STAINMASTER CARPET & RESTORATION, LLC ET AL.
MUSIC CITY MESSENGER SERVICE, INC. ET AL.
Session April 3, 2019
from the Chancery Court for Davidson County No. 15-289-II
William E. Young, Chancellor
appeal arises from an action for declaratory judgment as to
the ownership of a business, defamation, and tortious
interference with business relations. The plaintiff carpet
cleaner alleged that the defendant entrepreneur and his wife
loaned money to the plaintiff to expand his carpet cleaning
business with the condition that the defendants handle the
business's finances and bookkeeping. The defendants
asserted that they started a new carpet cleaning business and
the plaintiff was merely an employee. Following a jury
verdict for the plaintiff, the trial court denied the
defendants' motion for a new trial and remittitur. On
appeal, the defendants contend that the trial judge failed to
fulfill his duty as the thirteenth juror and there was no
material evidence to support the jury's verdict or award
of damages. After reviewing the record, we find the trial
judge fulfilled his role as the thirteenth juror and that
there was material evidence to support the jury's verdict
and award of damages. Accordingly, we affirm the judgment
against the defendants.
R. App. P. 3 Appeal as of Right; Judgment of the Chancery
F. Bloom, Nashville, Tennessee, for the appellants, Scott M.
Fulner, Pamela Fulner, Music City Messenger Service, Inc.,
and PIP of Tennessee, Inc.
Carl Spining and William Horace Neal, III, Nashville,
Tennessee, for the appellees, Stainmaster Carpet &
Restoration, LLC, and James Brandon Walker.
Randall E. Schisler, appellee, pro se.
G. Clement Jr., P.J., M.S., delivered the opinion of the
Court, in which Andy D. Bennett and W. Neal McBrayer, JJ.,
G. CLEMENT JR., P.J., M.S.
and Procedural History
central issue of this case is a dispute over the terms of an
oral agreement made in 2013 by entrepreneurs Brandon Walker
and Scott Fulner. Mr. Walker had owned and operated a carpet
cleaning business since 2004, and Scott Fulner had owned a
variety of businesses since the 1980s. In 1993, Mr. Fulner
incorporated Music City Messenger Service, Inc.
("MCM") as a "shell" corporation under
which he operated a delivery company and a mortgage company.
Mr. Fulner later sold the delivery business and closed the
mortgage company, but MCM remained in existence to collect
residual payments from a real estate sale. Mr. Fulner and Mr.
Walker met in 2009 at a social event, and Mr. Fulner
eventually hired Mr. Walker to clean the carpets at Mr.
Fulner's home and at the offices of another one of Mr.
Fulner's businesses, PIP of Tennessee, Inc., d/b/a
Dynamark Graphics Group ("Dynamark").
2012 or early 2013, Mr. Walker and Mr. Fulner entered into an
oral agreement, the terms of which the parties later
disputed. The agreement was never reduced to writing, and Mr.
Walker and Mr. Fulner were the only persons present at its
formation. According to Mr. Walker, he had recently begun
operating his carpet cleaning business under the name
Stainmaster when Mr. Fulner proposed loaning Mr. Walker money
for Mr. Walker to purchase a new van and additional
equipment. To ensure repayment of the loan, Mr. Fulner
insisted that Stainmaster's finances and bookkeeping be
handled by MCM and the loan repayments be automatically
deducted from Stainmaster's revenue. As part of the deal,
Stainmaster and Dynamark would exchange services, with
Dynamark receiving free carpet cleaning and Stainmaster
receiving free printing services. When the loans were repaid,
Mr. Walker was to retake control of the funds held by Mr.
to Mr. Fulner, Mr. Walker approached Mr. Fulner because Mr.
Walker's carpet cleaning business was failing due to,
inter alia, a lack of proper equipment. Although Mr.
Fulner was not interested in investing in the existing
business or becoming partners in a new venture, he saw an
opportunity to leverage his business experience and MCM's
existing administrative capabilities to build a new carpet
cleaning company. Mr. Fulner's goal was to grow the
business and then sell it. Accordingly, Mr. Fulner offered to
start the business and hire Mr. Walker as the operations
manager. If the business grew, the two men would either split
the profit from its sale, or Mr. Fulner would sell the
business to Mr. Walker for half of the asking price. Mr.
Fulner would use the existing administrative staff of MCM to
handle Stainmaster's administrative needs.
undisputed is that the two men reached an agreement of one
kind or another and, in March 2013, Mr. Fulner opened a bank
account under the name Music City Messengers, d/b/a
Stainmaster Cleaning & Restoration ("the Stainmaster
Account"). The account was opened with a check for $10,
000 from MCM's primary account. It is also undisputed
that the $10, 000 was structured as a loan from MCM, to be
repaid in 12 equal payments at 8% interest. Shortly
thereafter, a 1998 Ford van was purchased, which Mr. Walker
used to perform carpet cleaning services under the
Stainmaster name. Stainmaster's clients sent payment to
the Dynamark office, where it was accounted for by two MCM
employees before being deposited into the Stainmaster
Account. The van was insured on a policy in the name of Mr.
Fulner, d/b/a Stainmaster. Mr. Fulner also opened a business
credit card account under his name and the name of
Stainmaster. In May 2013, a 2005 Chevrolet van was purchased
for $16, 000 and titled in the name of Music City Messengers,
d/b/a Stainmaster. The van was paid for with a loan from Mr.
Fulner's wife, Pamela Fulner, to be repaid in 24 equal
installments at 8% interest. All of Stainmaster's credit
card bills, loan payments, payroll, and operating expenses
were paid out of the Stainmaster Account.
also undisputed that Mr. Walker's role was largely
confined to managing the day-to-day cleaning services, and
Mr. Fulner's role-through MCM-was largely confined to
managing the administrative functions of the business. Mr.
Walker hired and trained employees, directed the solicitation
of new clients, coordinated services for existing clients,
and performed the carpet cleaning. The employees began and
ended their day at Mr. Walker's house, where the vans
were kept. Although Mr. Walker and the other employees were
paid through a payroll service as employees of MCM, Mr.
Walker picked up payroll from the Dynamark office and
delivered them to Stainmaster's employees.
around March 2014, Mr. Walker was involved in an automobile
accident while driving the 1998 Ford van. The insurance
company declared the vehicle a total loss and issued a check
to Mr. Fulner, d/b/a Stainmaster, for $9, 311.49. The
proceeds were deposited into the Stainmaster Account, and
shortly thereafter a 2003 Ford van was purchased and titled
to Stainmaster Carpet Cleaning. Mr. Walker signed the invoice
and vehicle registration for the 2003 Ford van as
2014, Mr. Walker hired Randy Schisler as a cleaning
technician. Although Mr. Schisler proved less than
satisfactory in his role, Mr. Walker saw that Mr. Schisler
"had a gift of gab" and thought Mr. Schisler would
be good at sales. Thus, Mr. Walker moved Mr. Schisler to a
sales position. The next month, Stainmaster had a booth at
the 2014 Greater Nashville Apartment Association trade show,
where Stainmaster networked with apartment complex managers
from the Nashville area. Adding Mr. Schisler and attending
the trade show led to an increase in clients. Consequently, a
2002 GMC van was purchased with a second loan from Ms. Fulner
and titled to Stainmaster Carpet Cleaning. Like the first,
the second loan was to be repaid in 24 equal installments
with eight percent interest.
this point, Mr. Walker and Mr. Fulner maintained an amicable
relationship. In late 2014, however, Mr. Fulner and Mr.
Walker's disparate views of their respective roles in
Stainmaster became apparent when they disagreed about whether
the Stainmaster vans should be kept at Mr. Walker's house
or at Dynamark's office. The growing tension rose to a
crescendo in early February 2015.
Friday, February 6, 2015, one of Stainmaster's vans was
ready to be picked up from a repair shop. Both Mr. Walker and
Mr. Fulner showed up, and both claimed ownership of the van.
After an argument in the parking lot, it was clear to Mr.
Walker and Mr. Fulner that their arrangement was no longer
working. They agreed to meet that Sunday morning at the
Dynamark offices to discuss the dissolution of their business
relationship. At their meeting, Mr. Fulner offered to part
ways in exchange for a payment of $36, 000. As with their
initial agreement, Mr. Walker and Mr. Fulner later disputed
the terms of Mr. Fulner's offer. According to Mr. Walker,
Mr. Fulner asked for $36, 000 to pay off the remaining loan
balances and to pay for MCM's administrative services.
According to Mr. Fulner, he offered to sell the business to
Mr. Walker for $36, 000. Either way, the parties agree that
their negotiations quickly broke down and Mr. Fulner
"fired" Mr. Walker the next day via text message
and demanded the return of the van and equipment in Mr.
Walker did not capitulate to Mr. Fulner's demands.
Instead, he sent a letter to all of Stainmaster's
customers, informing them that future payments should be sent
to Mr. Walker's home address instead of Dynamark. Mr.
Walker also changed the addresses on the Stainmaster vans to
his home address and continued to perform carpet cleaning
services under the Stainmaster name. At the same time, Mr.
Fulner continued running Stainmaster with Mr. Schisler.
Emails were sent to Stainmaster's clients, informing them
that Mr. Walker had gone "rogue" and was no longer
an authorized representative of Stainmaster. Because of the
dueling Stainmasters, several clients refused to tender
payment to either party until the dispute was resolved.
March 9, 2015, Mr. Walker and Stainmaster Carpet &
Restoration, LLC(collectively, "Plaintiffs")
filed the present action against Mr. Fulner, Ms. Fulner, MCM,
Dynamark (collectively, "Defendants"), and Mr.
Schisler. The complaint asked for a declaratory
judgment that the Stainmaster business belonged to Mr. Walker
and requested damages for defamation and tortious
interference with business relations. Defendants filed an
answer, generally denying the allegations and asserting
counterclaims for conversion, defamation, tortious
interference with business relations, and fraud.
case proceeded to a five-day jury trial on January 22, 2018.
The jury found that Mr. Walker was the rightful owner of the
Stainmaster business, including its vehicles, equipment,
supplies, and accounts, and awarded Mr. Walker $100, 000
against Mr. Fulner. In addition, the jury found that Mr.
Fulner communicated defamatory statements about Mr. Walker,
damaging his business and reputation and causing a loss of
clients of Stainmaster, and awarded $75, 000 against Mr.
Fulner on this claim. Finally, the jury found that Mr. Fulner
wrongfully interfered with Mr. Walker's business
relationships, causing a loss of clients and ...