ÿWPCÊ /# ¢UN­ %û 0(w@)4i}Œ 0J” 0TÞ 0^2 0h 0rø 0|j 0†æ 0l 1uü 0dqU>ÕB) DC< 0@ D3¿ Bò AM U*\ † v~Ž vÓ AQ߯0 0Dö 0D: D/~ B­˜HP LaserJet 4SiHPPCL5MS,ü,,,,,ü0nLHÎ(ÈhH  Z ‹6Times New Roman RegularX($¡¡ d e f ghUiUjUkÓ€wxŒƒ*#~E3|xx2 ÿÿ0Indent1Ô2ÔÔ3  Ô2" ÿÿ0Indent2à0 àÔ2ÔÔ3  Ô2, ÿÿ0Indent3à0 àà0 àÔ2ÔÔ3  Ô26 ÿÿ0Indent4à0 àà0 àà0 àÔ2ÔÔ3  Ô2@ ÿÿ0Indent5à0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2J ÿÿ0Indent6à0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2T ÿÿ0Indent7à0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2^ ÿÿ0Indent8à0 àà0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô  ÿÿ?AGMSYaioIndent0I.A.1.a.(1)(a)i)a)P ÿÿ8Mac DefaultMac DefaultÓ ` °šXÓ< Œ 9p`(&Times New Roman% Line 7 d7Border 1dd("ÿÿ$££Ò  ÒÒ  Ò""""'ÿÿdxd d* Cþÿ << Gÿÿ< Œ 9p`(Arial þÝ ƒ!ÝÔ€ÔÝ  ÝÝ ƒ+"ÝÝ  ÝÔ€$ÔÔ€$ÔÓ  ÓÔ YYY ÔFILEDÔ€$XÔÌÌò òSeptember€29,€1997ÌÌCecil€Crowson,€Jr.ÌÔ€$ôÔAppellate€Court€Clerkó óPtPtHHÚ(ÿáÿâùFG(üHHÚ(d'hStyl{WP}01•ÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃà Ãà Ãà Ãà Ãà ÃÃÃÃÃÃÃÃÃÃÃÐ ÐÐHHÐÐ  ÐÐ2ÐÐÿÿ¸æ$ÿÐÐHHÐÐÐÐÐÐÐÐ  ÐÐ ÐÐ ÐÑÑÑGenevaÑÑ ÑÑ € ÑÑ<Px–ÈÑÒÒÒ443!#4ÒÒ$ *$ÒÒ$*$ÒÒ ÿKK ÒÒ  Geneva ÒÒ  Geneva ÒÓ.,ÓÓÓÓ6ÓÓ ÓßßßßßßßßßßßßßßßßßßÑGenevaÑÑ ÑÒ  h HD: Geneva ÒÒ  h HD: Geneva Ò*+ ,-Cþÿ<< CÿÿƒLevel 1Level 2Level 3Level 4Level 5(3¯$¢¢Ý ƒ!ÝÝ  Ý($$””ò òÚ  Ú1Ú  Úó ó..'÷ÿ dxdüÿP PdÝ ƒ!ÝÔ . ÔÔ€ÔÝ  Ýò òÑ\R AØ'\ÑÓ` Ü` p”XÓÑ\R AØ'\Ñ›Þ ÞÌà@ àIN€THE€COURT€OF€APPEALS€OF€TENNESSEE,€WESTERN€SECTIONÌà@ àAT€JACKSONó óÌÌà@ à_______________________________________________________ÌÌà à)Ìœò òCHARLEY›€CLUNAN€COMPANY,€INC.€€ó ó)à àShelby€County€Chancery€Court̜ـ*ÙßR€#%A1-j|Ÿ` Å `€€@ÿRß›à à)à àNo.€106613„1€R.D.Ì€€€€€Plaintiff/Appellee.à à)Ìà à)ÌVS.à à)à àC.A.€No.€02A01„9704„CH„00087Ìà à)Ìò òJOYCE€JEANETTE€MARTINó ó,à à)Ìà à)Ì€€€€€Defendant/Appellant.à à)Ìà à)Ì______________________________________________________________________________ÌÌFrom€the€Chancery€Court€of€Shelby€County€at€Memphis.Ìò òHonorable€Neal€Small,€Chancellor€ó óÌÌÌÌò òMark€J.€Graió ó,€THE€WINCHESTER€LAW€FIRM,€Memphis,€TennesseeÌAttorney€for€Defendant/Appellant.ÌÌÌò òCary€R.€Califfó ó,€Memphis,€TennesseeÌò òLinda€J.€Mathisó ó,€Memphis,€TennesseeÌAttorney€for€Plaintiff/Appellee.ÌÌÌÌOPINION€FILED:ÌÌò òAFFIRMED€AND€REMANDEDó óÌÌÌà àò òFARMER,€J.ó óÌÌò òHIGHERS,€J.ó ó:€(Concurs)Ìò òLILLARD,€J.ó ó:€œ(Concurs)ÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌ›ÓÓÓ  ÓÓ` Ü` ˜XÓœà àDefendant€Joyce€Jeanette€Martin€appeals€the€trial€courtððs€order€which€awardedÏPlaintiff/Appellee€Charley€Clunan€Company,€Inc.,€a€judgment€of€$35,200€in€its€action€to€recover€aÏreal€estate€commission.€€We€affirm€the€judgment€because€we€have€determined€that€the€recordÏsupports€the€trial€courtððs€ruling€that€Martin€breached€the€terms€of€the€partiesðð€exclusive€listingÏagreement€when€she€sold€the€property€to€a€third€party€without€paying€the€Company€a€commission.ÌÌà àMartin€formerly€owned€a€building€located€at€115€South€Front€Street€in€Memphis.€ÏIn€January€1995,€Michael€Matthews,€the€Companyððs€president€and€principal€broker,€prepared€anÏexclusive€listing€agreement€under€which€the€Company€agreed€to€list€Martinððs€property€for€sale€withÏa€listing€service€and€to€use€its€best€efforts€to€find€a€purchaser€for€the€property.€€Matthews€preparedÏthe€agreement€at€the€direction€of€Martinððs€son,€Wayne€Martin.€€Wayne€Martin€then€took€the€listingÏagreement€to€Martin€to€obtain€her€signature.€€Although€the€listing€agreement€subsequently€wasÏdated€February25,€1995,€it€was€not€clear€whether€Martin€signed€the€agreement€in€January€orÏFebruary€1995.€€In€any€event,€Martin€signed€the€listing€agreement,€which€was€effective€fromÏFebruary25,€1995,€until€January31,€1996.€€The€listing€agreement€provided€for€a€sales€price€ofÏ$625,000€and€a€standard€commission€of€six€percent(6%).ÌÌà àAt€the€time€the€agreement€was€executed,€both€Martin€and€Matthews€mistakenlyÏbelieved€that€Wayne€Martin€still€had€his€real€estate€brokerððs€license.€€Wayne€Martin€previously€hadÏtransferred€his€license€to€the€Company,€and€he€maintained€an€office€at€the€Companyððs€place€ofÏbusiness.€€Around€March€1995,€Matthews€learned€that€Wayne€Martinððs€license€had€not€beenÏrenewed€after€December31,€1994,€due€to€his€failure€to€maintain€the€required€insurance.ÌÌà àDespite€the€existence€of€the€exclusive€listing€agreement,€several€advertisements€forÍsale€of€the€property€appeared€in€a€Memphis€newspaper,€ò òòòThe€Commercial€Appealó óóó,€during€theÏspring€of€1995,€beginning€with€the€February19,€1995,€edition€and€ending€with€the€edition€datedÏApril€16,€1995.€€These€ads€were€purchased€by€Martin,€but€it€was€not€clear€whether€she€purchasedÏthem€prior€to€or€after€entering€into€the€listing€agreement€with€the€Company.ÌÌà àIn€May1995,€Martin€attempted€to€cancel€the€exclusive€listing€agreement.€€In€a€letterÏto€Matthews€dated€May12,€1995,€Martin€explained€that€she€was€ð ðvery€disappointed€with€theÏpromptness€with€which€you€all€have€been€to€work€this€listing.ðð€€Approximately€one€week€later,ÏMartin€entered€into€a€sales€contract€to€sell€the€property€to€Renaissance€Investments€for€a€totalÏpurchase€price€of€$450,000.€€Renaissance€Investments€was€not€one€of€the€prospective€purchasersÏto€whom€Matthews€had€shown€the€property.ÌÌà àWhen€Martin€refused€to€pay€the€brokerððs€commission€due€under€the€listingÏagreement,€the€Company€filed€this€action€against€Martin€seeking€to€recover€its€commission.€€In€herÏanswer,€Martin€raised€several€defenses,€including€the€defenses€of€constructive€fraud€and€mistake.€ÏIn€support€of€these€defenses,€Martin€alleged€that€she€entered€into€the€exclusive€listing€agreementÏbased€upon€the€Companyððs€representations€that€Wayne€Martin€would€be€the€broker€who€handledÏthe€sale€of€the€property€and€who€received€the€commission€from€the€sale.€€Alternatively,€MartinÏalleged€that€she€terminated€the€listing€agreement€prior€to€her€sale€of€the€property€based€on€theÏCompanyððs€failure€to€perform€its€obligations€under€the€agreement.ÌÌà àAt€trial,€the€evidence€was€disputed€as€to€whether€the€listing€agreement€was€executedÏby€the€parties€with€the€understanding€that€Wayne€Martin€would€handle€the€ultimate€sale€of€theÏproperty.€€Martin€testified€that€she€entered€into€the€listing€agreement€only€because€she€understoodÏthat€Wayne€Martin€still€had€his€brokerððs€license€and€that€he€would€be€the€broker€handling€the€sale.€ÏMatthews,€on€the€other€hand,€testified€that€Wayne€Martin€was€too€busy€with€his€landscapingÏbusiness€to€market€Martinððs€property.€€Accordingly,€Matthews€proceeded€to€market€the€propertyÍhimself.€€Wayne€Martin€did€not€testify,€although€he€had€been€subpoenaed€by€Martin.ÌÌà àThe€evidence€also€was€disputed€as€to€whether€the€Company€had€breached€the€listingÏagreement€by€failing€to€attempt€to€sell€the€property.€€At€trial,€Martin€took€the€position€that€MatthewsÏhad€made€no€efforts€to€sell€the€property,€other€than€to€place€a€small€sign€in€the€front€window€of€theÏbuilding.€€Matthews€testified€that,€in€addition€to€placing€the€sign€in€the€window,€he€(1)listed€theÏproperty€with€the€Multiple€Listing€Service,€(2)showed€the€property€to€several€prospectiveÏpurchasers,€(3)mentioned€the€property€to€several€clients€as€an€investment€opportunity,€andÏ(4)ordered€a€banner€to€be€placed€on€the€back€of€the€building€during€Memphis€in€May€festivities.€€ÌÌà àAt€the€trialððs€conclusion,€the€trial€court€rejected€the€defenses€raised€by€Martin€andÏentered€a€judgment€in€favor€of€the€Company€in€the€amount€of€$35,200.€€This€amount€includedÏ$26,400€in€brokerððs€commissions€and€$8,800€in€attorneyððs€fees.€€On€appeal,€Martin€presents€theÏfollowing€issues€for€this€courtððs€review:ÌÌÓÓà8 àà à1.à àDid€the€Chancery€Court€[err]€in€failing€to€hold€thatÏthe€Agency€Listing€Contract€was€null€and€void€on€the€basis€ofÏconstructive€fraud€or€mistake?ÌÌà8 àà à2.à àDid€the€Chancery€Court€[err]€in€failing€to€find€thatÏClunan€Companyððs€non„performance€under€the€Agency€ListingÏContract€was€an€adequate€ground€for€Ms.€Martinððs€termination€ofÏthat€agreement?€€ÌÌÓÓÌà àOur€review€of€the€trial€courtððs€judgment€in€this€non„jury€case€is€governed€by€theÏTennessee€Rules€of€Appellate€Procedure,€which€provide€that,€in€civil€actions,€the€appellate€courtððsÏreview€of€the€trial€courtððs€findings€of€fact€ð ðshall€be€òòò òde€novoó óóó€upon€the€record€of€the€trial€court,Ïaccompanied€by€a€presumption€of€the€correctness€of€the€finding,€unless€the€preponderance€of€theÏevidence€is€otherwise.ðð€€ò òòòHassv.€Knightonó óóó,€676€S.W.2d€554,€555€(Tenn.€1984)€(quotingÏT.R.A.P.€13(d)).€€Under€this€standard,€when€a€conflict€in€testimony€requires€the€trial€court€to€makeÏa€determination€regarding€the€credibility€of€a€witness€or€witnesses,€such€a€determination€is€ð ðbindingÍon€the€appellate€court€unless€from€other€real€evidence€the€appellate€court€is€compelled€to€concludeÏto€the€contrary.ðð€€òòò òHudsonv.€Cappsó óóó,€651€S.W.2d€243,€246€(Tenn.€App.€1983).ÌÌà àWith€this€standard€in€mind,€we€first€conclude€that€the€defense€of€constructive€fraudÏis€inapplicable€under€the€facts€of€this€case.€€In€ò òòòLand€Developers,€Inc.v.€Maxwelló óóó,€537ÏS.W.2d€904€(Tenn.€1976),€our€supreme€court€explained€the€basis€for€the€doctrine€of€constructiveÏfraud:ÌÌÓÓà8 àThe€doctrine€of€constructive€fraud€is€recognized€in€this€state€as€beingÏa€principle€of€equity.€€See€2€Gibson,€ò òòòSuits€in€Chanceryó óóó,€ðððð€982„984€(Crownover€1956).€€Although€it€has€been€applied€in€a€variety€ofÏcases,€ordinarily,€as€between€private€parties,€the€doctrine€has€beenÏemployed€where€there€has€been€an€abuse€of€a€fiduciary€orÏconfidential€relationship€between€the€parties.€€It€has€particularly€beenÏused€for€the€purpose€of€canceling€or€rescinding€transactions€whereÏthere€has€been€an€overreaching€or€undue€advantage€taken€betweenÏparties€who€are€not€dealing€at€armððs€length.€€See€ò òòòMackiev.ÏFuquaó óóó,€14€Tenn.€App.€176€(1931);€ò òòòBank€of€Blount€Countyv.ÏDunnó óóó,€10€Tenn.€App.€95€(1929).ÌÌÓÓÌò òòòLand€Developers€v.€Maxwelló óóó,€537€S.W.2d€at€918;€ò òòòsee€alsoó óóó€Henry€R.€Gibson,€ò òòòGibsonððsÏSuits€in€Chanceryó óóó€ðð388,€at€380€(William€H.€Inman€ed.,€7th€ed.€1988)€(indicating€thatÏconstructive€fraud€may€arise€where€person€occupying€position€of€special€trust€and€confidenceÏtowards€other€party,€such€as€relationship€of€agent€and€principal,€obtains€gift€or€undulyÏadvantageous€contract).ÌÌà àWe€recognize€that€ð ð[r]eal€estate€agents€are€fiduciaries€who€are€in€a€confidentialÏrelationship€with€their€principals.ðð€€ò òòòWynerv.€Athens€Utils.€Bd.ó óóó,€821€S.W.2d€597,€598Ï(Tenn.€App.€1991).€€In€the€present€case,€however,€no€evidence€was€presented€at€trial€to€show€thatÏthe€Company€was€guilty€of€overreaching€in€its€transaction€with€Martin€or€that€the€Company€tookÏundue€advantage€of€Martin.€€Accordingly,€we€hold€that€the€trial€court€property€rejected€MartinððsÏconstructive€fraud€defense.ÌÌà àWe€likewise€conclude€that€the€evidence€does€not€preponderate€against€the€trialÏcourtððs€decision€to€reject€Martinððs€defense€of€mutual€mistake.€€In€order€to€establish€her€entitlementÏto€rescission€of€the€listing€agreement€based€on€mutual€mistake,€Martin€was€required€to€establishÏ(1)that€the€mistake€was€mutual;€(2)that€the€mistake€related€to€a€material€fact;€(3)that€the€mistakeÏwas€not€due€to€Martinððs€negligence;€and€(4)that€the€mistake€injuriously€affected€Martin.€Ïò òòòLovedayv.€Cateó óóó,€854€S.W.2d€877,€880€(Tenn.€App.€1992);€ò òòòRobinsonv.€Brooksó óóó,€577ÏS.W.2d€207,€208„09€(Tenn.€App.€1978).€€We€believe€that€the€trial€court€properly€rejected€thisÏdefense€based€on€Martinððs€failure€to€demonstrate€that€the€partiesðð€mistake€related€in€a€material€wayÏto€the€subject€matter€of€the€partiesðð€contract.€€ò òòòSeeó óóó€ò òòòRobinsonv.€Brooksó óóó,€577€S.W.2d€at€209.ÌÌà àThe€evidence€was€undisputed€that,€at€the€time€they€executed€the€listing€agreement,Ïboth€parties€mistakenly€believed€that€Wayne€Martin€had€a€real€estate€brokerððs€license.€ÏNevertheless,€the€parties€also€presented€evidence€from€which€the€trial€court€could€have€found€thatÏthis€mistake€was€not€material€to€the€partiesðð€agreement.€€Although€Martin€testified€that€she€executedÏthe€listing€agreement€with€the€understanding€that€her€son€would€be€the€broker€handling€the€sale,€theÏevidence€showed€that€Martin€never€discussed€such€a€provision€with€Matthews€prior€to€executingÏthe€listing€agreement.€€Wayne€Martin€failed€to€corroborate€Martinððs€testimony€that€his€participationÏwas€a€material€term€of€the€agreement€because€he€did€not€testify€at€trial,€although€he€had€beenÏsubpoenaed€as€a€witness€by€Martin.€€Moreover,€the€listing€agreement€itself€failed€to€supportÏMartinððs€claim€that€the€agreement€was€executed€with€the€understanding€that€Wayne€Martin€wouldÏbe€the€broker€handling€the€sale.€€The€agreement€was€executed€by€Michael€Matthews€and€made€noÏmention€of€Wayne€Martin.€€In€executing€the€agreement,€Martin€specifically€agreed€to€a€provisionÏwhereby€she€authorized€the€Company€to€ð ðappoint€subagents€and€to€authorize€said€subagents€toÏperform€dutiesðð€under€the€agreement.ÌÌà àFinally,€we€reject€Martinððs€remaining€argument€that€she€properly€terminated€theÍlisting€agreement€based€upon€the€Companyððs€failure€to€perform.€€After€considering€the€conflictingÏevidence€presented€at€trial,€the€trial€court€specifically€found€that€the€evidence€did€not€support€thisÏdefense.€€This€evidence€included€Matthewsðð€testimony€that€he€placed€a€ð ðFor€Saleðð€sign€in€the€frontÏwindow€of€the€building,€listed€the€property€with€the€Multiple€Listing€Service,€showed€andÏpromoted€the€property€to€several€prospective€purchasers,€and€ordered€a€banner€to€be€displayedÏduring€Memphis€in€May.€€Inasmuch€as€our€own€review€of€the€record€fails€to€compel€a€contraryÏresult,€we€affirm€the€trial€courtððs€ruling€on€this€issue.€€ò òòòSeeó óóó€ò òòòHudsonv.€Cappsó óóó,€651€S.W.2d€atÏ246.ÌÌà àThe€trial€courtððs€judgment€is€affirmed€and€this€cause€remanded€for€furtherÏproceedings.€€Costs€of€this€appeal€are€taxed€to€the€Appellant,€for€which€execution€may€issue€ifÏnecessary.ÌÌÓÓà àà àà àà àà àà à____________________________________Ìà àà àà àà àà àà àFARMER,€J.ÌÌ______________________________ÌHIGHERS,€J.€(Concurs)ÌÌÌÌ______________________________ÌLILLARD,€J.€(Concurs)›