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Posted by: Landry Butler on May 31, 2017

Court: TN Court of Appeals

Attorneys 1:

D. Alexander Fardon, Nashville, Tennessee, for the appellant, Lemuel Lewis.

Attorneys 2:

Douglas S. Johnston, Jr., Nashville, Tennessee, for the appellees, Lynn Moore, and Sandcliffs Media, LLC.

Judge(s): MCBRAYER

In this breach of contract action, the plaintiff entered into a contract with a sole proprietor whereby he purported to purchase 10% of the sole proprietorship. The contract entitled the plaintiff to 10% of the cash withdrawals made from the business’s account. It further provided that, should the sole proprietor dissolve the business and form a new entity of which she was a majority owner, the plaintiff would be entitled to 10% of the cash withdrawals taken by the sole proprietor from the new entity. Two years later, the sole proprietor closed the business and formed a new entity, a limited liability company, with another individual. The plaintiff filed suit, alleging breach of contract and violations of the duty of good faith and fair dealing. The trial court found for the sole proprietor, concluding that the sole proprietor was free to close her business at will. It further found that the sole proprietor did not breach the express terms of the contract, nor did she breach her implied duty of good faith and fair dealing, in closing her business and forming the LLC. Discerning no error, we affirm.