ÿWPC¤ 7# UN %k 0(qw@™4Ùíün­ ¹U:Á 0ªû 0‚¥b'UN/ 0@} 0J½ 0T 0^[ 0h¹ 0r! 0|“ 0† 0• 1u% AQš Æë 0D± Bõ 0D 0dV D/º Bé D3U>9B)wDC  AMãU*0ùZv~SvÓјHP LaserJet 4 PlusHPPCL5MS,ð,,,,,ð0nLHÎ(ÖÃ9 Z ‹6Times New Roman RegularX($¡¡ ~DD€DD‚DƒD„D…U†Ó€]tÁ$xtttttt3|x«<þ6X9`("Courier NewTTXXxþ6X@ÉDQX@,†r‰AZ‹"Arial Regular(Z(2Lg$¤¤Ý ƒ!ÝÝ  ÝÔ€XæFXXXÔÔ€ X‰XXXæFÔà  àòòÚ  Ú0Ú  Úóó(A2`$Ô‡ X:¨XXX +ÔÔ‡ X:¨XXX:¨ÔòòÚ  Ú0Ú  Úóó- ù-6Times New Roman Regular("ÿÿ$££Ò  ÒÒ  Ò2 ÿÿ0Indent1Ô2ÔÔ3  Ô2" ÿÿ0Indent2à0 àÔ2ÔÔ3  Ô2, ÿÿ0Indent3à0 àà0 àÔ2ÔÔ3  Ô26 ÿÿ0Indent4à0 àà0 àà0 àÔ2ÔÔ3  Ô2@ ÿÿ0Indent5à0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2J ÿÿ0Indent6à0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2T ÿÿ0Indent7à0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2^ ÿÿ0Indent8à0 àà0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô ÿÿ?AGMSYaioIndent0I.A.1.a.(1)(a)i)a)!"$&Cþÿ<< CÿÿƒLevel 1Level 2Level 3Level 4Level 5(3¯$¢¢Ý ƒ!ÝÝ  Ý d($$””ò òÚ  Ú1Ú  Úó óP ÿÿ8Mac DefaultMac DefaultÓ ` °šXÓ(('÷ÿ dxdüÿP Pd####'ÿÿdxd< Œ 9p`(&Times New Roman% Line 7 d00007Border 1dd!1Cþÿ << Gÿÿ< Œ 9p`(Arial ïÝ ƒ!ÝÔ€/ÔÝ  ÝÝ ƒ""ÝÝ  ÝÔ€3ÔÔ€3ÔÓ  Óò òÔ YYY ÔFILEDÔ€3XÔÌÌJuly€22,€1998ÌÌCecil€W.€CrowsonÌAppellate€Court€ClerkÔ  Ôó 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 ÒÝ ƒ!ÝÔ . ÔÔ€/ÔÝ  ÝÒ € ÒÒ „ ÒÓ` °‡XøÈ“XÓÑ\R AØ'\ÑÞ ÞÌJAMES›€E.€œMcGAUGH,€JR.,à àà àà à)Ìà àà àà àà àà àà à)ÌÓ#` Ü‚Xøôx‘X#Óà àPlaintiff/Counter„à à)à àAppeal€No.Ìà àDefendant/Appellee,à à)à à01„A„01„9706„CH„00256Ìà àà à)Ìv.à àà à)Ìà àà à)à àDavidson€Chanceryà àÌÙ€!ÙßR€241A1-j|kÙ` ç `€€@ÿRßCHARLES€F.€and€JOYCE€L.à à)à àNo.€€96„625„IÌGALBREATH,à à)Ìà àà à)Ìà àDefendants/Counter€andà à)Ìà àCross„Plaintiffs/Appellants,à à)Ìà àà à)Ìv.à àà à)Ìà àà à)ÌTHOMAS€LAWLESS€and€FIRSTà à)ÌAMERICAN€NATIONAL€BANK,à à)Ìà àà à)Ìà àCross„Defendants/Appellees.à à)ÌÌÓ  ÓÔ€/¼ÔÌCOURT€OF€APPEALS€OF€TENNESSEEÌÌÌAPPEAL€FROM€THE€CHANCERY€COURT€FOR€DAVIDSON€€COUNTYÌÌAT€NASHVILLE,€TENNESSEEÌÌÌTHE€HONORABLE€IRVIN€H.€KILCREASE,€JR.,€CHANCELLORÌÓ ` Ü‚XœÈ“X ÓÌÌÓ  ÓÔ€/XÔTHOMAS€E.€STEWARTÌStewart€&€BlackÌ333€Gallatin€Road,€SouthÌMadison,€Tennessee€€37115Ìà àATTORNEY€FOR€APPELLEE€JAMES€E.€McGAUGH,€JR.ÌÌERIC€V.€HELMERSÌ721€First€American€CenterÌNashville,€Tennessee€€37237Ìà àATTORNEY€FOR€APPELLEE€FIRST€AMERICAN€NATIONAL€BANKÌÌTHOMAS€W.€LAWLESS,€Pro€SeÌLawless€&€AssociatesÌ315€Deaderick€StreetÌNashville,€Tennessee€€37238ÌÌÌCHARLES€GALBREATHÌ211€Union€Street,€Suite€901ÌNashville,€Tennessee€€37201ÌÔ€/¼Ôà àÔ€/XÔATTORNEY€FOR€APPELLANTS€CHARLES€and€JOYCE€GALBREATHÌÌÓ  ÓÌAFFIRMEDÌÌÓ  ÓWALTER€W.€BUSSART,€ÌÓ  Óà àà àà àà à€€€€€€€€€SPECIAL€JUDGEÌÑ7€¯3XXdðXXdì7ÑÑ€ÑÓÓÓ  ÓòòÔ€/èÔOPINIONóóÌÓ  ÓÓ€ÓÔ€/¼Ôà àThis€suit€involves€the€transfer€of€a€piece€of€real€estate€located€inÏMadison,€Tennessee€on€which€is€situated€a€commercial€doughnut€bakery.€TheÏtitle€of€the€Property€is€vested€in€Defendant€Charles€Galbreath€and€wasÏconveyed€to€Mr.€Galbreath€by€deed€from€DH€Restaurants,€Inc.€€Mr.ÏGalbreath€leased€the€property€to€Diversified€Hospitality€GroupÏ("Diversified"),€and€shortly€thereafter,€Diversified€subleased€the€property€toÏShipley€Do„Nuts€of€which€€Plaintiff€James€McGaugh€is€the€principal€owner.€ÌÌà àBefore€continuing€to€the€substantive€issues€of€this€appeal,€we€considerÏappellant's€Rule€14€motion€to€consider€post„judgment€facts.€€After€due€con„sideration€of€the€appellant's€motion,€the€court€finds€that€the€facts€do€not€comeÏwithin€the€purview€of€the€rule.€€The€motion€is€therefore€denied.ÌÌà àOn€November€1,€1995,€Mr.€McGaugh€entered€into€a€contract€toÏpurchase€real€estate,€leasehold€improvements€and€equipment€("the€Property")Ïfrom€Defendant€for€the€sum€of€$180,000€with€closing€set€for€January€1,Ï1996.€€Defendant€was€to€furnish€the€Property€"by€a€good€and€valid€warrantyÏdeed"€secured€by€a€title€insurance€policy.€€On€December€15,€1995,€PlaintiffÏreceived€his€primary€financing€commitment€to€finance€the€property€fromÏFirst€American€National€Bank€("the€Bank")€so€as€to€place€him€in€a€position€toÏbe€ready,€willing€and€able€to€close€for€cash€on€the€scheduled€closing€dateÍpursuant€to€the€contract.€€The€Bank's€commitment€to€lend€was€subject€to€theÏBank€receiving€a€first€lien€on€the€Property€and€a€deed€of€trust.€ÌÌà àThe€problems€in€this€case€first€arose€when€Thomas€Lawless,€the€Bank'sÏattorney,€notified€the€Bank€and€Mr.€McGaugh€of€the€existence€of€possibleÏdefects€in€the€title.€€The€first€defect€involved€the€original€lessee€(and€sub„lessor),€Diversified,€who€was€in€Chapter€7€bankruptcy€proceedings€inÏConnecticut.€€Mr.€Lawless€opined€that€because€Diversified's€lease€containedÏan€option€to€purchase€the€Property€at€the€end€of€the€lease€for€$250,000,€thisÏlease,€along€with€the€option,€was€now€the€property€of€the€bankruptcy€estate.€ÏThe€second€defect€was€due€to€a€vendor's€lien€against€the€property€whichÏwould€either€have€to€be€released€for€the€amount€necessary€to€pay€it€off€orÏwould€have€to€be€deducted€from€the€$180,000€sale€price.€€When€DefendantÏMr.€Galbreath€refused€to€take€the€necessary€steps€to€clear€the€two€defects€inÏthe€title,€Mr.€McGaugh€sued€for€specific€performance€and€damages€as€aÏresult€of€contract€breach.€€€Mr.€Galbreath€counter„sued€for€breach€ofÏcontract€and€filed€a€cross€action€against€the€Bank€and€its€attorney€Mr.ÏLawless€for€negligently€misrepresenting€that€the€title€was€defective€when€itÏwas€not.ÌÌà àInitially,€the€trial€court€refused€Mr.€Galbreath's€demand€for€a€juryÏtrial€and€granted€the€Bank's€and€Mr.€Lawless's€motions€for€summaryÏjudgment.€€The€order€of€dismissal€also€directed€Mr.€Galbreath€to€payÏsanctions€for€violations€of€Rule€11€as€well€as€attorney's€fees€totaling€$7,950.€ÏSubsequently,€the€court€granted€summary€judgment€to€Plaintiff€Mr.ÏMcGaugh.€€Mr.€Galbreath€gave€his€notice€of€appeal,€and€a€stay€of€executionÏwas€granted.€€After€the€stay€was€granted,€Counter„defendant€Mr.€LawlessÍhad€$2,500€seized€by€garnishment€from€Joyce€Galbreath's€bank€account€withÏthe€Bank.€€The€trial€judge,€on€motion€to€dissolve€the€garnishment,€held€thatÏJoyce€Galbreath€had€not€appealed€and€was€not€a€party€to€the€stay€of€executionÏbond.€€He€therefore€declined€to€order€that€Joyce€Galbreath's€money€beÏreleased.€€ÌÓ  ÓI.€€Appeal€of€Joyce€GalbreathÌÓ  Óà à€As€a€preliminary€matter,€we€must€determine€whether€or€not€JoyceÏGalbreath€is€properly€before€this€court€on€appeal.€€On€October€28,€1996,€theÏChancery€Court€entered€a€final€order€dismissing€the€Bank€and€Mr.€LawlessÏas€counter„defendants.€€In€that€order,€the€court€found€that€Mr.€Lawless€hadÏcarried€the€burden€of€proof€that€Mr.€Galbreath€had€violated€Rule€11.€€TheÏcourt€then€reinstated€the€sanction€previously€awarded€against€Charles€andÏJoyce€Galbreath€of€$2,500€to€deter€wrongful€conduct€and€the€frivolous€filingÏand€continued€prosecution€of€this€case€against€Mr.€Lawless€and€the€Bank.€ÏFinally,€the€court€noted€that€the€award€of€sanctions€against€Charles€and€JoyceÏGalbreath€would€become€a€final€order€as€this€issue€affects€no€otherÏcontroversy€in€the€case.ÌÌà àOn€November€13,€1996,€Mr.€Galbreath€filed€a€Notice€of€Appeal€whichÏmade€reference€to€the€Rule€11€sanctions.€€Joyce€Galbreath's€name€was€not€onÏthis€notice€nor€did€she€file€a€separate€notice.€€On€November€18,€1996,€Mr.ÏGalbreath€filed€an€Amended€Notice€of€Appeal€which€addressed€issuesÏinvolving€Mr.€Lawless's€advice€to€his€clients€regarding€the€cloud€on€the€titleÏof€the€Property.€€Again,€Joyce€Galbreath€was€not€designated€as€an€appellantÏin€the€amended€notice.€€The€first€time€that€Joyce€Galbreath's€name€appearedÏon€a€notice€of€appeal€was€on€the€notice€filed€February€18,€1997.€€Here,€bothÏCharles€Galbreath€and€Joyce€L.€Galbreath€noticed€their€appeal€"from€theÍadverse€judgments€of€the€trial€court."ÌÌà à"The€purpose€of€the€notice€of€appeal€is€simply€to€declare€in€a€formalÏway€an€intention€to€appeal."€€Tenn.€R.€App.€P.€3€advisory€commission€cmt.,Ïsubdivision€(f).€€Tennessee€Rule€of€Appellate€Procedure€3(f)€states€inÏpertinent€part€that€"[the€notice€of€appeal€shall€specify€the€party€or€partiesÏtaking€the€appeal.€.€.€"€€Besides€requiring€the€party€to€be€named€in€the€noticeÏof€appeal,€the€Rules€require€that€the€notice€be€timely€filed.€€"In€an€appeal€asÏof€right€to€the€Supreme€Court,€Court€of€Appeals€or€Court€of€CriminalÏAppeals,€the€notice€of€appeal€required€by€Rule€3€shall€be€filed€with€andÏreceived€by€the€clerk€of€the€trial€court€within€30€days€after€the€date€of€entryÏof€the€judgment€appealed€from."€€Tenn.€R.€App.€P.€4€(a).€€This€court€hasÏheld€that€the€time€limit€is€mandatory€and€jurisdictional€in€civil€cases.€Ïòòò òJefferson€v.€Pneumo€Servs.€Corp.ó óóó,€699€S.W.2d€181,€184€(Tenn.€Ct.ÏApp.€1985).€€The€Tennessee€Rules€of€Appellate€Procedure€specificallyÏprovide€that€the€Court€of€Appeals€can€neither€waive€nor€extend€this€timeÏperiod.€€Tenn.€R.€App.€P.€2€advisory€commission€cmt.€(addressing€waiver);€ÏTenn.€R.€App.€P.€21(b)€(addressing€extension€of€time).€ÌÌà àIn€a€recent€case,€our€court€addressed€the€specific€issue€of€"whether€theÏabsence€of€a€party's€name€from€a€notice€of€appeal€is€the€type€of€informalityÏthat€will€not€affect€the€party's€standing€as€an€appellant."€€òòò òTown€ofÏCarthage,€Tennessee€v.€Smith€Countyó óóó,€No.€01„A„01„9308„CH00391,Ï1995€WL€92266€at€*3€€(Tenn.€Ct.€App.€1995).€€Concluding€that€the€failure€toÏspecify€a€party€in€the€notice€of€appeal€was€not€an€excusable€informality,€theÏcourt€stated€as€follows:à àÌÓÓà8 àTo€be€considered€an€appellant,€a€party€must€file€a€timely€noticeÏof€appeal€in€its€own€name,€or€it€must€be€named€as€an€appellant€inÍa€timely€joint€notice€of€appeal€filed€in€accordance€with€Tenn.€R.ÏApp.€P.€16(a).€€Parties€who€do€neither€are€simply€not€before€theÏcourt€as€appellants.€ÌÌòòò òId.ó óóó€at€*4.€ÌÌÌÓ€Óà àIn€light€of€this€law,€we€conclude€that€Joyce€Galbreath€is€simply€notÏbefore€this€court€as€an€appellant€regarding€the€issue€of€the€Rule€11€sanctionsÏand€the€issue€of€Mr.€Lawless's€negligent€misrepresentation€and€inducement€ofÏcontract€breach.€€€By€not€filing€a€notice€of€appeal€until€February€18,€1997,ÏJoyce€Galbreath€failed€to€appeal€in€a€timely€manner€the€trial€court'sÏjudgment€with€regard€to€these€issues€which€the€trial€court€made€final€byÏorder€dated€October€28,€1996.€€Furthermore,€the€two€notices€filed€inÏNovember€of€1996€by€Charles€Galbreath€are€insufficient€to€preserve€theÏright€of€appeal€for€Joyce€Galbreath.€€Therefore,€these€issues€will€be€reviewedÏas€between€Mr.€Galbreath€and€Mr.€Lawless€and€the€Bank.€€On€the€otherÏhand,€by€the€notice€of€appeal€she€filed€on€February€18,€1997,€JoyceÏGalbreath€has€preserved€her€right€to€appeal€the€January€22,€1997€judgmentÏgranting€summary€judgment€to€Mr.€McGaugh€and€denying€the€same€to€theÏGalbreaths.ÌÓ  ÓII.€€Breach€of€ContractÌÓ  Óà àWe€turn€next€to€the€issue€of€contract€breach€as€between€Charles€andÏJoyce€Galbreath€and€James€McGaugh.€€These€proceedings€began€in€the€trialÏcourt€when€Mr.€McGaugh€sued€for€specific€performance€of€the€contractÏbetween€these€parties.€€By€Order€dated€January€22,€1997,€the€court€grantedÏMr.€McGaugh's€Motion€for€Summary€Judgment€which€entitled€him€toÏspecific€performance€of€the€contract€for€sale€of€the€Property.€€In€its€order,Ïthe€court€stated€that€"the€title€exceptions€have€been€cured€per€the€record€andÏare€no€longer€subject€to€objection€by€the€purchaser."€€€On€appeal,€the€issue€isÍwhether€Mr.€Galbreath€did€indeed€breach€the€contract€by€his€failure€to€clearÏthe€title€or€whether,€as€Mr.€Galbreath€asserts,€Mr.€McGaugh€breached€theÏcontract€by€his€failure€to€tender€the€purchase€price€on€January€1,€1996.€Ìà àÌà àThe€contract€provided€that€Mr.€Galbreath€was€to€convey€by€"good€andÏvalid€warranty€deed"€the€Property€with€the€sale€to€close€on€January€1,€1996.€ÏThe€contract€included€the€following€form€language:€"This€contract€isÏcontingent€upon€buyer's€ability€to€qualify€for€a€new€loan€whenever€a€newÏloan€is€a€part€of€the€terms€of€this€contract.€€Buyer€agrees€to€make€said€loanÏapplication€on€or€before€___."€€The€blank€had€been€filled€in€with€the€typedÏwords€"already€arranged."€€As€stated,€a€dispute€arose€when€Mr.€LawlessÏadvised€his€client,€the€Bank€which€had€approved€a€loan€for€Mr.€McGaugh,Ïthat€there€were€problems€with€the€title€of€the€Property.€€In€a€letter€from€Mr.ÏLawless€to€Mr.€Galbreath's€then€attorney,€Thomas€Stewart,€Mr.€LawlessÏstated€that€Mr.€Galbreath€faxed€a€warranty€deed€on€January€2,€1996.€€WhenÏconfronted€on€that€same€day€about€the€possibility€of€an€option€held€by€aÏbankruptcy€trustee€for€Diversified,€Mr.€Galbreath€took€the€position€thatÏthere€was€no€problem€and€asserted€that€"even€if€there€was€a€cloud€in€theÏchain€of€title,€he€'was€good€for€any€damages,€even€though€he€could€notÏconceive€of€any.'"ÌÌà àInitially,€we€point€out€that€both€parties€waived€the€ability€to€rely€on€theÏclosing€date€of€the€contract.€€Mr.€Galbreath€first€faxed€the€warranty€deed€onÏJanuary€2,€1998,€one€day€subsequent€to€the€date€of€closing€specified€in€theÏcontract.€€Because€the€parties€were€obviously€not€relying€on€the€contractÏdate,€they€had€a€reasonable€time€in€which€to€close.€€òòò òFirst€Am.€Trust€Co.Ïv.€Franklin„Murray€Dev.€Co.ó óóó,€925€S.W.2d€545,€547€(Tenn.€Ct.€App.Í1996).€€Next,€we€conclude€that€Mr.€McGaugh€did€not€breach€the€contract€byÏrefusing€to€purchase€the€Property€on€January€2,€1996€after€Mr.€GalbreathÏfaxed€him€the€warranty€deed.€€The€contract€stated€that€it€was€contingent€uponÏMr.€McGaugh's€ability€to€qualify€for€a€new€loan.€€Though€the€bank€issued€aÏletter€of€intent€approving€such€a€loan,€this€letter€was€conditioned€upon€theÏloan€being€secured€by€a€first€lien€and€upon€the€Bank€receiving€a€deed€ofÏtrust.€€Regardless€of€the€accuracy€of€Mr.€Lawless's€advice€regarding€theÏclouded€title,€the€bank's€reaction€to€this€advice€affected€Mr.€McGaugh'sÏability€to€obtain€the€loan€from€the€Bank€and€thereby€relieved€Mr.€McGaughÏof€his€obligation€under€the€contract.€€The€fact€that€the€contract€provides€thatÏthe€buyer's€agreement€to€make€the€loan€application€had€already€beenÏarranged€does€not€alter€our€finding.€€This€language€goes€to€the€buyer's€(hereÏMr.€McGaugh's)€responsibility€to€initiate€the€loan€process€which€had€in€factÏ"already€been€arranged."€€The€contingency€that€Mr.€McGaugh€qualify€for€theÏloan€remained€a€part€of€the€contract.ÌÌà àHowever,€it€is€not€disputed€that,€whatever€may€have€been€defects€in€theÏtitle,€they€have€since€been€cleared€to€the€satisfaction€of€the€Bank€such€thatÏMr.€McGaugh€is€not€only€willing€but€able€to€purchase€under€the€contract.€ÏOnce€cleared€within€a€reasonable€time,€Mr.€McGaugh€still€had€the€rightÏunder€the€contract€to€purchase€the€Property.€€òòò òId.ó óóó€€In€light€of€Mr.€Galbreath'sÏrefusal€to€transfer€the€Property,€we€find€that€the€trial€court€did€not€err€inÏawarding€specific€performance.€€€The€remedy€of€specific€performance€restsÏwithin€the€sound€discretion€of€the€trial€court€and€upon€the€particular€facts€ofÏeach€case.€€òòò òShuptrine€v.€Quinnó óóó,€597€S.W.2d€728,€730€(Tenn.1979).€Ï"[S]pecific€performance€is€regarded€as€appropriate€when€dealing€withÏcontracts€for€the€conveyance€of€real€property€because€real€property€isÍunique,€and€more€often€than€not,€an€award€of€damages€is€simply€not€anÏadequate€remedy."€€òòò òGRW€Enterprises,€Inc.€v.€Davisó óóó,€797€S.W.2d€606,Ï614€€€(Tenn.€Ct.€App.€1990).€€"[T]o€support€such€relief€the€contract€must€beÏclear,€complete€and€definite€in€all€its€essential€terms.€€The€Court€will€notÏmake€a€contract€for€the€parties€and€the€agreement€sought€to€be€enforcedÏspecifically€must€show€beyond€doubt€that€the€minds€of€the€parties€actuallyÏmet€and€that€they€themselves€made€the€agreement."€€òòò òParsons€v.€Halló óóó,€199ÏS.W.2d€99,€100€(Tenn.€1947)€(citing€Gibson's€Suits€in€Ch.,€1937€Ed.,€ðð€949).€€ÌÌà àIn€the€instant€case,€the€contract€concerned€the€conveyance€of€a€uniqueÏpiece€of€real€property€on€which€is€situated€a€commercial€doughnut€bakeryÏrun€by€Mr.€McGaugh.€€Furthermore,€the€contract's€essential€terms€wereÏclear€and€complete€leaving€no€doubt€that€the€parties'€minds€had€actually€metÏregarding€the€transfer€of€this€property.€€Thus,€specific€performance€of€thisÏcontract€is€the€adequate€remedy€for€Mr.€McGaugh.ÌÓ  ÓIII.€€€Negligent€Misrepresentation€or€Inducement€to€Breach€a€ContractÌÓ  Óà àThe€majority€of€Mr.€Galbreath's€appellate€argument€does€not€involveÏthe€defendant€Mr.€McGaugh€at€all.€€Rather,€Mr.€Galbreath€focusses€on€hisÏthird„party€complaint€against€the€Bank€and€its€attorney€Mr.€Lawless€in€whichÏhe€claims€Mr.€Lawless€gave€inaccurate€advice€which€caused€Mr.€McGaugh€toÏbreach€the€contract€between€himself€and€Mr.€Galbreath.€€It€is€undisputed€thatÏMr.€Lawless€advised€his€clients€that€the€title€of€the€Property€was€clouded€byÏan€option€to€purchase€the€Property€held€by€the€bankruptcy€trustee€for€theÏsub„lessor€Diversified.€€On€the€one€hand,€Mr.€Galbreath€has€challenged€theÏcompetency€of€Mr.€Lawless's€advice€by€arguing€that€the€option€to€purchaseÏthe€land€was€held€by€Mr.€McGaugh€as€the€sublessee€of€Diversified€because€aÏcovenant€conferring€an€option€to€purchase€runs€with€the€land€and€passes€withÍan€assignment€of€a€lease.€€€Still€at€other€times,€Mr.€Galbreath€has€expressedÏhis€opinion€that€the€option€as€held€by€Diversified,€which€was€in€the€amountÏof€$250,000€($70,000€more€than€the€McGaugh„Galbreath€contract€price)Ïonly€improved€Mr.€McGaugh's€position€as€he€stood€to€make€$70,000€shouldÏthe€bankruptcy€trustee€exercise€the€option.€€Regardless€of€these€veryÏdifferent€positions,€Mr.€Galbreath€has€consistently€asserted€that€by€advisingÏhis€client€that€Diversified€had€any€interest€in€the€property,€Mr.€LawlessÏcommitted€the€torts€of€negligent€misrepresentation€and€inducement€of€aÏbreach€of€contract.€€Moreover,€Mr.€Galbreath€claims€that€by€grantingÏsummary€judgment,€the€court€prevented€the€factual€issue€of€whether€Mr.ÏLawless€acted€negligently€from€being€determined€by€a€jury.ÌÌà àWe€find€that€the€trial€court€did€not€err€in€dismissing€Mr.€Galbreath'sÏclaims€against€Mr.€Lawless.€€Mr.€Lawless€has€thoroughly€briefed€his€positionÏin€support€of€the€competency€of€his€advice€regarding€the€cloud€on€the€title.€ÏFrom€the€record,€it€is€apparent€that€Mr.€Lawless€was€diligent€in€arriving€atÏhis€opinion.€€In€a€letter€to€Mr.€Galbreath's€attorney,€Mr.€€Stewart,€Mr.ÏLawless€stated€that€he€had€contacted€the€bankruptcy€trustee€who€opined€thatÏthe€lease€and€option€were€the€property€of€the€bankruptcy€estate.€€InÏdocuments€before€the€court,€Mr.€Lawless€cited€statutory€and€case€law€inÏsupport€of€his€opinion€that€the€mere€existence€of€the€option€coupled€with€theÏpending€bankruptcy€of€the€record€holder€of€that€option€created€a€cloud€onÏthe€title.€€òòò òSeeó óóó€11€U.S.C.€ðð€541(a)(1)€(1993)€(stating€that€a€bankruptcy€estateÏincludes€"all€legal€or€equitable€interests€of€the€debtor€in€property€as€of€theÏcommencement€of€the€case").€€Mr.€Galbreath€has€failed€to€present€aÏconvincing€argument€to€the€contrary.ÌÌà àHowever,€€regardless€of€the€proficiency€of€Mr.€Lawless's€counsel,€Mr.ÏGalbreath€fails€to€show€that€he€could€recover€against€Mr.€Lawless€underÏeither€theory€advanced€by€Mr.€Galbreath.€€First,€we€turn€to€the€tort€ofÏnegligent€misrepresentation€which€is€outlined€in€Section€552€of€theÏRestatement€(Second)€of€Torts€as€follows:ÌÓ#` Ü‚X˜ œ ’X#ÓÓÓà8 àà à(1)€One€who,€in€the€course€of€his€business,€profession€orÏemployment,€or€in€any€other€transaction€in€which€he€has€aÏpecuniary€interest,€supplies€false€information€for€the€guidance€ofÏothers€in€their€business€transactions,€is€subject€to€liability€forÏpecuniary€loss€caused€to€them€by€their€justifiable€reliance€uponÏthe€information,€if€he€fails€to€exercise€reasonable€care€orÏcompetence€in€obtaining€or€communicating€the€information.€€Ìà8 àà à(2)€Except€as€stated€in€Subsection€(3),€the€liability€stated€inÏSubsection€(1)€is€limited€to€loss€sufferedÌÓ&` Ü‚X˜ Äœx‘X&Óà8 àà8 à(a)€by€the€person€or€one€of€a€limited€group€of€personsÏfor€whose€benefit€and€guidance€he€intends€to€supplyÏthe€information€or€knows€that€the€recipient€intends€toÏsupply€it;€andÌà8 àà8 à(b)€through€reliance€upon€it€in€a€transaction€that€heÏintends€the€information€to€influence€or€knows€that€theÏrecipient€so€intends€or€in€a€substantially€similarÏtransaction.€€ÌÌÓ€Óòòò òRobinson€v.€Omeró óóó,€952€S.W.2d€423,€427€(Tenn.€1997)€(citing€RestatementÏ(Second)€of€Torts,€ðð€552€(1977)).€€There€need€not€be€contractual€privityÏbetween€the€plaintiff€and€defendant€(here€the€cross„plaintiff€and€cross„defendant)€as€long€as€the€following€criteria€are€met:ÌÓÓà8 à(1)€the€defendant€is€acting€in€the€course€of€his€business,Ïprofession,€or€employment,€or€in€a€transaction€in€which€he€has€aÏpecuniary€(as€opposed€to€gratuitous)€interest;€€andÌà8 à(2)€the€defendant€supplies€faulty€information€meant€to€guideÏothers€in€their€business€transactions;€€andÌà8 à(3)€the€defendant€fails€to€exercise€reasonable€care€in€obtainingÏor€communicating€the€information;€€andÌà8 à(4)€the€plaintiff€justifiably€relies€upon€the€information.Ì€€ÌÓ€Óòòò òId.€€ó óóó(citing€òòò òJohn€Martin€Co.€v.€Morse/Diesel,€Inc.ó óóó,€819€S.W.2d€428,Ï431€(Tenn.€1991)).€ÌÌà à€€The€problem€here€is€that€Mr.€Galbreath€is€not€the€right€plaintiff€for€aÏnegligent€misrepresentation€claim.€€Certainly,€Mr.€Lawless€was€acting€in€theÏcourse€of€his€profession€as€an€attorney€is€advising€the€Bank€and€thereforeÏMr.€McGaugh€about€the€clouded€title.€€Assuming€arguendo€that€this€adviceÏwas€"faulty€information"€and€that€Mr.€Lawless€failed€to€exercise€reasonableÏcare€in€obtaining€it,€it€was€not€given€for€Mr.€Galbreath's€benefit€nor€did€heÏdo€anything€in€reliance€on€this€advice.€€The€supreme€court€noted€that€whenÏcourts€have€allowed€non„clients€to€recover€under€the€theory€of€negligentÏmisrepresentation,€it€has€been€situations€where€"the€advice€was€given€for€theÏguidance€of€the€plaintiffs€in€the€course€of€the€real€estate€transaction€andÏreliance€upon€that€advice€was€justifiable€and€foreseeable."€€€òòò òRobinson€v.ÏOmeró óóó,€952€S.W.2d€423,€427€(Tenn.€1997)€(citing€òòò òCollins€v.€Binkleyó óóó,€750ÏS.W.2d€737€(Tenn.1988);€€òòò òStinson€v.€Brandó óóó,€738€S.W.2d€186Ï(Tenn.1987)).€€While€Mr.€Galbreath€may€have€been€affected,€he€did€notÏ"justifiably€rel[y]€upon€the€information"€and€therefore€cannot€recover€againstÏMr.€Lawless€under€a€theory€of€negligent€misrepresentation.ÌÌà àWe€next€turn€to€evaluate€Mr.€Lawless's€liability€under€a€theory€ofÏ"Inducement€of€Breach€of€Contract"€which€is€outlined€in€Tennessee€CodeÏAnnotated€section€47„50„109€as€follows:€ÌÓÓà8 àIt€is€unlawful€for€any€person,€by€inducement,€persuasion,Ïmisrepresentation,€or€other€means,€to€induce€or€procure€theÏbreach€or€violation,€refusal€or€failure€to€perform€any€lawfulÏcontract€by€any€party€thereto;€€and,€in€every€case€where€aÏbreach€or€violation€of€such€contract€is€so€procured,€the€personÏso€procuring€or€inducing€the€same€shall€be€liable€in€treble€theÍamount€of€damages€resulting€from€or€incident€to€the€breach€ofÏthe€contract.€€The€party€injured€by€such€breach€may€bring€suitÏfor€the€breach€and€for€such€damages.ÌÌÓ€ÓThis€court€has€stated€that€"[b]efore€recovery€can€be€had€under€T.C.A.€Sec.Ï47„50„109,€seven€elements€must€be€proved:ÌÓÓà à1.€There€must€be€a€legal€contract.Ìà à2.€The€wrongdoer€must€have€knowledge€of€the€existence€of€theÏcontract.Ìà0 à3.€There€must€be€an€intention€to€induce€its€breach.Ìà à4.€The€wrongdoer€must€have€acted€maliciously.Ìà à5.€There€must€be€a€breach€of€the€contract.Ìà à6.€The€act€complained€of€must€be€the€proximate€cause€of€the€breach€ofÏthe€contract.Ìà à7.€There€must€have€been€damages€resulting€from€the€breach€of€theÏcontract."ÌÌÓ€Óòòò òHodges€v.€Reidó óóó,€836€S.W.2d€120,€124€(Tenn.€Ct.€App.€1992)€(citingÏòòò òDynamic€Motel€Management,€Inc.€v.€Erwinó óóó,€528€S.W.2d€819,€822Ï(Tenn.€Ct.€App.1975)).€€Several€of€these€criteria€are€missing€in€this€case.€ÏMost€significantly,€as€stated€above,€we€find€that€Mr.€McGaugh€did€not€breachÏthe€contract.€€He€delayed€performance€until€title€was€cleared€within€aÏreasonable€time€at€which€time€he€attempted€to€perform€under€the€contract.€ÏIn€addition,€there€has€been€no€allegation€that€Mr.€Lawless€acted€maliciouslyÏor€with€the€intent€to€induce€the€contract's€breach€but€only€that€he€wasÏcarrying€out€his€duty€to€research€title€as€hired€by€the€Bank€to€do.€€Indeed,ÏMr.€Galbreath€states€in€his€brief€that€"[i]t€is€not€charged€that€LawlessÏintentionally€harmed€anyone.€€He€simply€made€a€mistake,€undoubtedly€in€aÏmisguided€effort€to€help€his€client."€€In€addition,€in€a€Motion€to€ReconsiderÏfiled€June€28,€1996,€Mr.€Galbreath€asserted€that€he€had€never€"intimated€.€.€.Ïthat€Mr.€Thomas€Lawless€was€in€a€manner€less€than€a€competent,€respectedÏattorney,"€but€rather€that€he€had€made€a€mistake.€€In€light€of€Mr.€Galbreath'sÍfailure€to€prove€the€elements€under€this€cause€of€action,€we€find€that€theÏcourt€did€not€err€in€dismissing€the€third€party€complaint€against€Mr.ÏLawless.ÌÌÓ  ÓIV.€€Rule€11€SanctionsÌÓ  Óà àFinally,€we€address€the€trial€court's€decision€to€impose€Rule€11Ïsanctions€on€Mr.€Galbreath€and€his€wife€on€account€of€their€claims€againstÏMr.€Lawless.€€In€its€August€1,€1996€Order,€the€court€made€an€initial€findingÏthat€these€claims€"were€not€founded€in€Law€or€in€Fact€and€are€without€merit,Ïthat€there€was€and€is€no€basis€existing€for€the€claims€against€Lawless€and€as€aÏconsequence€the€Court€finds€that€the€claims€against€Lawless€are€frivolous€andÏbrought€in€violation€of€Rule€11."€€At€Mr.€Galbreath's€request,€the€court€heldÏa€separate€evidentiary€hearing€pursuant€to€Rule€11.€€Following€the€hearing,Ïan€order€was€entered€on€October€28,€1996€in€which€the€court€found€that€Mr.ÏLawless€had€carried€his€burden€of€showing€by€clear€and€convincing€proofÏthat€Galbreath€had€violated€Rule€11.€€The€court€then€reinstated€its€"priorÏsanction€awarded€against€Charles€F.€Galbreath€and€Joyce€L.€Galbreath€ofÏ$2,500.00€to€deter€the€wrongful€conduct€of€Galbreath€in€the€filing€andÏcontinued€prosecution€of€the€frivolous€lawsuit€and€claims€against€Lawless€andÏFirst€American."€ÌÌà àIn€his€brief,€Mr.€Galbreath€claims€that€even€if€there€is€no€basis€for€hisÏtort€action,€it€can€not€be€considered€frivolous.€€Mr.€Galbreath€claims€thatÏafter€researching€the€applicable€law,€he€believed€that€Lawless'sÏrepresentation€that€the€title€was€defective€was€the€negligent€act€that€caused€theÏbreach€of€contract€by€Mr.€McGaugh.€€€Mr.€Galbreath€claims€that€the€courtÏfailed€to€give€reasons€for€its€conclusions€regarding€Rule€11€despite€theÍexplicit€language€of€Rule€11.03€which€provides€that€"[w]hen€imposingÏsanctions,€the€court€shall€describe€the€conduct€determined€to€constitute€aÏviolation€of€this€rule€and€explain€the€basis€for€the€sanction€imposed."€€Tenn.ÏR.€Civ.€P.€11.03(3).ÌÌà àThe€Tennessee€Supreme€Court€has€stated€that€"[t]he€certification€whichÏresults€from€the€attorney's€signature€on€a€motion,€pleading,€or€otherÏdocument€is€directed€at€the€three€substantive€prongs€of€Rule€11:€€its€factualÏbasis,€its€legal€basis,€and€its€legitimate€purpose.€€.€.€.€€A€signature€signifies€toÏthe€Court€that€the€signer€has€read€the€pleading,€motion,€or€other€paper,€hasÏconducted€a€reasonable€inquiry€into€the€facts€and€the€law,€and€is€satisfied€thatÏthe€document€is€well„grounded€in€both,€and€is€acting€without€any€improperÏmotive."€€òòò òAndrews€v.€Bibleó óóó,€812€S.W.2d€284,€287€(Tenn.€1991).€€"TheÏtest€to€be€applied€in€deciding€whether€an€attorney's€conduct€is€sanctionable,€isÏone€of€objective€reasonableness€under€all€the€circumstances€.€.€.€and€theÏreasonableness€of€the€attorney's€belief€must€be€assessed€in€light€of€theÏcircumstances€existing€at€the€time€the€document€in€question€was€signed."€€òòò òId.ó óóóÏat€288.€€Because€such€a€determination€involves€"'fact„intensive,€close€calls'€.€.Ï.€appellate€courts€review€Rule€11€under€the€'abuse€of€discretion'€andÏ'deferential'€standard."€€òòò òKrug€v.€Krugó óóó,€838€S.W.2d€197,€205€(Tenn.€Ct.ÏApp.€1992)€(citations€omitted).€ÌÌà àAs€we€held€above,€Mr.€Galbreath€failed€to€prove€his€claims€forÏnegligent€misrepresentation€and€inducement€to€breach€a€contract€against€Mr.ÏLawless€and€therefore,€the€lower€court€was€correct€in€dismissing€theseÏclaims.€€The€question€for€the€trial€court€in€finding€a€violation€of€Rule€11€wasÏwhether€or€not€Mr.€Galbreath's€beliefs€concerning€these€causes€of€actionÍwere€reasonable€in€light€of€the€circumstances€existing€at€the€time€that€heÏsigned€documents€making€such€allegations.€€For€the€following€reasons,€weÏhold€that€Mr.€Galbreath's€beliefs€were€not€reasonable€and€that€the€court€didÏnot€abuse€its€discretion€in€finding€that€Mr.€Galbreath's€claims€against€Mr.ÏLawless€were€frivolous€and€merited€Rule€11€sanctions.ÌÌà àMr.€Lawless€and€the€Bank€were€first€brought€into€this€lawsuit€as€crossÏdefendants€by€Mr.€Galbreath€in€his€"Answer€and€Counter„Complaint"€filedÏMay€15,€1996.€€In€that€document,€Mr.€Galbreath€alleged€the€Bank,€actingÏthrough€its€agent€Mr.€Lawless,€refused€to€approve€Mr.€McGaugh's€loan€inÏlight€of€Diversified's€option€to€purchase€the€land€and€thereby€induced€Mr.ÏMcGaugh€to€breach€the€contract.€€€However,€there€is€no€reference€to€the€lawÏwhich€supports€Mr.€Galbreath's€cross„claims€other€than€that€found€in€a€JuneÏ28,€1996€"Motion€to€Reconsider."€€In€this€document,€Mr.€Galbreath€simplyÏquotes€the€definition€of€"Negligent€Misrepresentation"€as€articulated€in€theÏRestatement€(2d)€of€Torts.€€Mr.€Galbreath€never€cites€any€law€related€to€theÏissue€of€contractual€privity€in€a€negligent€misrepresentation€case.€€Nor€doesÏhe€cite€any€law€on€"Inducement€of€Breach€of€Contract."€€Finally,€in€theÏdocuments€in€the€record€where€Mr.€Galbreath's€third„party€claims€areÏmentioned,€there€is€very€little€analyses€of€the€facts€of€this€particular€case€toÏthe€law.€€Rather,€Mr.€Galbreath's€third€party€claims€ÌÌconsist€primarily€of€unsupported€allegations€that€Mr.€Lawless€"induced€aÏbreach€of€contract"€and€made€"negligent€misrepresentations."€€Based€uponÏthis€record,€we€cannot€say€that€Mr.€Galbreath's€conduct€was€objectivelyÏreasonable.ÌÓ  ÓV.€€ConclusionÌÓ  Óà àAfter€a€careful€review€of€the€record€before€us,€we€find€that€the€trialÏcourt's€judgment€should€be€affirmed.€€As€the€court€found,€Joyce€GalbreathÏpreserved€her€right€to€appeal€the€lower€court€only€in€its€finding€involvingÏthe€breach€of€contract.€€Regarding€this€issue,€we€find€that€the€court€belowÏwas€correct€in€granting€specific€performance€to€the€plaintiff,€Mr.€McGaugh.€ÏFinally,€we€agree€with€the€lower€court€that€there€was€no€merit€to€Mr.ÏGalbreath's€third„party€claims€against€the€Bank€and€Mr.€Lawless.€€Not€onlyÏwere€these€claims€without€merit,€they€did€not€have€a€sound€legal€or€factualÏbasis.€€Consequently,€the€court€did€not€err€in€imposing€Rule€11€sanctions€onÏMr.€Galbreath€for€his€conduct.€€In€light€of€our€findings,€the€decision€of€theÏtrial€court€is€wholly€affirmed€and€the€costs€of€appeal€are€taxed€to€theÏdefendant€Mr.€Galbreath.ÌÌÌÓÓà àà àà àà à_______________________________Ìà àà àà àà àWALTER€W.€BUSSART,Ìà àà àà àà àSPECIAL€JUDGEÌÌÌÌCONCUR:ÌÌÌ__________________________________ÌHENRY€F.€TODD,€PRESIDING€JUDGEÌÌÌ__________________________________ÌWILLIAM€C.€KOCH,€JR.,€JUDGE€€€à àÌà8 àà à