WPCX s[]ַVBfY'k'n"WP*ym\o iniWNM4enjF-PIT>tцmJ2$lv%w3ֱ6} |gIq6-͒l8{B,i/ nL?M衔 [iY4vW|gH \/9'ηp\Fh0Q k?05L`{P{aW˳<T'Z$]k˒ݍydv=g~l8Xf Ni[\2S<`YJEIB ,DxU:ْUw](,ZH;Pw7Lvy 8w'Od\=-2s( =Cc;>!}30o&Ve.}GN)kƦy*x-ȗvJ]jxMƐ\":) % j 0P UN 1& ^ w z 74 , m.E  1u]N 72#E 0c 72,^^`f  0D/UN! 0*" # 10# 72## %%<%%%%% 0+b,, 0, 0- 0. 0/ 00 0{1 0Z2 063 04 04 05 06 07 0U8 0%9 09 0: 0; 0{< 0V= 0.> 0? 0? 0@ 0pA 009B 0<iB 0B 0>cC 0vC 0`D 0`wD 0`D 0`7E 0E 0`F 08F 0G BG 02 H 0;H D3H D-I 0K?I 0I ASJJ 0K 0DCL AL 0:2M 0YlM 0_M 0 $N 0j.O 0P B*R D/FR 0uR D/S 0(T 06T 0,U 0:4V 0^nV 0<V 0NWU6VWU>WU*WWWWWWWWWWWWWWWWWWWWWWWWWW 0W XWHITE DRAFT ONE  '  0 .   (`$.8dd8    ("  Z6Times New Roman Regular(5hCEKQW]cioAutoList1I.I.I.I.I.I.I.I.je+  C:\PROGRA~1\COREL\WORDPE~1\TEMPLATE\CUSTOM~1\REVISE~1.WPTC:\Program Files\Corel\WordPerfect Office 2000\Template\Custom WP Templates\revised standard opinion.wptuV)4' (%1!cH8q3|x ULevel 1Level 2Level 3Level 4Level 5Level 1Level 2Level 3Level 4Level 5Level 1Level 2Level 3Level 4Level 5Level 1Level 2Level 3Level 4Level 53#37=CIQYag1.a.i.(1)(a)(i)1)a)i)HP LaserJet 4050 Seri0(;3$2#  0  .3  0  I.  V Rb$      5   dX X  _In Stojanovskiv.StroblandManoogian,P.C., 783F.Supp.319(E.D.Mich.1992)thecourtfoundthatthe  caselawshowedthatanattorney"whoengagesincollectionactivitiesmorethanahandfuloftimesperyearmustcomply v withthe[Act]." Crossleyv.Lieberman ,868F.2d566,569(3dCir.1989)(quotingR.Hobbs,AttorneysMustNow : ComplyWithFairDebtCollectionLaw,XPa.J.L.Rptr.,No.46,3(Nov.21,1987)).Itwasthevolumeoftheattorney's P debtcollectioneffortsthatwasdispositive,notthepercentagesucheffortsamountedtointheattorney'spractice. Cacace  v.Lucas ,775F.Supp.502,504(D.Conn.1990); InreLittles ,90B.R.669,676(Bankr.E.D.Pa.1988),aff'dasmodified  subnom., Crossleyv.Lieberman ,90B.R.682(E.D.Pa.1988),aff'd,868F.2d566(3dCir.1989);M.Sweig,Guidelines P  forConsumerDebtCollectionbyAttorneysUnderthe1986AmendmenttotheFairDebtCollectionPracticesAct,21  f NewEng.L.Rev.697,699(1987);cf.Mertesv.Devitt,734F.Supp.872,874(W.D.Wis.1990)(stating% " %"mthattwocollection  * mattersperyearamountingtolessthan1%oftheattorney'spracticewasnot"regular"debtcollection).    S b   Rb$      2   dX X  _Theunderlyingprayerofreliefsoughtinthatsuitwasthatthedeedconveyingthepropertybedeclarednull  andvoid.ISSUES(#$  0    Rb$      3   dX X  _Mr._Harber_ԀfiledanaffidavitandamotiontowithdrawascounselforMr.WhiteonNovember18,1998,  becauseofaconflictofinterestinwhichMr.WhiteaverredthatMr._Harber_Ԁdidnothavepermissiontofilethisaction t forMr.White.WehavenotbeenabletolocateapleadingintherecordbeforeusthatMr.Whitesigned.Exceptfor 8 anaffidavitbyMr.WhitewhichwasstampedfiledonSeptember21,1998,allweresignedbyMr._Harber_Ԁonbehalfof L Mr.White.Wedonotknowtowhattheaffidavitwasattached.asanexhibit(1).Subsequently,inFebruary1999,other  counselforMr.White,StewartM.Craneof_Loudon_,filedanaffidavitandamotionrequestingpermissiontowithdraw  aslegalcounselforMr.White.OnMarch4,1999,anagreedorderwasenteredpermittingthewithdrawalofMr.Crane.(9 Z6Times New Roman Regular2J+M 0_level1  X 2( ` hp x 223  ..  5+ ` hp x 5  SDU_218 CSY_ekqw}Numbers 2Numbers1.1.1.1.1.1.1.1.#1.  Rb$      1   dX X  _AccordingtotheitemizedlistingofMr.Nolan'sattorney'sfees,hischargescommencedonAugust8,1997,  whenMr.Nolanmetwithhisclientforonehalfhourandreviewedthefile.Mr.Nolanthenfurtherreviewedthefileand t preparedthenoticeofappearance.DISCUSSION 2 Rb$      4   dX X  _ԀRule11.03(a)describestheconditionsrelatingtotheimpositionofsanctions.    8  (2)NatureofSanction;Limitations.Asanctionimposedforviolationofthisruleshallbelimited t towhatissufficienttodeterrepetitionofsuchconductorcomparableconductbyotherssimilarly 8 situated.Subjecttothelimitationsinsubparagraphs(a)and(b),thesanctionmayconsistof,or L include,directivesof_nonmonetary_Ԁnature,anordertopayapenaltyintocourt,or,ifimposedon  motionandwarrantedforeffectivedeterrence,andorderdirectingpaymenttothemovantofsome  orallofthereasonableattorneys'feesandotherexpensesincurredasadirectresultofthe H  violation. \   8  0`   (a)Monetarysanctionsmaynotbeawardedagainstarepresentedpartyforaviolationof   subdivision11.02(2).  ` `  Ѐ8  0`   (b)Monetarysanctionsmaynotbeawardedonthecourt'sinitiativeunlessthecourtissues X   itsordertoshowcausebeforeavoluntarydismissalorsettlementoftheclaimsmadeby  l  oragainstthepartywhichis,orwhoseattorneysare,tobesanctioned. 0 ` `  Ѐ2G+M 0_level2   /%` ` hp x /23  ..  5+ ` hp x 5  - -2D+M 0_level3   ," hp x ,23  ..  5+ ` hp x 5  2A+M 0_level4  ` ) hp x )23  ..  5+ ` hp x 5  2>+M 0_level5   &hhp x &23  ..  5+ ` hp x 5  2;+M 0_level6   #p x #23  ..  5+ ` hp x 5  28+M 0_level7  h  p x 23  ..  5+ ` hp x 5  25+M 0_level8   pp x 23  ..  5+ ` hp x 5  22+M 0_level9    x 23  ..  5+ ` hp x 5  2JM 0_levsl1  X 2( ` hp x 223  Ԁ  5+ ` hp x 5  2GM 0_levsl2   /%` ` hp x /23  Ԁ  5+ ` hp x 5  2DM 0_levsl3   ," hp x ,23  Ԁ  5+ ` hp x 5  2AM 0_levsl4  ` ) hp x )23  Ԁ  5+ ` hp x 5  2>M 0_levsl5   &hhp x &23  Ԁ  5+ ` hp x 5  2;M 0_levsl6   #p x #23  Ԁ  5+ ` hp x 5  28M 0_levsl7  h  p x 23  Ԁ  5+ ` hp x 5  25M 0_levsl8   pp x 23  Ԁ  5+ ` hp x 5  22M 0_levsl9    x 23  Ԁ  5+ ` hp x 5  2JM 0_levnl1  X 2( ` hp x 223   5+ ` hp x 5  2GM 0_levnl2   /%` ` hp x /23   5+ ` hp x 5  2DM 0_levnl3   ," hp x ,23   5+ ` hp x 5  2AM 0_levnl4  ` ) hp x )23   5+ ` hp x 5  2>M 0_levnl5   &hhp x &23   5+ ` hp x 5  2;M 0_levnl6   #p x #23   5+ ` hp x 5  28M 0_levnl7  h  p x 23   5+ ` hp x 5  25M 0_levnl8   pp x 23   5+ ` hp x 5  22M 0_levnl9    x 23   5+ ` hp x 5  0.Normal<:Definition T<AA:Definition L , 5+ ` hp x 5  5+ ` hp x 586Definition(''&H1   XXX   (&H2 XXX (&H3 XXX (&H4 XXX XXX(&H5 XXX (|G2b$ !.8dd8         0   dX X(&H6 XXX 20Address8MM6Blockquote , , 5+ ` hp x 5   5+ ` hp x 5 d,*CITE(|36U$ !.8dd8     VVVV'dxd)!dxdx( $ Figure  1  ,dl*CODEKs<6X9`(Courier NewKXXXSt\  `&Times New RomanS^_X`YE<<CLevel 1Level 2Level 3Level 4Level 5(|36U$ !.8dd8     ($$   1  X[Z&OLE 2.0 Box <=8C HKKKK42Emphasis64Hyperlink    <:FollowedHype    4go2Keyboard Ks<6X9`(Courier NewKXXXSt\  `&Times New RomanS <:Preformatted/%  ,Kk %#/Ks<6X9`(Courier NewKXXXSt\  `&Times New RomanS/%  ,Kk %#/<:zBottom of 7i(X7  ?u%2A`Arial?  XXXSt\  `&Times New RomanS7Z(X7&0 d dh)1dxd<:zTop of For7k(X7  ?u%2A`Arial?  XXXSt\  `&Times New RomanS7Z(X7h)2dxd0KS.SampleKs<6X9`(Courier NewKSt\  `&Times New RomanS0.Strong 8dl6TypewriterKs<6X9`(Courier NewKXXXSt\  `&Times New RomanS42Variable: 8HTML MarkupB      2 0CommentB  (O$<6X9`(Courier New\  `&Times New Roman%2A`Arial(|36U$ !.8dd8     !.8dd8     _   X X8xXXdd8  @  / INTHECOURTOFAPPEALSOFTENNESSEE  @WW$ATKNOXVILLE#  / #Ԉ &   May7,2001Session L  XxX  # X Xx#ROGERE.WHITEv.K.DAVIDMYERS,etal. XxX   J @@ AppealfromtheChanceryCourtforUnionCounty  J @@No.3190BillyJoeWhite,Chancellor  6 FILEDOCTOBER31,_2001_    @@*AV) ` dE<` A   @@TTNo.E199902642COAR3CV   AV) ` dE<|` A }       ThePlaintiff,RogerE.White,filedsuitseekingdamages,attorney'sfees,andcourtcostsfor x  multipleviolationsoftheFairDebtCollectionPracticesActagainsttwoattorneys.DefendantK. d DavidMyerswasvoluntarilydismissedwithprejudicefromthesuit.UnionCountyChanceryCourt P grantedamotionforsummaryjudgmentonbehalfofDefendantAppellee,RogerD.Hyman.The < courtalsograntedMr.Hyman'smotionforsanctionsagainstMr.Whiteandhisattorney,J.Philip (x _Harber_.Mr.Whitedidnotappeal.Mr._Harber_Ԁfiledanoticeofappealastotheawardofsanctions d andalsotheamountofthesanctions.Weaffirmthedecisionofthetrialcourt. P  Tenn.R.App.P.3,AppealasofRight# X Xxj# XxX ;JudgmentoftheChanceryCourtAffirmedand ( Remanded# X Xxw# XxX Ԁ     #  Xx # XxX. HoustonM.Goddard,P.J.,deliveredtheopinionofthecourt,inwhichCharlesD.Susano,Jr.,  andD.MichaelSwiney,JJ.,joined.  DavidA.Stuart,Clinton,Tennessee,filedabrieffortheAppellant,J.Philip_Harber_,butthereafter ` withdrewascounsel.J.Philip_Harber_ԀfiledtheReplyBriefandarguedthecaseProSe L  J.BrentNolan,Knoxville,Tennessee,fortheAppellee,RogerD.Hyman $"t!  @66'OPINION # X Xxo #Ԉ #L#  XxX   ThisisanappealfromordersofthetrialcourtgrantingDefendantAppelleeRogerD. %$!% Hyman'smotionforsanctionspursuanttoRule11oftheTennesseeRulesofCivilProcedureand &"& settingtheamountofattorney'sfeestobeawardedassanctions. '"' @ ProceedingsinthisCase  )$)   ThespringfromwhichthisactionflowedwasthatClydeLeeSweetandhiswifehelda \+&+ promissorynotefromPlaintiffRogerE.Whitesecuredwithaparcelofrealpropertylocatedin H,', UnionCounty,Tennessee.DefendantK.DavidMyers,attorneyfortheSweets,sentalettertoMr. 4-(- WhiteonMarch10,1997,advisingthatthesemiannualinterestpaymentonapromissorynotedated  August2,1996intheprincipalsumof$40,000with7%annualinterestwasoverdueandthatthe  Sweetshaddeclaredtheentireprincipalwithinterestdueandpayable.OnApril1,1997,Mr.Myers  sentanotherlettertoMr.WhiteadvisingthattheSweetsrequestedMr.Myers,astrustee,tobegin t foreclosureproceedings.Mr.MyersenclosedacopyoftheTrustee'sNoticeofSaleadvertisingthe ` propertytobesoldonMay1,1997.AppellantJ.PhilipHarber,onbehalfofMr.White,sentaletter L  datedApril28,1997,toMr.MyersadvisingthatMr.HarberwascounselofrecordforMr.White 8  intheforeclosureproceedingsandinthecaseofWhitev.SweetsandMyers.Mr.Harberalso $ t advisedthatAttorneyJ.MichaelClementhadbeenengagedbyMr.Whitetofilesuittostopthe  ` foreclosuresalescheduledforMay1,1997,andtoseekdamagesagainsttheSweetsforbreachof  L  contract,breachofwarranty,fraud,negligenceandothermiscellaneousviolationsofTennesseelaw,  8  aswellasaclaimagainstMr.MyersforviolationsoftheFairDebtCollectionPracticesAct,as $  codifiedat15U.S.C.1692,etseq.     TherecordrevealsthatMr.Hymanhadnoassociationwithanyoftheeventslistedinthe   aboveparagraph.OnMay9,1997,hefiledananswerandcounterclaimonbehalfoftheSweets   inthesuittostoptheforeclosuresaleinwhichMr.Clementwascounselofrecord.Thedocument p wasserveduponMr.Clementascounselofrecord. \   OnMay15,1997,sixdaysafterMr.Hymanfiledananswerintheforeclosuresuit,Mr. 4 HarberfiledthispresentsuitinUnionCountyChanceryCourtonbehalfofMr.White,seeking  p damages,attorney'sfee,andcourtcostsallegingmultipleviolationsoftheFairDebtCollection  \ PracticesAct,15U.S.C.1692g(a)(1),1962e(11),1692g(a)(4),againstMr.MyersandMr.Hyman. H Mr.WhiteaverredthatbothDefendantsweredebtcollectorsasdefinedin15U.S.C.1692a(6).On 4 May27,1997,Mr.HarberfiledanamendmenttothecomplaintaverringMr.MyersandMr.Hyman   wereattemptingtocollectadebtasdefinedin15U.S.C.1692a(5).     OnJune5,1997,Mr.Hymanfiledananswertothecomplaint,denyingtheallegations,and  requestingthecourttodismissthecomplaintagainsthim.InhisanswerMr.Hymanassertedthat  hehadfiledanamendedcounterclaimonJune2,1997,beforeanyresponsivepleadingtothe l originalcounterclaimwasfiledbyMr.White.Adaylater,Mr.HymanfiledRequestsfor X  Admissionandalsoasetofinterrogatories.Therewerenumerousadditionalfilingsinthismatter. D!   OnJune19,1997,theTrialCourtheldahearingonthevariousmotionsandenteredanorder #l! onJune27,1997,settingaschedulinganddiscoveryconference. $X"   Thirtysixdaysafterthecomplaintinthiscasewasfiled,anorderofvoluntarydismissalwith %0!$ prejudice,astoonlyMr.Myers,wasenteredonJune20,1997. &"%   Mr.Hymanfiledamotiontocompelanswerstotheinterrogatoriesandrequestsfor (#' productionofdocuments,inadditiontoamotionforsummaryjudgmentwithhisownaffidavit )$( againstMr.WhiteonJuly11,1997. |*%)  h+&* _  OnJuly24,1997,ahearingwasheldandthecourtorderedthatMr.Whiteanswerthe  interrogatoriesandrequestsforproductionofdocuments.Shortlythereafter,Mr.Hymanfileda  noticeoftakingofthedepositionofMr.White.Mr.Whitefiledresponsestointerrogatoriesand  requestsforproductionofdocumentsalongwitharesponsetorequestsforadmissiononJuly31, t 1997.Mr.WhitealsofiledanoticeofthetakingofdepositionofMr.Hyman. `   OnAugust2,1997,Mr.Hymanfiledanothermotionforprotectiveorderandamotionto 8  strike.IncludedinthemotiontostrikewasarequestforsanctionsunderRule11.03ofthe $ t TennesseeRulesofCivilProcedure.  `   Mr.Hymanwasprose,untilAugust26,1997,whenJ.BrentNolanenteredhisnoticeof  8  appearanceonbehalfofMr.Hyman.% #  1      ׀ $    OnSeptember8,1997,Mr.Whitefiledanoticesettingahearingonhismotiontodismiss.   HealsofiledaresponsetoMr.Hyman'smotionforsummaryjudgment.Insupportofhisresponse   heattachedacopyofthecomplaintinPearlHensleyv.JohnEarlHensley,Jr.,andhiswife,Debra   SueBelitzHensley,KnoxCountyChanceryCourtDocketNumber1289681, #  2      ׀alongwithanaffidavit p ofanattorney,CharlesTerryWebber,statingthatthecomplaintwasanattempttocollectadebtas \ definedin15U.S.C.1692a(5).HefurtherallegedthatthiscasedemonstratedthatMr.Hymanwas H adebtcollectorunder15U.S.C.1692a(6). 4   OnFebruary18,1998,Mr.Hymanfiledanothermotionforsummaryjudgmentalongwith  \ statementofmaterialfactsnotindisputeinsupportofhismotionforsummaryjudgment,anotice H ofhearingonhismotionforsummaryjudgmentandanoticeofhearingonhismotionforRule11 4 sanctions.OnMarch12,1998,Mr.HymanfiledanothermotionforsanctionspursuanttoRule11   oftheTennesseeRulesofCivilProcedure.Shortlythereafter,Mr.Whitefiledasupplemental   responsetothemotiontoamend,aresponsetothesecondmotionforsummaryjudgment,anda  responsetothemotionforsanctions.    AhearingwasheldonthevariousmotionsonSeptember21,1998.Byorderenteredon l December12,1998,thetrialcourtgrantedMr.Hyman'smotionforsummaryjudgmentanddenied X  Mr.White'smotiontodismissandhisvariousothermotionsregardingdiscovery.Indoingso,the D! TrialCourtmadethefollowingfindings: 0"   #( 938   ` 1.TheDefendantRogerD.Hymanisnotadebtcollectorasdefinedbythe $X" FairDebtCollectionsPracticesAct.RogerHymanhasfiledanaffidavitstatingthat $D # hedoesnotcollectconsumerdebtsaspartofhislegalpractice.Thisaffidavitwas %0!$ __unrebutted_Ԁintheevidenceproducedatthehearinginthiscause.Mr.Whites  Attorney,Phillip_Harber_,acknowledgedinopencourtthathehadreviewedcourt  filesinbothAndersonandKnoxCountiesanddidnotfindcasesthatwouldindicate  Mr.Hymancollectsconsumerdebtsasaregularpartofhispractice.Thiswould t providefurthersupportthatMr.Hymanwascorrectintheassertionscontainedinhis ` affidavit.L    8   ` 2.TherewasnocommunicationbetweenMr.HymanandMr.White.The 8  casearisesoutofacounterclaimtoacceleratethetermsandconditionsofa $ t promissorynote.ThecounterclaimwasserveduponMr.White'sattorneyofrecord,  ` MichaelClement.Thiscourtisoftheopinionthatfilingalegalpleadingandserving  L  ituponMr.White'scounselofrecord,isnotacommunicationasdefinedbytheFair  8  DebtCollectionsPracticesAct.$    8   ` 3.ThelawsuitthathasbeenfiledagainsttheDefendant/CounterPlaintiff   hasnobasisinlaworfact.       `     h      p       Asecondorder,alsoenteredonDecember12,1998,grantedMr.Hyman'smotionfor   sanctionspursuanttoRule11oftheTennesseeRuleofCivilProcedureRule.TheTrialCourtfound p thatthelawsuithadnobasisinlaworfactandwasfrivoloussuchastowarrantanawardof \ sanctions,attorney'sfees,againstMr.WhiteandMr._Harber_,jointlyandseverally.Mr.Hymanwas H tofileanaffidavitoftimeandexpensesincurredindefendingthefrivolouslawsuit.TheChancellor 4 found:  p 8   ` 1.TheDefendantRogerD.Hymanisnotadebtcollectorasdefinedbythe H FairDebtCollectionsPracticesAct.RogerHymanhasfiledanaffidavitstatingthat 4 hedoesnotcollectconsumerdebtsaspartofhislegalpractice.Thisaffidavitwas   _unrebutted_Ԁintheevidenceproducedatthehearinginthiscause.Plaintiff'sAttorney,   Phillip_Harber_,acknowledgedinopencourtthathehadreviewedcourtfilesinboth  AndersonandKnoxCountiesanddidnotfindcasesthatwouldindicateMr.Hyman  collectsconsumerdebtsasaregularpartofhispractice.Thiswouldprovidefurther  supportthatMr.Hymanwascorrectintheassertionscontainedinhisaffidavit.Mr. l _Harber_ԀfiledthislawsuitdespitehavingknowledgethatMr.Hymanwasnotadebt X  collectorasdefinedbytheFairDebtCollectionsPracticesAct.Suchactionsarenot D! condonedbythiscourtandsanctionsagainsthimandhisclientarewarranted.0"    8   ` 2.TherewasnocommunicationbetweenMr.HymanandMr.White.The #l! casearisesoutofacounterclaimtoacceleratethetermsandconditionsofa $X" promissorynote.ThecounterclaimwasserveduponMr.White'sattorneyofrecord, $D # MichaelClement.Thiscourtisoftheopinionthatfilingalegalpleadingandserving %0!$ ituponPlaintiff'scounselofrecord,isnotacommunicationasdefinedbytheFair &"% DebtCollectionsPracticesAct.'#&   8   ` 3.ThelawsuitthathasbeenfiledagainsttheDefendant/CounterPlaintiff (#' hasnobasisinlaworfactandsanctionsareappropriateagainstbothMr.Whiteand )$( hiscounselofrecord,Phillip_Harber_.|*%)    h+&*   OnJanuary11,1999,Mr.Nolanfiledanitemizedandverifiedaccountofhisfeesfor25.75  hoursat$125.00perhourforatotalof$3,812.50.OnFebruary18,1999,Mr._Harber_Ԁfileda  responsetotheaccounting.IncludedinhisresponsewerethreeletterssentbyMr.Nolaninaneffort  tosettlethecase. t   Onedaybeforethehearing,whichwasheldonJuly22,1999,Mr.Nolanfileda L  supplementeditemizedandverifiedaccountofhisfeesof$537.50(4.3hours).Additionally,he 8  statedthathewouldprovideorallyatthehearingthetimespentinpreparingforthehearingand $ t attendanceatthehearing.  `   ByorderenteredonJuly22,1999,theChancellorawardedsanctionsof$4,000inattorney's  8  feesagainstMr.WhiteandMr._Harber_,jointlyandseverely,findingthattheamountrepresentedfees $  thatwerereasonableandnecessaryindefendingthefrivolouslitigation.CostsweretaxedtoMr.   WhiteandMr._Harber_.OnthesamedayMr.Hymanfiledanoticeofvoluntarydismissalofhis   counterclaimandtheTrialCourtenteredanorderdismissingit.     OnAugust20,1999,Mr._Harber_,prose,onhisownbehalfonly,filedaNoticeofAppeal p fromthe"'OrderGrantingDefendant/CounterPlaintiffRogerHyman'sMotionforSanctions \ PursuanttoTennesseeRuleOfCivilProcedure11'andfromtheorderenteredonJuly22,1999, H settinganamountofattorneyfees."Mr.Whitedidnotfileanoticeofappealastoeitherthegranting 4 ofthesummaryjudgment,theawardofsanctionsortheamountofthesanctions._ #  3      _Ԁ  p   OnNovember18,1999,Mr._Harber_ԀfiledastatementoftheproceedingsheldonSeptember H 21,1998.Mr.HymanfiledanobjectiontothestatementofproceedingsonDecember6,1999.The 4 trialcourtenteredanordersustainingtheobjectiontothestatementofproceedingsonFebruary7,   2000.Thesameday,Mr._Harber_Ԁfiledamotionforthecertificationandtransmittalofa   supplementalrecordwiththetrialcourt.OnMarch20,2000,Mr._Harber_Ԁfiledanoticeofhearing  onmotionforthecertificationandtransmittalofasupplementalrecord.    OnMay1,2000,Mr._Harber_Ԁfiledasecondproposedstatementoftheproceedings.Mr. l HymanfiledanobjectiontothestatementofproceedingsonMay11,2000,andsupplemental X  objectionstothesecondproposedstatementofproceedingsonAugust24,2000.Byorderentered D! onNovember2,2000,theTrialCourtsetforthitsownstatementoftheevidenceofthehearingheld 0"  onSeptember21,1998,whichisasfollows: #l!   $X" 8   ` 1.Therewasnotestimonyorotherevidenceadducedatthehearingonthe   dateaforesaid.Rather,theproceedingsconsistedentirelyoftheargumentsof  counselandcolloquybetweencounselandtheCourt.TheCourtobservedatthe  outsetthatthecaseinvolvedaquestionoffederallaw.Theargumentsandcolloquy t encompassedallpendingmotions,includingamotionbyHymantoamendhis ` counterclaim,amotiontodismissHyman'scounterclaim,Hyman'smotionfor L  summaryjudgment,andHyman'smotionforRule11sanctions.8    8   ` 2.Duringhisarguments,theAppellant,J.Philip_Harber_,summarizedhis $ t contentionsassetforthinhisaffidavitandthepleadings,motionsandotherpapers  ` filedwiththetrialcourt.Hearguedthattheelementsofacounterclaimformalicious  L  prosecutiondidnotexistastherehadbeennodismissaloftheunderlyingaction.He  8  arguedthatthemaliciousprosecutionsuitwasuntimely,andthatdamageswerenot $  properunder15U.S.C.1692kbecausenoevidencehasbeenintroducedthatthe   originalactionhadbeenfiledinbadfaithandforthepurposesofharassment,as   requiredbythestatute.    8   ` 3.TheAppellantarguedthattheAffidavitofAttorneyCharlesT.Webber,   Jr.,andacaseinwhichMr.Hymanactedasadebtcollectordemonstratedanissue p offactastowhetheritwastruethatMr.Hymanhadneverfiledadebtcollection \ case,ashehadclaimed.However,thecourtdeterminedthatsuchaffidavitandcase H wereinsufficienttoovercomeAppellee'smotionforsummaryjudgment.4   8   ` 4.TheAppellantexplainedthathehadsearchedcourtrecordsfordebt  p collectionscasesfiledbyMr.Hyman,inresponsetotheassertionbyMr.Hymanthat  \ hehadneverfiledadebtcollectioncase,butstatedthathecouldnotsearchthefiles H byattorneynames.4   8   ` 5.Duringhisarguments,theattorneyfortheAppelleesummarizedhis   contentionsassetforthinthepleadings,motionsandotherpapers,filedonbehalfof   RogerD.Hyman,aswellastheaffidavitofRogerD.Hyman.Heannounceda  voluntarydismissalorwithdrawalofhiscounterclaimandmotiontoamendthe  same.   %  @' Issues%W  D!   Mr._Harber_Ԁpresentsthreeissues,whichwerestatetobe1)whethertheTrialCourtabused #l! itsdiscretioninawardingTenn.R.Civ.P.11sanctionsagainstMr._Harber_,2)whethertheTrial $X" CourterredindeterminingtheamountofattorneyfeestobeawardedaspartofitsTenn.R.Civ.P. $D # 11sanctionsagainstMr._Harber_,and3)whethertheTrialCourterredinsustainingMr.Hyman's %0!$ objectiontotheintroductionofevidencetodemonstratebiasorprejudice,badfaithand/ordeceit &"% onthepartofMr.Nolan? '#&   Additionally,Mr.Hymanpresentsanissueforourreviewandthatiswhetherthisappealis )$( frivolousandcostsshouldbeawardedtoMr.Hyman? |*%)  h+&* & t @))% % & Discussion %&[Ԉ    AttheoutsetwepointoutthatonlyMr._Harber_Ԁhasfiledanappeal,whichquestionsthe  awardofsanctionsagainsthimandtheamountthereof.ThereisnoappealbyMr.Whiteofthe t _____summary_Ԁjudgmentgranted_against_Ԁhim,northeawardofsanctionsagainsthimortheamount ` thereof. L  't[  Rule11.02oftheTennesseeRulesofCivilProcedure,ineffectatthetimethecasewasfiled, $ t providedthatbysigningthedocumenttheattorney"iscertifyingthattothebestoftheperson's  ` knowledge,information,andbelief,formedafteraninquiryreasonableunderthecircumstances,-  L  8   ` (1)itisnotbeingpresentedforanyimproperpurpose,suchastoharassorto  8  causeunnecessarydelayorneedlessincreaseinthecostoflitigation;$    8   ` (2)theclaims,defenses,andotherlegalcontentionsthereinarewarrantedby   existinglaworbya_nonfrivolous_Ԁargumentfortheextension,modification,or   reversalofexistinglawortheestablishmentofnewlaw;    8   ` (3)theallegationsandotherfactualcontentionshaveevidentiarysupportor,   ifspecificallysoidentified,arelikelytohaveevidentiarysupportafterareasonable p opportunityforfurtherinvestigationordiscovery;and\   8   ` (4)thedenialoffactualcontentionsarewarrantedontheevidenceor,if H specificallysoidentified,arereasonablybasedonalackofinformationorbelief.4   Ѐ  p 8  11.03Sanctions.-If,afternoticeandareasonableopportunitytorespond,thecourt  \ determinesthatsubdivision11.02hasbeenviolated,thecourtmay,subjecttothe H conditionsstatedbelow,_( #  4      _Ԁimposeanappropriatesanctionupontheattorneys,law 4 firms,orpartiesthathaveviolatedsubdivision11.02orareresponsibleforthe   violation.      Therefore,wereviewthegrantingofTennesseeRulesofCivilProcedureRule11sanctions  underanabuseofdiscretionstandard. Andrewsv.Bible ,812S.W.2d284(Tenn.1991).When atrial  courtdecidestoimposesanctionsonaparty,thecourt'sinquiryisveryfactintensiveand,therefore, l itsdecisionisgivenmuchdeferenceonappeal. _Krug_Ԁv._Krug_, 838S.W.2d197(Tenn.Ct.App.  1992). JusticeDrowotain Andrewsv.Bible inaddressingRule11sanctions,statedaspertinent  here,asfollows:  8  Thecertificationwhichresultsfromtheattorney'ssignatureonamotion,pleading, ` orotherdocumentisdirectedatthethreesubstantiveprongsofRule11:itsfactual L  basis,itslegalbasis,anditslegitimatepurpose._Schwarzer_,"SanctionsUnderthe 8  NewFederalRule11-ACloserLook,"104_F.R.D._Ԁ181,186(1985).Seealso,Note, $ t "TheIntendedApplicationOfFederalRuleofCivilProcedure11:AnEndToThe  ` EmptyHead,PureHeartDefense,"41_Vand_.L.Rev.343,361-62(1988).A  L  signaturesignifiestotheCourtthatthesignerhasreadthepleading,motion,orother  8  paper,hasconductedareasonableinquiryintothefactsandthelaw,andissatisfied $  thatthedocumentiswell-groundedinboth,andisactingwithoutanyimproper   motive.BusinessGuidesv.ChromaticCommunicationsEnt.,...U.S....,111_S.Ct_.   922,929,112_L.Ed_.2d1140(1991);Cooter&_Gell_Ԁv.HartMarxCorp.,496U.S....   ,110_S.Ct_.2447,2454,110_L.Ed_.2d359(1990)."TheessenceofRule11isthat   signingisnolongerameaninglessact;itdenotesmerit.Asignaturesendsamessage p tothe[trialjudge]thatthisdocumentistobetakenseriously."BusinessGuides,111 \ _S.Ct_.at930.ThepurposeofRule11asawholeistobringhometotheindividual H signerhispersonal,_nondelegable_Ԁresponsibility."Themessagetherebyconveyedto 4 theattorney,isthatthisisnotateameffortbutinthelastanalysis,yoursalone,  p preciselythepointofRule11."_Pavelic_Ԁ&_Leflore_Ԁv.MarvelEntertainmentGroup,  \ 493U.S.120,110_S.Ct_.456,107_L.Ed_.2d438(1989).Anattorneywhosignsapaper H withouttherequiredsubstantiatedbelief"shall"bepenalizedby"anappropriate 4 sanction."Thissanctionmay,butneednot,includepaymentoftheotherparty's   expenses.Althoughtherulemustbereadinlightofconcernsthatitwillspawn   satellitelitigationandchillvigorousadvocacy,seeAdvisoryCommitteenotes,any  interpretationmustgiveeffecttotherule'scentralgoalofdeterrence.Cooter&_Gell_,  110_S.Ct_.at2454.Seealso,Note,"TheImmediate_Appealability_ԀofRule11  Sanctions,"59_Geo_.Wash.L.Rev.683(1991)(purposeofRule11istoprevent l abusiveanddilatorytacticsbylitigants).  Thetesttobeappliedindeciding X  whetheranattorney'sconductissanctionable,isoneofobjectivereasonableness D! underallthecircumstances,BusinessGuides,111_S.Ct_.at933,andthe 0"  reasonablenessoftheattorney'sbeliefmustbeassessedinlightofthecircumstance #l! existingatthetimethedocumentinquestionwassigned.104_F.R.D._Ԁat189.The $X" AdvisoryCommitteenotestothefederalversionofRule11statethat"[_t]he_ԀCourt $D # isexpectedtoavoidusingthewisdomofhindsightandshouldtestthesigner's %0!$ conductbyinquiringwhatwasreasonabletobelieveatthetime[ofsigning]."Cruz &"% v.Savage,896F.2d626,631(1stCir.1990).Oneoftheclearestandmostsuccinct '#& explanationsoftheprinciplesassociatedwithaproperRule11analysiswassetforth (#' inWhittingtonv.OhioRiverCo.,115_F.R.D._Ԁ201,209(E.D.Ky.1987):)$(   8   ` 1.AnattorneymustREADeverypaperbeforesigningit.|*%)   8   ` 2.Hemustmakeareasonablepre-filinginvestigationoftheFACTS.h+&*   8   ` 3.HemustresearchtheLAW,unlessheiscertainheknowsit.   8   ` 4.ThelawasappliedtothefactsmustREASONABLYWARRANTthelegal  positionsandstepshetakes.Ifexistinglawdoesnotwarrantthesepositions,a  plausibleargumentfortheextensionofthelawtothefactsofthecaseisrequired.t   8   ` 5.Itmustbedemonstrated,asthebasisofpre-filinginvestigationand ` research,thatthereisaREASONABLEBASIStonameeachDefendantnamed,and L  tosupporteachclaimasserted.Theshotguncomplaintoranswer,filedinthehope 8  thatdiscoverywillproducethejustificationforit,isimproper.$ t   8   ` 6.Theadequacyofanattorney'sinvestigation,researchandlegalanalysiswill  ` beevaluatedbythecourtunderanOBJECTIVESTANDARD,namely,whetherthe  L  attorneyactedasareasonablycompetentattorneyadmittedto...practice.Except  8  astoimproperpurpose,subjectivegoodfaithisnotadefensetoRule11sanctions. $  Apureheartbutanemptyheadisofnoavail.    @  '***   8   ` 8.AnattorneymustnothaveanIMPROPERPURPOSE,suchasharassment   orintimidation,innaminganyDefendant,assertinganylegalpositionortakingany   legalstep.p   8   ` 9.IfanattorneyviolatesRule11theimpositionofsomesanctionis \ MANDATORY,althoughthenatureandextentofthesanctionisdiscretionarywith H the[trial]court.4    Andrewsv.Bible ,812S.W.2dat28788.(Emphasisinoriginal).  \   WhatwemustlookatisthestateofthelawatthetimethissuitwascommencedonMay15, 4 1997,againstMr.Hyman.TheFairDebtCollectionPracticeActprohibited"debt_collector[s_]"from   makingfalseormisleadingrepresentationsandfromengaginginvariousabusiveandunfair   practices.15U.S.C.1692(d).TheAct'sdefinitionoftheterm"debtcollector"includedaperson  "whoregularlycollectsorattemptstocollect,directlyorindirectly,debtsowed[to]...another."15  U.S.C.1692(a).And,itlimited"debt"toconsumerdebt,i.e.,debts"arisingoutof...  _transaction[s_]"that"areprimarilyforpersonal,family,orhouseholdpurposes."15U.S.C. l 1692a(5).See _Heintz_Ԁv.Jenkins ,514U.S.291,115_S.Ct_.1489(1995). X    "Regular"isdefinedbyWebster'sThirdNewInternationalDictionary1913(1993)as"steady 0"  oruniformincourse,practiceoroccurrence.""Regularly"isdefinedas"inaregular,orderly,lawful #l! ormethodicalway." $X"   Whetherapersonoranentity"regularly"collectconsumerdebtforpurposesoftheActis %0!$ determinedonacasebycasebasis.Courtshaveconsideredseveralfactorsinmakingthat &"% determination,includingthepercentageofrevenuegeneratedbydebtcollectionactivities,thesheer '#&  volumeofdebtcollectionactivities,andwhetherthedefendanthasanongoingattorneyclient (#' relationshipwithacollectionagency. #  5      ׀LookingattherecordwecanfindnoevidencethatMr.   Hymanregularlycollectedconsumerdebts.    Inhismotionforsummaryjudgment,Mr.Hymanaverredthathedidnotregularlypractice t lawintheareasorfieldsofdebtcollection,hehadneverhandedaconsumerdebtcollectioncaseas ` definedin15U.S.C.1692(a)andhewasnotadebtcollectorasdefinedin15U.S.C.1692a(6). L  Mr._Harber_Ԁrespondedtothemotionforsummaryjudgmentwithanaffidavitofanattorneystating 8  thatthecomplaintin Pearl_Hensley_Ԁv.JohnEarl_Hensley_,Jr.,andhiswife,DebraSue_Belitz_ $ t _Hensley_ ,KnoxCountyChanceryCourtDocketNumber1289681,wasanattempttocollectadebt  ` asdefinedin15U.S.C.1692a(5),andthat _Hensley_ demonstratedthatMr.Hymanwasadebt  L  collectorunder15U.S.C.1692a(6).Thefundamentalreliefsoughtin _Hensley_ ,however,wasthat  8  thedeedconveyingthepropertybedeclarednullandvoid. $    Moreover,wesuspectthetimingofthefilingofthissuit.LitigationwascommencedbyMr.   WhiteagainstDefendantMyersandtheSweetsonMay1,1997,tostoptheforeclosureonthe   property.OnFriday,May9,1996,Mr.Hymanfiledananswerandacounterclaimonbehalfofthe   Sweetsinthatsuit.Withinsixdays,includingSaturdayandSunday,Mr._Harber_Ԁinstitutedthissuit p againstMr.Hyman.Basedupon Andrews ,anattorneyhasnotmadeareasonableinquiry \ concerningthefacts,ifhehasnotmadeanyinquirywhentimepermittedhimtomakeafurther H investigation.Theclaimmustnotbeassertedagainstadefendantmerelyinthehopethatdiscovery 4 willturnupsomethingagainstthatdefendant.EveninhisappellatebriefoneofMr._Harber_'smajor  p issueswasthatthetrialcourtdidnotpermithimtohavediscoverytoprovethatMr.Hyman  \ regularlyengagedindebtcollection.Theburdencannotbeshiftedtoadefendanttoprovehimself H outofthecaseafterfiling. 4   Here,ChancellorWhiteexercisedhisdiscretionwhenhesanctionedMr._Harber_ԀforaRule   11violation.Itisawell-establishedruleinTennesseethattheimpositionofRule11sanctionsis  solelywithinthediscretionoftheTrialCourtunlessaninjusticehasoccurred.Moreover,ifan  attorneyviolatesRule11theimpositionofsomesanctionismandatory,althoughthenatureand  extentofthesanctionisdiscretionary.ItistheconclusionofthisCourtthatChancellorWhitedid l notabusehisdiscretionwhenheorderedsanctionsagainstMr._Harber_ԀandMr.White.Thereare X  certainlyfactscontainedintherecordbeforeustosupportafindingonthepartoftheChancellorthat D! Mr._Harber_ԀfiledthislawsuitdespitehavingknowledgethatMr.Hymanwasnotadebtcollectoras  definedbytheFairDebtCollectionsPracticesAct,thatthelawsuithadnobasisinlaworfact,and  wasfrivolous.    TheChancellorawarded$4,000insanctionsforattorney'sfees.Mr._Harber_Ԁchallengesthe ` amountoftheawardofsanctionsandallegesthattheChancellorerredinrefusingtoadmitthree L  letterswrittenbyMr._Nolen_Ԁduringsettlementnegotiationstodemonstratebiasorprejudice,bad 8  faithand/ordeceitonthepartofMr._Nolen_.Trialjudgeshavebroaddiscretionoverthe $ t admissibilityofevidence. Otisv.CambridgeMut.FireIns.Co. ,850S.W.2d439(Tenn.1992).  ` Rule408oftheTennesseeRulesofEvidenceprovides:  L  8   ` Evidenceof(1)furnishingorofferingtofurnishor(2)acceptingoroffering $  toacceptavaluableconsiderationincompromisingorattemptingtocompromisea   claim,whetherinthepresentlitigationorrelatedlitigation,whichclaimwasdisputed   orwasreasonablyexpectedtobedisputedastoeithervalidityoramount,isnot   admissibletoproveliabilityfororinvalidityofacivilclaimoritsamountora   criminalchargeoritspunishment.Evidenceofconductorstatementsmadein p compromisenegotiationsislikewisenotadmissible.Thisruledoesnotrequirethe \ exclusionofanyevidenceactuallyobtainedduringdiscoverymerelybecauseitis H presentedinthecourseofcompromisenegotiations.Thisrulealsodoesnotrequire 4 exclusionwhentheevidenceisofferedforanotherpurpose,suchasprovingbiasor  p prejudiceofawitness,negativingacontentionofunduedelay,orprovinganeffort  \ toobstructacriminalinvestigationorprosecution;however,apartymaynotbe H impeachedbyapriorinconsistentstatementmadeincompromisenegotiations.4     Asnotedsupra,Rule408prohibitstheadmissionofevidenceobtainedduringsettlement   negotiationswhensuchevidenceisofferedto"proveliabilityfororinvalidityofacivilclaimorits  amount."Tenn.R._Evid_.408.Mr._Harber_Ԁarguesthattheletterswereonlyofferedtodemonstrate  biasorprejudice,badfaithand/ordeceitonthepartofMr._Nolen_.Actually,itappearsthatMr.  _Harber_ԀofferedtheletterstoimpeachthestatementsofMr._Nolen_Ԁastotheamountoftimehespent l defendingthisfrivoloussuit.Rule408providesthat"apartymaynotbeimpeachedbyaprior X  inconsistentstatementmadeincompromisenegotiations."Consequently,webelievethatthe D! Chancellorproperlyexcludedthelettersofcompromise. p  0"    WehaveexaminedthetimerecordssubmittedbyMr.Nolan.Inviewofthevexatious $X" documentsfiledbyMr._Harber_,wefindthemtobequitereasonable.Therefore,thedecisionofthe $D # Chancellorisaffirmed. %0!$   Last,weaddressMr.Hyman'srequestthatthisappealbedeclaredfrivolous.T.C.A. '#& 27-1-122provides: (#' 8   ` Whenitappearstoanyreviewingcourtthattheappealfromanycourtof |*%) recordwasfrivolousortakensolelyfordelay,thecourtmay,eitheruponmotionof h+&* apartyorofitsownmotion,awardjustdamagesagainsttheappellant,whichmay  include,butneednotbelimitedto,costs,interestonthejudgment,andexpenses  incurredbytheAppelleeasaresultoftheappeal.     Wefindthatthisappealisfrivolous. `   FortheforegoingreasonsthejudgmentoftheChanceryCourtisaffirmed.Thecauseis 8  remandedforadeterminationoftheappropriatedamagestobeawardedtoMr.Hymanforthis $ t frivolousappealandforcollectionofcostsbelow.CostsofappealareadjudgedagainstMr._Harber_  ` andhissurety.  L  XxXX Xx   `     h   _________________________________________      `     h   HOUSTONM.GODDARD,PRESIDINGJUDGE   # XxXXXxխ#