James E. Whalen v. Quint Bourgeois

IN THE COURT OF APPEALS OF TENNESSEE
AT KNOXVILLE
March 11, 2014 Session

JAMES E. WHALEN ET AL. v. QUINT BOURGEOIS

Appeal from the Chancery Court for Morgan County
No. 12-59 Frank V. Williams, III, Chancellor

No. E2013-01703-COA-R3-CV-FILED-JUNE 27, 2014

This action arose over the sale of improved real property (“the Property”), consisting of
approximately twenty-five acres located in Morgan County, Tennessee. Co-plaintiffs, James
E. and Karen M. Whalen, entered into an agreement to purchase the Property from the
defendant, Quint Bourgeois. The Whalens subsequently entered into an agreement with co-
plaintiffs, Alan and Kathleen Bone, to borrow the purchase price of the Property in return for
an executed promissory note, secured by a deed of trust. The parties closed the purchase and
sale of the Property on January 19, 2012, at the Roane County office of US Title of
Tennessee, Inc. (“US Title”). On January 20, 2012, Mr. Bourgeois, upset that he had not
received $900.00 in rent he believed the Whalens owed him, returned to the US Title office
and convinced staff there to accept his uncashed check from the sale and give him the
unrecorded deed. The plaintiffs filed this action against Mr. Bourgeois, ultimately amending
their complaint to allege breach of contract, breach of the duty of good faith and fair dealing,
and intentional interference with contractual relations.1 Following a bench trial, the trial
court found that Mr. Bourgeois had committed the tort of intentional interference with the
contractual relationship between the Whalens and the Bones. The court further found that
because the purchase and sales contract between the plaintiffs and Mr. Bourgeois had been
completed at closing, Mr. Bourgeois did not breach that contract but did intentionally commit
egregious acts by, inter alia, demanding the deed from the title company. The court awarded
the Whalens $110,000.00 in compensatory damages, $14,736.99 in prejudgment interest, and
$55,000.00 in punitive damages. The court awarded the Bones $76,733.50 in compensatory
damages and $40,000.00 in punitive damages. The court also awarded the plaintiffs
$1,324.81 in discretionary costs. The court vested title of the Property in Mr. Bourgeois,
subject to the plaintiffs’ judgment liens. Mr. Bourgeois appealed. We affirm the trial court’s
judgment as to the awards of compensatory damages and discretionary costs in favor of the

1
The plaintiffs also named US Title as a defendant but subsequently reached a settlement before trial,
and US Title is not a party to this appeal.
plaintiffs, prejudgment interest in favor of the Whalens, and vesting of title to the Property
in Mr. Bourgeois, subject to the plaintiffs’ judgment liens. We further affirm the trial court’s
judgment that Mr. Bourgeois is liable to the plaintiffs for punitive damages, but we vacate
the amount of punitive damages awarded and remand for reassessment based upon the factors
delineated in Culbreath v. First Tenn. Bank Nat’l Assoc., 44 S.W.3d 518 (Tenn. 2001) and
Hodges v. S.C. Toof & Co., 833 S.W.2d 896 (Tenn. 1992).

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court
Affirmed in Part, Vacated in Part; Case Remanded

T HOMAS R. F RIERSON, II, J., delivered the opinion of the Court, in which C HARLES D.
S USANO, J R., C.J., and J OHN W. M CC LARTY, J., joined.

James S. Tipton, Jr., Knoxville, Tennessee, for the appellant, Quint Bourgeois.

Hoyt O. Samples, Chattanooga, Tennessee, for the appellees, James E. Whalen, Karen M.
Whalen, Alan Bone, and Kathleen Bone.

OPINION

I. Factual and Procedural Background

Mr. Bourgeois, an experienced real estate investor and broker, purchased the Property,
located at 1516 Airport Road in Oakdale, Morgan County, for $52,215.10 at a foreclosure
sale in December 2011. A Substitute Trustee’s Deed conveying the Property to Mr.
Bourgeois was executed on December 19, 2011, and recorded on January 9, 2012. Prior to
foreclosure, the Property had been the residence of John and Pamela Marshall, who were in
the process of a divorce. Mr. Marshall had believed his wife was making monthly house
payments and did not realize the home was in foreclosure until he discovered a note left on
his front door by Mr. Bourgeois, informing the occupants of the completed sale.

The Whalens are Mr. Marshall’s sister and brother-in-law. Upon being informed of
the foreclosure, they contacted Shelly Marshall, Mr. Marshall’s cousin by marriage and a real
estate agent, and asked her to arrange a meeting with Mr. Bourgeois. The exact date of this
initial meeting is not in the appellate record, but it is undisputed that it occurred soon after
the foreclosure sale and in December 2011. Present at the meeting were, inter alios, Mr.
Bourgeois, the Whalens, Mr. Marshall, and Shelly Marshall. During the meeting, the
Whalens entered an oral agreement with Mr. Bourgeois to purchase the Property for the price
of $75,000.00. The Whalens intended that Mr. Marshall and his children would continue to
live in the home on the Property. The purchase and sales agreement was not memorialized

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in writing. The Whalens subsequently obtained an agreement from Alan and Kathleen Bone
to finance the purchase of the Property.

The parties closed the purchase and sale of the Property on the afternoon of January
19, 2012, with Jenny Ruiz of US Title acting as the closing agent. Among the documents
executed by the parties were a Special Warranty Deed conveying title to the Property from
Mr. Bourgeois to the Whalens and a Promissory Note reflecting the debt owed by the
Whalens to the Bones in the amount of $76,733.50. The Whalens’ debt to the Bones was
secured by a Deed of Trust for principal in the amount of $76,733.50, plus interest, executed
by the Whalens in favor of US Title as trustee. Mr. Bourgeois left the closing with a check
for the full purchase price of $75,000.00 in hand. As the closing occurred late in the
afternoon, the Special Warranty Deed and Deed of Trust remained at US Title’s office and
were not recorded that day.

The following morning, January 20, 2012, Mr. Bourgeois left Ms. Ruiz at US Title
several telephone messages, stating that he wanted to return his check and retrieve the deed
he had executed. Mr. Bourgeois subsequently appeared at the US Title office and convinced
staff there to accept his uncashed check and deliver to him the unrecorded Special Warranty
Deed. In demanding the deed, Mr. Bourgeois asserted that the Whalens had violated an oral
agreement to pay him $900.00 in monthly rent if the closing occurred more than thirty days
after the date that he had purchased the Property. The closing on January 19, 2012, took
place thirty-one days after execution of the Substitute Trustee’s Deed that conveyed the
Property to Mr. Bourgeois.

At trial, the Whalens, Mr. Marshall, and Shelly Marshall all testified that the subject
of rent had not been raised during their initial meeting with Mr. Bourgeois. They asserted
that no rental agreement had been included in the oral purchase and sales agreement. US
Title owner Stephanie Hatch testified that prior to closing, Mr. Bourgeois told US Title that
a $900.00 rent charge should be added to the Whalens’ settlement statement. It is
undisputed, however, that in response to an email inquiry from Ms. Ruiz, Mr. Bourgeois
directed US Title by email to remove the $900.00 charge. Mr. Bourgeois’s email message,
admitted into evidence, states in pertinent part: “Drop the charge. Not many good deeds go
unpunished.” Mr. Bourgeois testified that he withdrew his request for $900.00 because he
had spoken by telephone with Ms. Whalen earlier that morning and accepted her request to
pay the rent after closing because she and her husband did not have the money then. Ms.
Whalen denied that she ever admitted owing the $900.00 or told Mr. Bourgeois she would
pay it. Mr. Bourgeois acknowledged that he did not raise the issue of the $900.00 rent at the
closing.

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 Mr. Bourgeois testified that he became upset when he learned at the closing that the
Bones had been prepared to loan the Whalens additional funds and that the Whalens did not
intend to pay him the $900.00 rent. He became more agitated when he reached Ms. Whalen
by telephone at a restaurant the evening of the closing, demanded the $900.00, and had his
call intercepted by Mr. Whalen, who told him not to call Ms. Whalen again. According to
Mr. Bourgeois, he contacted an attorney at another title office on the morning of January 20,
2012, and upon the advice of the attorney, believed he could stop the purchase and sale of
the Property by returning the uncashed check for sale proceeds to US Title in exchange for
the deed that had yet to be recorded. When questioned at trial, Mr. Bourgeois gave only a
first name for the attorney and offered no further proof of such a consultation. Mr.
Bourgeois acknowledged that he believed taking back the deed would give him “leverage”
to convince the Whalens to pay the $900.00 rent. He consistently asserted that obtaining the
rent from the Whalens was a matter of principle.

On January 20, 2012, after Mr. Bourgeois had returned the check and obtained the
deed, he telephoned Mr. Bone. At trial, Mr. Bone described the telephone conversation in
relevant part as follows:

Mr. Bone: [H]e basically asked me, says, well, what do you
think I should do, Alan? It floored me, but I says,
Quint, what you need to do is take the deed back
to U.S. Title, put it back, give it to them so they
can get it filed; collect your check. If it’s about
the $900, I’ll get it to you.

Plaintiffs’ Counsel: And how did he respond to that?

Mr. Bone: After I offered him the $900, he screamed at me
or basically hollered, it’s not about the $900. I
just – I have no idea. He had plenty of
opportunities to accept this $900.

Plaintiffs’ Counsel: So you tried to get him to take $900, take the deed
back so none of this would happen?

Mr. Bone: Yes. I did offer it to him, yes.

Plaintiffs’ Counsel: And he hollered what at you?

Mr. Bone: It’s not about the $900.

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 Plaintiffs’ Counsel: What did you tell him you were going to have to
do then?

Mr. Bone: That’s when I told him, I said, I’m gonna have to
go to an attorney. I said, I can’t live with what’s
going on here. Gotta get this deed back.

Plaintiffs’ Counsel: And what did he say?

Mr. Bone: He said, you go ahead and get an attorney,
whatever. He says, you can do whatever you
want to do. But he says, you’ll probably win, but
I’ll drag it out as long as I can.

When questioned regarding why US Title accepted the check from Mr. Bourgeois and
returned the Special Warranty Deed to him, Ms. Hatch stated that she and her staff were
intimidated when Mr. Bourgeois came to their office demanding the deed and appearing
“upset and agitated.” She feared Mr. Bourgeois, a locally prominent real estate agent, would
become angry at US Title and would spread negative rumors about her business in the
community. According to Ms. Hatch, Mr. Bourgeois informed her that he had spoken to a
lawyer and that “the lawyer said if he refused the check, that I had to give him back the
deed.” She offered to waive the $600 to $700 fee charged by US Title if Mr. Bourgeois
would accept the purchase check, but Mr. Bourgeois declined the offer, stating that it was
not Ms. Hatch’s responsibility to pay the rental fee. Ms. Hatch was not able to reach her own
attorney until after Mr. Bourgeois left US Title with the deed. Upon her own attorney’s
subsequent advice that Mr. Bourgeois had not been entitled to the deed, Ms. Hatch attempted
to telephone Mr. Bourgeois and request that he return the instrument of conveyance. He did
not answer the call, but US Title personnel left him a message. Mr. Bourgeois did not
respond.

The $75,000.00 check returned to US Title by Mr. Bourgeois had been written and
delivered to him by US Title at the closing upon the title company’s receipt of a cashier’s
check from the Bones in the amount of $76,733.50. Upon return of the check, US Title held
the entire $76,733.50 in trust until August 6, 2012, when upon motion from the Bones, the
trial court entered an agreed order to deposit the funds with the clerk and master of the
Morgan County Chancery Court, pursuant to Tennessee Rule of Civil Procedure 67.

Through the date of trial, Mr. Marshall and his children continued to reside on the
Property, paying monthly rent in the amount of $366.34 to the Whalens. The Whalens in turn

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paid $366.34 monthly to the Bones pursuant to the terms of the Promissory Note, despite
having no recorded title to the Property.

On January 27, 2012, the plaintiffs filed a complaint against Mr. Bourgeois and US
Title in the Roane County Circuit Court. The complaint alleged against Mr. Bourgeois and
on behalf of the Whalens: (1) breach of the contract between Mr. Bourgeois and the
Whalens (2) intentional interference with the contractual relationship between the Whalens
and the Bones, and (3) negligence. The complaint also alleged procurement of breach of
contract on behalf of the Bones. The plaintiffs requested specific performance of the
purchase and sales contract, as well as damages for negligence and intentional interference
with contractual relations, the latter to be trebled pursuant to Tennessee Code Annotated §
47-50-109 (2013), and punitive damages. In addition, the plaintiffs requested a restraining
order enjoining Mr. Bourgeois from transferring title to the Property. On January 27, 2012,
the Roane County Circuit Court entered a temporary restraining order, restraining Mr.
Bourgeois from “selling, disposing, transferring, or encumbering” the Property pending
further proceedings. On February 6, 2012, the Roane County court entered an agreed order,
amending the temporary restraining order to constitute an “agreed injunction” pending
further orders of the court.

Mr. Bourgeois filed a motion to dismiss on March 2, 2012, asserting, inter alia, that
the action was improperly filed in the Roane County Circuit Court because a suit to compel
specific performance of a property sales contract lies only in the county where the subject
deed is registered, or Morgan County in this instance. See Tenn. Code Ann. § 16-11-114(1)
(2009) (“All bills filed in any court seeking to divest or clear the title to land, or to enforce
the specific execution of contracts relating to realty . . . shall be filed in the county in which
the land, or a material portion of it, lies, or in which the deed or mortgage is registered; . . .”).
The plaintiffs filed a timely response to the motion to dismiss. They subsequently requested
voluntary non-suit of their specific performance “claim” only, and the Roane County Circuit
Court entered an order dismissing the plaintiffs’ request for specific performance without
prejudice on April 17, 2012. The plaintiffs subsequently filed an amended complaint in the
Roane County Circuit Court on April 25, 2012, alleging the same causes of action as in the
original complaint and requesting return of the Special Warranty Deed and damages.

On May 8, 2012, the Whalens, acting without the Bones, filed a complaint against Mr.
Bourgeois in the Morgan County Chancery Court, alleging breach of contract and breach of
the duty of good faith and fair dealing. Basing their complaint on the same allegations as in
the Roane County action, the Whalens reinstated their request for specific performance of
the purchase and sales contract and again requested damages. On May 21, 2012, the Roane
County Circuit Court entered an agreed order, transferring the cause to the Morgan County
Chancery Court and consolidating the Roane County and Morgan County cases. Mr.

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Bourgeois again filed a motion to dismiss the action on June 20, 2012. The plaintiffs
responded to Mr. Bourgeois’s motion on June 22, 2012, and concomitantly moved for default
judgment and requested that the court order Mr. Bourgeois to deposit the Special Warranty
Deed with the clerk and master for safekeeping. Mr. Bourgeois subsequently filed an answer
to the motion for default judgment, incorporating his previously filed motion to dismiss.

On October 5, 2012, the Whalens and the Bones filed an amended complaint against
Mr. Bourgeois and US Title in the consolidated action, again alleging against Mr. Bourgeois
breach of his contract with the Whalens, breach of the duty of good faith and fair dealing,
and intentional interference with contractual relations as to both the Whalens and the Bones.
The plaintiffs again requested specific performance of the purchase and sales contract,
damages, and an injunction restraining Mr. Bourgeois from transferring the Property. Mr.
Bourgeois filed an answer to the amended complaint on November 26, 2012, asserting the
affirmative defenses of estoppel, failure of consideration, laches, unclean hands, waiver, and
non-performance of a condition precedent.

Meanwhile, on October 24, 2012, US Title filed a cross-claim against Mr. Bourgeois,
alleging that he had committed conversion when he appropriated the deed and that his actions
constituted procurement of a breach of settlement agreement. US Title subsequently
amended its cross-claim on March 8, 2013, maintaining essentially the same allegations. Mr.
Bourgeois answered the amended cross-claim in May 2013 and asserted defenses identical
to those stated in his answer to the plaintiffs’ complaint.

In a related action, Mr. Bourgeois filed a third-party complaint against John and
Pamela Marshall on December 13, 2012. Mr. Bourgeois requested that the trial court order
the Marshalls to relinquish possession of the Property and pay past-due rent and additional
damages. On January 18, 2013, Mr. Marshall filed an answer to the third-party complaint,
denying the allegations and noting that the Marshalls were by then divorced and that Pamela
Marshall did not reside on the property. Mr. Marshall subsequently filed a motion to impose
sanctions and recover expenses and attorney’s fees against Mr. Bourgeois on March 21,
2013. At the close of trial, the third-party claims brought against and on behalf of Mr.
Marshall were dismissed in their entirety and are not at issue in this appeal.

The trial court conducted a trial on May 24, 2013. Preliminarily, the court denied the
plaintiffs’ motion for default judgment and reserved ruling on Mr. Bourgeois’s motion for
payment of rent. In addition, the parties announced a settlement with US Title, and on May
24, 2013, the trial court entered separate orders dismissing the plaintiffs’ claim against US
Title and US Title’s cross-claim against Mr. Bourgeois, respectively.

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 At the close of trial, the court found, inter alia, that Mr. Bourgeois had committed the
tort of intentional interference with contractual relations between the Whalens and the Bones
“on a number of levels.” The trial court awarded a judgment in favor of the Whalens in the
amount of $110,000.00 in compensatory damages, $14,736.99 in prejudgment interest, and
$55,000.00 in punitive damages. The court awarded a judgment in favor of the Bones in the
amount of $76,733.50 in compensatory damages, $4,112.07 in prejudgment interest, and
$40,000.00 in punitive damages. The court vested title to the Property in Mr. Bourgeois,
subject to the plaintiffs’ judgment liens. Upon request of the plaintiffs, the trial court
directed that the funds held by the clerk and master, equaling $77,010.91 on the day of trial,
be disbursed immediately to the Bones.

Having held the issue of discretionary costs in abeyance, the trial court subsequently
heard the plaintiffs’ motion for discretionary costs on June 20, 2013, and also heard oral
argument as to the content of the final judgment. The court entered the final judgment that
day, incorporating all awards of damages listed above except the prejudgment interest
previously awarded to the Bones in the amount of $4,112.07. Also on June 20, 2013, the trial
court entered an order awarding the plaintiffs discretionary costs in the amount of $1,324.81.
Mr. Bourgeois timely appealed.

II. Issues Presented

Mr. Bourgeois has presented seven issues on appeal, which we restate as follows:

1. Whether the trial court erred by awarding the Whalens a judgment against Mr.
Bourgeois in the amount of $110,000.00 in compensatory damages,
representing the difference in the purchase price of the Property and its fair
market value as of the date of closing, in view of the trial court’s ruling that
the purchase and sales contract was completed.

2. Whether the trial court erred by awarding the Whalens a judgment against Mr.
Bourgeois for prejudgment interest in the amount of $14,736.99 based on the
award of compensatory damages.

3. Whether the trial court erred by awarding the Bones a judgment against Mr.
Bourgeois in the amount of $76,733.50 for compensatory damages.

4. Whether the trial court erred by awarding the Whalens punitive damages in the
amount of $55,000.00.

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 5. Whether the trial court erred by awarding the Bones punitive damages in the
amount of $40,000.00.

6. Whether the trial court erred by awarding the Whalens and Bones discretionary
costs in the amount of $1,324.81.

7. Whether the trial court erred by divesting title to the real Property out of the
Whalens and vesting it into Mr. Bourgeois.

III. Standard of Review

Our review of the trial court’s judgment following a non-jury trial is de novo upon the
record, with a presumption of correctness as to the trial court’s findings of fact unless the
preponderance of the evidence is otherwise. See Tenn. R. App. P. 13(d); Rogers v. Louisville
Land Co., 367 S.W.3d 196, 204 (Tenn. 2012). “In order for the evidence to preponderate
against the trial court’s findings of fact, the evidence must support another finding of fact
with greater convincing effect.” Wood v. Starko, 197 S.W.3d 255, 257 (Tenn. Ct. App. 2006)
(citing Rawlings v. John Hancock Mut. Life Ins. Co., 78 S.W.3d 291, 296 (Tenn. Ct. App.
2001)). We review the trial court’s conclusions of law de novo with no presumption of
correctness. Hughes v. Metro. Gov’t of Nashville & Davidson County, 340 S.W.3d 352, 360
(Tenn. 2011). While “the amount of damages to be awarded in a particular case is essentially
a fact question,” “the choice of the proper measure of damages is a question of law.” GSB
Contractors, Inc. v. Hess, 179 S.W.3d 535, 541 (Tenn. Ct. App. 2005). The trial court’s
determinations regarding witness credibility are entitled to great weight on appeal and shall
not be disturbed absent clear and convincing evidence to the contrary. See Jones v. Garrett,
92 S.W.3d 835, 838 (Tenn. 2002).

IV. Conversion

We first address a threshold issue of whether the trial court entered a judgment for the
Whalens based on the tort of conversion of the Special Warranty Deed, and if so, whether
such a judgment was in error. In his principal brief on appeal, Mr. Bourgeois raises issues
regarding the amount and measure of damages awarded the plaintiffs, as opposed to the
possible remedy of returning the Special Warranty Deed to the Whalens and so quieting title
to the Property on behalf of the Whalens. In addition to responding to these remedy issues,
the plaintiffs in their responsive brief assert that the trial court properly found Mr. Bourgeois
liable to the Whalens for the tort of conversion, which they maintain had been tried by
implied consent, pursuant to Tennessee Rule of Civil Procedure 15.02. The plaintiffs
concede that they did not allege conversion in their pleadings but argue that they did allege
the facts upon which the court found conversion. Mr. Bourgeois in his reply brief,

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responding to the plaintiffs’ conversion argument, contends that the plaintiffs cannot rely on
the trial court’s finding of conversion to justify the damages award to the Whalens because
conversion was not pled by the Whalens and was not tried by implied consent. Upon a
careful and thorough review of the record, we determine that although the trial court referred
to conversion in its ruling from the bench, its judgment in favor of the Whalens was based
upon its finding that Mr. Bourgeois had committed the common law tort of intentional
interference with contractual relations.

As the plaintiffs correctly note, Tennessee Rule of Civil Procedure 15.02 creates an
exception to the general rule that “[j]udgments awarded beyond the scope of the pleadings
are void.” See Randolph v. Meduri, 416 S.W.3d 378, 384 (Tenn. Ct. App. 2011). Rule 15.02
provides in pertinent part:

15.02. Amendments to Conform to the Evidence. – When issues not
raised by the pleadings are tried by express or implied consent of the parties,
they shall be treated in all respects as if they had been raised in the pleadings.
Such amendment of the pleadings as may be necessary to cause them to
conform to the evidence and to raise these issues may be made upon motion
of any party at any time, even after judgment; but failure so to amend does not
affect the result of the trial of these issues.

“‘Generally speaking, trial by implied consent will be found where the party opposed to the
amendment knew or should reasonably have known of the evidence relating to the new issue,
did not object to this evidence, and was not prejudiced thereby.’” Hiller v. Hailey, 915
S.W.2d 800, 804 (Tenn. Ct. App. 1995) (quoting Zack Cheek Builders v. McLeod, 597
S.W.2d 888, 890-91 (Tenn. 1980)). As this Court has explained, however, “‘[t]rial by
implied consent is not shown by the presentation of evidence that is relevant to an
unestablished issue when that evidence is also relevant to the established issue.’” Christmas
Lumber Co., Inc. v. Valiga, 99 S.W.3d 585, 593 (Tenn. Ct. App. 2002) (quoting McLemore
v. Powell, 968 S.W.2d 799, 803 (Tenn. Ct. App. 1997)).

In the case at bar, the written judgment entered by the trial court details the specific
damages awarded to the plaintiffs but does not specify the cause of action upon which the
damages are based. The trial court explained its findings of fact and conclusions of law in
its ruling at the close of trial, the transcript of which is included in the record. In pertinent
part, the trial court stated:

And with regard to the closing statements as to how to characterize this
lawsuit, I agree with what Mr. Williams [Mr. Marshall’s counsel] said over

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there. This isn’t breach of contract. This is a theft of documents of a done
deal.

When Mr. Bourgeois signed that deed and handed it to the closing agent
and when the note was signed by the Whalens and given to Mr. Bone, and
when the Whalens signed the deed of trust securing the note that they had just
given to Mr. Bone, title passed then at that moment. The title passed by law.
By statute the title passed. The Whalens then owned the beneficial interest in
the land.

The trustee in the deed of trust, and I don’t know who it was, owned the
legal title and the land for the benefit of Mr. Bone, who was financing the deal
and who had the right under the note to receive the payments that had been
agreed upon by the parties.

So the transaction was completed. It was concluded. Title had passed.
You don’t go down there – Mr. Bourgeois said he got advice from counsel
before he did this. Well, you know, I’d have to have that lawyer come take the
witness stand and confess to that before I would believe Mr. Bourgeois, that
any lawyer would advise him that he could do that.

I just don’t believe it. He’s not credible. That’s not a credible
statement. No lawyer in his right mind would ever tell him to do that. That’s
crazy. To make that argument is just so absurd.

I have been at this almost 29 years, and I believe this is the most
outlandish case. In a way it’s such a small case, I mean, when you’re talking
about $900. The small amount of money that is involved here is just indicative
of the outrageous nature of what Mr. Bourgeois did by going down there and
intimidating the closing agent into giving him the deed back.

It makes it all the more worse for him that it was done for the sake of
$900, which is disputed. If I had to say who I believe right at this point, I
would have to say that I don’t believe Mr. Bourgeois; that I would believe
those who said there was no discussion about agreeing to pay rent after 30
days. If I had to pick somebody to believe, it would be them, not Mr.
Bourgeois. In 29 years I can’t recall anything like this. I just don’t recall it.

So when Mr. Williams calls this a theft, a tort, a conversion, well, yeah,
that’s [the] way I look at it. I think he’s right about it. I think counsel is right.

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 If there are other ways to make people whole, then specific performance is not
the way to go.

I think Mr. Bourgeois committed a [tort], an intentional interference
with contractual relations between these other parties on a number of levels.
I’m going to find that he did this knowingly, intentionally; that he did it for the
purpose – as Mr. Williams pointed it out quite clearly, he said by getting the
deed back he was going to use that as leverage to get the $900.

That’s just outrageous conduct. It may not be the foundation for a
lawsuit based upon the [tort] of outrageous conduct, but insofar as the tortious
interference with the contractual relations between these other parties, in my
way of thinking it is outrageous conduct, especially when you consider that the
lady who did the closing said, let’s not do this, I’ll give up my fees, we’ll
forfeit our fees; which were then 6- or $700 before he ever got hold of the
documents.

In mentioning conversion, the trial court appeared to be emphasizing that the purchase
and sale of the Property was complete with execution and delivery of the deed. See Hughes
v. New Life Dev. Corp., 387 S.W.3d 453, 466 (Tenn. 2012) (“‘In Tennessee, as in other
states, land conveyances generally occur in a two step process: execution of a land sale
contract followed by execution and delivery of a deed.’”) (quoting with approval In re Gee,
166 B.R. 314, 317 (Bankr. M.D. Tenn. 1993)). The trial court thus found that Mr.
Bourgeois’s appropriation of the subject deed was a “theft” of the document. See Barger v.
Webb, 391 S.W.2d 664, 665 (Tenn. 1965) (“A conversion, in the sense of the law of trover,
is the appropriation of the thing to the party’s own use and benefit, by the exercise of
dominion over it, in defiance of plaintiff’s right.”). In so doing, the court agreed with the
characterization of Mr. Bourgeois’s actions that had been presented immediately prior to the
court’s ruling by counsel for the third-party defendant, Mr. Marshall. The trial court,
however, continued by emphatically stating that Mr. Bourgeois had “committed a [tort]” and
that the tort was “intentional interference with contractual relations between these other
parties on a number of levels.” The court further found that Mr. Bourgeois had committed
this interference “knowingly and intentionally” for the purpose of obtaining the $900.00 he
claimed the Whalens owed him for rent.

Having interpreted the trial court’s comments within the full context of the
proceedings, we conclude that the court’s judgment in favor of the Whalens was not based
on a finding of conversion. Instead, the court’s judgment in favor of both the Whalens and
the Bones was based on its finding that Mr. Bourgeois committed the tort of intentional
interference with contractual relations. We note that Mr. Bourgeois concedes the essential

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facts supporting a finding that he appropriated the deed conveying property to the Whalens
following a completed real estate transaction. We need not pursue further analysis of
whether conversion was tried by implied consent in the action brought by the Whalens
because the trial court’s ruling clearly indicates that its judgment was actually based on the
tort of intentional interference with contractual relations.

V. Intentional Interference with Contractual Relations

Mr. Bourgeois contends that the trial court erred by awarding the Bones compensatory
and punitive damages based on its finding that he interfered with their contractual
relationship with the Whalens. The plaintiffs contend that the trial court properly awarded
damages to the Bones based upon Mr. Bourgeois’s interference because all required elements
of both statutory and common law interference with contractual relations, or inducement to
breach a contract, were proven. We conclude that the weight of the evidence preponderates
in favor of the trial court’s finding that Mr. Bourgeois tortiously interfered with the plaintiffs’
contractual relations “on many levels.” Moreover, as explained in the previous section of
this opinion and based upon our thorough review of the record, we conclude that the trial
court properly found Mr. Bourgeois liable to all plaintiffs, the Whalens and the Bones, for
compensatory and punitive damages based upon the tort of intentional interference with
contractual relations.

The plaintiffs alleged both a common law claim for intentional interference with
contractual relations and a statutory claim for inducement of breach of contract, pursuant to
Tennessee Code Annotated § 47-50-109, which provides:

It is unlawful for any person, by inducement, persuasion, misrepresentation,
or other means, to induce or procure the breach or violation, refusal or failure
to perform any lawful contract by any party thereto; and, in every case where
a breach or violation of such contract is so procured, the person so procuring
or inducing the same shall be liable in treble the amount of damages resulting
from or incident to the breach of the contract. The party injured by such
breach may bring suit for the breach and for such damages.

As to the interplay between the common law and statutory actions, our Supreme Court has
explained:

Tennessee recognizes both a statutory and common law action for
inducement to breach a contract, see Tenn. Code Ann. § 47-50-109 (2001);
Polk & Sullivan, Inc. v. United Cities Gas Co., 783 S.W.2d 538, 543 (Tenn.
1989), and both forms of the action are identical, except that a plaintiff

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 asserting a common law action may recover punitive damages, instead of the
treble damages mandated by the statute. See Buddy Lee Attractions, Inc. v.
William Morris Agency, Inc., 13 S.W.3d 343, 360-61 (Tenn. Ct. App. 1999).
In order to recover on a theory of inducement to breach a contract, a plaintiff
must allege and prove seven elements: (1) that a legal contract existed; (2) that
the defendant was aware of the contract; (3) that the defendant intended to
induce a breach of that contract; (4) that the defendant acted with malice; (5)
that a breach of the contract occurred; (6) that the breach was a proximate
result of the defendant’s conduct; and (7) that the breach injured the plaintiff.
See Quality Auto Parts Co. v. Bluff City Buick Co., 876 S.W.2d 818, 822
(Tenn. 1994); Baker v. Hooper, 50 S.W.3d 463, 468 (Tenn. Ct. App. 2001).

Givens v. Mullikin, 75 S.W.3d 383, 405 (Tenn. 2002). The basic principle in awarding
compensatory damages to a plaintiff who has proven inducement to breach a contract is that
the damages “must be based on the direct and proximate result of the wrongful acts of the
person procuring the breach of contract.” See Dorsett Carpet Mills, Inc. v. Whitt Tile &
Marble Distrib. Co., 734 S.W.2d 322, 324 (Tenn. 1987) (noting the identical elements of the
common law claim and the statutory claim for inducement to breach a contract under Tenn.
Code Ann. § 47-50-109).

In the instant action, the trial court awarded punitive damages to both the Whalens and
the Bones and expressly did not award treble damages, indicating that the judgment entered
was in accordance with the common law tort of inducement to breach a contract, rather than
the statutory action. As for the elements of the common law action, it is undisputed that the
Promissory Note constituted a legal contract between the Whalens and the Bones and that
Mr. Bourgeois not only was aware of the Promissory Note but was present at the closing
when it was executed. Moreover, it is clear from the record that the Bones loaned the
Whalens $76,733.50 with the understanding that this loan would facilitate the Whalens’
purchase of the Property. The Bones required as security for the loan that the Whalens
execute a Promissory Note and a Deed of Trust. Thus, the contract between the Whalens and
the Bones included not only the Promissory Note but also the Deed of Trust executed by the
Whalens in favor of US Title. See Ferguson v. Peoples Nat’l Bank of LaFollette, 800
S.W.2d 181, 183 (Tenn. 1990) (noting with approval the “widely accepted general rule that
a mortgage or deed of trust and a note or bond secured by it are to be deemed parts of one
transaction and construed together as such . . . .”) (quoting 55 Am. Jur. 2d Mortgages § 176
at 303-04 (1971)).

Mr. Bourgeois does not dispute the trial court’s finding that he acted “knowingly and
intentionally” when he convinced US Title to accept his uncashed check in return for the
executed Special Warranty Deed. Mr. Bourgeois’s primary arguments in support of his

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contention that the trial court erred in awarding compensatory damages are that (1) no
contract was breached, (2) the court did not find that Mr. Bourgeois acted with malice, and
(3) neither the Whalens nor the Bones were injured by any effect of Mr. Bourgeois’s actions
on the Promissory Note. We disagree.

First, Mr. Bourgeois asserts that the plaintiffs did not demonstrate a breach of contract
because the Whalens had made payments to the Bones on the Promissory Note as agreed.
At trial, Mr. Bone testified that since the closing, he and his wife had received from the
Whalens $366.34 in monthly payments toward the Promissory Note. The Whalens and Mr.
Marshall testified that these payments had been made first by Mr. Marshall as monthly rent
to the Whalens, who then forwarded the payments to the Bones in honor of the Promissory
Note. Mr. Bourgeois’s assertion ignores, however, that once he had appropriated the Special
Warranty Deed, the Whalens could no longer convey title to the Property to the trustee named
in the Deed of Trust, US Title. The Whalens were unable to provide a valid, enforceable
Deed of Trust, which they were required to provide the Bones in exchange for the Bones’
loaning the purchase price of the Property. Despite the Whalens’ willingness to continue
making monthly payments to the Bones pursuant to the Promissory Note, at least through the
date of trial, the Whalens were in breach of their overall contract with the Bones. This
breach was unquestionably the proximate result of Mr. Bourgeois’s interference. The
Whalens, of course, were also without the benefit of their bargain, namely recorded title to
the Property as signified by the Special Warranty Deed and secured by the Deed of Trust.
See Lincoln Gen. Ins. Co. v. Detroit Diesel Corp., 293 S.W.3d 487, 491 (Tenn. 2009) (noting
the benefit of the bargain as “traditionally the core concern of contract law”) (quoting East
River Steamship Corp. v. Transamerica Delaval, Inc., 476 U.S. 858, 870 (1986)).

Second, Mr. Bourgeois maintains that because the trial court did not find his actions
to be “malicious,” the court erred by holding him liable for intentional interference with the
plaintiffs’ contract. In its judgment, the trial court awarded punitive damages “as a result of
[Mr. Bourgeois’s] intentional and egregious acts.” In reviewing the language of the
judgment draft submitted by the plaintiffs during the post-judgment hearing, which included
the words, “intentional, malicious, and egregious,” the trial court explained:

Well, I think somewhere I would take out the – it was intentional,
malicious, and egregious. I would take out the words malicious – I would take
out the malicious. But I do think that in order to support an award of punitive
damages, that it has to be something more than just a run of the mill tort case.

And as I indicated at the trial of the lawsuit, at the conclusion of the
case, I didn’t consider this to be just an ordinary breach of contract lawsuit.
I thought that this was a completed real estate transaction, that the deeds had

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 been all executed, exchanged, were in the possession of a third party, that
being the closing agent, and that title, even though the deeds had not been
recorded because it was late in the evening of the previous day when the
closing was conducted, that title had passed, and that when Mr. Bourgeois
went down and intimidated the closing agent to give him the warranty [deed]
back, that that was a tort rather than a breach of contract. And not just a tort,
but an intentional tort and one that would support an award of punitive
damages.

One thing I did, of course, there was a claim for treble damages, I didn’t
do that, but I thought that punitive damages were justifiable and that I think
it’s appropriate in an order to indicate that the punitive damages are based
upon what I consider to be an intentional and egregious act on the part of Mr.
Bourgeois.

To support his argument, Mr. Bourgeois cites the definition of “malicious” set out as
one of the four alternative mental states a court is required to find in order to award punitive
damages: “A person acts maliciously when the person is motivated by ill will, hatred, or
personal spite.” Hodges, 833 S.W.2d at 901 (holding that punitive damages may be awarded
only if a court finds that the defendant “acted either (1) intentionally, (2) fraudulently, (3)
maliciously, or (4) recklessly”). This Court previously has held, however, that within the
context of an action for procurement of breach of contract,2 the required element of “malice
is ‘the wilful violation of a known right.’” Prime Co. v. Wilkinson & Snowden, Inc., No.
W2003-00696-COA-R3-CV, 2004 WL 2218574 at *4 (Tenn. Ct. App. Sept. 30, 2004)
(quoting Crye-Leike Realtors, Inc. v. WDM, Inc., No. 02A01-9711-CH-00287, 1998 WL
651623 at *6 (Tenn. Ct. App. Sept. 24, 1998) (in turn quoting Dorsett Carpet Mills, 1986
WL 622 at *6)). “[T]he ‘ill will’ definition of malice for punitive damages doe[s] not apply
to procurement of breach . . . .” Prime Co., 2004 WL 2218574 at *4. As this Court has
explained:

It was sufficient if the evidence showed that [the defendant’s] conduct was
intentional and without legal justification. . . . Interference is without
justification if it “is done for the indirect purpose of injuring the plaintiff or
benefiting the defendant at the plaintiff’s expense.”

2
We note that the common law action of “intentional interference with contractual relations” is
alternatively referred to as “procurement of breach of contract,” as well as the statutory action’s title of
“inducement to breach a contract.” See, e.g., Jones v. LeMoyne-Owen College, 308 S.W.3d 894, 908 (Tenn.
Ct. App. 2009).

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Id. (quoting Crye-Leike Realtors, 1998 WL 651623 at *6) (in turn quoting Bismarck Realty
Co. v. Folden, 354 N.W.2d 636, 642 (N.D. 1984)).

In the judgment at issue, the trial court struck the word “malicious” from the
paragraphs awarding punitive damages, indicating that it was employing the definition of
“malicious” used within the context of punitive damages. See Hodges, 833 S.W.2d at 901.
As to the definition of malice required for procurement of breach of contract, the court
expressly found that Mr. Bourgeois acted intentionally and certainly without legal
justification to demand return of the Special Warranty Deed. See Prime Co., 2004 WL
2218574 at *4. In its ruling following trial, the court also found that Mr. Bourgeois acted
“knowingly” and with the purpose of using the deed as “leverage to get the $900.” Such a
purpose for “leverage” exemplifies the phrase, “benefitting the defendant at the plaintiff’s
expense.” See id. (quoting Crye-Leike, 1998 WL 651623 at *6). In addition, the trial court
purposefully did not strike the word “egregious” and utilized it to describe Mr. Bourgeois’s
actions. In simple terms, “egregious” is defined as conduct “extremely or remarkably bad;
flagrant.” See B LACK’S L AW D ICTIONARY 555 (8th ed. 2004). We determine that the trial
court, although it did not employ the word “malice” as used within the context of intentional
interference with contractual relations, properly found the requisite culpability on Mr.
Bourgeois’s part to support the common law tort.

Finally, Mr. Bourgeois argues that the plaintiffs failed to demonstrate injury suffered
as a result of his interference with the contractual relationship between the Whalens and the
Bones. This argument follows from Mr. Bourgeois’s contention that the Promissory Note
was not breached. The argument is unavailing. Due to Mr. Bourgeois’s intentional
interference, the Bones were left without the security of a valid and recorded Deed of Trust,
which they had required of the Whalens in return for providing the funds to purchase the
Property, and the Whalens for their part were left without the title to the Property for which
they had become indebted to the Bones. We conclude that the evidence supports the trial
court’s finding that Mr. Bourgeois committed the common law tort of intentional interference
with the contractual relationship between the Whalens and the Bones.

VI. Damages

A. Compensatory Damages

1. The Whalens

Mr. Bourgeois contends that the trial court erred by basing its award of compensatory
damages to the Whalens in the amount of $110,000.00 upon the difference between the
purchase price and fair market value of the Property. His argument is grounded in his

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assertion that the trial court found no breach of the purchase and sales contract, as he
concedes that the proper measure of damages for such a breach would be the difference
between the purchase price and market value at the time of sale. See Security Land Co. v.
Touliatos, 716 S.W.2d 918, 921 (Tenn. 1986). Mr. Bourgeois’s argument fails to take into
account the overall agreement between the Whalens and Bones, memorialized by both the
Promissory Note and the Deed of Trust, with which Mr. Bourgeois interfered. We determine
that as a direct result of Mr. Bourgeois’s wrongful acts, the Whalens lost the difference
between the purchase price and market value of the Property at the time of closing, or what
would have been the benefit of their indebtedness to the Bones for the purchase price,
secured by the Deed of Trust in favor of US Title as trustee.

As previously noted, compensatory damages awarded to a plaintiff who has proven
inducement to breach a contract “must be based on the direct and proximate result of the
wrongful acts of the person procuring the breach of contract.” See Dorsett Carpet Mills, 734
S.W.2d at 324. In this case, the trial court arrived at $110,000.00 as the difference between
the purchase price and fair market value of the Property after hearing testimony from Chris
Jackson, a state-certified residential real estate appraiser called by the plaintiffs. Mr. Jackson
appraised the Property at a market value of $185,000.00 and explained that it was assessed
for tax purposes at $190,900.00. In addition, Mr. Bourgeois, explaining that he initially
meant to help Mr. Marshall remain on the Property, acknowledged that he sold the Property
for less than its fair market value, which he testified was in excess of $150,000.00.

Before trial began, Mr. Bourgeois objected to the trial court’s admission of expert
testimony from Mr. Jackson based upon short notice of the testimony. The trial court
admonished the plaintiffs for providing only a few days’ notice of the expert testimony, but
the court further noted that Mr. Bourgeois and his counsel had known that Mr. Jackson
completed an appraisal of the property well in advance of trial. The court overruled Mr.
Bourgeois’s objection to Mr. Jackson’s testimony, and Mr. Bourgeois offered no opposing
proof to demonstrate that the appraisal was inaccurate. See Wilson v. Monroe County, 411
S.W.3d 431, 441 (Tenn. Ct. App. 2013) (“The admission of expert testimony is entrusted to
the sound discretion of the trial court.”) (citing McDaniel v. CSX Transp., Inc., 955 S.W.2d
255 (Tenn. 1997)). In awarding a judgment for compensatory damages in the amount of
$110,000.00 to the Whalens, the trial court accepted Mr. Jackson’s appraisal of the
Property’s market value in the amount of $185,000.00 and subtracted the $75,000.00
purchase price. We conclude that this value was reasonable based upon the evidence
submitted and that the trial court did not err by awarding the Whalens $110,000.00 in
compensatory damages.

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 2. The Bones

Mr. Bourgeois also contends that the trial court erred by awarding the Bones
$76,733.50 in compensatory damages. His assertion is grounded in his argument that the
Promissory Note was not breached. This assertion is unavailing in light of our conclusion
that Mr. Bourgeois’s interference forced a breach of the overall agreement between the
Whalens and the Bones, stripping both couples of the loan security that otherwise would have
been provided by the Whalens’ execution of the Deed of Trust. By awarding the Bones
$76,733.50 in compensatory damages, the trial court returned the exact amount to the Bones
that they had loaned to the Whalens to facilitate purchase of the Property. Insofar as these
funds had been inaccessible to the Bones, kept first in trust at US Title and subsequently
deposited with the clerk and master, return of the funds represented compensation for a direct
loss due to Mr. Bourgeois’s wrongful actions. See Hodges, 833 S.W.2d at 902 (noting that
“the purpose of compensatory damages is to make the plaintiff whole”).

We conclude that the trial court did not err by awarding the Bones compensatory
damages in the amount of $76,733.50. The trial court also did not err by ordering that the
funds deposited with the trial court clerk and master be disbursed immediately to the Bones
to fulfill this award of compensatory damages. These funds included the $76,733.50
originally deposited plus $277.41 earned in interest. We note that the award of compensatory
damages has been paid to the Bones prior to this appeal and that any other damages due to
the Bones should be offset by the amount of $277.41.

B. Prejudgment Interest to the Whalens

The trial court awarded the Whalens prejudgment interest in the amount of
$14,736.99, pursuant to Tennessee Code Annotated § 47-14-123 (2013).3 Mr. Bourgeois’s
sole assignment of error regarding this award is that it flowed from what he believed to be
an erroneous award of compensatory damages. Having concluded that the trial court did not
error in awarding the Whalens a judgment in the amount of $110,000.00 for compensatory
damages, we further conclude that the trial court did not abuse its discretion by awarding the
Whalens $14,736.99 in prejudgment interest. See Reeder v. Reeder, 375 S.W.3d 268, 281

3
Tennessee Code Annotated § 47-14-123 provides in pertinent part:

Prejudgment interest, i.e., interest as an element of, or in the nature of, damages, as
permitted by the statutory and common laws of the state as of April 1, 1979, may be
awarded by courts or juries in accordance with the principles of equity at any rate not in
excess of a maximum effective rate of ten percent (10%) per annum; . . .

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(Tenn. Ct. App. 2012) (“[I]n most civil actions whether to award prejudgment interest lies
within the sound discretion of the trial court . . . .”).4

C. Punitive Damages

Mr. Bourgeois contends that the trial court erred by awarding the Whalens $55,000.00
and the Bones $40,000.00 in punitive damages because (1) the plaintiffs failed to present
clear and convincing evidence of conduct warranting punitive damages and (2) the trial court
failed to consider all applicable factors to be used in determining the amount of punitive
damages. The plaintiffs contend that the trial court properly awarded punitive damages
because the court expressly found Mr. Bourgeois’s actions to be intentional, egregious, and
outrageous. We conclude that the trial court did not err in finding clear and convincing
evidence that Mr. Bourgeois is liable to the plaintiffs for punitive damages. We also must
conclude, however, that the trial court erred by failing to assess the amount of punitive
damages based upon the factors delineated in Culbreath, 44 S.W.3d at 528 and Hodges, 833
S.W.2d at 901-02, and we remand for reassessment of the amount of punitive damages in
consideration of these factors.

Regarding Mr. Bourgeois’s liability for punitive damages, a court may award punitive
damages “only if it finds a defendant has acted either (1) intentionally, (2) fraudulently, (3)
maliciously, or (4) recklessly.” Hodges, 833 S.W.2d at 901. As our Supreme Court
explained in Hodges:

A person acts intentionally when it is the person’s conscious objective
or desire to engage in the conduct or cause the result. Cf. T.C.A. § 39-11-
302(a) (1991) (criminal definition of “intentional”). A person acts fraudulently
when (1) the person intentionally misrepresents an existing, material fact or
produces a false impression, in order to mislead another or to obtain an undue
advantage, and (2) another is injured because of reasonable reliance upon that
representation. See First Nat’l Bank v. Brooks Farms, 821 S.W.2d 925, 927

4
We note that in the trial court’s ruling immediately following trial, it articulated an award of
prejudgment interest to the Bones in the amount of $4,112.07. This award was not included, however, in the
written judgment. See Heath v. Memphis Radiological Prof’l Corp., 79 S.W.3d 550, 556 (Tenn. Ct. App.
2001) (“[A] court speaks through its written orders.”). Insomuch as the absence of an award of prejudgment
interest to the Bones in the final judgment has not been raised as an issue by the Bones on appeal and was
not raised in the trial court, we find no reason to disturb the trial court’s judgment in this regard. See Tenn.
R. App. P. 13(b) (“Review generally will extend only to those issues presented for review.”); Tenn. R. App.
P. 36(a) (“Nothing in this rule shall be construed as requiring relief be granted to a party responsible for an
error or who failed to take whatever action was reasonably available to prevent or nullify the harmful effect
of the error.”). The Bones, therefore, are not entitled to an award of prejudgment interest.

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 (Tenn. 1991). A person acts maliciously when the person is motivated by ill
will, hatred, or personal spite. A person acts recklessly when the person is
aware of, but consciously disregards, a substantial and unjustifiable risk of
such a nature that its disregard constitutes a gross deviation from the standard
of care that an ordinary person would exercise under all the circumstances. Cf.
T.C.A. § 39-11-302(c) (1991) (criminal definition of “reckless”).

Further, because punitive damages are to be awarded only in the most
egregious of cases, a plaintiff must prove the defendant’s intentional,
fraudulent, malicious, or reckless conduct by clear and convincing evidence.[FN]
This higher standard of proof is appropriate given the twin purposes of
punishment and deterrence: fairness requires that a defendant’s wrong be
clearly established before punishment, as such, is imposed; awarding punitive
damages only in clearly appropriate cases better effects deterrence.

[FN.] Clear and convincing evidence means evidence in which there
is no serious or substantial doubt about the correctness of the conclusions
drawn from the evidence.

Id.

As noted previously, the trial court in this case expressly found in its ruling that Mr.
Bourgeois acted knowingly, intentionally, and outrageously when he appropriated the Special
Warranty Deed and interfered with the contractual relationship between the Whalens and the
Bones. The trial court included in its written judgment that Mr. Bourgeois’s actions were
“intentional and egregious.” Mr. Bourgeois argues that because the trial court did not
describe his actions as “malicious,” awards of punitive damages could not be warranted. We
note that the standard requires the plaintiffs to prove clear and convincing evidence of either
intentional, fraudulent, malicious, or reckless behavior on the part of the defendant. See id.
Mr. Bourgeois admitted that he intentionally appropriated the Special Warranty Deed as
“leverage” to obtain $900.00 in rent from the Whalens. He testified that he believed after
speaking with an attorney on the morning after the closing that he had a right to reclaim the
deed if he returned his uncashed check for the purchase price. The trial court did not find
this testimony credible.

We discern no evidence in the record that would lead us to disturb the trial court’s
findings regarding witness credibility. See Jones, 92 S.W.3d at 838 (noting that the trial
court’s determinations regarding witness credibility shall not be disturbed absent clear and
convincing evidence to the contrary). We also note that according to Mr. Bourgeois’s own
testimony, he was an experienced real estate investor and broker who had participated in

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hundreds of real estate closings. The trial court found that Mr. Bourgeois had intimidated
staff at US Title into giving him the Special Warranty Deed, and Ms. Hatch’s testimony
supported this finding. We agree with the trial court’s finding that Mr. Bourgeois acted
intentionally, as with the “conscious objective or desire to engage in the conduct or cause the
result,” when he appropriated the deed and interfered with the contractual relations between
the Whalens and the Bones. See Hodges, 833 S.W.2d at 901.

Mr. Bourgeois also argues that the trial court erred by finding liability for punitive
damages because the court “allowed itself to be misled by preconceptions of the case.” He
cites comments made by the trial court at the opening and closing of trial to the effect that
this was “the silliest lawsuit” and “outlandish” to have arisen over the $900.00 rent dispute,
particularly when Ms. Hatch testified that she offered to waive US Title’s fee in order to
avoid a dispute. This argument is without merit. We have been cited no authority that would
prohibit the trial court from noting the small percentage of the total funds involved in the
property sale that became the focus of Mr. Bourgeois’s actions or the number of times he had
an opportunity to avoid legal action before it was initiated.

Once a defendant’s liability for punitive damages has been established, as in this case,
the trial court must immediately conduct a second phase of the trial to determine the
appropriate amount of punitive damages. See Culbreath, 44 S.W.3d at 527 (citing Hodges,
833 S.W.2d at 901). As our Supreme Court explained in Culbreath:

During this second phase, the factfinder shall consider, to the extent
relevant, at least the following:

(1) The defendant’s financial affairs, financial condition, and net
worth;

(2) The nature and reprehensibility of defendant’s wrongdoing, for
example

(A) The impact of defendant’s conduct on the plaintff, or

(B) The relationship of defendant to plaintiff;

(3) The defendant’s awareness of the amount of harm being caused
and defendant’s motivation in causing the harm;

(4) The duration of defendant’s misconduct and whether defendant
attempted to conceal the conduct;

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 (5) The expense plaintiff has borne in the attempt to recover the
losses;

(6) Whether defendant profited from the activity, and if defendant
did profit, whether the punitive award should be in excess of the
profit in order to deter similar future behavior;

(7) Whether, and the extent to which, defendant has been subjected
to previous punitive damage awards based upon the same
wrongful act;

(8) Whether, once the misconduct became known to defendant,
defendant took remedial action or attempted to make amends by
offering a prompt and fair settlement for actual harm caused;
and

(9) Any other circumstances shown by the evidence that bear on
determining the proper amount of punitive award.

Hodges, 833 S.W.2d at 901-02. In applying these factors, the trier of fact must
consider “that the primary purpose of a punitive award is to deter misconduct,
while the purpose of compensatory damages is to make the plaintiff whole.”
Id. at 902.

In jury cases the trial judge must review the jury’s award of punitive
damages and “clearly set forth the reasons for decreasing or approving all
punitive awards in findings of fact and conclusions of law demonstrating a
consideration of all factors on which the jury is instructed.” Id. In non-jury
trials, such as the pending case, the trial judge’s findings of fact and
conclusions of law are equally essential. In the absence of sufficient findings
of fact and conclusions of law as to each of the relevant Hodges criteria, an
appellate court cannot adequately review the trial court’s award of punitive
damages.

Culbreath, 44 S.W.3d at 527-28 (footnote omitted).

In the case at bar, the trial court failed to conduct a second phase of the trial to
determine the appropriate amount of punitive damages to award the plaintiffs. The court did
expressly state in its ruling that it was “not going to treble” compensatory and prejudgment
interest damages pursuant to Tennessee Code Annotated § 47-50-109 and was instead “going

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to allow punitive damages” in the amount of $55,000.00 in favor of the Whalens and
$40,000.00 in favor of the Bones pursuant to the common law tort of intentional interference
with contractual relations. Other than its general findings regarding Mr. Bourgeois’s
culpability warranting punitive damages, as noted above, the trial court did not consider the
respective factors for the amount of damages set out in Culbreath and Hodges.

For this reason, we remand to the trial court with specific instructions to conduct a
hearing in which the trial court shall reassess the amount of punitive damages awarded to the
plaintiffs by considering and making specific findings of fact according to the Culbreath and
Hodges criteria. See, e.g., Emerson v. Oak Ridge Research, Inc., 187 S.W.3d 364, 374
(Tenn. Ct. App. 2005) (“Since the Trial Court failed to make such findings and did not
conduct the proper analysis in this case, the issue of punitive damages is remanded and the
Trial Court is directed to comply with the requirements of Hodges and Culbreath.”). On
remand, the parties should be allowed to present additional evidence relative to the factors
for determining the amount of punitive damages. See Wilkerson v. Wilkerson, No. W1999-
01684-COA-R3-CV, 2000 WL 633462 at *2-3 (Tenn. Ct. App. May 11, 2000) (affirming the
trial court’s consideration of additional proof regarding the value and distribution of marital
assets on remand from this Court) (quoting First Tennessee Bank Nat’l Assoc. v. Hurd Lock
and Mfg. Co., 816 S.W.2d 38, 40 (Tenn. Ct. App. 1991) (“‘[T]his court, in its original
opinion, envisioned and intended that the trial judge, on remand, take all action necessary to
do complete justice, including the reception of additional proof.’”)).

VII. Discretionary Costs

Mr. Bourgeois contends that the trial court erred by awarding $1,324.81 in
discretionary costs to the plaintiffs because the award included a fee paid to the expert
witness, real estate appraiser Chris Jackson, whose testimony Mr. Bourgeois asserts should
not have been allowed. He further argues that the trial court sufficiently provided for the
plaintiffs’ expenses through awards of compensatory and punitive damages. The plaintiffs
contend that the discretionary costs awarded were all clearly allowed by Tennessee Rule of
Civil Procedure 54.04(2). We agree with the plaintiffs on this issue.

The plaintiffs filed a post-judgment motion for discretionary costs on June 7, 2013.
Following a hearing conducted on June 20, 2013, the trial court granted the motion as to all
requested costs except a $400.00 fee paid to Mr. Jackson for completing the appraisal of the
Property. The court found this $400.00 to be a fee paid to an expert witness in preparation
for trial and accordingly denied it pursuant to Tennessee Rule of Civil Procedure 54.04(2).
The remaining costs granted to the plaintiffs included the following:

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 Court Reporter Expense, Depositions: $1,008.15
Expert Witness Fee, Appraiser Chris Jackson: 200.00
Court Reporter Fee, Trial and Memorandum Opinion: 116.66
TOTAL $1,324.81

Tennessee Rule of Civil Procedure 54.04(2) provides in pertinent part:

(2) Costs not included in the bill of costs prepared by the clerk are
allowable only in the court’s discretion. Discretionary costs
allowable are: reasonable necessary court reporter expenses for
depositions or trials, reasonable necessary expert witness fees
for depositions (or stipulated reports) and for trials, reasonable
and necessary interpreter fees for depositions or trials, and
guardian ad litem fees; travel expenses are not allowable
discretionary costs.

Recovery of expert fees does not include fees incurred for trial preparation. Shahrdar v.
Global Hous., Inc., 983 S.W.2d 230, 239 (Tenn. Ct. App. 1998) (citing Miles v. Marshall C.
Voss Health Care Ctr., 896 S.W.2d 733 (Tenn. 1995)). A trial court will generally grant the
prevailing party reasonable discretionary costs when requested through a timely, properly
supported motion. Scholz v. S.B. Int’l, Inc., 40 S.W.3d 78, 84 (Tenn. Ct. App. 2000).

Having concluded that the trial court did not err by allowing expert testimony as to
the market value of the Property, we cannot agree with Mr. Bourgeois’s assertion that the
court erred by awarding discretionary costs for the expert’s appearance at trial. Mr.
Bourgeois does not object to the trial court’s finding that the discretionary costs were
reasonable. We determine that the trial court did not abuse its discretion by awarding the
plaintiffs $1,324.81 in discretionary costs in addition to the damages awarded. See Scholz
v. S.B. Int’l, Inc., 40 S.W.3d at 85 (“Awards of discretionary costs are not intended to punish
the defendant either for its conduct that caused the litigation or for its conduct during the
litigation. Rather, they represent another step toward making an injured plaintiff whole.”).

VIII. Vesting Title to the Property

Mr. Bourgeois contends that the trial court erred by vesting title to the Property in him
rather than the Whalens. He concedes that he had no right to attempt a unilateral rescission
of the purchase and sales contract. He argues that because the trial court ruled that sale of
the Property was complete, the appropriate remedy would have been to grant the plaintiffs
specific performance and issue a decree divesting title to the Property from Mr. Bourgeois

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and vesting it in the Whalens pursuant to Tennessee Rule of Civil Procedure 70.5 The
plaintiffs do not address this issue directly on appeal except to state that they are not
appealing the trial court’s ruling. We conclude that the trial court did not err by vesting title
to the Property in Mr. Bourgeois.

In their initial complaint and ultimately in their final amended complaint, the Whalens
requested specific performance of the purchase and sales contract as well as compensatory
and punitive damages for, inter alia, intentional interference with the contractual relationship
between the Whalens and the Bones. During closing argument at trial and in response to
questioning from the trial court judge, the plaintiffs’ counsel stated that the plaintiffs were
“seeking compensation, not specific performance.” Counsel explained that the plaintiffs had
“elected damages” as set out in their “calculation of damages” submitted to the trial court.
In its ruling at the close of trial, the court expressly found that damages, rather than specific
performance, constituted an equitable remedy. In its final judgment, the trial court provided
in pertinent part:

[It is hereby] ORDERED that Quint Bourgeois shall receive the residence and
real property located at 1516 Airport Road, Oakdale, Morgan County,
Tennessee, which property shall be subject to the judgment liens of the
Plaintiffs as set forth in this judgment. Said property is hereby vested out of
Whalens and into Bourgeois.

In electing damages as a remedy, the plaintiffs evoked the doctrine of election of
remedies, which “is implicated when two inconsistent and irreconcilable remedies are
available to the plaintiff to redress a single wrongful act.” See Concrete Spaces, Inc. v.
Sender, 2 S.W.3d 901, 906 (Tenn. 1999). As our Supreme Court has explained:

Tennessee Rule of Civil Procedure 8.01 “grants a plaintiff wide latitude in
pleading alternative claims for relief and pursuing an array of theories of
recovery in a single action.” Concrete Spaces, Inc. v. Sender, 2 S.W.3d 901,
906 (Tenn. 1999). This allows Plaintiffs to seek redress both under common
law and under the Tennessee Consumer Protection Act. However, in certain
circumstances, a plaintiff is required to elect between remedies.

The election of remedies doctrine has two general applications:
(1) a plaintiff may be estopped from pursuing additional

5
Tennessee Rule of Civil Procedure 70 provides in pertinent part: “A decree for specific performance
shall, if so ordered by the court, operate as a deed to convey land located in this state, or, in appropriate
cases, other property, without any conveyance being executed by the vendor.”

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 remedies once a plaintiff has made a choice to pursue a specific
remedy in another forum or lawsuit, and (2) a plaintiff may be
forced to elect between different remedies “where the remedies
are so inconsistent or repugnant that pursuit of one necessarily
involves negation of the other.”

Forbes v. Wilson County Emergency Dist. 911 Bd., 966 S.W.2d 417, 421
(Tenn. 1998) (internal citations omitted). “For election of remedies to apply,
the two remedies sought must be truly repugnant to one another.” Allied
Sound, Inc. v. Neely, 909 S.W.2d 815, 822 (Tenn. Ct. App. 1995). The
purpose behind the election of remedies doctrine is to prevent “double redress”
for a single wrong. Forbes, 966 S.W.2d at 421.

Miller v. United Automax, 166 S.W.3d 692, 696-97 (Tenn. 2005).

The trial court in this case found that Mr. Bourgeois did not breach the purchase and
sales contract because that contract was completed when the Special Warranty Deed was
executed at closing. The court could not therefore grant a remedy of specific performance
as to the purchase and sales contract. Even if, arguendo, the trial court could have awarded
specific performance of the purchase and sales contract, the decision of whether to make
such an award would have been within the sound discretion of the trial court. See Lane v.
Assoc. Hous. Developers, 767 S.W.2d 640, 643 (Tenn. Ct. App. 1988) (noting that the
remedy of specific performance of a real estate sales contract “rests in the sound discretion”
of the trial court). We note that such an award would have been truly repugnant to the
elected remedy of compensatory damages insofar as it would have provided double redress,
both the Property and its lost value, to the Whalens. The trial court did not err by vesting title
to the Property in Mr. Bourgeois, subject to the plaintiffs’ judgment liens.

IX. Conclusion

For the reasons stated above, we vacate the trial court’s award of punitive damages
in the amount of $55,000.00 to the Whalens and $40,000.00 to the Bones and remand to the
trial court for reassessment of the amounts to be awarded based upon the factors delineated
in Culbreath, 44 S.W.3d 518 and Hodges, 833 S.W.2d 896. The trial court’s judgment is
affirmed in all other respects. Costs on appeal are assessed equally, one half collectively to
the plaintiffs and one half to the defendant, Quint Bourgeois.

_________________________________
THOMAS R. FRIERSON, II, JUDGE

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