Bakersouth, LLC v. Green Hills Mall TRG, LLC
| Decision Date | 23 January 2020 |
| Docket Number | No. M2018-02129-COA-R3-CV,M2018-02129-COA-R3-CV |
| Parties | BAKERSOUTH, LLC v. GREEN HILLS MALL TRG, LLC, ET AL. |
| Court | Tennessee Court of Appeals |
Appeal from the Chancery Court for Davidson County
Claudia Bonnyman, Chancellor
This appeal involves a long-running dispute among neighboring property owners over a parking easement near the Green Hills Mall that was formerly owned by the Metropolitan Government of Nashville and Davidson County in connection with its operation of a public library. The chancery court declared that the plaintiff now owns fee simple title to its lots in addition to the easement appurtenant over the defendants' lots for parking purposes. The defendants appeal. We affirm and remand for further proceedings.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed
CARMA DENNIS MCGEE, J., delivered the opinion of the court, in which J. STEVEN STAFFORD, P.J., W.S., and ARNOLD B. GOLDIN, J., joined.
Kevin C. Baltz, Nashville, Tennessee, for the appellant, American General Realty Investment Corporation.
Jack R. Dodson, III, Nashville, Tennessee, for the appellee, BakerSouth, LLC.
Joshua R. Denton and Jeremey R. Goolsby, Nashville, Tennessee, for the appellee, Green Hills Mall TRG, LLC.
OPINIONThe properties at issue are located near the Green Hills Mall in Nashville, Tennessee. At the outset, we note that the properties are identified by lot numbers according to a recorded subdivision plat, and the specific properties at issue in this case are lots 9, 10, 11, and 12. They appear on the subdivision plat as follows:1
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Most of the lots were further subdivided into an eastern and a western half, (e.g., Lot 9 East and Lot 9 West).
In the 1950s, Green Hills Village, Inc. owned all four lots at issue - 9, 10, 11, and 12. On March 31, 1966, Green Hills Village, Inc. conveyed some of the lots by warranty deed to attorney Harlan Dodson "as Trustee." Specifically, the deed conveyed to the Trustee the western fifty feet of Lot 9 and the eastern fifty feet of Lot 10 ("Lots 9 West and 10 East"). In addition, the deed conveyed to the Trustee "[a]n easement for free parking purposes" over the western fifty feet of Lot 10 ("Lot 10 West"), all of Lot 11, and the eastern fifty feet of Lot 12 ("Lot 12 East"). The deed provided that the parcels with the appurtenances were conveyed to "Harlan Dodson, Trustee, his successors and assigns[.]" It further provided that Mr. Dodson, as Trustee, had "full power to sell, transfer and convey [the property] without the joinder of any beneficiary or disclosure of the terms of any trust." The deed did not identify the trust or its beneficiaries.
The original common owner of the lots, Green Hills Village, Inc., conveyed the lots burdened by the parking easement (Lots 10 West, 11, and 12 East) to Third National Company. The deed to Third National specifically referenced the previous conveyance to Dodson as Trustee and the existing easement over the property for free parking purposes. In 1967, Third National conveyed one of the burdened lots, Lot 10 West, to Metro. (Lot 10 West was subject to the parking easement but immediately adjacent to the area where the library was to be constructed on Lots 9 West and 10 East.) Like the deed from Dodson to Metro, the Third National deed to Metro provided that the conveyance was being made in consideration of Metro's agreement to construct a public library on the property. The deed stated that if Metro at any future date ceased to use the property for the operation of a public library branch, then all right, title, and interest of Metro in the property would terminate, and the interest would revert to Third National, its successors and assigns.
In 1967, Metro constructed a public library branch on not only Lots 9 West and 10 East (conveyed to it by Dodson as Trustee) but also on Lot 10 West (conveyed to it by Third National but originally subject to the parking easement). The following illustration depicts the position of the library building on the lots, with the former Dodson property in red, the former Third National property in green, and the remainder of the parking easement in blue:
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Metro operated the library for decades, but at some point after 2000, it stopped using the library building for a public library and instead used the building to house archived records. In 2013, the Metro Council enacted an ordinance relinquishing Metro's interest in the property and recognizing that the property would revert to the grantors.
The parties agree that the reversionary interest in Lot 10 West formerly held byThird National reverted and now belongs to its successor-in-interest, American General Realty Investment Corporation. The other lots burdened by the parking easement, Lots 11 and 12 East, are owned by Green Hills Mall TRG, LLC ("the Mall").
However, determining the status of the former Dodson parcel and its parking easement was more complicated. The 1966 deed from Dodson to Metro provided that the property and its parking easement would revert to Dodson as Trustee, his successors and assigns. However, Harlan Dodson had passed away in 1986. The heirs of Harlan Dodson and their spouses executed a quitclaim deed conveying any interest they had in the lots and the parking easement to Thomas White, "as Trustee." Metro likewise executed a quitclaim deed conveying any interest it had in the lots and parking easement to Thomas White "as Trustee." Thomas White, purportedly "as Trustee," then conveyed the lots and the parking easement to BakerSouth, LLC.
BakerSouth informed the Mall that it had acquired the former library property and the free parking easement. The Mall had been using the lots burdened by the parking easement for valet parking for the Mall's customers. BakerSouth demanded use of the lots burdened by the parking easement, but the Mall refused.
The Mall filed a lawsuit against BakerSouth in federal district court, asking the court to determine the respective rights of the parties to Lots 9, 10, 11, and 12. See Green Hills Mall TRG, LLC v. Bakersouth, LLC, No. 3:14-CV-01675, 2016 WL 2595149, at *2 (M.D. Tenn. May 5, 2016) aff'd 709 F.App'x 792 (6th Cir. 2017). The Mall acknowledged that the parking easement was to revert to Trustee Dodson. Id. at *3. However, the Mall argued that Dodson's heirs were not trustees, successors or assigns, and therefore, they had no authority to transfer the parking easement to White (who conveyed the property to BakerSouth). Id. The district court agreed. Applying Tennessee law, the district court found that when a trustee dies, "naked title passes to the heirs of the trustee" but "subject to be divested on the appointment of his successor." Id. (quotation omitted). Under the circumstances, the district court ruled that a new trustee had to be appointed by a court. Id. It further ruled that a state court would have to determine who was entitled to the free parking easement. Id. As such, the Dodson heirs should have "deliver[ed] the free parking easement to the court." Id. They did not have authority to sell it, according to the district court. Id. Because the sale from the heirs to White was not valid, White was not entitled to sell the easement to BakerSouth, and BakerSouth was not the owner of the free parking easement.2 Id.
After the district court's ruling, the Dodson heirs and other parties claiming to bethe beneficiaries of the unnamed trust jointly filed a petition to appoint a successor trustee in the probate division of the circuit court for Davidson County.3 All of the petitioners consented to the appointment of Thomas White as successor trustee of the trust. (Thomas White was the same individual to whom the heirs and Metro had attempted to quitclaim the property years earlier.) On November 9, 2016, the probate court entered an order appointing White as the successor trustee of the unnamed trust. The probate court found that all beneficiaries had consented to the relief sought in the petition. It also found that appointment of a successor trustee was necessary to administer the single asset held by the subject trust. As such, the probate court found that the petition was well taken and should be granted. The Mall later filed a motion to intervene and set aside the order appointing the successor trustee in the probate proceeding, but that motion was denied.
After the entry of the probate court's order appointing him as successor trustee, Thomas White executed another quitclaim deed conveying Lots 9 West and...
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