Arvest Bank v. Byrd et al, No. 2:2010cv02004 - Document 162 (W.D. Tenn. 2011)
Court Description: ORDER denying 112 Motion in Limine. Signed by Judge Samuel H. Mays, Jr on 12/16/2011.
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Arvest Bank v. Byrd et al Doc. 162 IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TENNESSEE WESTERN DIVISION ARVEST BANK, ) ) ) No. 10-2004 ) ) ) ) ) ) ) ) Plaintiff, v. PRESTON E. BYRD, DONETTE L. BYRD, and PRESTON E. BYRD IRREVOCABLE INSURANCE TRUST, Defendants. ORDER DENYING PLAINTIFF’S MOTION IN LIMINE Before the Court is Plaintiff Arvest Bank’s (“Arvest”) October 6, 2011 Amended Motion in Limine and Request for Jury Instructions. (ECF No. 112) (“Amended Motion in Limine”). Defendant Preston Byrd (“Byrd”) responded on October 14, 2011. (ECF No. 119) (“Byrd Response”). Arvest inducement. Holding is suing Byrd for conversion and fraud in the Byrd was the agent and chief manager for Horizon Company, LLC (“HHC”) and was (Second Am. Compl. ¶ 12, ECF No. 24.) an undisclosed owner. HHC sought funding for the construction of multifamily low and moderate income housing to be known as the Lamar Crossing Apartments. The Development Agreement (the (Id. ¶¶ 10-11.) “Development Agreement”) established a pay schedule for dispersing Developer Fees (the 1 Dockets.Justia.com “Developer Fees”) to HHC. 1 Arvest contends that Byrd converted (Id. ¶¶ 20-33.) those Developer Fees for his personal benefit. Arvest requests “entry of an Order excluding from the trial . . . any testimony, evidence or argument that [] Byrd was justified under the governing contracts in transferring any amounts over $250,000 from the bank accounts of Lamar Crossing Apartments, LP to the bank accounts of Horizon Holding Company, LLC.” that (Am. Mot. in Limine 1.) Byrd was entitled to According to Arvest, evidence transfer more than $250,000 is irrelevant and unfairly prejudicial under Rules 402 and 403 of the Federal Rules of Evidence. Arvest also asks the Court to instruct the jury that, as a matter of law, payment of no more than $250,000 of the Developer governing contracts until Apartments project. (See Fees was completion of id.) the For permitted the by the Lamar Crossing following reasons, Arvest’s Motion is DENIED. I. Analysis Generally, evidence is all relevant relevant if it evidence has “any is admissible, tendency” to make existence of any consequential fact more or less probable. 1 and the See Section 6(a) of the Development Agreement states that “not more than $250,000 of the Development Fee shall be paid out [] of said First Installment, not more than an additional $250,000 shall be paid out [] of the Third Installment, not more than [] $177,767 shall be paid out [] of the Fourth Installment, and not more than [] $343,653 shall be paid out [] of the Fifth Installment.” (See Development Agreement §6(a), ECF No. 112-2.) The Development Agreement directs payment of the Developer Fees “as of and when the Developer’s Services are rendered.” (Id.) 2 Fed. R. Evid. 401, 402. Under Federal Rule of Evidence 403, relevant evidence may be excluded “if its probative value is substantially confusion outweighed of the considerations of by the issues, undue or danger of misleading delay, waste of unfair the prejudice, jury, time, or or by needless See Fed. R. Evid. 403. presentation of cumulative evidence.” A. Rule 402 Arvest’s Motion addresses the Development Agreement. Am. Mot. whether in Limine Byrd’s Developer Fees 3-4.) The testimony that under the Court’s he Development threshold received (See inquiry $1,280,000 Agreement is is as relevant. “The standard for relevancy is ‘extremely liberal’ under the United States v. Clark, 377 F. Federal Rules of evidence.” App’x 451, 456 (6th Cir. 2010) (quoting Dortch v. Fowler, 588 F.3d 396, 400 (6th Cir. 2009)). Developer Agreement. Fees for services Byrd contends that he received rendered (“Byrd Resp. 1-3.) under the Development That assertion has a direct bearing on whether Byrd is liable for conversion. Evidence that Byrd was justified under the Development Agreement and governing contracts to transfer amounts more than $250,000 is relevant. B. Rule 403 Arvest argues that evidence of receiving more than $250,000 in Developer Fees under inadmissible under Rule 403. the Development Agreement is Although Arvest’s Motion is not 3 specific, the Court understands Arvest to be challenging Byrd’s evidence as unfairly prejudicial under Rule 403. (See Am. Mot. in Limine 5) (“Defendants cannot be allowed to usurp the Court’s role as interpreter of unambiguous contract provisions by urging the jury that because a developer fee was contemplated under the agreements to be eventually owed and paid, they were entitled to take the fee early in derogation of explicit provisions.”) (emphasis in original). Allegedly prejudicial evidence is reviewed “in a light most favorable to its proponent, maximizing its probative value and minimizing its prejudicial effect.” F. App’x 353, 358 (6th Cir. 2001). “only where substantially the probative outweighed by value the United States v. Knox, 17 Exclusion is appropriate of danger relevant of evidence unfair is prejudice.” Id.; see also Humana, Inc. v. Shook, No. 85-5478, 1986 U.S. App. LEXIS 27825, at *6 (6th Cir. June 3, 1986). For evidence to be unfairly prejudicial, it “must be more than damaging or simply adverse.” Shook, 1986 U.S. App. LEXIS 27825, at *6. “[U]nfair prejudice ‘does not mean the damage to a defendant's case that results from the legitimate probative force of the evidence; rather, it refers to evidence which tends to suggest decision on an improper basis.’” United States v. Dotson, No. 09-6120, 2011 U.S. App. LEXIS 24033, at *8 (6th Cir. Dec. 2, 2011) (quoting United States v. Schrock, 855 F.2d 327, 335 (6th Cir. 1988)). 4 Avest argues that permitting the jury to hear Byrd’s evidence would introduce an “improper basis” for deciding the case. and According to Arvest, the Development Agreement “expressly unambiguously forbid[s] the payment of any more than $250,000 of the developer fee until construction is complete, which never occurred.” (Am. Mot. in Limine 4.) Arvest contends that, “[w]here a contract provision is unambiguous, construction and interpretation of the contract is for the Court, not the jury.” Ins. (Id.) (quoting Vencor, Inc. v. Std. Life and Accident Co., 317 F.3d 629, 634-35 (6th Cir. 2003)). Arvest’s argument is not well taken. Vencor was a breach-of-contract case where “the resolution . . . ultimately turn[ed] on the interpretation of a term in [an] insurance (interpreting conversion is conversion and policy.” “Medicare often Vencor, eligible “factually breach of 317 Inc., expenses.”). intertwined” contract F.3d are 634 Although with separate at a contract, claims. See Academic Imaging, LLC v. Soterion Corp., 352 F. App’x 59, 67 (6th Cir. 2009); see also Greenbank v. Thompson, No. E2010- 00160-COA-R3-CV, 2010 Tenn. App. LEXIS 806, at *3 (Tenn. Ct. App. Dec. 29, 2010) (“Conversion is an intentional tort.”). “To prove conversion, a plaintiff must show the following: (1) the appropriation of another's property to one's own use and benefit, (2) by the intentional exercise of dominion over it, 5 (3) in defiance of the true owner's rights.” omitted). Byrd has asserted that he received the disputed funds in accordance with the Development Agreement. 1-3.) (See Byrd Resp. Byrd’s evidence directly bears on proving the elements of conversion. That Id. (citation the Arvest’s See Greenbank, 2010 Tenn. App. LEXIS 806, at *3. evidence may be “damaging argument is insufficient or simply adverse” to demonstrate prejudice. Shook, 1986 U.S. App. LEXIS 27825, at *6. that converted Byrd Arvest’s funds requires an to unfair Proving analysis different from the analysis in Vencor. II. Conclusion For the foregoing reasons, Arvest’s Motion is DENIED. So ordered this 16th day of December, 2011. s/ Samuel H. Mays, Jr._______ SAMUEL H. MAYS, JR. UNITED STATES DISTRICT JUDGE 6
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