Tennessee Business Litigation Lawyers Blog
In a recent Tennessee partition case, the Court of Appeals of Tennessee reversed the trial court’s finding that the plaintiff did not have an interest in the farm which he sought to partition by sale. The trial court held that, even though the plaintiff was listed as a joint tenant on the deed to the property, he had no interest based on the theories of title by prescription, and unjust enrichment and based on Tenn. Code Annotated §28-2-110 (the statute which prevents someone from bringing an action to assert title to property if that person has not paid property taxes for more than 20 years).
Here are the key facts:
- Defendants, the parents of the plaintiff (“Parents”), owned several separate tracts of farmland as joint tenants in common (also sometimes referred to as “co-tenants”) with their sons — Plaintiff and his brother
- Plaintiff sought to partition several tracts of the farmland
- The tract known as the McLemoresville Farm (the “Farm”) was the subject of the appeal
- In 1979, Parents had executed a deed transferring to Plaintiff and his brother a one-fourth interest each in the Farm
- The purchase of the Farm had been financed, and Parents, Plaintiff and his brother had all signed the deed of trust which secured the loan
- Only parents signed the note for the Farm, and they paid all of the payments
- In addition to the loan payments, Parents paid all property taxes and other expenses related to the Farm for nearly 30 years
- All parties agreed that Parents, Plaintiff and Plaintiff’s brother farmed harmoniously on the Farm, and on other jointly owned tracts, for years and until Plaintiff filed the partition lawsuit
The trial court held that Plaintiff could not partition the Farm because only parents had an ownership interest in the Farm for three reasons: (1) Tenn. Code Ann. §28-2-110 barred Plaintiff from asserting any ownership in the Farm; (2) Parents had obtained title by prescription to all interest in the Farm; and (3) Parents were entitled to exclusive ownership of the Farm based on the theory of unjust enrichment. The court of appeals reversed the trial court on all three holdings.
Tenn. Code Ann. §28-2-110 provides that no one may bring an action to claim title to land if that person has failed to pay property taxes for more than 20 years. The court of appeals held that the statute did not apply to Plaintiff because the Supreme Court of Tennessee has held that the statute does not bar a lawsuit by one joint tenant against another unless the plaintiff in such a lawsuit was ousted by the other joint tenant. Because Plaintiff and Parents had cooperatively farmed the Farm for many years, there was no ouster and, therefore, the statute did not apply.
The court of appeals then held that Parents had not obtained title by prescription because to do so they would have had to prove they possessed and used the Farm to the exclusion of Plaintiff and his brother for at least 20 years.
With respect to the unjust enrichment finding, the court of appeals reversed it on the basis that the payments made by the Parents were all made voluntarily, and that Parents never sought reimbursement for over 20 years, yet continued to work the Farm with their sons.