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Posted by: Tanja Trezise on Jun 29, 2012

Court: TN Court of Appeals

Attorneys 1:

P. Edward Pratt, Knoxville, Tennessee, for the appellant, Mountain National Bank.

Attorneys 2:

Lewis S. Howard, Jr., and Joshua B. Bishop, Knoxville, Tennessee, for the appellee, Covered Bridge Resort on Waldens Creek, LLC.

Daryl G. Lowe, Knoxville, Tennessee, for the appellees, Johnson, Murrell & Associates, P.C., Charlie R. Johnson, and Sherri E. Case.

Judge(s): SUSANO

Covered Bridge Resort on Waldens Creek, LLC (“Seller”) sold its interest in an ongoing resort development to Tennessee Covered Bridge, LLC (“Purchaser”). Seller agreed to finance the sale and Purchaser agreed to secure the debt with a mortgage on the property. Mountain National Bank (“the Bank”) agreed to loan Purchaser money to continue development of the property but required that its mortgage be in a first position. Seller agreed to subordinate its mortgage with the understanding that the members of Purchaser would personally guarantee the debt to Seller. Attorneys Charlie R. Johnson and Sherri E. Case of the firm of Johnson, Murrell & Associates, P.C. (collectively “the Lawyers”) prepared the documents and handled the closing. Purchaser soon defaulted and Seller learned that Purchaser’s members had refused to execute the guaranties. Seller filed this action against the Bank, the Lawyers and Purchaser . When Seller took the 1 deposition of the Bank’s loan officer, the Bank, through counsel, instructed him not to answer several categories of questions on the ground of privilege. Seller filed a motion to compel which the trial court granted upon finding that the information at issue was not privileged. The trial court granted permission for an interlocutory appeal. This Court agreed to hear the appeal. We now affirm the order of the trial court (1) granting the motion to compel and (2) holding the Bank’s motion for summary judgment in abeyance pending completion of discovery.