SENIOR HOUSING ALTERNATIVES, INC. v. BERNARD GLOBAL LOAN INVESTORS, LTD. (Tenn. Ct. App. June 28, 2011)
Senior Housing Alternatives, Inc. ("the Borrower") filed this action against Bernard Global Loan Investors, Ltd. ("the Secured Party") asking the trial court to enjoin the Secured Party from foreclosing on a deed of trust that secured several notes on which the Borrower had defaulted. In essence, the Borrower's complaint alleges that its original lender had defrauded the Borrower and inflated the balance owed on the notes and that the Secured Party had knowledge of the fraud when it took ownership of the notes and deed of trust. The complaint alleges that the merits of the case are at issue in a federal district court in Georgia.
Despite expressing reservations about the Borrower's ability to prevail on the merits, the trial court granted it a temporary injunction to preserve the status quo in an order entered February 15, 2010. The court noted that developments in the federal court action could affect the equities and set a hearing for August 13, 2010, to "review the entire matter." Two days before the hearing date, the Secured Party filed a brief, with supporting affidavits, asking the court to dissolve the injunction. The court heard proof at a status conference and thereafter issued a memorandum opinion explaining that it was dissolving the injunction because, among other things, the court did not believe the Borrower could prevail on the merits. The Borrower appeals from the order dissolving the injunction and dismissing the complaint. We affirm.
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