No. 02A01-9803-CH-00055, 1998 WL 846708, at *1 (Tenn.Ct.App.Dec.7, 1998) (no perm. app. filed); accord CompuServe, Inc. v. Patterson, 89 F.3d 1257, 1262 (6th Cir.1996); Market/Media Research, Inc. v. Union-Tribune Publ’g Co., 951 F.2d 102, 104 (6th Cir.1991), cert. denied, 506 U.S. 824, 113 S.Ct. 79, 121 L.Ed.2d 43 (1992); Theunissen v. Matthews, 935 F.2d 1454, 1458, 1459 (6th Cir.1991); Serras v. First Tennessee Bank Nat’l Ass’n, 875 F.2d 1212, 1214 (6th Cir.1989). Under this standard, dismissal is proper only if all of the specific facts alleged by the plaintiff collectively fail to state a prima facie case for jurisdiction. CompuServe, 89 F.3d at 1262; Market/Media Research 951 F.2d at 105; Theunissen, 935 F.2d at 1459.

Id. at 855.

In Chenault v. Walker, 36 S.W.3d 45 (Tenn.2001), our Supreme Court provides guidelines for consideration of a motion to dismiss for lack of personal jurisdiction:

Under the Tennessee Rules of Civil Procedure a motion to dismiss may be based on one or more of eight grounds, including lack of personal jurisdiction and failure to state a claim on which relief can be granted. See Tenn. R. Civ. P. 12.02. A court either decides this motion based on the allegations contained in the pleadings or, if matters outside the pleadings — such as affidavits — are presented, the court will treat the motion as one for summary judgment as provided in Tenn. R. Civ. P. 56. See Tenn. R. Civ. P. 12.03.
As we have stated in the past, however, Rule 12.03 does not apply to a motion to dismiss for lack of personal jurisdiction, unless the evidence brought to the court is so conclusive that the motion may be fully and finally resolved on the merits. See Nicholstone Book Bindery, Inc. v. Chelsea House Publishers, 621 S.W.2d 560, 561 n. 1 (Tenn.1981) (“[Sjummary judgment procedure does not properly apply to jurisdictional issues.”) (quoting 6 Moore, Federal Practice (Part 2) § 56.17(36) at 913 (1980)). Often a complete resolution of the jurisdictional issue is not possible at the beginning of litigation because not enough evidence has been developed; indeed, discovery will not have yet begun. This gives rise to a dilemma. If a court seeks to develop more evidence, by ordering discovery or an evidentiary hearing, the burden on an out-of-state defendant may in some cases be nearly as great as if the court simply ruled from the start that jurisdiction was present and allowed the litigation to proceed. But allowing a court to decide whether jurisdiction exists based entirely on the pleadings, as a court may do when confronted with one of the other grounds to dismiss listed in Rule 12.02, is hardly a better solution.
Regardless of the theory on which personal jurisdiction is based, though, the necessity of adopting a middle-ground solution — between relying merely on the pleadings and postponing a decision on jurisdiction until discovery has been completed — is apparent.... It is clear that the plaintiff bears the ultimate burden of demonstrating that jurisdiction exists. See McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 189, 56 S.Ct. 780, 785, 80 L.Ed. 1135, 1141 (1936); Massachusetts School of Law at Andover, Inc. v. American Bar Ass’n, 142 F.3d 26, 34 (1st Cir.1998). If the defendant challenges jurisdiction by filing affidavits, the plaintiff must establish a prima facie showing of jurisdiction by responding with its own affidavits and, if useful, other written evidence. See Posner v. Essex Ins. Co. Ltd., 178 F.3d 1209, 1214 (11th Cir.1999); Bank Brussels Lambert v. Fiddler Gonzalez & Rodriguez, 171 F.3d 779, 784 (2nd Cir.1999); OMI Holdings, Inc. v. Royal Ins. Co. of Canada, 149 F.3d 1086, 1091 (10th Cir.1998). A court will take as true the allegations of the nonmoving party and resolve all factual disputes in its favor, see Posner, 178 F.3d at 1215; IMO Industries, Inc. v. Kiekert AG, 155 F.3d 254, 257 (3rd Cir.1998), but it should not credit conclusory allegations or draw farfetched inferences, see Massachusetts School of Law, 142 F.3d at 34.
We find that this procedure for evaluating a defendant’s motion to dismiss under Tenn. R. Civ. P. 12.02(2) is sensible and not inconsistent -with any rule or case in Tennessee of which we are aware, and we therefore adopt it.

Id. at 55-56.

In this case, the trial court’s order granting Selvey’s motion to dismiss stated that the court relied upon “Defendant’s Motion, Defendant’s Memorandum of Law in Support of Motion, Plaintiffs Response to Defendant’s Motion, statements of counsel, and the entire record in this matter,” in forming its decision. We, therefore, consider the entire record on appeal, including the affidavits filed in support of Humphreys’s complaint, in determining whether the trial court properly found that personal jurisdiction over Selvey was lacking.

Tennessee’s long-arm statute, T.C.A. § 20-2-214 (1994), allows Tennessee courts to exercise jurisdiction to the extent the Fourteenth Amendment of the United States Constitution permits. See, e.g., Cummins v. K-Mart, Inc., 635 F.Supp. 122, 124 (E.D.Tenn.1986); Rodell, 42 S.W.3d at 855. T.C.A. § 20-2-214 (1994) provides:

20-2-214. Jurisdiction of persons unavailable to personal service in state— Classes of actions to which applicable.— (a) Persons who are nonresidents of Tennessee and residents of Tennessee who are outside the state and cannot be personally served with process within the state are subject to the jurisdiction of the courts of this state as to any action or claim for relief arising from:
(1) The transaction of any business within the state;
(2) Any tortious act or omission within this state;
(3) The ownership or possession of any interest in property located within this state;
(4) Entering into any contract of insurance, indemnity, or guaranty covering any person, property, or risk located within this state at the time of contracting;
(5) Entering into a contract for services to be rendered or for materials to be furnished in this state;
(6) Any basis not inconsistent with the constitution of this state or of the United States;
(7) Any action of divorce, annulment or separate maintenance where the parties lived in the marital relationship within this state, notwithstanding one party’s subsequent departure from this state, as to all obligations arising for alimony, custody, child support, or marital dissolution agreement, if the other party to the marital relationship continues to reside in this state.
(b) “Person,” as used herein, includes corporations and all other entities which would be subject to service of process if present in this state.
(c) Any such person shall be deemed to have submitted to the jurisdiction of this state who acts in the manner above described through an agent or personal representative.

Our task, therefore, is to determine if the exercise of personal jurisdiction over Sel-vey violates the Due Process Clause.

Since the United States Supreme Court adopted the “minimum contacts” analysis in International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945), and in keeping with this state’s long-arm statute, Tennessee courts have developed a five-part test which serves to evaluate the contacts between a defendant and the forum state. See Masada Investment Corp. v. Allen, 697 S.W.2d 332, 334 (Tenn.1985). That test evaluates: (1) the quantity of the contacts between the defendant and the forum state; (2) the nature and quality of those contacts; (3) the relationship between those contacts and the cause of action; (4) the interest of the forum state in adjudicating the dispute; and (5) the convenience of the forum state to the parties. See id. The end result of the Masada analysis is a determination of whether, through its conduct and connection to the forum state, a defendant could “reasonably anticipate being haled into court there.” World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980).

The pertinent facts can be summarized chronologically as follows. In August 2001, Selvey sent a letter to Hawkins in North Carolina, informing Hawkins of his desire to sell a collection of antique soda dispensers. Hawkins, in turn, contacted Humphreys by telephone regarding Sel-vey’s stated intent to sell the dispensers, and further forwarded a copy of Selvey’s letter to Humphreys in Tennessee. There is no evidence in the record to indicate that Selvey was aware that Hawkins had a potential buyer in Tennessee at this time.

After receiving a copy of Selvey’s letter, Humphreys instructed Hawkins to contact defendant. As instructed, Hawkins contacted Selvey and began arrangements for a sale of the dispensers to a third party. Again, there is no indication in the record as to whether Selvey was aware at this time that Hawkins was acting on behalf of a Tennessee resident.

During the last week of August 2001, Humphreys authorized Kennedy to contact Selvey to discuss the terms of sale. The parties entered into a contract for sale in September 2001. Soon thereafter, Kennedy, at Humphreys’s request and direction, drove to South Carolina to pick up a sample lot of dispensers. Upon receipt of the dispensers, Kennedy paid to Selvey the $100,000.00 down payment required by the parties’ contract. The down payment was financed with funds from a bank in Memphis, Shelby County, Tennessee.

Approximately one week later, Selvey personally delivered the remaining dispensers to Kennedy in Jackson, Tennessee. Selvey unloaded the dispensers and was paid the remaining balance due under the contract. The $200,000.00 balance was financed with funds from the same bank in Tennessee.

The parties do not dispute the basic facts of this case. Rather, the sole dispute in this matter centers around whether the facts, as established by the affidavits filed in support of Humphreys’s complaint, establish a prima facie case that Selvey had sufficient minimum contacts with the State of Tennessee as a result of his dealings with plaintiff, to warrant the exercise of jurisdiction over his person.

We note, initially, that T.C.A. § 20-2-214(a)(5) permits Tennessee courts to exercise personal jurisdiction over a nonresident for any action or claim for relief arising from “a contract for services to be rendered or for materials to be furnished in this state.” In the instant case, Hum-phreys and Selvey entered into a single contract for the purchase of a collection of antique soda dispensers (materials), with final delivery of the primary balance of the dispensers to take place in Jackson, Tennessee. Moreover, T.C.A. § 20-2-214(a)(2) permits Tennessee courts to exercise personal jurisdiction over a nonresident for “[a]ny tortious act or omission within the state.” Humphreys’s complaint specifically alleges fraud and misrepresentation by Selvey resulting in injury to the plaintiff. The plain language of this statute and the relevant subsections appears to grant Tennessee courts personal jurisdiction over a non-resident defendant in actions such as the case before this Court.

In Neal v. Janssen, 270 F.3d 328, 331 (6th Cir.2001), the Sixth Circuit determined that T.C.A. § 20-2-214(a)(2) “allows a court to exercise jurisdiction ‘if a tortious act is committed outside the state and the resulting injury is sustained within the state, the tortious act and the injury are inseparable, and jurisdiction lies in Tennessee.’ ” Accordingly, the court noted that “even a single act by defendant directed toward Tennessee that gives rise to a cause of action can support a finding of minimum contacts sufficient to exercise personal jurisdiction without offending due process.” Id. (citation omitted). We find the reasoning and interpretation applied by the Sixth Circuit to be sound, and thus conclude that the single contract formed between Humphreys and Selvey for the purchase of a collection of antique soda dispensers could support a finding of minimum contacts sufficient to exercise personal jurisdiction over the defendant pursuant to T.C.A. § 20-2-214(a)(2) and (5), provided that the evidence set forth by plaintiff creates a prima facie case that personal jurisdiction over the defendant is proper in light of the Masada factors.

Addressing each of the Masada factors in turn, we first note that the contract around which this dispute centers was formed as a result of several telephone conversations and written communications between Humphreys and/or his agents (Kennedy and Hawkins) and defendant. In Neal, the Sixth Circuit noted that “[t]he acts of making phone calls and sending facsimiles into the forum, standing alone, may be sufficient to confer jurisdiction on the foreign defendant where the phone calls and faxes form the bases for the action.” 270 F.3d at 331 (citations omitted). Cf. Garrett v. R.H. Macy & Co., Inc., 360 F.Supp. 872, 877 (E.D.Tenn.1972) (finding that “[tjelephone calls by the nonresident to the forum state alone are not sufficient to give the forum court jurisdiction”). Humphreys’s complaint sets forth counts of breach of express warranty, breach of implied warranty of merchantability, fraud and misrepresentation, negligent misrepresentation, and violations of the Tennessee Consumer Protection Act, based upon allegations that Selvey misrepresented the quality, value, and condition of the dispensers in his communications with plaintiff or his agents. The record indicates that Selvey directed the alleged misrepresentations to Humphreys and/or his agents. Although Selvey’s initial communications were directed toward Hawkins, it is evident that Selvey became aware of the fact that he was dealing with a Tennessee buyer prior to the formation of the contract. Moreover, Kennedy testified that he spoke with Selvey regarding the terms of the sale contract, such terms apparently including the parties’ agreement to have the balance of the dispensers delivered to a destination specified by plaintiff in Jackson, Tennessee. We thus find that Selvey’s communications regarding the quality, value, authenticity, and condition of the dispensers had foreseeable consequences in Tennessee and were ultimately directed at a Tennessee resident.

Although it is unlikely that the telephone calls and communications exchanged between the parties would, alone, be sufficient to support a finding of minimum contacts, we conclude that these communications, coupled with Selvey’s act of personally delivering the balance of the dispensers to Jackson, Tennessee, constitute sufficient minimum contacts with the State of Tennessee such as to justify the exercise of personal jurisdiction over the defendant. Considering the record as a whole, we find that Selvey purposefully availed himself of the privilege of conducting business within the State of Tennessee by knowingly entering into a contract for sale with a Tennessee resident after numerous telephone conversations and written communications, collecting a significant purchase price on the contract ($300,000.00), and personally delivering the balance of the dispensers to the plaintiffs agent in Jackson, Tennessee. We thus conclude that Selvey’s actions are of sufficient quantity and quality to constitute minimum contacts with the State of Tennessee.

As to the third Masada factor, we find that Selvey’s contacts with the State of Tennessee are directly related to Hum-phreys’s causes of action. As has been discussed, the contacts and causes of action all stem from or relate to the parties’ contract for sale and purchase of the dispensers.

Masada’s fourth factor directs the court to evaluate the interest of the forum state in adjudicating the dispute. In Southern Mach. Co. v. Mohasco Indus., Inc., 401 F.2d 374 (6th Cir.1968), the Sixth Circuit stated that “when the contract is with a resident of Tennessee, the State’s interest in resolving a suit based on the contract and brought by that resident cannot be doubted.” Id. at 385 (citations omitted); see also Flakt, Inc., Drying Sys. Div. v. Windsor Gypsum, Inc., 1987 WL 15197, at *10 (Tenn.Ct.App. Aug.5, 1987).

With regard to the fifth factor, we note that there is no evidence in the record regarding the level or degree of inconvenience that would befall Selvey should he be forced to litigate this matter in Tennessee. Although one can assume that litigation of this matter in Tennessee might be burdensome to a non-resident such as Selvey, we are simply unwilling to deny jurisdiction on this basis in light of our foregoing discussion. Moreover, we find that the nature and consequences of Selvey’s contractual agreement with Humphreys dictate that the defendant could have reasonably anticipated being haled into court in this State for complications or disputes arising from his contract with plaintiff. Considering the record as a whole, we find that it would not violate “traditional notions of fair play and substantial justice” to permit Tennessee to exercise personal jurisdiction over the defendant.

In the interest of providing a complete and accurate analysis, we briefly distinguish the case of Darby v. Superior Supply Co., 224 Tenn. 540, 458 S.W.2d 423 (1970), a Tennessee Supreme Court decision relied upon by Selvey in his argument to this Court. In Darby, the defendant, an Alabama resident, purchased an order of mahogany lumber from a Tennessee corporation (plaintiff). Id. The Court noted:

Darby bought the lumber for his personal use at his home in Florence, Alabama, the order therefor resulting from correspondence and telephone calls between the parties, without Darby ever entering the State of Tennessee. The lumber was delivered to Darby’s agent at Superior’s plant in Chattanooga and carried to Florence, Alabama. After delivery Darby found he could use only a part of the lumber because of its dimensions. He used this, paid for it, and notified Superior he could not use the balance and would hold it for Superior. Subsequently, Superior sued Darby for the balance claimed, $3,639.48 and interest, serving process on him in Alabama by means of Tennessee’s long arm statute ....

Id. at 423-24.

On appeal, the Court considered the issue of whether Tennessee courts had personal jurisdiction over the defendant, stating:

Adverting to the factual situation, we have a case where a nonresident individual, without ever entering the State of Tennessee, consummated by interstate mail and telephone calls, a retail purchase of a modest amount of mahogany lumber to be used for his own personal benefit. While Superior had some trouble filling the order, this did not arise from its unusual nature, since it was simply for mahogany boards of normal dimensions.... The only act of defendant in Tennessee was the acceptance of the lumber on board a truck he sent to Superior’s mill for that purpose.
So, the question boils down simply to this: In an ordinary, single, retail sale transaction, where the purchaser never enters the State of Tennessee until the purchase contract has been consummated, and thereafter his only connection with the State of Tennessee is the acceptance of the delivery by an agent in Tennessee, is this a purposeful availing of the privilege of conducting activities in Tennessee and is it an invocation of the benefits and protection of its laws?
The question answers itself in the negative. What are the activities, that are not interstate? Where are the benefits? What protection of the law was required that is not extended to every interstate transaction? To each question the honest answer must be “none.”
* * * * * *
In conclusion we should mention that reference in this opinion to the interstate character of the transaction involved was only for the purpose of emphasizing the absence of either qualitative or quantitative instate activity. We also emphasize that this case has not been decided solely on the ground the defendant never entered Tennessee in the course of the transaction involved. We have decided the case as we have because, viewed in its entirety, we are of the. opinion it fails to meet the test laid down in International Shoe, [Co. v. State of Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945)] McGee, [v. International Life Ins. Co., 355 U.S. 220, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957)] and Hanson [v. Denckla, 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958)].

Id. at 426-27.

Selvey asserts that facts of Darby are controlling in the instant matter. We disagree, noting, initially, that the Tennessee Supreme Court has limited Darby’s authority to the particular facts of that case. See Nicholstone Book Bindery, Inc. v. Chelsea House Publishers, 621 S.W.2d 560, 562 (Tenn.1981). Although the facts of the case at bar are similar to those in Darby, we note two specific differences. Unlike the defendant in Darby, Selvey personally delivered the dispensers to Humphreys in Jackson, Tennessee, knowingly and purposefully availing himself of the privilege of conducting business in Tennessee. Selvey further accepted final payment of the contract balance in Tennessee. From the record as it stands, it appears as though Selvey’s delivery of the dispensers to Humphreys in Tennessee was a material condition of the parties’ contract. Moreover, we note that the parties’ contract, unlike the agreement in Darby, provided for a substantial purchase price of $300,000.00. A contract providing for such a substantial purchase price has foreseeable economic consequences in Tennessee.

Accordingly, we conclude that the trial court erred in finding that it did not have personal jurisdiction over Selvey, and thereby reverse its June 28, 2002 order to the extent that it grants defendant’s motion to dismiss pursuant to Tenn. R. Civ. P. 12.02(2).

The trial court further granted Selvey’s motion to dismiss on grounds of improper venue pursuant to Rule 12.02(3). The court specifically found that, “assuming arguendo that the State of Tennessee held sufficient contracts to exercise in per-sonam jurisdiction over Defendant, proper venue lies in Madison County, not Shelby County, because of Defendant’s delivery of goods to Jackson, Tennessee.” Hum-phreys acknowledges that he “did not appeal the decision of the trial court on venue.” Therefore, the issue of whether the trial court correctly dismissed plaintiffs complaint on grounds of improper venue is not properly before this court.

Although we are not concerned with the correctness of the trial court’s decision to grant dismissal of plaintiffs complaint on grounds of improper venue, this Court is faced with the question of whether it is permitted to transfer the case to Jackson, Madison County, Tennessee, rather than affirm the trial court’s outright dismissal of the action.

Madison County, Tennessee would be the appropriate venue for this matter. T.C.A. § 20-4-101(a) (1994) states:

In all civil actions of a transitory nature, unless venue is otherwise expressly provided for, the action may be brought in the county where the cause of action arose or in the county where the defendant resides or is found.

In Five Star Express, Inc. v. Davis, 866 S.W.2d 944 (Tenn.1993), the Tennessee Supreme Court defined a transitory action as “one in which the injury occurred to a subject not having an immovable location; therefore a transitory action could have occurred anywhere.” Id. at 945 n. 1. The Court noted that “typical examples of transitory actions are actions sounding in tort and contract.” Id. The cause of action in the instant matter is transitory in nature.

We further find that plaintiffs cause of action arose in Madison County, Tennessee, and not Shelby County, on the basis that the most significant events surrounding the parties’ contract occurred in Madison County. Although all communications between the parties were received and/or initiated in Shelby County, final delivery of the dispensers and payment of the contract balance was made in Madison County. As such, the consequences of Selvey’s alleged misconduct had them primary effect in Madison County. We thus find that Humphreys’s cause of action arose in Madison County, Tennessee.

Having determined that Madison County is the appropriate venue for this matter, we must now consider whether this Court is permitted to transfer the case. T.C.A. § 16-1-116 (Supp.2003) states:

Notwithstanding any other provision of law or rule of court to the contrary, when an original civil action, an appeal from the judgment of a court of general sessions, or a petition for review of a final decision in a contested case under the Uniform Administrative Procedures Act, compiled in title 4, chapter 5, is filed in a state or county court of record or a general sessions court and such court determines that it lacks jurisdiction, the court shall, if it is in the interest of justice, transfer such action or appeal to any other such court in which the action or appeal could have been brought at the time it was originally filed. Upon such a transfer, the action or appeal shall proceed as if it had been originally filed in the court to which it is transferred on the date upon which it was actually filed in the court from which it was transferred.

In Wylie v. Farmers Fertilizer & Seed Co., No. W2002-01227-COA-R9-CV, 2003 WL 21998408, *1 (Tenn.Ct.App. Aug.21, 2003), this Court reversed the trial court’s finding that plaintiffs cause of action was transitory in nature, and determined that the action was required to have been brought in Gibson County, rather than Dyer County. Acting pursuant to T.C.A. § 16-1-116, we concluded, however, that “the interest of justice would best be served by transferring the lawsuit to Gibson County rather than dismissing it.” Id. at *6. On remand, we directed the trial court to transfer the case to the appropriate court in Gibson County. Id.

In the instant matter, we find that the interest of justice would best be served by transferring the lawsuit to Madison County. We note, initially, that delivery of a substantial number of the dispensers was completed in Madison County at the direction of the plaintiff, a Shelby County resident. Moreover, payment of the final $200,000.00 balance due under the contract was rendered and accepted in Madison County. Finally, as noted, the economic consequences of Selvey’s alleged wrongful conduct had their most substantial and foreseeable impact in Madison County. We thus reverse the trial court’s dismissal of plaintiffs complaint on grounds of improper venue and remand the action for transfer to the appropriate trial court.

The decision of the trial court is reversed and remanded for further proceedings consistent with this Opinion. Costs of this appeal are assessed against the appel-lee, Richard Selvey.

      . Hawkins is a resident of Valdese, Burke County, North Carolina.

      . In his complaint, Humphreys noted:
      Defendant is experienced in the antiques trade, specifically in the collection and sale of dispensers. Prior to the transaction, defendant represented that the dispensers were in "very good to excellent condition,” with the exception of two dispensers that were reproductions, and further that the dispensers were “one-hundred percent (100%) original.” Plaintiff reasonably relied upon defendant's representations about the quality and value of the dispensers.

      . Humphreys’s $100,000.00 down payment was financed in part by a $50,000.00 cashier’s check obtained by plaintiff from Enterprise National Bank in Memphis, Tennessee, Humphreys withdrew the remaining $50,000.00 from his personal account with Enterprise National Bank,

      . On September 6, 2001, Humphreys withdrew funds for the final $200,000.00 payment from his account with Enterprise National Bank.

      . Humphreys contends that Selvey’s motion to dismiss "was not 'properly supported’ because [defendant] failed to submit any evidence in the form of affidavits, sworn statements, declarations, testimony, or otherwise in support of his motion.” (emphasis in original). In Manufacturers Consolidation Serv., Inc. v. Rodell, 42 S.W.3d 846, 854 (Tenn.Ct.App.2000), the court noted that where "the defendant challenges the trial court's personal jurisdiction over him by filing a properly supported motion to dismiss, 'the plaintiff may not stand on his pleadings but must, by affidavit or otherwise, set forth specific facts showing that the court has jurisdiction.' ” (quoting Theunissen v. Matthews, 935 F.2d 1454, 1458 (6th Cir.1991); accord Serras v. First Tennessee Bank Nat'l Ass’n, 875 F.2d 1212, 1214 (6th Cir.1989)). The above-cited authority does not stand for the position that a movant is required to file affidavits or evidentiary documents in support of their motion, but rather provides that where a movant files affidavits or similar evidentiary documents in support of a motion to dismiss, a plaintiff "must, by affidavit or otherwise, set forth specific facts showing that the court has jurisdiction.” See id.

      . In Nicholstone, the Court determined that Darby “did not sanction the assertion of jurisdiction under our 'long arm’ statute to the maximum extent permitted by the Fourteenth Amendment, which is the declared intent of our General Assembly.” Id. at 563.


source: Caselaw Access Project

author: DAVID R. FARMER, J.,

license: Public Domain

text:
    In re Nellie Elizabeth CROWELL.
    Court of Appeals of Tennessee, at Nashville.
    March 16, 2004 Session.
    May 3, 2004.
    Application for Permission to Appeal Denied by Supreme Court Dec. 6, 2004.

      Mark A. Ellmore, Jr., Nashville, Tennessee, for the appellants, Joseph H. Nickens, Katherine N. Moser, Agnes E. Baker and Dana A. Nickens.
    J. Frank Rudy, Jr. And W. Gregory Miller, Nashville, Tennessee, for the appel-lees, The Orphans’ Homes Affiliated with the Free Will Baptist Church Denomination.
   OPINION

DAVID R. FARMER, J.,

delivered the

opinion of the court,

in which W. FRANK CRAWFORD, P.J., W.S., and HOLLY M. KIRBY, J., joined.

This is a Will construction case. The decedent’s Will provided that her estate would be distributed to her husband. However, the husband predeceased the decedent leaving no issue. The only remaining provision in the Will provided that her estate would be distributed to certain orphan’s homes if she and her husband died at the same time. The trial court found it unreasonable to construe the Will to require simultaneous death and distributed the estate to the orphan’s homes. We hold that the Will contains a failed condition resulting in intestate succession. We reverse and remand.

On February 5, 1971, Nellie Elizabeth Crowell (Mrs. Crowell) executed her Will. Her husband (Mr. Crowell), whose Will was identical to Mrs. Crowell’s, died on August 27, 1998. On June 8, 2000, at the age of eighty-two, Mrs. Crowell died. Her Will was admitted to probate on November 20, 2000. Her Will provides in pertinent part:

ITEM I: I direct that all of my just debts, including funeral and testamentary expenses and expenses of my last illness, be paid by my Executor as soon as convenient after my death. All inheritance, estate and other like taxes shall be paid by Executor and charged generally against my estate without attempting to prorate the same or charge any part thereof against [a] beneficiary named herein.
ITEM II: I nominate and appoint Mr. William L. Smith, a Public Accountant as Executor of this Will and direct that no bond shall be required of him.
ITEM III: I give and bequeath to my Husband, Robert H. Crowell, all assets, both real and personal and for him to have a free hand to do whatever he wishes with any or all thereof.
ITEM IV: In the event that [I] and my Husband should decease at the same time, it is my desire that my Executor dispose of all assets and any residue remaining in our estate be distributed to the Orphans homes operated by the Free Will Baptists Denomination [(Claimants)] in equal amounts to all.
In Witness Whereof,....

On June 11, 2002, the trial court made a determination as to the identification of the proper heirs and beneficiaries (The Heirs) of Mrs. Crowell’s estate. There is no transcript of the proceedings, but the parties entered a Statement of Evidence pursuant to Rule 24(c) of the Tennessee Rules of Appellate Procedure. The Statement of Evidence provides in pertinent part:

On behalf of the heirs of Nellie Elizabeth Crowell, Mr. Bennett F. Bratcher, Attorney[,] examined Ms. Pat Whittle, who testified as to her personal conversations with the decedent on the occasion of Ms. Whittles[’] birthday party in 1992. Ms. Whittle also read from corroborating correspondence she received from Paul Crowell concerning the decedent[’]s own personal comments, made to Paul Crowell, about the decedent[’s] Will and her ultimate wishes concerning the disposition of her property. Decedent had made the statements to Paul Crowell during her attendance at the funeral of Pauline Crowell in 1998. On both occasions[,] the decedent stated that if her husband, [Mr. Crowell], predeceased her, she intended for her heirs to inherit her estate....
On behalf of the Claimants, [letters were submitted] from two of the four claimants. Each of the two claimants stated that their interpretation of the Decendent[’s] Will to be that Decedent intended them to be the recipients of her estate....

Based upon the pleadings, statements of counsel, and statements of the witnesses...:

1. Under Tennessee law, it is the cardinal rule in Will construction to determine the intent of the Testator.
2. Courts will endeavor to avoid intestacy if at all possible.
3. A Will should be construed as if the Decedent prepared and executed it on the date of death.

In accordance with these principles^] the Court concluded as follows:

1. The Last Will and Testament of [Mrs.] Crowell was duly executed in accordance with Tennessee law on February 5,1971.
2. ITEM III of the Will provided for [Mrs.] Crowell’s estate to be distributed to her husband, [Mr.] Crowell, however [Mr.] Crowell predeceased his wife.
3. In the event that [Mrs.] Crowell[’]s husband predeceased her, ITEM IV of the Will provided for [Mrs.] Cro-well[’]s residuary estate to be distributed in equal amounts to the [Claimants]. The Court found it unreasonable [to] construe the Will in such a way as to require simultaneous death by [Mrs.] Crowell and her husband in order to conclude that [Mrs.] Crowell intended to leave her estate to the [Claimants]. Therefore, the Trial Court found proper construction of ITEM TV of the Will provides for equal distribution of the entire estate to the claimants in this matter since [Mrs.] Cro-well’s husband had predeceased her.

On September 19, 2002[,] certain heirs of the Estate of [Mrs.] Crowell filed a Notice of Appeal regarding the Court’s decision.

Issue Presented

The Hems appeal and present the following issue, as we perceive it, for our review:

Whether the trial court erred in construing Mrs. Crowell’s Will to provide for distribution of Mrs. Crowell’s residuary estate in equal amounts to the Claimants.

Standard of Review

In a Will construction case, the Tennessee Supreme Court has stated that “ ‘[w]hen there is no conflict in the evidence as to any material fact, as in this case, the question on appeal is one of law, and our scope of review is de novo with no presumption of correctness accompanying the Chancellor’s conclusions of law.’ ” In re Estate of Vincent, 98 S.W.3d 146, 148 (Tenn.2003) (quoting Union Carbide Corp. v. Huddleston, 854 S.W.2d 87, 91 (Tenn.1993)).

Will Construction

In Will construction, “[t]he cardinal rule ... is the ascertainment of the intent of the testator. That intent, when known, will be given effect unless prohibited by some rule of law or public policy.” In re Walker, 849 S.W.2d 766, 768 (Tenn.1993) (citing Cowden v. Sovran Bank/Cent. So., 816 S.W.2d 741, 744 (Tenn.1991)). Further, in Will construction:

the testator’s intention must be ascertained from “that which he has written” in the will, and not from what he “may be supposed to have intended to do,” and extrinsic evidence of the condition, situation and surroundings of the testator himself may be considered only as aids in the interpretation of the language used by the testator, and “the testator’s intention must ultimately be determined from the language of the instrument weighed in the light of the testator’s surroundings, and no proof, however conclusive in its nature, can be admitted with a view of setting up an intention not justified by the language of the writing itself.”

Nichols v. Todd, 20 Tenn.App. 564, 101 S.W.2d 486, 490 (1936) (quoting Sizer’s Pritchard on Wills §§ 384, 387, 388, and 409 (2nd Ed.)).

In this case, the plain language of the Will provides first that Mrs. Crowell’s husband, Mr. Crowell, was to take her estate. However, Mr. Crowell predeceased his wife and left no issue resulting in the bequest and devise lapsing. See Tenn. Code Ann. § 32-3-105 (2001). Item IV of the Will provides that “[i]n the event that me and my Husband should decease at the same time, it is my desire that my Executor dispose of all assets and any residue remaining in our estate be distributed” to the Claimants. Under the plain language, this provision cannot be effectuated because Mr. Crowell predeceased Mrs. Cro-well by nearly two years. The logical result, under the plain language, would be a failed condition under a conditional Will with an intestate distribution of Mrs. Cro-well’s estate. However, it is a general rule of Will construction that when a Will has been executed, “there is no presumption of an intention to die intestate.” 80 Am. Jur.2d Wills § 1037 (2002).

This Court recently addressed the issue of conditional Wills in In re Estate of Franklin, E2000-02687-COA-R3-CV, 2001 WL 896635 (Tenn.Ct.App. Aug.9, 2001) (no perm. app. filed). In that case, the Will provided:

I[,] Gloria Franklin[,] leave! ] everything I own incl[ Juding farm, vehic[ ]les ... to Jess & Terry Wattman in case I die on my way to & from Jersey.

Id. at *1. Ms. Franklin did not die on her trip to Jersey. Id. This court stated:

In determining whether a will is conditional or contingent, a court must first determine “whether the happening of the possibility referred to is a condition precedent to the operation of the will, or whether the possibility of the happening was only a statement of the motive or inducement which led to the preparation and execution of the instrument.”

Id. at *2 (quoting Bagnall v. Bagnall, 148 Tex. 423, 225 S.W.2d 401, 402 (1949)). In answering this question, this Court laid out several factors that should be considered:

(1) the circumstances surrounding the execution of the document; (2) any statements made by the decedent following the execution of the document; (3) the manner in which the document was kept after the time for the purported contingency had lapsed; (4) the decedent’s education and knowledge of the law; (5) whether any subsequent testamentary documents were made; (6) whether the contingency bears a reasonable relation to the disposition of the decedent’s property; (7) whether a finding of a conditional will means that the deceased died intestate; (8) whether effectuating the terms of the will would be inequitable under the circumstances; and (9) such other relevant factors as bear on the issue at hand.

Id. at *4. In that case, it was undisputed that Ms. Franklin “was motivated by the news of an automobile accident to make a will. It is also undisputed ... that !Ms. Franklin] told others that she wanted the same disposition of her property whether she died on the trip or at any other time.” In re Estate of Franklin, No. E2003-00926-COA-R3-CV, 2003 WL 22734618, at *2 (Tenn.Ct.App. Oct. 20, 2003) (no perm, app. filed). The trial court also found that Ms. Franklin had no special education or knowledge of the law which led this Court to conclude that she would have no reason to think that the language used about her trip to Jersey would affect the validity of the Will. Id. Based upon these facts, this Court concluded that the language used by Ms. Franklin in the Will was not a condition precedent to the operation of the Will but rather her knowledge of a recent traffic accident in the context of her pending trip to Jersey induced her preparation and execution of the Will. Id. at *3.

In the present case, the statement of evidence does not provide facts relevant to all of the factors enumerated in the Franklin case but does provide sufficient facts to determine whether Ms. Crowell’s Will is conditional. Unlike the Franklin case, there was no testimony from Mrs. Crowell that she intended for her estate to go to the Claimants in the event that she and Mr. Crowell did not pass away at the same time. Rather, there was testimony from an apparent disinterested witness that on at least two occasions, Mrs. Cro-well had said that if Mr. Crowell predeceased her, she intended for her estate to be distributed to her heirs. The statement of evidence also includes two letters from the Claimants, who, based solely on the reading of Mrs. Crowell’s Will, believed that Mrs. Crowell intended her estate to be distributed to the Claimants. Based upon this evidence, we cannot conclude that the condition contained in Item IV of the Will was a motive or inducement for Mrs. Crowell to make the Will. Rather, the only permissible construction is that the condition was precedent to the Will’s operation. The failed condition results in Mrs. Crowell’s intent, based upon the testimony, that her estate be distributed to her heirs, be effectuated through intestate succession. Accordingly, on remand, the distribution of Mrs. Crowell’s estate shall proceed in accordance with the intestacy provisions of Tenn.Code Ann. §§ 31-2-101 to -110 (2001).

Conclusion

In light of the foregoing, we reverse the decision of the trial court to distribute Mrs. Crowell’s estate to the Claimants. Costs of this appeal are taxed to the Ap-pellees, Free Will Baptist Ministries, Inc., Free Will Baptist Orphanage, Inc., Free Will Children’s Home of Alabama, and Harvest Free Will Baptist Child Care Ministries, for which execution may issue if necessary.

      . Joseph H. Nickens, the brother of Mrs. Cro-well, replaced Mr. Smith as the executor of the Will.

      . The findings of fact occurred after the case was remanded to the trial court after the first opinion. In re Estate of Franklin, 2001 WL 896635, at *4-5. This second opinion was the result of an appeal from the trial court after remand. In re Estate of Franklin, 2003 WL 22734618, at *1.


author: HERSCHEL PICKENS FRANKS, P.J., E.S.,

text:
    Dr. Kenneth F. FREELS, Kenneth F. Freels, D.D.S., P.C., and Kenneth F. Freels, D.D.S., P.C., Defined Benefit Pension Trust v. JOSEPH C. TAYLOR & ASSOCIATES, INC., and Howard G. Hogan, Successor Receiver for Joseph C. Taylor & Associates, Inc.
    Court of Appeals of Tennessee, Eastern Section, at Knoxville.
    March 23, 2004 Session.
    May 26, 2004.
    Permission to Appeal Denied by Supreme Court Dec. 6, 2004.

      Robert S. Stone, Knoxville, Tennessee, for Appellants.
    James R. Moore, Knoxville, Tennessee, for Appellees.
   OPINION

HERSCHEL PICKENS FRANKS, P.J., E.S.,

delivered the opinion of the Court,

in which CHARLES D. SUSANO, JR., J„ and WILLIAM H. INMAN, Sp., J., joined.

Plaintiffs sought recovery of cashier’s check on theory of bailment or resulting or constructive trust. From an adverse Judgment by the Chancellor, plaintiffs appealed. We affirm.

The dispositive issue in this action is the ownership of a $50,000.00 cashier’s check, which was made out to “Joe Taylor and Assoc.” by plaintiff Freels.

The check was found in the automobile of Joseph C. Taylor, a Knoxville businessman, after he committed suicide in November, 1995. According to the Complaint, the check was given to Taylor by plaintiff, Dr. Kenneth Freels, for the purchase of stock options as a part of a pension plan Freels had established for his employees. The check was made out as Taylor directed which was consistent with the parties’ past transactions. The check was delivered by Freels to Taylor for the purpose of purchasing stock options and the Complaint further alleged that the check was in the possession of the Knoxville Police Department.

Ultimately, all defendants were dismissed except Joseph C. Taylor & Associates, and its receiver after the check was delivered to the Clerk of the Court.

Plaintiffs filed a Motion for Partial Summary Judgment, stating that the check was delivered to Taylor the day before he died and was never endorsed, negotiated or co-mingled. Thus, plaintiffs’ claim there was a resulting or constructive trust created for plaintiffs’ benefit, or alternatively, there was a bailment.

Freels filed an affidavit stating that he was a dentist in Kingsport, Tennessee, and that the Freels Trust was a pension trust organized for the benefit of his employees. Freels stated that Joseph Taylor had made investments for Freels’ trust and purchased securities for the same. Freels stated that he and his wife first met Taylor in 1982 and had an ongoing relationship regarding investments and financial planning, and that he had complete trust and confidence in Taylor and invested with him exclusively.

Freels attached two exhibits to his affidavit, showing the transaction he had made with Taylor, and further stated that Taylor contacted him just prior to November 2, 1995 and told him that he had stock options available for Freels to invest and that Freels purchased the Cashier’s check at issue and delivered the same to Taylor to purchase stock options for the Freels Trust, but that Taylor died the next day without ever endorsing or negotiating the check.

The receiver for Joseph C. Taylor & Associates filed a Response, stating that Taylor was involved in a “ponzi” scheme, wherein he used the money for certain clients to “pay off’ the investment returns of other clients. The receiver stated that Freels was involved in this scheme, and that on two occasions received incredible returns for a very short term investment. The receiver said that Freels was no differently situated than any of Taylor’s many other clients who had been similarly defrauded and that plaintiffs had no right to reclaim the cashier’s check because, in this jurisdiction, cashier’s checks are treated as cash. The receiver concluded that plaintiff should be treated just like every other creditor of Taylor & Associates, and receive a pro rata share of the bankruptcy estate.

The receiver also filed an affidavit of William Hendon who stated that he was a retired FBI agent who was now a bankruptcy trustee, and that he had investigated the dealings of Taylor & Associates and found no legitimate investments.

Subsequently, the Court issued a Memorandum Opinion and Order and held that plaintiffs’ claim of bailment sounded in contract law, and thus, if a bailment was created, plaintiffs would be in no different position than any other creditor of the bankruptcy estate. The Court also found that equity required that the plaintiffs’ claim be satisfied pro rata along with the other creditors similarly situated, and that plaintiffs were not entitled to the return of the cashier’s check. At the behest of the plaintiffs, the Court’s Judgment was made final pursuant to Tenn. R.App. P., rule 54.02, and this appeal ensued.

Plaintiffs present four issues which advance theories of bailment and resulting or constructive trust which entitled the return of the cashier’s check.

The Supreme Court has recognized that “cashier’s checks are commonly perceived and circulated in the commercial world as cash.” Stringfellow v. First American National Bank, 878 S.W.2d 940 (Tenn.1994). The Court has thus declared that in Tennessee, cashier’s checks are to be treated as a cash equivalent, and that an issuing bank has no right to refuse to pay same when presented. Id.

In jurisdictions which follow the cash equivalent approach to cashier’s checks, it has been said that “until delivery of the cashier’s check to the named payee, the purchaser remains the ‘owner’ and retains the right to cancel” but “the delivery of the cashier’s check to [a payee] had the same effect as a delivery of the cash itself which it represented.” Mutual Savings and Loan v. National Bank of Detroit, 185 Mich.App. 591, 462 N.W.2d 797 (1990); Pikeville Nat. Bank & Trust Co. v. Shirley, 281 Ky. 150, 135 S.W.2d 426 (App.1940). Applying these principles to this case, delivery of the cashier’s check by Freels to Taylor was tantamount to Freels giving Taylor cash. Thus, the existence of a cashier’s check given to Taylor by Freels affords plaintiffs no superior right to the return of the cashier’s check than they would have if cash had been found in Taylor’s possession.

Plaintiffs argue that the check should be returned to them pursuant to either a resulting or constructive trust theory, since the check was given to Taylor to invest for the benefit of the Freels trust. This argument ignores the fact that basically all assets received by Taylor & Associates were held in this same manner. Plaintiffs’ argument also ignores the basic tenets of the bankruptcy code, which provides that “all legal or equitable interests of the debtor in property” are to be made a part of the bankruptcy estate to be distributed by the bankruptcy court. 11 U.S.C. § 541. This provision is broadly construed, such that it would extend to all property wherever located and by whomever held, and would include all of the debtor’s legal, equitable, and possessory interests. See Matter of Continental Airlines, Inc., 134 B.R. 536 (Bankr.D.Del.1991). As such, there can be no question that cash or a cashier’s check in the possession of Taylor at the time of his death would be included in the bankruptcy estate for disposition by the bankruptcy court. (Similarly, this claim seeking return of property included in the bankruptcy estate would arguably be subject to the automatic stay provisions in the bankruptcy code, found at 11 U.S.C. § 362(a).)

Some cases have recognized the existence of a constructive trust in certain funds held by a bankruptcy debtor. However, it is clear that in these cases it is the bankruptcy court which properly decided the outcome of this issue by looking to state law. See, e.g., In re Winkle, 128 B.R. 529 (Bankr.S.D.Ohio 1991); In re North American Coin & Currency, Ltd., 767 F.2d 1573 (9th Cir.1985); In re Fox, 5 B.R. 317 (Bankr.N.D.Tex.1980). By applying State law, it was proper for the Trial Court to rule that plaintiffs were similarly situated to the other creditors of Joseph C. Taylor & Associates, and thus plaintiffs should assert their claims in the bankruptcy proceeding and receive their proper pro rata share.

Plaintiffs concede in their brief that resulting and constructive trusts are judicial creations basically found to exist as an equitable remedy to prevent unjust enrichment. In this case, the Trial Court found that equity would not be served by imposing a trust on these funds for plaintiffs’ benefit, because, as the Chancellor said:

In accordance with the equitable maxim “equity delights in equality”, a court of Chancery will divide a common fund equally between those entitled, and if the fund is not sufficient to pay all in full, a pro rate distribution will be ordered. Gibson’s Suits in Chancery § 23, 7th Edition.

We conclude that the Chancellor resolved the competing equities in the appropriate manner.

Finally, plaintiffs’ claim regarding a bailment is without merit. Plaintiffs concede that a bailment sounds in contract and thus would not put plaintiffs in any greater position than any other creditor with a contractual claim, as the Trial Court found.

For the foregoing reasons, we affirm the Judgment of the Trial Court and remand, with the cost of the appeal assessed to Dr. Kenneth F. Freels.


author: WILLIAM C. KOCH, JR., P.J., M.S.,

text:
    Donald HARGROVE et al. v. METROPOLITAN GOVERNMENT OF NASHVILLE AND DAVIDSON COUNTY.
    Court of Appeals of Tennessee, at Nashville.
    April 14, 2004 Session.
    June 22, 2004.
    Permission to Appeal Denied by Supreme Court Dec. 6, 2004.
    Phillip L. Davidson, Nashville, Tennessee, for the appellants, Donald Hargrove, Richard Hughey, Scott Sulfridge, Jimmie Knight, and Jerry Pinkleton.
    John L. Kennedy and Rita Roberts-Turner, Nashville, Tennessee, for the ap-pellee, Metropolitan Government of Nashville and Davidson County.
   OPINION

WILLIAM C. KOCH, JR., P.J., M.S.,

delivered the opinion of the court,

in which PATRICIA J. COTTRELL and FRANK G. CLEMENT, JR., JJ., joined.

This appeal involves a dispute regarding the procedures for returning a formerly-disabled police officer to work. After the Employee Benefit Board of the Metropolitan Government of Nashville and Davidson County determined that the former officer was no longer disabled, the Metropolitan Nashville Police Department directed him to report to a 13-week training class. Fearing that he could lose both his disability pension and his job if he failed the training class, the officer filed suit in the Chancery Court for Davidson County seeking a declaratory judgment that the Department lacked the authority to require him to complete the training class before returning him to work. The trial court determined that requiring the officer to complete the training class before returning him to active duty was not inconsistent with Nashville’s charter or ordinances. The officer perfected this appeal. We affirm the trial court’s conclusion that the Department has the authority to require the officer to complete the training before returning him to active duty.

I.

Jimmie Knight worked as a patrol officer for the Metropolitan Nashville Police Department from 1971 until he was placed on a disability pension on October 23, 1986. He apparently continued to work after leaving the Department, and in 2001 he was employed as a police officer by the City of Lavergne.

When Mr. Knight received his disability pension in 1986, it was not customary for the Metropolitan Government of Nashville and Davidson County to require persons receiving disability pensions to demonstrate periodically that they remained disabled. However, the Metropolitan Council enacted an ordinance in 1992 empowering the Employee Benefit Board to require disabled pensioners to submit proof each year that they were still disabled. In addition, the ordinance empowered the Benefit Board to discontinue a disability pension if it determined that the employee was no longer disabled and if the employer had reassigned the employee to a position of authority and responsibility comparable to the position the employee held before he or she became disabled.

In 1999, when Mr. Knight was approximately 57 years old, the Benefit Board determined that he was no longer disabled. Thereafter, the Department offered three times to return him to active duty. Each of these offers notified him that he would be required to complete a personal history statement, to make himself available for medical, psychological, polygraph, and drug screening tests, and to enroll in and pass a 13-week lateral hire training class.

The third offer, dated January 4, 2002, informed Mr. Knight that his failure to accept the offer could result in the loss of his disability pension and his ability to receive credit toward his regular retirement for the time he had been on disability. The offer directed Mr. Knight to submit the required background information and to report to the lateral training class beginning on February 19, 2002. When Mr. Knight failed to respond to this notice, the Department notified him that his refusal to provide the requested background information could be deemed to be a failure to report for work and again warned him of the consequences of failing to report.

Mr. Knight was concerned that he would lose both his disability pension and his job if he was not able to complete the lateral training class, and he believed that the Department was using the training class as a pretext to strip him of his disability pension. On February 7, 2002, he joined in an already ongoing lawsuit in the Chancery Court for Davidson County challenging the Department’s policy requiring former officers who had not been on active duty for more than five years to take and pass the lateral training class. He also requested a temporary injunction preventing the Department from requiring him to enroll in and complete the lateral training class beginning on February 19, 2002.

The trial court set a February 19, 2002 hearing on Mr. Knight’s application for a temporary injunction. Prior to the hearing, the Benefit Board voted to terminate Mr. Knight’s disability pension because he had failed to respond to three offers of employment. In an order entered on February 21, 2002, the trial court enjoined the Benefit Board from terminating Mr. Knight’s disability pensión in order to avoid irreparable harm before his claim could be adjudicated. The court also enjoined the Department from prohibiting Mr. Knight to enter the training class late and from unfairly evaluating his performance once be began the training.

The lateral training class beginning on February 19, 2002 was completed while this litigation was still pending. Accordingly, the Department made a fourth offer to Mr. Knight to attend another lateral training class any time prior to May 17, 2002. As far as this record shows, Mr. Knight did not avail himself of this opportunity.

Following a status conference on October 18, 2002, the parties agreed to submit the case to the court on briefs. On January 7, 2003, the trial court filed an order determining that Messrs. Knight and Pin-kleton had not refused to accept employment by declining to enter the lateral training class that had begun on February 19, 2002. The court also determined that the Department’s lateral training requirement for formerly disabled officers was not contrary to the Metropolitan Charter or Code. On April 14, 2003, the trial court entered an order deleting its conclusion with regard to the legal effect of the officers’ failure to report to the lateral training class that began on February 19, 2002. Mr. Knight has appealed.

II.

The STANDARD OF REVIEW

This case requires the court to interpret provisions of the Metropolitan Government’s Charter and ordinances. The tools for this job consist of the same rules of construction used to interpret state statutes. City of Chattanooga v. Davis, 54 S.W.3d 248, 265 (Tenn.2001); Tenn. Manufactured Hous. Ass’n v. Metropolitan Gov’t, 798 S.W.2d 254, 260 (Tenn.Ct.App.1990). Our goal is to ascertain and to give effect to the ordinance’s purpose without unduly restricting it or expanding it beyond its intended scope. See Consumer Advocate Div. v. Greer, 967 S.W.2d 759, 761 (Tenn.1998); Perry v. Sentry Ins. Co., 938 S.W.2d 404, 406 (Tenn.1996).

The search for an ordinance’s purpose begins with the words of the ordinance itself. See Neff v. Cherokee Ins. Co., 704 S.W.2d 1, 3 (Tenn.1986); Winter v. Smith, 914 S.W.2d 527, 538 (Tenn.Ct.App.1995). If the ordinance is unambiguous, the courts need only enforce it as written. See Hawks v. City of Westmoreland, 960 S.W.2d 10, 16 (Tenn.1997); Carson Creek Vacation Resorts, Inc. v. State, 865 S.W.2d 1, 2 (Tenn.1993); Jackson v. Jackson, 186 Tenn. 337, 342, 210 S.W.2d 332, 334 (1948). The courts must consider an ordinance as a whole, see State v. Cauthern, 967 S.W.2d 726, 735 (Tenn.1998); Cohen v. Cohen, 937 S.W.2d 823, 827 (Tenn.1996), and in doing so, must give the words in the ordinance their natural and ordinary meaning. See Davis v. Reagan, 951 S.W.2d 766, 768 (Tenn.1997); Westland West Cmty. Ass’n v. Knox County, 948 S.W.2d 281, 283 (Tenn.1997).

Courts should be mindful of existing law when they construe an ordinance. See Still v. First Tenn. Bank, N.A., 900 S.W.2d 282, 284 (Tenn.1995); First Nat’l Bank of Fulton v. Howard, 148 Tenn. 188, 194, 253 S.W. 961, 962 (1923). They should also avoid displacing existing rules and principles any further than the plain meaning of the ordinance expressly declares or necessarily implies. See In re Deskins’ Estates, 214 Tenn. 608, 611, 381 S.W.2d 921, 922 (1964); Harbison v. Briggs Bros. Paint Mfg. Co., 209 Tenn. 534, 546, 354 S.W.2d 464, 470 (1962). Likewise, they should avoid questioning the wisdom of the ordinance or substituting their own policy judgments for those of the local legislative body. See Exxon Corp. v. Metropolitan Gov’t of Nashville and Davidson County, 12 S.W.3d 638, 641 (Tenn.2002).

A trial court’s decision regarding the interpretation of a statute or ordinance is a question of law. State v. Walls, 62 S.W.3d 119, 121 (Tenn.2001). Accordingly, it will be reviewed on appeal without the presumption of correctness that customarily accompanies findings of fact. The appellate courts will review the issue de novo and reach their own independent conclusion regarding the proper interpretation of the ordinance at issue.

III.

The DEPARTMENT’S PREROGATIVE TO REQUIRE Returning, Formerly Disabled Officers to Complete a Lateral Training Class

Mr. Knight’s case rests on his belief that the Benefit Board has the authority not only to determine whether a pensioner remains disabled but also to require city departments to put the pensioner back to work without conditions once it determines that a pensioner is no longer disabled. While the Benefit Board is clearly empowered to determine whether pensioners continue to be disabled, it does not have the power to return them to work. Likewise, it does not have the power to override reasonable conditions on a pensioner’s return to work established by the Civil Service Commission or a city department.

The responsibility for managing the Metropolitan Government’s human resources is not vested in one department or agency. It is shared by several departments, including the Civil Service Commission, the Department of Personnel, the Employee Benefit Board, the Employees Relations Board, and the employing departments and agencies. This shared arrangement works best when the various commissions and departments operate within the limits of their legal authority.

The Civil Service Commission is chiefly responsible for developing and fostering the effectiveness of the Metropolitan Government’s personnel policies with regard to employees in the classified service. Charter of the Metropolitan Government of Nashville and Davidson County, Tennessee § 12.01 (2003) (“Metro Charter”). Its authority extends to the selection and hiring of city employees, the maintenance of a classification and pay plan, and the administration of disciplinary policies and procedures. Metro Charter §§ 12.05, 12.07, and 12.10. The Commission has authority to promulgate rules, Metro Charter § 12.06, and these rules have the force and effect of law. Metro Charter § 12.07.

Acting under its rule-making power, the Commission has promulgated rules specifically regarding the re-employment of former employees of the Metropolitan Police Department. Rule 7.7 provides that:

[a] member of the Police Department (Civilian or Sworn) who is on leave for six months or longer or has been terminated from employment for any period will be required to successfully complete a polygraph exam and physical exam before returning to work. Upon return to work such employee may be required to successfully complete refresher training.

In addition, Rule 7.8 provides that:

[a]ny officer who leaves the Metropolitan Police Department must meet the requirements of state law (T.C.A. 38-8-106 or as amended), before he [or she] can be considered for reemployment. Such officers may be required to successfully complete additional training upon reemployment or rehire.
A. Section 3.13, Reemployment provides that employees who have at least two years of service may be re-employed within one year of separation, subject to all requirements and restrictions of that section.
B. A former officer who does not meet the time requirements established in Section 3.13 may be hired under the provisions of a policy approved by the Civil Service Commission. A former officer hired under this policy will not be granted credit for prior service time.

The Metropolitan Employee Benefit Board is responsible for “administering, managing, and coordinating” the Metropolitan Government’s employee benefit plans. Metro Charter § 13.02, Metropolitan Government of Nashville and Davidson County, Tennessee Code § 3.08.040(A) (2003) (“Metro Code”). It has the exclusive authority to determine the disability and continuation of disability of disabled city employees. Metro Code § 3.28.060(C)(1) (1998). With regard to the continuation of disability, the Benefit Board has the authority to require disabled pensioners under 65 years of age to verify their disability on an annual basis and to conduct investigations to determine whether a disabled pensioner continues to be disabled. Metro Code § 3.28.060(B), (C)(1).

If the Benefit Board determines that a pensioner is no longer disabled, the Benefit Board has the authority to terminate the disability pension of a former police officer or fireman when two conditions are met. First, the pensioner must be “assigned to work ... at the same, or substantially the same, rate of pay being paid at the time such pensioner was disabled.” Second, the duties of the position to which the pensioner is assigned must not be “substantially less in authority or responsibility and shall be such that the pensioner can perform based on his [or her] training, education and experience.” Metro Code § 3.28.060(C)(1).

On at least two prior occasions, the courts have decided jurisdictional disputes between the Civil Service Commission and the Benefit Board in favor of the Civil Service Commission. When the Benefit Board attempted to force the retirement of a city employee, the Tennessee Supreme Court held that it had exceeded its legal authority and that the Civil Service Commission had the sole authority to review and approve the dismissal of a city employee. Culbertson v. Metropolitan Gov’t, 483 S.W.2d 716, 717 (Tenn.1971). More recently, this court held that the Benefit Board did not have authority to consider a request for payment of accrued sick leave because this matter was within the exclusive authority of the Civil Service Commission. Bush v. Employee Benefit Bd., 792 S.W.2d 932, 933 (Tenn.Ct.App.1990).

When called upon to construe the legal authority of two city agencies, we should endeavor to construe the applicable ordinances in a way that avoids conflicting or overlapping authority. The plain language of the ordinances dealing with the City’s disability pensions makes clear that the Benefit Board’s responsibility includes (1) determining whether a disabled pensioner continues to be disabled and (2) terminating the pensioner’s disability pension once it determines (a) that the pensioner has been rehired at a rate of compensation that is the same or substantially the same as the rate of compensation being paid when the pensioner became disabled, (b) that the position to which the pensioner has been assigned is not “substantially less in authority or responsibility” than the position the pensioner was in when he or she became disabled, and (c) that the pensioner is able to perform the work based on his or her training, education, and experience.

The Civil Service Commission has clear legal authority to promulgate rules establishing reasonable requirements and conditions for returning formerly disabled employees to work. It has exercised this authority by authorizing the Metropolitan Police Department to require that employees returning to work following an absence of six months or more successfully complete additional “refresher training.” Nothing in the Charter or ordinances of the Metropolitan Government empowers the Benefit Board to circumvent or overrule this retraining requirement.

Mr. Knight has not explicitly asserted that the 13-week lateral training class required by the Department is unreasonable or that it exceeds the refresher training permitted by Civil Service Commission Rules 7.7 and 7.8. However, he claims that requiring him to enroll in the lateral training class was simply a pretext to enable the City to strip him of his disability pension and his job. Requiring retraining before placing police officers who have been away from the job for almost 15 years back on the street is reasonable. In fact, the City would open itself to justifiable criticism if it did not require retraining. As far as this record shows, the only other formerly disabled police officer who returned to active duty was able to complete the lateral training class when he was 52 years old. This record contains no evidence warranting the conclusion that the City’s retraining requirement is simply a veiled attempt to deprive Mr. Knight of his disability pension and his job.

IV.

Application of Metro Code § 3.28.060(C)(1)

Mr. Knight has not yet enrolled in the Department’s lateral training course. Therefore, addressing the legal consequences of his failure to pass the course after making a good faith effort would be premature. However, based on our understanding of Metro Code § 3.28.060(C)(1), we have substantial doubt regarding whether assigning Mr. Knight to the lateral training course triggers the cessation of his disability pension. Before the Benefit Board may terminate a disability pension, Metro Code § 3.28.060(C)(1) requires not only that the pensioner receive the same or substantially the same rate of pay being paid at the time the pensioner became disabled, but also that the position to which the pensioner is assigned has substantially the same authority or responsibility as the position the pensioner formerly held and that the work to be performed is the sort of work that the pensioner is able to perform based on his or her training, education, and experience.

The record contains no evidence regarding the authority or responsibility of persons enrolled in the Department’s lateral training class. Accordingly, we are unable to determine whether the authority of en-rollees in the lateral training class is substantially the same as that of patrol officers on active duty. If the authority and responsibility is substantially the same, then the Benefit Board may terminate Mr. Knight’s disability pension as soon as he enrolls in the lateral training class and begins receiving a salary that is substantially the same as the salary he was receiving when he became disabled. If, however, the authority and responsibility of trainees is less than that of regular patrol officers, then the Benefit Board may not be able to terminate Mr. Knight’s disability pension until he completes the lateral training and is assigned to regular active duty.

V.

We affirm the judgment dismissing Mr. Knight’s complaint seeking declaratory and injunctive relief and remand the case to the trial court for whatever further proceedings may be required. We tax the costs of this appeal to Jimmie Knight and his surety for which execution, if necessary, may issue.

      . This training class consists of basic criminal law courses, physical fitness training, and training in defensive tactics and firearms. It is designed for persons who have been employed by other police departments for at least three years and is intended to acquaint them with applicable statutes, ordinances, and departmental policies and procedures. It is less extensive than the 26-week training class required for all new recruits, but it is more extensive than the annual in-service training required of all police officers on active duty.

      . At this time, only one formerly disabled police officer had been returned to active duty. He was 52 years old when he completed the lateral training class.

      . Hargrove v. Metropolitan Gov’t, No. 02-215-III. This suit was originally filed by three former police officers. On February 7, 2002, they moved to amend their complaint to add Mr. Knight as a plaintiff. Later, on February 28, 2002, they moved to amend their complaint to add Jerry Pinkleton as the fifth plaintiff. The claims of the original three plaintiffs were eventually found to be moot after it was determined that they were medically unable to return to work. The lawsuit proceeded with Messrs. Knight and Pinkleton as the plaintiffs.

      .Mr. Pinkleton did not appeal.

      . The term "disability,” when applied to police officers, means "the inability and/or the incapacity to perform the duties of a ... policeman.” Metro Code § 3.28.060(G).

      . In this situation, should Mr. Knight be unable to complete the lateral training successfully notwithstanding his best efforts, the Benefit Board has no basis to terminate his disability pension. If, however, Mr. Knight purposely fails the lateral training course in order to keep his disability pension, the Board and the Department will have grounds not only to terminate his employment but also to terminate his disability pension.