Alside Supply Center v. Vinson

In Alside Supply Center v. Vinson, 802 S.W.2d 632, 635 (Tenn. Ct. App. 1990), a contractor, who was hired by a homeowner, charged the materials needed for the job on an open account with a supplier. Id. at 632. After being paid by the homeowner, the contractor then used the payment to pay part of the outstanding balance owed to the supplier but did not designate to which debts the payment was to be applied. The supplier applied the payment to the contractor's earlier debts and not to the debt incurred from the materials used in the homeowner's job. The supplier then sued the homeowner to enforce a materialman's lien on the home. Id. at 633. The lower court sustained the lien and the appellate court reversed. The appellate court quoted and applied Restatement (Second) of Contracts 260 and held that contractor's payment should have been applied to the debt for the materials used for the homeowner's home because the contractor owed a duty to the homeowner to pay that debt. Id.