Carter v. Butler

• Decision Date: 09 February 2021
• Docket Number: No. W2020-00169-COA-R3-CV,W2020-00169-COA-R3-CV
• Parties: YOLANDA CARTER v. MAURICE BUTLER
• Court: Tennessee Court of Appeals

YOLANDA CARTER v. MAURICE BUTLER

No. W2020-00169-COA-R3-CV

COURT OF APPEALS OF TENNESSEE AT JACKSON

November 18, 2020 Session

February 9, 2021

Appeal from the Chancery Court for Shelby County

No. CH-18-0162-2

Jim Kyle, Chancellor

The parties dispute the meaning of a one-page written agreement. Appellee asserts the agreement entitled her to purchase a piece of real property over a four-and-a-half-year lease term, with her rental payments and a non-refundable down payment going toward the purchase price. In contrast, Appellant asserts that Appellee was entitled to purchase the property after the four-and-a-half-year lease term, with credit for her down payment but not her monthly rental payments. Given the ambiguity of the agreement, we defer to the trial court's interpretation and affirm its holding that Appellee purchased the property by the conclusion of the contract's term.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed

J. STEVEN STAFFORD, P.J., W.S., delivered the opinion of the court, in which KENNY ARMSTRONG, and CARMA DENNIS MCGEE, JJ., joined.

Richard L. Rikard, Germantown, Tennessee, for the appellant, Maurice Butler.

Scottie O. Wilkes, Covington, Tennessee, for the appellee, Yolanda Carter.

OPINION

FACTUAL AND PROCEDURAL HISTORY

This Court previously vacated and remanded the order from the Shelby County Chancery Court ("the trial court") in this case because the trial court failed to enter a sufficiently detailed order in compliance with Tennessee Rule of Civil Procedure 52.01. See generally Carter v. Butler

, No. W2019-00175-COA-R3-CV, 2019 WL 4942435 (Tenn. Ct. App. Oct. 8, 2019). We recite much of the background in this case from this Court's prior opinion:

Maurice Butler ["Appellant"] was a licensed real estate agent and owner of two businesses that provided services to disabled individuals, including access to affordable housing. In April 2013, Yolanda Carter ["Appellee"] accompanied her sister to view a property owned by [Appellant]. [Appellee]'s sister was an employee of [Appellant] and was interested in renting one of his properties. [Appellee], her sister, and [Appellant] met at a home located at 3200 Cherrywood Cove in Memphis, Tennessee ["the property"].

Id. at *1. Mr. Butler had bought the property during a foreclosure sale in 2008 for $35,000.00 in cash. He later took out a $52,000.00 mortgage on it in order to make repairs, including making it accessible to people with disabilities. He paid that mortgage off in 2015. Prior to the time Appellant met Appellee and her sister at the property, at which point it was vacant, he had been renting it for $1,000.00 per month, but intended to raise the rent to $1,100.00 or $1,200.00 per month after that. However, after viewing the property and discussing the rent, Appellee's sister indicated that she could not afford to rent it. Appellee then inquired about other properties Appellant had. The parties agree that she was not looking for a home to rent, as she was already renting another property.

[Appellee] also informed [Appellant] that she had a limited budget, as she had no job or credit and intended to file for disability. She further explained that she would be unable to secure a traditional loan. Shortly thereafter, [Appellee] and [Appellant] executed a one page document that he drafted entitled "Lease Purchase Agreement for 3200 Cherrywood Cove Memphis TN, 38128."

Id. Throughout this document, Appellee is referred to as "Tenant," except under her signature line, where she is referred to as "Buyer." Appellant is referred to as "Landlord" in the document, except for one time when he is referred to as "Landlord/Sellor."

In accordance with the agreement, [Appellee] agreed to pay [Appellant] $1,000 per month for four and one-half years, or fifty-four months. The agreement contained a provision stating that it began on April 23, 2013 and would end on October 23, 2017. It further provided that if [Appellee] defaulted, the "security deposit" of $10,000 would be forfeited.

Id. (footnote omitted). While the document refers to the $10,000.00 payment as a security deposit, Appellant testified that it should have referred to the $10,000.00 payment as a non-refundable down payment, and Appellee does not dispute this.

[Appellant] contends that there was another document that contained options for purchase of the property that he prepared and discussed with [Appellee] when the lease agreement was signed; [Appellee] denies this. The seconddocument was not referenced in the lease agreement, nor was it initialed or signed by either party. The [second] document was entitled "Lease Option for 3200 Cherrywood Cove Memphis 38128." The type-written provisions of the document simply stated: "1) Purchase of $65,000 2) Financing search start 3 months prior to lease expire 3) Sales contract drawn at end of lease to address Cnty [sic] City taxes and attorney fees 4) Sales option extended with buyer completing lease as agreed[.]" The document also contained hand-written notes, some of which are illegible, that [Appellant] described as "doodling."

Id. Appellee testified that in March 2016, after she received a lump-sum disability back-payment, she contacted Appellant about paying the balance in full on the property. Appellant apparently responded by letter, writing

that he had reviewed the "lease purchase." He further stated that the agreement provided that the monthly payments would continue until October 23, 2017, and that the parties needed "to follow the agreement." In October 2017, [Appellee] paid what she considered to be the final payment on the property. It is undisputed that [Appellee] made all monthly payments from April 2013 until October 2017. After that time, [the parties] exchanged several text messages disputing the terms of the agreement.

In January 2018, [Appellant] filed a forcible entry and detainer warrant in general sessions court, demanding possession of the property and unpaid rent. [The next month, Appellee] filed a complaint in chancery court seeking specific performance, damages for breach of contract, and a lien lis pendens on the property. She also sought an injunction to prevent [Appellant] from prosecuting his general sessions claim. Subsequently, a consent order was entered transferring the general sessions case to chancery court.

Id. at *1-2 (footnotes omitted). A fiat was filed in the trial court on July 13, 2018, ordering the trial court clerk to issue an injunction, as requested by Appellee. A bench trial was then held before the trial court judge on July 17, 2018. The only witnesses were Appellant, Appellee, and Appellee's sister. Appellee testified that she told Appellant that she did not want to get into a long-term financing situation. Rather, she

testified that her understanding of the lease purchase agreement was that the purchase price for the property was $54,000 and that [Appellant] was financing the property. She stated that the $10,000 she paid down was a fee for [Appellant] owner-financing the property. She further testified that once all payments in accordance with the agreement were made, she and [Appellant] were to schedule a closing date, so that the property could be deeded in her name. [Appellee] also testified that a second document [inaddition] to the lease agreement was never discussed. She stated that she was not aware of the second document until her counsel showed it to her, after he received it in response to his discovery requests. She testified that, when she exchanged text messages with [Appellant], he never mentioned that she had other terms to fulfill before she could purchase the property[, though he wanted to discuss reimbursement for property taxes and ongoing rent payments].

Id. at *2.

Appellee also testified that she knew at the time she signed the agreement that she would be responsible for paying closing costs. In the text messages between her and Appellant that were entered in evidence at trial, Appellee also stated that she and Appellant had discussed that she would assume the responsibility for property taxes after she finished paying off the house.

[Appellant] testified that he drafted the lease purchase agreement. He indicated that he no longer had a real estate license, but knew how to "write a sales contract" [and would not have written one in the form of the one-page agreement at issue]. He testified that his understanding of the agreement was that [Appellee] was leasing the property from him for $1,000 a month for fifty-four months. He testified that, once [Appellee] had fulfilled the terms of her lease, she had the option to purchase the property for an additional $55,000. He indicated the actual purchase price was $65,000; however, her $10,000 down payment would be applied, leaving a remaining balance of $55,000 for the purchase of the home. He further testified that the terms for the purchase of the property were explained on the second document which he and [Appellee] discussed "line by line" on the day they executed the lease purchase agreement.

At the close of the evidence, the trial court issued its oral ruling. A written order memorializing the court's ruling was entered on August 1, 2018. The trial court found that: (1) the agreement was a "lease purchase agreement," (2) [Appellee] had made all payments required under the agreement, (3) [Appellant] was responsible for all property taxes through the date of the order, (4) [Appellee] was responsible for obtaining an attorney to close on the property, (5) [Appellant] will cooperate with closing on the property, (6) the closing would take place within 45 days from entry of the order, and (7) each party was responsible for his or her own attorney's fees.

Id. at *2 (footnote omitted). In its oral findings, the trial court found that Appellee did not "owe any rent from the date of the end of this agreement." However, this was not included in the trial court's written order.

On August 10, 2018, [Appellant] filed a motion to reconsider

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