Beacon4, LLC v. I & L Investments, LLC

Case Number
E2015-01298-COA-R3-CV
This case involves a contract dispute over the construction of a “Fireworks Over America” retail store in Blountville, Tennessee (“FOA Project”). The defendant company, I & L Investments, LLC (“I & L”), sought to build the store on an 11.71-acre tract of undeveloped property that it had acquired in November 2010. A contracting and development corporation, Altera Development, Inc. (“Altera”), submitted a bid to complete the site work and building construction for the FOA Project.1 At this time, the plaintiff contractor, Beacon4, LLC (“Beacon4”), had been entering into a relationship with Altera in which Altera would market and secure construction work to be performed by Beacon4. Upon I & L’s acceptance of Altera’s bid, Beacon4 eventually became the designated contractor for both the building and site portions of the FOA project, which was divided into two contracts. On January 28, 2011, Beacon4 obtained its Tennessee general contractor’s license with a monetary limit of $1,100,000.00 plus ten percent. On February 7, 2011, I & L and Beacon4 entered into a site contract, valued at $795,486.00, and a building contract, valued at $1,097,115.00. A certificate of occupancy was granted for the FOA store on May 17, 2011. One year later, Beacon4 filed a complaint alleging that I & L had violated the Prompt Pay Act of 1991, see Tenn. Code Ann. §§ 66-34-101 to -602, and breached the parties’ site contract. Beacon4 sought, inter alia, enforcement of a mechanics’ and materialmen’s lien in the amount of $212,856.02 allegedly owed under the site contract. I & L conceded that it had withheld a retainage of $46,942.75 but otherwise asserted affirmative defenses, including, inter alia, that Beacon4 had willfully and grossly exaggerated the lien claim and had violated the Tennessee Contractor’s Licensing Act of 1994, see Tenn. Code Ann. §§ 62-6-101 to 62-6-521, by dividing the Project into two contracts in order to circumvent its monetary licensing limit. I & L also filed a counterclaim, alleging that Beacon4 had violated the Tennessee Consumer Protection Act of 1977, pursuant to Tennessee Code Annotated § 47-18-104(b)(35). Following a five-day bench trial, the trial court dismissed I & L’s counterclaim and entered a judgment in favor of Beacon4, finding that I & L had violated the Prompt Pay Act and breached the parties’ site contract. The court awarded to Beacon4 $150,390.04 plus six-percent interest per annum, reasonable attorney’s fees, and, upon a post-trial motion, out-of-pocket expenses. The court also granted a lien in favor of Beacon4 on the title to I & L’s Blountville FOA store property. I & L has appealed the trial court’s judgment, and Beacon4 has raised an issue regarding the statutory penalty provided in the Prompt Pay Act and has requested attorney’s fees on appeal. Having determined that the trial court made a typographical error in entering the final award of interest to Beacon4, we modify the award of interest from $32,715.76 to $31,715.76. We affirm the judgment in all other respects. Having also determined that an award to Beacon4 of reasonable attorney’s fees on appeal is appropriate under the PPA, we remand for the trial court to determine reasonable attorney’s fees incurred by Beacon4 during the appellate process. 
 
Authoring Judge
Judge Thomas R. Frierson, II
Originating Judge
Chancellor E.G. Moody
Case Name
Beacon4, LLC v. I & L Investments, LLC
Date Filed
Dissent or Concur
No
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