In 2007, Byron and Kelly Bush took out a loan with Reliant Bank to develop a commercial property they had purchased two years prior. Dr. Bush, a Nashville dentist and a former candidate for U.S. Senate, had sold Bush Dental Care in 2005 and purchased the property.
The Bushes defaulted in 2012 after the 2008 economic downturn, the interest-rate doubling by Reliant, and broken-promises to finance the construction of a Microtel Hotel. Instead of the Bushes “debt” being “satisfied” as had been agreed, Reliant Bank bought the property themselves for 54-cents on the dollar, using an appraisal based on a down-zoning of the property, contrary to FDIC appraisal guidelines. This greatly reduced the property’s value. Reliant then took the Bushes to court in 2014 to recover a deficiency judgment including attorney fees approaching a million dollars.
This was the same year that a June 10, 2014 article in Fortune Magazine ranked Tennessee as third in the United States for public corruption [http://fortune.com/2014/06/10/most-corrupt-states-in-america/]. Tennessee State Sen. Brian Kelsey called for judicial reform shortly thereafter in an op-ed piece, which also was cited by Tom Humphrey, a former Knoxville News Sentinel Nashville bureau chief, who writes about Tennessee politics, state government, and Legislature news. [http://knoxblogs.com/humphreyhill/2014/06/13/forbes-finds-tn-nations-third-corrupt-state-trailing-ms-la/]
It is becoming increasingly clear that the Courts of Tennessee, or at the very least, certain Officers of these courts [Judges] have no intention of ever openly addressing within their Opinions, ANY of the incriminating testimony of Reliant Bank’s senior officers that reveal Reliant’s “alleged-mistake” and “fraud” including unauthorized unilateral “alteration of loan documents” and Reliant’s “concealment” of the same. What began as a scheme by Reliant Bank to defraud the Bushes, has now evolved into a concerted effort by the Officers of these courts to cover-up Reliant’s testimony. The result is “fraud upon the courts” of Tennessee, which impacts ALL residents.
Reliant Bank made a non-recourse agreement with the Bushes, meaning “all they could lose was the property.” Reliant drafted and prepared their Multi-Purpose Note with a Third-Party Agreement which read, “If a Borrower defaults, my [Dr. Bush] interest in the secured property may be used to satisfy the Borrower’s debt.”Both Dr. Bush and his wife Kelly were Borrowers.
At trial, Senior Vice President for Reliant Mr. Rick Belote testified that he had found this non-recourse agreement in 2010 but determined that it was a “mistake.” He later told his superiors but never told the Bushes, who found out at trial four-years later. He also informed the court that he “made it a point to ensure that the Third-Party Agreement was not executed on that 2011 [Renewal] document,” thereby concealing a “known mistake in a contract.”That’s like selling your home without telling the buyers there are termites. That’s FRAUD as legally defined.
But NONE of these incriminating “material facts” were considered or mentioned by the Trial or Appellate Courts, who concealed these known facts from their “findings” in the same way Reliant Bank hid and concealed their fraudulent behavior for four-years. Instead, evidence was swept under the rug to justify the Ruling and Opinion.
Mr. Belote also testified that “This is the only time I’ve ever seen it used,” concerning the non-recourse Third Party Agreement. But others have come forward since this case with the exact same agreement and are now suffering damages at the hand of Reliant Bank.
But again, this “material fact” was not considered by either court. WHY?
Even though Reliant’s “alleged-mistake” was the central theme of the trial, Williamson County Chancellor James G. Martin III never mentioned this “mistake” or any other incriminating testimony of Reliant Bank officers in 30-pages of his ruling. He held the Bushes accountable for Reliant Bank’s alleged “mistake.” This is contrary to multiple Tennessee Statutes and Rules of Civil and Appellate Procedure.
The Bushes lost their home, as have others, and have exhausted their savings and retirement defending against a bank that does not honor an agreement they made to “satisfy the Borrower’s debt.” Reliant Bank has the land and they now want more!
So next time you’re in court, just tell the judge it’s all a big “mistake.” But don’t expect to get off the hook unless you are a BIG BANK! Fortunately, the Tennessee Supreme Court has an opportunity to reverse this injustice for the protection of ALL Tennesseans.