WPCP # VU:a % 0(b w@4 ) 0l8 0D  0J 0T: 0^ 0h 0rT 0| 0B 0 1uX 0d U *1B)[DC AM B D3v~v 0@k AO 0D D/ B3HP LaserJet 4Si/4SiMX PS 600dpiPSCRIPT0nLH,rAZ"Arial RegularX($- - cEdeDfagUhDijDkӀuD 3|xu((3$ !      0  (#$  0  2 0Indent123  2" 0Indent20 23  2, 0Indent30 0 23  26 0Indent40 0 0 23  2@ 0Indent50 0 0 0 23  2J 0Indent60 0 0 0 0 23  2T 0Indent70 0 0 0 0 0 23  2^ 0Indent80 0 0 0 0 0 0 23   ?AGMSYaioIndent0I.A.1.a.(1)(a)i)a)P 8Mac DefaultMac Default ` X<  9p`(Arial% Line 7 d####7Border 1dd-$C << G !  #d#"  "   YYY FILED"XSeptember17,1997CecilW.CrowsonAppellateCourtClerk    !#d#"       "     Tenn.CodeAnn.292101(b)(1)provides:8 Noactionshallbebroughtagainstalenderorcreditoruponanypromiseorcommitmenttolendmoneyortoextendcredit,oruponanypromiseorcommitmenttoalter,amend,renew,extendorotherwisemodifyorsupplementanywrittenpromise,agreementorcommitmenttolendmoneyorextendcredit,unlessthepromiseoragreement,uponwhichsuchactionshallbebrought,orsomememorandumornotethereof,shallbeinwritingandsignedbythelenderorcreditor,orsomeotherpersonbyhimthereuntolawfullyauthorized.  !#d#"       "     AlthoughthebankhadestablishedalineofcreditforNPStofinanceitsinventory,ninetyninepercentoftheavailablefundsunderthatagreementhadbeenwithdrawn.NPSdoesnotassertthatthebankhadanyfurtherobligationunderthelineofcredit. d))))'dxdPtPtHH(FG(HH(d'hStyl{WP}01  HH  2$HH  Geneva  <Px443!#4$*$$*$ KK  Geneva  Geneva .,6 Geneva   h HD: Geneva  h HD: Geneva ("$    -C<< CLevel 1Level 2Level 3Level 4Level 5($$   1  ' dxdP Pd ! . "         \RA'\\RA'\7XXdd7    ћ FIRSTAMERICANNATIONALBANK, )      ) Plaintiff/Appellee,   )      ) AppealNo.      ) 01A019702CH00051̜VS.      )      ) DavidsonChancery      ) No.933015III(II)̜R%&$A1-j|o`  `@RߛNATIONALPROJECTSERVICES, )INC.,      )      ) Defendant/Appellant.  )@ COURTOFAPPEALSOFTENNESSEE@ MIDDLESECTIONATNASHVILLEAPPEALEDFROMTHECHANCERYCOURTOFDAVIDSONCOUNTYATNASHVILLE,TENNESSEE̜THEHONORABLEELLENHOBBSLYLE,CHANCELLORANTHONYJ.McFARLAND̜CLISBYH.BARROWBRYANE.LARSON2700FirstAmericanCenterNashville,Tennessee37238 AttorneysforPlaintiff/AppelleeALFREDH.KNIGHT215SecondAvenue,NorthNashville,Tennessee37201NADERBAYDOUNJOHNI.HARRIS,IIINashvilleCityCenter511UnionStreet,Suite2420Nashville,Tennessee372191716 AttorneysforDefendant/Appellant̛̜@ AFFIRMEDANDREMANDED̛̜       BENH.CANTRELL,JUDGECONCUR:TODD,P.J.,M.S.LEWIS,J.  @ "OPINION "X  Asmallbusinessassertsthatitsbankhadanimplieddutytogivereasonablenoticeofitsintenttostopextendingcredittothebusiness;thatsuchimpliedpromisewasnotwithinthestatuteoffrauds;andthatevenifitwerewithinthestatuteoffrauds,thebankwasestoppedtoraisethestatuteasadefense.TheChanceryCourtofDavidsonCountygrantedsummaryjudgmenttothebank.Weholdthatinthiscasethebankdidnothaveadutytoinformthecustomerthatitwasterminatingthecustomerscredit.Therefore,weaffirmthelowercourtsorder.@ I.   Thefollowingfactsarestatedinthelightmostfavorabletotheappellant.SeeAlliedSound,Inc.v.Neely,909S.W.2d815(Tenn.App.1995).  NationalProjectServices,Inc.(NPS)operatedasmallbusinesssellingindustrialsupplies.AbranchmanagerofFirstAmericanNationalBankϜ(thebank)contactedtheprincipalownersofthebusiness,seekingtoestablishabankingrelationship.Theprincipalsaskedthebranchmanagerforalineofcredit,butthebankturnedthemdown.Thebranchmanagerdidsaythathecouldextendcreditofupto$30,000onhisownandthathewoulddobusinesswiththecompanyonthatbasis.NPStransferreditsaccountstothebank.  Ingeneral,NPSfilledordersforindustrialsuppliesbyorderingthesuppliesfromthemanufacturersanddeliveringthegoodstothepurchaser.Initially,whenthecompanyreceivedanorder,ittookthedocumentstothebankandborrowedthemoneytocovertheexpensesincurredinfillingtheorder.TherelationshipwasinformalbuttheNPSprincipalsinterpretedthebranchmanagersstatementsasapromisetolendmoneyoneachpurchaseorderuptothe$30,000limit.Theyadmit,however,thathedidnottellthemthat;thathedidnotrepresentthatthearrangementwouldexistforanyparticularperiodoftime;orthattheloanswouldcontinuetobemadeataparticularinterestrateorforaparticularrepaymentperiod.  Later,thebankmadeNPSarealestateloanandaloantopurchaseacomputer.InMarchof1990thebankdidestablishalineofcredittofinanceϜNPSinventorypurchases,andinJulyof1991thebankincreasedthelineofcreditto$180,000,substantiallyallofwhichwassubsequentlydrawnbyNPS.  Earlyin1992,thebanktransferredtheresponsibilityforNPSmatterstothecentralofficeandceasedmakingtheindividualloanstofinancepurchaseorders.SomeonefromthebankassuredNPSthattheloanswouldberesumedwhenthetransferwascomplete.Asaresult,NPSdidnotseekothersourcesofcreditandcontinuedtoseekordersonthesamelevelasbefore.InJanuaryof1993thebankfinallynotifiedNPSthatit(thebank)wouldnotresumeextendingNPScredit.NPShadbythistimesoexhausteditsworkingcapitalthatthecompanycollapsed.  WhenthebanksuedNPSontheloansmadebefore1992,NPSfiledacounterclaimfordamages,allegingbreachofcontract,fraud,negligentmisrepresentationsandcommonlaw.Thechancellorgrantedsummaryjudgmenttothebankonallclaims.@ II.   OnappealNPSpresentsonlyonetheory:thatthebankhadanimplieddutytonotifyNPSthatitwouldnolongermakeloanstofundthecompanyspurchaseorders.NPSnowconcedesthatanactiononthepromisetoresumefundingisbarredbythestatuteoffrauds,Tenn.CodeAnn.292101(b)(1)(1996Supp.) '   כTherefore,theyallegethatthebanksbreachofdutynotitspromisetomakeloansisthebasisforthebanksliability.  TheauthorityforthebreachofdutytheoryisfoundinK.M.C.Co.v.IrvingTrustCo.,757F.2d752(6thCir.1985).Inthatcasethebankhadestablishedalineofcreditforitscustomerandhadtakenasecurityinterestinallofthecustomersinventoryandaccountsreceivable.Inadditionthebankrequiredthatallofthecustomersreceiptsbeplacedina blockedaccounttowhichonlythebankhadaccess.Whenthecustomerrequestedtodrawonthelineofcreditandthebankrefusedwithoutwarning,thecustomersufferedfinancialruin.  ThelawofNewYorkgovernedtherelationshipbetweentheparties,andthetrialjudgeinstructedthejurythatthereisagoodfaithobligationimpliedineverycontract;thatthisobligationmayhaveimposedonthebankadutytogivenoticetoitscustomerwhenitdecidedtorefusetoadvancefundswithinthelineofcredit;andthatthebankbreachedthedutyunlessitsdecisiontoterminatethelineofcreditwithoutnoticewasmadeingoodfaithandinthereasonableexerciseofitsdiscretion.TheSixthCircuitCourtofAppealsapprovedthisinterpretationofNewYorklawandsaid, [t]hisobligationtoactingoodfaithwouldrequireaperiodofnoticeto[thecustomer]toallowitareasonableopportunitytoseekalternatefinancing,absentvalidbusinessreasonsprecluding[thebank]fromdoingso.757F.2dat759.  EvenifweassumethatthelawinTennesseeisthesameasitisinNewYork,thereisafundamentaldifferenceintherelationshipbetweenthebankandNPS,andthebankanditscustomerinK.M.C.Inthatcasethecustomerhadanexistingwrittenlineofcreditandthedrawrequestbythecustomerwaswithintheamountavailableunderthelineofcredit.Thecustomer,therefore,hadareasonableexpectationofcontinuedcredit.  Inthiscase,NPSdidnothaveanavailablelineofcredit. (   ׀ThemostfavorableviewofthefactsforNPSshowsthatitonlyhadanoralpromisebythebanktofundNPSpurchaseordersalthoughnotinanyspecificamountandnotforanyspecificperiodoftime.Underthosecircumstances,NPShadnoreasonableexpectationofcontinuedcredit.SeeFasolinoFoodsCo.v.BancaϜNazionaleDelLavoro,961F.2d1052(2dCir.1992);ManufacturersHanoverTrustCo.v.Yanakas,7F.3d310(2dCir.1993).Therefore,thebankdidnothaveadutytonotifyNPSthatitwouldnolongerdowhatitwasnotobligatedtodo.@ III.@ Estoppel   NPSarguesonappealthattheimpliedpromisetogivenoticeofcreditterminationisnotwithinthestatuteoffrauds,andevenifitis,thebankwouldbeestoppedtoraisethestatuteasadefense.Withourconclusionthattheimpliedpromisedidnotariseinthiscase,wepretermittheseissues.  Wewouldliketoaddress,however,whyinourjudgment,estoppelwouldnothelpNPSinenforcingtheallegedoralagreementtofundthepurchaseorders.AlthoughtheTennesseecourtshaverecognizedthatpromisorsmaybeestoppedfromraisingthedefensethattheirpromiseswerenotinwriting,seeϜBalilesv.CitiesServiceCo.,578S.W.2d621(Tenn.1979),Disneyv.Henry,656S.W.2d859(Tenn.App.1983),estoppelcannotbeusedtocreaterightsonlytoprotectthem.SeeE.K.HardisonSeedCo.v.ContinentalCasualtyCo.,56Tenn.App.644,410S.W.2d729(1966).Ifthebank,onthebasisofestoppel,couldbeforcedtocontinuefundingtoNPS,NPSwouldacquiregreaterrightsthanithadundertheoralagreement.Therefore,thedoctrineofestoppelshouldnotbeappliedtosecuretheresultNPSseeks.  ThejudgmentofthecourtbelowisaffirmedandthecauseisremandedtotheChanceryCourtofDavidsonCountyforanyfurtherproceedingsthatmaybecomenecessary.Taxthecostsonappealtotheappellant.        _________________________________      BENH.CANTRELL,JUDGECONCUR:_______________________________HENRYF.TODD,PRESIDINGJUDGEMIDDLESECTION_______________________________SAMUELL.LEWIS,JUDGE̜   X   ћ