Creditors Rights 101

There will never be another Tom Lawless

Tom Lawless didn’t care whether you liked him or not.

And there were definitely people who didn’t like him. But those people never took the time to get to know him. They stopped at his politics, were leery of his sharp sense of humor, or were jealous of his self-confident independence. Tom was defined by his politics, but he didn’t play politics by the rules.

One reason Tom didn’t care if you didn’t liked him was that, frankly, he knew you were wrong. Tom brought his authentic self to every interaction, to every case.

If somebody was being dumb in court, he’d say it. If his client was being greedy, he’d tell them. If opposing counsel pushed too hard, watch out (and, to be clear, it didn’t need to be Tom who was being pushed–he was genuinely offended by jerks).

Local reporters loved Tom. He was always willing to go on the record. Tom was a “good quote.” (Though I bet the off the record stuff was phenomenal too.)

A smart legal mind is a dime a dozen, but the ability cut somebody in half with a sarcastic comment and a willingness to say it? Tom was fearless and absolutely owned that.

He was also a fierce friend.

Tom and I swam in the same waters. We both represented creditors, and so we never had cases against each other. Instead, we were competing for the same clients–a position that maybe was more adversarial than being opposing counsel.

Tom was always good to me. Don’t get me wrong: For the first 10 years of my career, I avoided him. If Tom Lawless was in the business of calling out dumb lawyers for doing dumb things, I didn’t need him paying attention to my little career.

Then, I got to know him. He chaired the Nashville Bar Association Ethics and Professionalism Section, and, for years, he’d host a monthly sit-down session with titans of the Nashville Bar and chit chat with them, about the law, their career, about anything that came to mind, under the guise of a committee meeting. Really wide-ranging, candid conversations that only Tom could have with these people.

At first, I thought that it was a discrete way for Tom to flatter the important people; after attending a number of those meetings, I figured out that it was a way for those people to curry favor with Tom.

Because you always wanted to be on Tom’s good side. Pre-COVID, I joined the Rotary Club, and I’d generally sit at Tom’s table–at the back of the house–and he just could not keep quiet. He knew everybody and knew everything. A story would come to his mind, a catty comment, and he’d say it. Out loud. Years ago, a friend told me “Tom is like the internet. If you tell him, you need to assume that everybody knows.”

You couldn’t have a call with Tom that lasted less than an hour. He loved to talk and, despite his political reputation, had a genuine interest in people of all sorts. If you needed something, he’d help. A call with him always included a sincere “And how are you doing? Everything good?”

I can’t count the number of times I left the office late or ate a cold dinner, because I took the 5pm call from Tom.

People talk all the time about politics being too partisan nowadays, but, despite being the most conservative of conservatives–in a blue town like Nashville– Tom was always willing to cross the aisle when a helping “a lib” was the right thing to do.

For years, the Nashville Bar Association posted a list of volunteers for its Dial-A-Lawyer pro bono program, and Tom’s name was on it every month. What a thankless service, just answering debt collection questions on the phone for hours, but he was there.

When he passed, I hadn’t talked to Tom for months.

About a year ago, a friend of mine was up for a judgeship, and I reached out to him to put a good word in for her. (She got the job.) Tom took the credit, and I was happy to give it to him. Tom was a guy who did favors and got things done.

I felt guilty, asking for anything, when I hadn’t seen him for a bit. In fact, I volunteered at Dial-A-Lawyer last month (for the first time ever), hoping that maybe Tom would be there, holding court with the other volunteers during the lull in calls. He wasn’t there, and the volunteer coordinator said she hadn’t seen him in a long time.

I got a little concerned. For a months, I had been meaning to reach out to him. To check in on him, trade some gossip, all of that. I never texted, because I knew my phone would ring instantly, and I always held off, waiting until I had about an hour to chat.

It’s a busy time, and I’m sure I’ll see him soon.

Sunday night was a shock. Other people knew him far better than I did, but Tom’s passing is a big loss to our community. For all his politics, he was never politically correct. Despite his proximity to power, he’d call out hypocrites and stupidity, no matter the party. His strongest affiliation was to his friends. And, if you needed his help, he’d probably say yes.

Tom will be missed. In Bankruptcy Court and Chancery Court. At the Nashville Bar Association. Over at the legislative offices. On my caller id.

I can’t imagine there will ever be another Tom Lawless.

Crowdsourcing: I’m looking for Office Space

I’m looking for office space, via a sublease, lease of a small space, or coworking.

Internet, I turn to you for help.

In the six years that I’ve run my own firm, I’ve rented private office space at WeWork–and have been fairly happy with it–but WeWork doesn’t make it easy to stay a “forever” tenant. (Note: I am leaving after having a dispute with them over about $19 per month in copy charges. I’m being a little bit petty, but the business side of WeWork is pretty awful.)

During COVID, I learned quickly that I don’t need grand office space, gaudy views, and expensive, long-term leases to succeed. My practice needs good wifi and…well, that’s it. My responsiveness and results do not depend on how fancy my office space is.

Now, don’t get me wrong. Whatever I choose is going to be nice, but, at the same time, smart, efficient, and lean.

Early in COVID, my old law firm faced both a challenge and an opportunity: Our gigantic office space–which had been mostly empty for 2-3 months as the firm dealt with the government mandated version of WFH–was up for renewal in July 2020. After looking at larger (and smaller) spaces in/near downtown and in new areas, the firm decided to stay put, moving to a similar space, on a lower floor of the same building. Having missed paychecks and year end bonuses over the years due to the firm’s operating costs, I vowed to run my own practice differently.

So, here we are. If you know of anybody with a few hundred square feet of cool space available, email me at david@exolegal.com.

Memphis Grizzlies and Service of Process: A match made on Beale Street

I’m am a huge Memphis Grizzlies fan, but I haven’t had any reason to talk about them on this blog. Until now.

Here’s a photo from my seats when the Grizzlies played the 76ers on Marc Gasol retirement night on April 6, 2024. Side note: Melton did not file a motion to set aside while in town for this game.

Last week, the Tennessee Court Appeals issued an opinion, Werner, et al. v. De’Anthony Melton , No. W2025-00779-COA-R3-CV, 2026 WL 2654566 (Tenn. Ct. App. Sept. 9, 2026), involving a Grizzlies player and some interesting service of process issues.

On June 3, 2022, a neighbor sued De’Anthony Melton over an alleged dog bite that occurred on January 23, 2022. On June 24, 2022, Melton was traded to the 76ers (in a pretty dumb trade by the Grizzlies).

Not only did the trade frustrate me (Melton was a good player, on a great contract, and they got nothing for him), it made service of process especially difficult for the plaintiff.

First, they tried to serve him personally at his (former) Tennessee residence. Then, after the trade, an Alias Summons was issued, and they tried to serve him at the 76ers’ practice facility, but failed to serve him personally a number of times. On the third attempt in October 2022, the process server left the Summons with the team’s “Director of Executive Protection” “who purported to accept service on Mr. Melton’s behalf.” ….

Foreclosure Attorney Nightmares: How late is “too late” for recorded liens to receive notice of the sale?

Want to keep a foreclosure attorney up at night? Call one late on a Friday and leave a voicemail that says “Hi. I’m with a title company doing a sale of a property you foreclosed on, and we found some liens and have some questions about your notice.”

Foreclosures in Tennessee are non-judicial, meaning it’s all technical compliance with the foreclosure statutes (and the terms of the deed of trust), but no judges are involved.

“It’s all paperwork,” I often say, “but you’d better get it exactly right.”

I got one of those calls last week. I conducted a sale on a Friday in April, and the deed was recorded at 2pm on the following Monday. But, the title company discovered, a new lien was recorded on 10am on that same Monday.

“We want to know whether you gave notice to this lienholder of your sale.”

“Well, no,” I confidently wrote, “I did not give written notice to the party who at no point prior to the foreclosure had recorded a lien.” But the terrified voice in my head was nevertheless freaking out a bit.

This is why Tenn. Code Ann. § 35-5-104(d) exists.

That statute defines the “parties interested” (and, thus entitled to be listed in the sale notice and receive notice) as parties holding liens, but those liens must have been “recorded more than ten (10) days prior to the first advertisement or notice in the register’s office of the county in which the real property is located.”

This makes sense, right? There has to be cutoff, at some point, of the foreclosing party’s obligation to check for new liens. If a party records a lien the day before the sale, this should not blow up the sale.

Having said that, the “best practice” is to downdate the status of title beyond the requirements of Tenn. Code Ann. § 35-5-104(d), especially if the goal is to conduct a clean, problem-free sale. I tend to check for these liens in the days before, and often the day of, my sale.

Here the lien that was recorded a few days after my sale falls outside of the “parties interested” definition.

Ok. Back to sleep where I worry about all the other cases that are rightfully keeping me up at night.

On Law Firm Bankruptcies and the Law Firms of the Future

You never imagine that a 160 year old law firm would file for bankruptcy.

That’s why the Daily Memphian’s recent story about the Apperson Crump law firm’s Chapter 11 bankruptcy was such a surprise. This wasn’t some start-up law firm that couldn’t navigate choppy waters; it was founded in 1865 and billed itself as “the oldest continuously operating law firm in Memphis.” The news story was as much about the storied history of the firm as it was about the bankruptcy filing.

On paper, running a law practice seems, frankly, pretty simple. You bill hours, collect fees, and spend less than you collect.

By year 160, what could have tripped them up?

In reality, it’s not that simple. Per the bankruptcy filings, reports the Daily Memphian, the firm suffered a drop in annual gross revenue from $4.45 million in 2024 to $2.01 million in 2025. The firm listed roughly $1.39 million in assets (generally accounts receivable) against $2.7 million in debt. The article suggests that the end was hastened when 7-8 lawyers and 24 staff members left to open a competing firm in 2025, and the remaining 16 lawyers quickly shrunk to 6, in a 15,000 square foot office. The Daily Memphian notes that an eviction lawsuit had been filed.

By the end, the article notes, the firm owed $857,700 to its largest creditors, including its information technology service Adan Technologies, FedEx, Thomas Reuters, and its landlord Boyle Investment Co.

My firm is 6 years old. I look at this and ask “What happened?”

Right out of school, I was hired by a small firm (2, then 3 lawyers), and it was run like a very small business, where every penny was pinched. Paychecks were hand-written by the boss himself. Printer cartridges were not replaced until they had been shaken dozens of times, in order to buy a few more days (or weeks) of printing. Westlaw? Nope; I’d walk and use the courthouse library (which, honestly, was great).

After 7 years there, I was excited to move up to a 40 lawyer firm, to see how “big law” did things.

I got a quick education in law firm management: At the end of my first quarter, I’d billed enough hours to trigger a performance bonus. I didn’t receive it. Instead, I got an email that pointed out the fine print in my offer letter, that the bonus was “conditioned on the firm having sufficient revenue.” My mind was blown. It never occurred to me that they wouldn’t have the money.

Maybe bigger isn’t always better. That firm was run like a big firm, even when the revenue didn’t support it.

Whenever the the younger lawyers asked why the firm did certain things a certain way, the leadership response was pretty specific: “Nashville has lots of law firms. If you don’t like how we do it, you can go work at one of the other ones.” Soon, we quit asking questions.

Ask me how many really good lawyers grew a thriving practice at that firm and then left.

Looking at the list of creditors in the Apperson Crump story, I’m a bit surprised by how boring it all is. No gambling , embezzlement, or extraordinary debts. Just the types of debts you’d expect to see in a law firm bankruptcy filing.

I wonder if the “old fashioned” way of running a law firm was part of the trouble. The big office space. The expensive Westlaw subscription. The heavy IT and computer expenses. Lots of partners. Add in a 2 to 1 staff to lawyer ratio, and it’s easy for expenses get ahead of income.

The mass defection of lawyers also can’t be ignored.

Maybe there’s no single lesson to be learned here.

Modern law firms are in uncharted waters. COVID-era advances in working, technology, and the reduction in hard costs have drastically decreased the complexity and cost of operating a law firm. The post-COVID generation’s shift in mindset matters too; lawyers–even successful, partner level lawyers–are more likely to jump ship than ever before. Legal AI is here to stay and can’t be ignored or vilified any longer. The jobs lawyers have today may look totally different in 10 years. Lawyers have to be open to innovation and change more than they ever have been.

Law is a stubborn industry, grounded in tradition and “the way we’ve always done things,” but law firms have to abandon that approach to stay relevant over the next decade. This is no longer about preserving the status quo and partner origination percentages; it’s about staying in business.

Over the past 15 years, there has been lots of talk in the industry about “succession planning,” i.e. the transition of the law firm management from the old guard to the next generation of leaders. In my experience, law firm management doesn’t transition from the old guard. Instead, the old guard just holds on (way too long) and then sells the law firm to a bigger law firm that has either figured it out or can impose an economy of scale (and higher rates) to paper over the gaps.

I don’t know if that’s what happened in Memphis, but that’s part of what I’m taking away from it all.

For me, I’m not looking to sell any time soon. I’ll be here, pinching pennies and shaking laser cartridges, hoping to buy a few more years of practicing law in Bankruptcy Court (and not appearing as a debtor there).

Tennessee’s Registered Agent Loophole Needs A Better Fix

Someday, I’m going to run for public office in Tennessee, and the legislation that I will work on will be the most boring, non-headline-generating, administrative laws you’ve ever seen. But I’ll win 100% of the lawyer vote.

We need to fix Tenn. Code Ann. § 48-15-101, the statute that defines who can serve as a registered agent for a corporate entity in Tennessee and requires every corporation to maintain one at all times.

The stakes are high because of Tenn. Code Ann. § 48-15-104(a), which governs service of process. In layman’s terms, a corporate entity does not have “hands” into which a plaintiff can serve a lawsuit, so this statute requires that the company designate a specific “individual who resides in this state” (§ 48-15-101(a)(1)) to serve as those hands.

But, the statute also allows a registered agent to just be another corporate entity, which, itself, may or may not have an individual listed as its registered agent. See Tenn. Code Ann. § 48-15-101(a)(2).

That creates a gap. What if that second entity has no individual serving as its own registered agent and, instead, just lists another LLC (and so on)? Worse, what if an LLC simply lists itself as its own registered agent? If no individual is ever named in the chain — or the registered agent is the LLC itself — who is there to serve? (Spoiler-alert: Nobody. Service becomes impossible.)

The same gap opens if a registered agent resigns and, despite Tenn. Code Ann. § 48-15-101(b), the corporation never names a replacement.

Tenn. Code Ann. § 48-15-101 should require that, when another entity serves as registered agent, some minimal standard ensures an actual individual — or at least a legitimate, service-able corporate entity — stands behind it. Without that, the Secretary of State is effectively handing sloppy (or clever) entities a permanent way to dodge service of process.

The only fallback is Tenn. Code Ann. § 48-15-104(b), which provides that when a corporation “fails to appoint or maintain a registered agent in this state,” or when “its registered agent cannot be found with reasonable diligence,” the Secretary of State becomes the corporation’s agent for service. Tenn. Code Ann. § 48-15-105(a) then governs the mechanics: the plaintiff identifies which § 104(b) ground applies, and the Secretary of State sends process “by registered or certified mail” to the corporation’s registered office.

But that’s a workaround, not a fix — and plaintiffs shouldn’t have to invoke it just because Tennessee’s registered-agent statute lets entities hide behind entities with no individual, anywhere, ultimately accountable.

Plus, with all due respect to our very smart Tennessee Secretary of State Office, the law isn’t clear, and, at best, this introduces a great deal of uncertainty and delay when this fairly common problem presents itself.

The General Assembly should amend § 48-15-101 to require that whenever a corporate entity names another entity as its registered agent, the filing must, somewhere, identify a natural person and a physical Tennessee address where that person can actually be found — either directly, or by reference to the designated entity’s own registered-agent filing.

The amendment should also bar an entity from naming itself as its own registered agent, closing off the most obvious version of this loophole, and direct the Secretary of State to reject filings that don’t ultimately identify an individual or a legitimate third party corporate entity.

This shouldn’t be controversial; it just extends the “individual who resides in this state” requirement through any layers of entity-agents the statute already allows.

Until then, plaintiffs are stuck relying on the Secretary of State as substitute agent under §§ 48-15-104(b) and 105(a) — a real remedy, but one that only kicks in after the time and expense of proving the primary agent can’t be found.

(Side note: I was going to upload an image of a snake eating its own tail, but everything I found was disgusting.)

AI in Law: Don’t Trust and Always Verify

For the sake of transparency, and before you all accuse me of being an AI-In-Law-Technology shill based on yesterday’s post, here’s an interaction I had with Claude today, when a citation in a response didn’t look quite right to me…

Uh, yes, that’s a good catch. The statute literally doesn’t say what the prior response said it did.

Always remember, “Don’t Trust and Verify.”

Recent District Court Opinion out of Memphis “presents a study in the perils” of “unchecked use of AI” (and possibly $48,240 in sanctions)

A few weeks ago, while researching a complicated legal issue, I asked Claude AI to take the first pass before I dug in.

Yes, it’s controversial for a lawyer to admit to using AI at all, but it shouldn’t be. Claude is really good and, frankly, as good as (or better than) your standard issue first-year associate. Having said that, though, you have to treat Claude’s work with the same cautious skepticism that you’d apply to a first-year associate’s work. (My motto? “Don’t Trust and Verify.”)

Here’s why I found Claude’s sources to be eminently trust-worthy…

Yes, in vetting the sources, it was revealed that I am the brains behind the robots! This is either very flattering or terrifying. For now, I’ll accept the compliment.

For 3 years, lawyers have been bombarded by vendors selling AI. Every task, application, or product is AI based or enhanced (and priced accordingly). The future of law is now, and it can be yours for just $755.00 per seat.

At last week’s Tennessee Bar Association Convention and Technology Showcase, every CLE panel related to the use of artificial intelligence. At ClioCon, every exhibitor had some sort of “AI!” product to sell. When I open an app on my computer, I am constantly asked whether I want AI’s help.

Don’t get me wrong; AI is awesome technology, with capabilities that actually match the hype (well, mostly).

But there’s been an equally fervent backlash in the legal profession about the traps presented by the use of AI.

I hear all of that, but, after approaching it with a skeptical mind, I’ve been blown away by AI’s capabilities and believe that it can make competent, smart, careful lawyers better and more efficient at their jobs.

Having said that, though, what about the lawyers who don’t use the AI in competent, smart, careful ways? Let’s ask the Chief Judge for the District Courts in the Western District of Tennessee…

Yes, a Final General Sessions Judgment Can Be Enforced in Other States as a Foreign Judgment (Part 2)

If you’ve been here long enough, you know that I’m an advocate for filing lawsuits in Tennessee’s General Sessions Courts.

Matters move fast, are cost-efficient, and judges are some of the most no-nonsense jurists you’ll ever meet.

Some lawyers like a little bit of “making things more complicated than necessary” and prefer cases with lots of billable hours, and those lawyers tend to object to “small claims court” because they aren’t a “court of record” and, thus, the judgments may not be enforceable in other states.

I’ve always said they’re wrong and that a judgment entered by a Tennessee General Sessions Court is likely entitled to full faith and credit and enforceable in other states under the Uniform Enforcement of Foreign Judgments Act, even though such courts are not courts of record.

If you are facing an argument about enforceability in Tennessee, here’s some text from a 2001 case that will be useful:

[Defendant’s] first argument is that the [Plaintiff’s] judgments are not entitled to full faith and credit because they were not rendered by a court of record. This argument is wrong … Tenn. Code Ann. § 26-6-104(b) does not, even by implication, limit the judgments entitled to full faith and credit to those rendered by a court of record.

Tenn.Code Ann. § 26-6-104(b) provides that our state courts will treat a foreign judgment “in the same manner as a judgment of a court of record in this state.” Based on this language, [Defendant] asserts that in order for a foreign judgment to be accorded the same treatment as a judgment of a Tennessee court of record, the judgment must have been rendered by a court of record. This reasoning overlooks that neither U.S. Const. art. IV, § 1 nor Tenn.Code Ann. § 26-6-103 limits the judgments entitled to full faith and credit to judgments of “courts of record.” According to Tenn. Code Ann. § 26-6-103, a “foreign judgment” entitled to full faith and credit in Tennessee is “any judgment, decree, or order of a court of the United States or of any other court which is entitled to full faith and credit in this state.”

See Boardwalk Regency Corp. v. Patterson, No. M199902805COAR3CV, 2001 WL 1613892, at *3 (Tenn. Ct. App. Dec. 18, 2001.

Under this same reasoning, the question of whether an “outgoing” Tennessee General Sessions Court judgment is entitled to full faith and credit in other states ultimately depends on the law of the enforcing state. But, under the UEFJA, those courts will generally look to whether the judgment is final and valid in Tennessee, and most states don’t introduce anything about “courts of record” into their version of the Act.

Lawyers are risk adverse, and, faced with a risky decision that will save the client money but introduce a drop of risk, many Tennessee lawyers will opt for to file a matter in chancery or circuit court.

This issue comes up more than you’d think, and that case citation could get you where you need quickly and in a cost-efficient manner.

New Law Firm Advice: Get a Post Office Box

Having started this law firm about 6 years ago, I get asked for advice a lot.

The questions are all over the place. Technology. Marketing. Legal research. Hiring. Finding clients.

One unsolicited thing I tell them: Get a P.O. Box and use that for everything.

It’s rarely followed.

Lawyers put mailing addresses on a pedestal. We think clients view expensive street names or prestigiously high floor numbers as indicators of the quality of work the lawyer provides. In short, the more a lawyer’s rent is, the better the lawyer is, right?

What does a Post Office Box say? Maybe, that you work from home or aren’t serious about all of this. Maybe the lawyer doesn’t have enough work, yet, to have an office.

I had a little bit of that in my mind when I first started.

Inspired by the “new way of doing things,” I was leaving the big firm at the height of COVID and making the plan at the same time. I wanted to practice law in a leaner, more efficient way, and my prime directive was to avoid the big expenses and long term leases that made me so unhappy at the old firm. (To be fair, I was most “unhappy” when the firm couldn’t make payroll.)

But, to me, the lawyers who used PO Boxes all seemed to be solo lawyers, with impermanent and unestablished practices. Maybe, I thought back then, I shouldn’t try to subvert all the old assumptions all at once.

Ultimately, I got a P.O. Box for my firm, but I still tended to give clients the fancy Music Row address of the WeWork where I had an office. Looking back, by not owning it all, I perpetuated the BS.

It was dumb.

Freed from the burden of the old firm’s server rooms and storage closets full of 25 year old boxes, my nimble little firm spent 2.5 years at that fancy address, and also a month in Eulijiro, Seoul, and, after that, I switched to a different WeWork in East Nashville. To this day, though, I still get mail at that old Music Row address.

Here’s the nice thing about using a post office box, especially for a new law practice: You aren’t tied down to one physical address, one law firm entity, or one long term lease forever. You have one central mailing address for the firm, for as long as you need it, for about $200 per year.

What if, just starting the practice, you want to grow, but don’t know when or how much or for how long? What if you want to have a virtual practice and work for stretches from new locations? What if, after you start your practice, you decide this isn’t for you and you want to join another firm?

If you are part of a huge firm, this advice doesn’t apply to you. Sign that 10 year lease and never look back.

But, if you are considering starting your own practice, I urge you to use a post office box for court notices, payments, tax forms, and, well, everything. Use this one address and keep it for as long as you have the firm. Work from home, South Korea, from wherever, but know where your mail is heading.

Generally, the reason people consider starting their own firm is a dissatisfaction about “the way things have always been done” and a frustration that things could be done differently and better. Here’s an easy initial step to break the mold.