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Posted by: Brittany Sims on Nov 18, 2014

Court: TN Court of Appeals

Attorneys 1:

James R. Kelley, Marc T. McNamee, and Stephen M. Montgomery, Nashville, Tennessee, for the appellants, LaVada J. Doyle, Mike Doyle, William O. Daugherty, III, and Volunteer Thread Company, Inc.

Attorneys 2:

William L. Harbison and Lisa K. Helton, Nashville, Tennessee, for the appellee, Ronald T. Daugherty.

Judge(s): BENNETT

A shareholder in a closely-held family business brought this action pursuant to Tenn. Code Ann. § 48-26-102(b) to inspect the company’s accounting records. The trial court determined that the shareholder’s request was made in good faith and for a proper purpose. On appeal, the defendants assert that the trial court erred in finding that the shareholder’s request was made in good faith and in awarding him his attorney fees and the expenses he incurred in hiring a forensic accountant. We reverse the trial court’s decision to award the shareholder the expenses he incurred for the forensic accountant, but remand for a determination of an award based on the accountant’s fees concerning testimony about whether the records requested by Mr. Daugherty were accounting records. In all other respects, we affirm the decision of the trial court.