Business Torts

September 18, 2025

Promissory fraud based on promise to pay future costs.

Where a town asserted that an individual member of an LLC had promised that the LLC would pay a certain amount towards a road improvement project, but that the LLC never intended to pay that amount, the town had stated a cause of action for promissory fraud against the individual.

In CCD Oldsmith Henry, LLC v. Town of Nolensville, No. M2024-01102-COA-R3-CV (Tenn. Ct. App. Aug. 21, 2025), Plaintiff LLC asked Defendant town to rezone property so that the LLC could develop residential units. Plaintiff LLC had two members—Smith and Olderman. Both Smith and Olderman attended the rezoning hearing, but Olderman did not speak during the hearing. When the discussion turned to improvements to a nearby intersection that would be required by the rezoning, Smith stated that “we can contribute the difference” in reference to the amount remaining after the state contributed. After additional discussion, the board approved the rezoning and “limited [the LLC’s] contribution to no more than 50% of the costs.”

At some point following the meeting, the town sent a bill to the LLC, and the LLC refused to pay the amount requested. The town then refused to issue building permits, and the LLC filed suit. The town filed a counterclaim against the LLC, as well as a motion to join Smith and Olderman individually, alleging that Smith and Olderman “fraudulently and negligently misrepresented what Oldsmith was willing to pay.” The trial court denied the motion to add Smith and Olderman as individuals, ruling that there was no personal liability on their parts. On appeal, that ruling was overturned as to Smith.

April 12, 2024

No causation or improper motive in tortious interference case

by The Law Offices of John Day, P.C.

Where plaintiffs asserting a tortious interference with a business relationship claim could not show that the defendants intended to cause a breach or termination of the relationship, which had already been breached before defendants’ involvement, or that defendants acted with an improper motive, summary judgment for defendants was affirmed.

In Throckmorton v. Lefkovitz, No. M2022-01124-COA-R3-CV (Tenn. Ct. App. Feb. 29, 2024), plaintiff attorneys had previously represented clients in a property dispute in which clients’ goal was to be awarded the property at issue. Plaintiffs and clients had entered into a contingency fee agreement stating that clients would pay plaintiffs a percentage of the recovery, but recovery was not defined. After clients successfully obtained the property, plaintiff attorneys attempted to recover the percentage in the fee agreement based on a contract for the sale of the land that clients entered into. Clients contested that the amount sought was reasonable, and clients eventually hired defendant attorneys to represent them in the fee dispute.

Defendants advised clients to attempt to settle the dispute, and defendants engaged in settlement discussions with plaintiffs on behalf of clients. Defendants informed plaintiffs that if a settlement was not reached, clients would file for bankruptcy. Clients ultimately did file for bankruptcy, and through the bankruptcy process, plaintiffs and clients settled the fee dispute. Thereafter, plaintiff attorneys filed this case against defendant attorneys for tortious interference with a business relationship. The trial court granted defendants summary judgment, finding that the bankruptcy was a legitimate option, that defendants did not act with improper intent, and that there was no evidence that defendants “acted in self-interest.” Summary judgment was affirmed on appeal.

May 4, 2022

Revenge Porn

by The Law Offices of John Day, P.C.

My newest article, ” A New Arrow in the Quiver to Fight Revenge Porn,” has been published in the May/June edition of Tennessee Bar Journal.

An excerpt:

Now, a new federal law effective October 1, 2022, expands the rights of revenge porn victims and certain others by creating a federal cause of action that includes adults harmed by such conduct. The Violence Against Women Act Reauthorization Act of 2022, signed into law on March 16, creates a new federal right of action for a “depicted individual” (regardless of gender) against one who, in or affecting interstate or foreign commerce, discloses the “intimate visual depiction” of the identifiable plaintiff without their consent. The legislation applies to adults and minors. Certain disclosures are not actionable, including but not limited to disclosure of “commercial pornographic content” unless produced “by force, fraud, misrepresentation, or coercion of the depicted individual.”

March 9, 2022

Attorney’s fees allowed as compensatory damages in inducement of breach of contract case.

by The Law Offices of John Day, P.C.

Where the evidence clearly established the elements of intent and malice in an inducement of breach of contract case, summary judgment for plaintiff was affirmed. Moreover, the trial court’s ruling that plaintiff could recover attorney’s fees as compensatory damages under the independent tort theory was also affirmed.

In HCTEC Partners, LLC v. Crawford, No. M2020-01373-COA-R3-CV, 2022 WL 554288 (Tenn. Ct. App. Feb. 24, 2022), plaintiff was the former employer of defendant Crawford, who had worked for plaintiff in healthcare information technology recruitment. When Crawford was hired by plaintiff, he signed a “Confidentiality, Non-Competition, and Non-Solicitation Agreement,” which, among other things, provided that he would not work in the same field for 12 months after leaving plaintiff’s employment.

Defendant Rezult made Crawford a job offer while he was still working for plaintiff, which Crawford accepted. Plaintiff communicated to Rezult and Crawford about the Agreement, but Crawford was nonetheless placed in a position that involved healthcare information technology recruiting. Plaintiff thereafter brought this suit asserting breach of contract against Crawford and inducement of breach of contract against Rezult. After entering an injunction, the trial court granted plaintiff’s motion for summary judgment against both defendants, and the Court of Appeals affirmed.

September 25, 2019

Summary Judgment Affirmed on Negligent Misrepresentation Claim

by The Law Offices of John Day, P.C.

Where an attorney working for a bank gave the bank president advice about his resignation but also recommended that he seek independent counsel, the Court of Appeals affirmed summary judgment on a negligent misrepresentation claim.

In Batten v. Community Trust and Banking Company, No. E2017-00279-COA-R3-CV (Tenn. Ct. App. Aug. 26, 2019), plaintiff was the president and CEO of defendant bank. Plaintiff had an employment contract with the bank that included a provision allowing him to resign and receive 36 months of additional compensation. When the Tennessee Department of Financial Institutions (TDFI) examined the bank, it found serious problems, eventually declaring that the bank was in a troubled condition.

May 2, 2017

The Latest Intentional Interference with Business Relationships Decision

by The Law Offices of John Day, P.C.

In Clear Water Partners, LLC v. Benson, No. E2016-00442-COA-R3-CV (Tenn. Ct. App. Jan. 26, 2017), the Court of Appeals reversed dismissal of a claim for intentional interference with business relationships and civil conspiracy. The Tennessee court concluded that a current contractual relationship was not an automatic bar to an intentional interference with contractual relationships claim.

Plaintiff had an option contract to purchase and develop 111 acres of land, with the purchase being “contingent on the approval of a development plan, obtaining rezoning approval, and the performance of certain site development work.” Plaintiff also had a contract to sell Paul Murphy around 30 acres of the property once the option had been executed. According to plaintiff, the 23 named individual defendants used “improperly motivated conduct and/or improper means” to delay and oppose the rezoning and the approval of the development plan, causing Mr. Murphy to “void” his contract with plaintiff. Subsequently, plaintiff entered into another contract to sell the 30 acres to Belle Investments, but that contract required plaintiff to make some changes to its plan and incur damages.

As plaintiff continued to work towards rezoning and approval of its project, plaintiff alleged that the Defendants “individually and through their attorney/agent, ‘vigorously opposed’ its rezoning application and development plans.” Plaintiff alleged that defendants created false email accounts to make it look like residents near the development were emailing the County Commission, that one defendant sent a flyer containing false information home with the students at an elementary school, that one defendant gave a flyer with false information to nearby residents, and that an affidavit containing false information was given to the planning commission and zoning board, among other allegations. Plaintiff’s fight with defendants wound its way through the planning commission and zoning board, the circuit court, and even included an appeal to the Court of Appeals. At the time of plaintiff’s filing of the complaint in this case, the circuit court had upheld the zoning board’s decision to approve the development plan and deny part of the rezoning request.

January 7, 2016

Gross Negligence Affirmed where Advertisement Misrepresented Mini Storage

by The Law Offices of John Day, P.C.

In Kuhn v. Panter, No. M2015-00260-COA-R3-CV (Tenn. Ct. App. Nov. 25, 2015), the Court of Appeals affirmed a finding of gross negligence against the owners of a mini storage facility.

Here, defendants had advertised the mini storage facility as “clean and dry.” Plaintiffs rented one of the units in 2011 and stored many personal belongings there, including photographs, a family Bible, clothes and furniture. In May 2013, plaintiffs found that their unit had flooded and ruined all of their personal property.

Plaintiffs filed suit in sessions court and were awarded a judgment there, which defendants appealed to circuit court. During a bench trial, the evidence showed that the building had “drainage issues” during construction and the city issued a stop work order on it. Moreover, when the building was eventually completed, there was never a final inspection by the city and a certificate of occupancy was never issued. A witness for plaintiffs testified that the building housing their storage unit was “eleven inches lower than the surrounding storage buildings.” Further, it was shown that an “agent [of defendants] testified in a prior hearing that the unit rented to [plaintiffs] had flooded on a prior occasion.” Based on these facts, the trial court found defendants had committed gross negligence, and the Court of Appeals affirmed.

November 19, 2015

Summary Judgment Reversed in Conversion Case

by The Law Offices of John Day, P.C.

In Garner v. Coffee County Bank, No. M2014-01956-COA-R3-CV (Tenn. Ct. App. Oct. 23, 2015), the Court of Appeals partially overturned a trial court’s grant of summary judgment to defendants on several claims, including the torts of conversion and trespass to chattels.

Plaintiff and his former wife had purchased a home together, but wife moved out in 2009, taking her belongings with her. The home and its contents were damaged by fire in 2010. Wife was named on the insurance policy, so the checks from the insurer were made to both plaintiff and wife. The checks were for home damage, property loss and living expenses. Plaintiff believed that wife was not entitled to any of the proceeds for personal property loss and living expenses, since wife was not living at the home at the time and did not have any of her belongings there. According to plaintiff, however, the president of the bank where the home mortgage was held told plaintiff that he could not cash the checks and get any money unless he gave wife half of the proceeds. Plaintiff averred that, feeling coerced, he gave wife half the proceeds, and that money was used to pay down wife’s separate loan from the bank. The bank ultimately foreclosed on plaintiff’s home, and plaintiff filed suit for conversion, trespass to chattels, and conspiracy, among other causes of action.

Defendants moved for summary judgment on all of plaintiff’s claims. Plaintiff, however, failed to file any response to the summary judgment motion until after the time required by Tennessee Rule of Civil Procedure 56.03, and the trial court refused to use its discretion to excuse this delay. While the court acknowledged that plaintiff had been sick in the days leading up to the hearing and that could have affected his ability to sign his affidavit, it also pointed out that no other papers not requiring plaintiff’s signature and no motion for an extension of time were filed. Accordingly, plaintiff’s late-filed responsive documents were not considered in the summary judgment decision.

September 16, 2015

Intentional Interference With Business Relations Requires Proof of Damages

by The Law Offices of John Day, P.C.

In Springfield Investments, LLC v. Global Investments, LLC, No. E2014-01703-COA-R3-CV (Tenn. Ct. App. Aug. 27, 2015), plaintiffs sued defendants for intentional interference with business relationships related to plaintiffs’ opening of a Wendy’s restaurant in Cleveland, Tennessee. Defendants already owned and operated a Wendy’s in Cleveland, and in 1998 one of plaintiff’s brothers signed a non-compete agreement with defendants agreeing not to open a Wendy’s in Cleveland. A later “Clarification and Confirmation” document signed by the brother included that no entities he was associated with would open a Wendy’s, including Springfield Investments, LLC (a plaintiff in this case). The individual plaintiff in this case was never a party to the non-compete, and by the time that the pertinent events took place the brother signing the non-compete was not the owner of Springfield Investments.

In January 2010, plaintiffs began the process of seeking approval from Wendy’s to build and open a restaurant in Cleveland. Because it would be 4.8 miles from defendants’ existing Wendy’s, the restaurant chain’s procedures required defendants to be notified and have the opportunity to oppose the new franchise. Over the course of the next several months, defendants followed the standard procedures allowed by Wendy’s to oppose the new restaurant. At one point Wendy’s, using its own discretion, allowed for additional time for defendants to submit certain requests, but otherwise the normal course of action provided for in Wendy’s franchise guidelines was followed.

April 28, 2015

Signing an “As Is” Agreement Negates Reliance on Alleged Misrepresentation

by The Law Offices of John Day, P.C.

Justifiable reliance is one of four elements a plaintiff must prove in a negligent misrepresentation case. In the recent case of Pritchett v. Comas Montgomery Realty & Auction Co., Inc., No. M2014-00583-COA-R3-CV (Tenn. Ct. App. April 15, 2015), the Court of Appeals held that a plaintiff who signed an agreement stating that the sale of real estate was “as is” and that he would only rely upon his own inspection could not prove this essential reliance element of his negligent misrepresentation claim.

The plaintiff in Pritchett went to an auction for commercial real estate that had been advertised as being 11,556 square feet. Before the auction began, plaintiff signed a “Terms of Sale” form that stated that everything was being sold “as is” and that “buyer shall rely entirely on their own inspection and information.” The auctioneer also announced that all property was sold “as is.” Plaintiff was the highest bidder and thus signed a contract of sale. The contract stated that “buyer specifically acknowledges herein that the property is being purchased ‘as is’ and that neither the Seller nor [Defendant] makes any warranties or representations, express or implied, as to the habitability or condition of the real property contained herein.” The sales contract did not state the square feet of the building. After taking possession of the property, plaintiff discovered that the building was actually only 9,353 square feet and accordingly brought this negligent misrepresentation claim. The trial court granted summary judgment to defendant, and the Court of Appeals affirmed, although on different grounds.