Supreme Court Opinions

Format: 03/22/2013
Format: 03/22/2013
Kristen Cox Morrison v. Paul Allen, et al.
M2007-01244-SC-R11-CV
Authoring Judge: Justice Gary R. Wade
Trial Court Judge: Chancellor Claudio Bonnyman

After the death of her husband, the plaintiff filed suit against their agents/financial planners based upon several theories of recovery in regard to the termination of a life insurance policy from one company and the acquisition of a replacement policy from a second company. After initially contesting the award of benefits, the second company, which was also named as a defendant in the suit, settled with the plaintiff. At the conclusion of the bench trial as to the liability of the agents, the plaintiff was awarded substantial damages as to each policy based upon various theories of recovery: the agents’ failure to procure a life insurance policy as directed, negligence, negligent misrepresentation, breach of fiduciary duty, and violation of the Tennessee Consumer Protection Act. The Court of Appeals affirmed in part, but held that the damages in contract relating to the failure to procure should be offset by the amount of the plaintiff’s pre-trial settlement with the second insurance company. Because of the nature of the issues presented, this Court granted permission to appeal. As to the policy for which benefits were denied by the second company, we hold that (1) a cause of action may arise for the failure of the agents to procure a policy not subject to contest; (2) the claim for failure to procure may be actionable, notwithstanding the policy holders’ admission that they did not read the insurance application; and (3) because the settlement by the second life insurance company was not specifically resolved based upon contract, the agents are not entitled to a credit against damages caused by their failure to procure. As to the policy terminated by the plaintiff, we hold that the evidence preponderates against any award of damages based upon negligence, negligent misrepresentation, breach of fiduciary duty, or violations of the Tennessee Consumer Protection Act. Finally, we hold that the ad damnum clause in the complaint provided the agents with sufficient notice to support a damage award in the amount of $1,000,000 plus pre-judgment interest. The judgment of the Court of Appeals is affirmed in part and reversed in part, and the cause is remanded to the trial court for determination of post-judgment interest.

Davidson County Supreme Court 02/16/11
Kristen Cox Morrison v. Paul Allen, et al. - Dissent
M2007-01244-SC-R11-CV
Authoring Judge: Justice William C. Koch, Jr.
Trial Court Judge: Chancellor Claudio Bonnyman
Davidson County Supreme Court 02/16/11
Kristen Cox Morrison v. Paul Allen, et al. - Dissent
M2007-01244-SC-R11-CV
Authoring Judge: Chief Justice Cornelia A. Clark
Trial Court Judge: Chancellor Claudia Bonnyman
Davidson County Supreme Court 02/16/11
Estate of Martha S. French v. Stratford House et al.
E2008-00539-SC-R11-CV
Authoring Judge: Justice Gary R. Wade
Trial Court Judge: Judge L. Marie Williams

The administratrix of the estate of the deceased brought this wrongful death suit against the defendant nursing home and its controlling entities, alleging damages as the result of ordinary negligence, negligence per se, and violations of the Tennessee Adult Protection Act. The trial court granted the defendants’ motion for partial summary judgment, holding that the Tennessee Medical Malpractice Act applied to the ordinary negligence claims, thereby precluding allegations of negligence per se or violations of the Tennessee Adult Protection Act. The trial court also dismissed a claim for punitive damages. The Court of Appeals affirmed, but vacated the portion of the order dismissing the punitive damages claim. This Court granted the administratix’s application for permission to appeal in an effort to clarify the standards governing nursing home liability and to resolve a conflict in the decisions rendered by the Court of Appeals. We hold that, because the administratrix of the estate of the deceased has alleged violations of the standard of care pertaining to both medical treatment and routine care, she has made claims based upon both medical malpractice and ordinary negligence. Further, she may offer proof of negligence per se and violations of the Tennessee Adult Protection Act as support for her ordinary negligence claims. We affirm the Court of Appeals’ reinstatement of the punitive damages claim. The judgment of the Court of Appeals is, therefore, affirmed in part and reversed in part. The cause is remanded to the trial court.

Hamilton County Supreme Court 01/26/11
Estate of Martha S. French v. Stratford House et al. - Dissenting
E2008-00539-SC-R11-CV
Authoring Judge: Justice William C. Koch, Jr.
Trial Court Judge: Judge L. Marie Williams

This appeal involves important questions regarding the process for adjudicating the liability of nursing homes for injuries to their residents. In particular, it requires this Court to articulate the principles that should be used to decide whether a claim based in part on the conduct of a certified nursing assistant (“CNA”) should be treated as a medical malpractice claim or as an  ordinary negligence claim. The Court has determined that claims involving the adequacy of CNAs’ training, the sufficiency of the staffing at a particular nursing home, and the adherence of CNAs to a patient’s plan of care are ordinary negligence claims that can be substantiated without the introduction of expert proof. The Court has also decided that the negligence per se doctrine permits the use of federal and state regulations regarding the licensing of nursing homes to create and define the scope of the duty of care that nursing homes owe to their patients. I cannot concur with either decision.

Hamilton County Supreme Court 01/26/11
State of Tennessee v. Genaro Dorantes
M2007-01918-SC-R11-CD
Authoring Judge: Justice Gary R. Wade
Trial Court Judge: Judge Steve R. Dozier

The defendant, who was extradited from Mexico to face charges for aggravated child abuse
and felony murder by aggravated child abuse, was convicted for each offense. The trial court imposed sentences of twenty-two years and life, respectively, to be served consecutively. The Court of Criminal Appeals reversed the conviction for aggravated child abuse, finding the evidence to be insufficient, but upheld the felony murder conviction. This Court granted applications for permission to appeal by both the State and the defendant. Because the circumstantial evidence was sufficient to support the convictions for both aggravated child abuse and felony murder, the judgment of the Court of Criminal Appeals is reversed in part and affirmed in part. More specifically, the conviction for felony murder is affirmed, and the conviction for aggravated child abuse is reinstated. No other issues warrant the grant of a new trial on either offense. The sentences imposed by the trial court for each of the two offenses are affirmed.

Davidson County Supreme Court 01/25/11
State of Tennessee v. Jeremy Garrett
W2007-02700-SC-R11-CD
Authoring Judge: Chief Justice Cornelia A. Clark
Trial Court Judge: Judge W. Otis Higgs

The defendant was indicted separately for two different criminal episodes, one involving an aggravated robbery and the other involving a homicide and an especially aggravated robbery. On the State’s motion but over the defendant’s objection, and without conducting an evidentiary hearing, the trial court consolidated the indictments for a single trial. The jury convicted the defendant of all offenses charged, and the Court of Criminal Appeals affirmed. On appeal, the defendant contends that the trial court committed reversible error in consolidating the offenses. We hold that the trial court erred both as to methodology and as to result in consolidating the indictments. When a defendant objects to the State’s pretrial motion to consolidate offenses, the trial court must conduct a hearing and consider the motion under the severance provisions of Tennessee Rule of Criminal Procedure 14(b)(1), not the provisions of Rule 8(b). We also hold that a prosecutor should refrain from seeking the consolidation of offenses over a defendant’s objection unless the prosecutor has a good faith basis for arguing that the requirements of Rule 14(b)(1) will be met. The trial court’s error in ordering consolidation requires that we reverse the defendant’s conviction of aggravated robbery and remand for a new trial on that charge. The trial court’s error was harmless as to the defendant’s convictions for first degree felony murder and especially aggravated robbery, and we affirm those convictions.

Shelby County Supreme Court 01/24/11
Blue Bell Creameries, LP v. Richard Roberts, Commissioner, Department of Revenue, State of Tennessee
M2009-00255-SC-R11-CV
Authoring Judge: Justice Janice M. Holder
Trial Court Judge: Chancellor Ellen H. Lyle

Taxpayer is a Delaware limited partnership that produces, sells, and distributes ice cream in Tennessee and elsewhere. At issue in this appeal is the Tennessee Department of Revenue’s excise tax assessment on capital gains from a one-time stock transaction between Taxpayer and its holding company. Taxpayer sought a refund in chancery court, challenging the validity of the tax assessment on statutory and federal constitutional grounds. Both Taxpayer and the Department moved for summary judgment. The chancery court granted summary judgment to Taxpayer, and the Court of Appeals affirmed the judgment. Based on the uncontested facts in the record, we hold that Taxpayer’s capital gains were business earnings pursuant to the functional test provided in Tennessee Code Annotated section 67-4-2004(1) (Supp. 2000) and therefore subject to the excise tax. Additionally, we hold that the tax assessment was constitutional pursuant to the unitary business principle. We therefore reverse the judgment of the Court of Appeals and enter summary judgment for the Department. We remand to the trial court to determine the amount of excise tax related to Taxpayer’s capital gains.

Davidson County Supreme Court 01/24/11
Bob Fannon, Individually and as a City Councilman for the City of LaFollette v. City of LaFollotte, et al.
E2008-01616-SC-R11-CV
Authoring Judge: Justice Gary R. Wade
Trial Court Judge: Judge John D. McAfee

An elected council member of the City of LaFollette filed a declaratory judgment action alleging that three other members of the council had violated the terms of the Open Meetings Act in the process of adopting a resolution to increase the pay of various city employees. The trial court, after a hearing, granted a temporary restraining order, restricting implementation of the pay raises until the City complied with the procedural requirements of the City Charter. The order did not address the Open Meetings Act allegations. At a subsequent meeting, the Council, apparently in accordance with the requisite guidelines, approved the pay raises. After the Plaintiff filed a motion for summary judgment and then a motion seeking attorney’s fees and costs, the trial court dismissed the Open Meetings Act claim as moot, but awarded fees and costs to the council member who had initiated the suit. The order did not address a challenge by the City to the council member’s standing to sue. On direct appeal by the City, the Court of Appeals confirmed that the council member had standing as a taxpayer, rather than in his official capacity, but reversed the award of attorney’s fees and costs. Because the litigation involves issues of public interest, this Court granted an application for permission to appeal. We hold that the council member had no standing to sue as a council member or a taxpayer, but that he did have standing based upon his allegations of an Open Meetings Act violation. As the prevailing party, he is entitled to an award of discretionary costs, but not attorney’s fees. The judgment is, therefore, affirmed in part and reversed in part, and the cause is remanded to the trial court for further proceedings consistent with this opinion.

Campbell County Supreme Court 12/21/10
Bob Fannon v. City of LaFollette et al. - Concurring
E2008-01616-SC-R11-C
Authoring Judge: Justice William C. Koch, Jr.
Trial Court Judge: Judge John D. McAfee

I concur with the Court’s conclusion that Mr. Fannon has standing under Tenn. Code Ann. § 8-44-106(a) (2002) to seek judicial relief from his colleagues’ violation of the Sunshine Law [Tenn. Code Ann. §§ 8-44-101 to -111 (2002 & Supp. 2010)]. I also agree that Mr. Fannon was the prevailing party in the proceedings below and that he was entitled to recover discretionary fees under Tenn. R. Civ. P. 54.04(2) but not attorney’s fees. I am constrained to prepare this separate opinion because, unlike the Court, I have concluded that Mr. Fannon’s status as a public official provides an independently sufficient basis to confer standing on him to challenge the conduct of his fellow members of the LaFollette City Council.

Campbell County Supreme Court 12/21/10
Board of Professional Responsibility of the Tennessee Supreme Court v. F. Chris Cawood
E2009-01957-SC-R3-BP
Authoring Judge: Justice Janice M. Holder
Trial Court Judge: Senior Judge Jon Kerry Blackwood

Disciplinary Counsel of the Board of Professional Responsibility filed a petition for discipline against attorney F. Chris Cawood for alleged violations of Rules of Professional Conduct. After Disciplinary Counsel’s presentation of evidence, the Hearing Panel dismissed the petition. The Board of Professional Responsibility appealed to the chancery court, which affirmed the Hearing Panel’s dismissal. The Board appealed the decision of the chancery court to this Court. We hold that the Board of Professional Responsibility’s petition for certiorari failed to meet the requirements of Tennessee Code Annotated section 27-8-106 and that the chancery court therefore lacked jurisdiction to hear the appeal.

Roane County Supreme Court 12/20/10
Michael Sanford v. Waugh & Company, Inc. et al.
M2007-02528-SC-R11-CV
Authoring Judge: Justice Sharon G. Lee
Trial Court Judge: Chancellor Ellen Hobbs Lyle

The primary issue presented in this appeal is whether an individual creditor of an insolvent corporation may bring a direct cause of action for breach of fiduciary duty against the corporate directors and officers. We hold that a creditor of an insolvent corporation may not bring a direct claim, only a derivative claim, against officers and directors for breach of the fiduciary duties they owe to the corporation. We adopt the reasoning of the Delaware Supreme Court in North American Catholic Educational Programming Foundation, Inc. v. Gheewalla, 930 A.2d 92 (Del. 2007), observing that corporate creditors are adequately protected by existing law, and that recognizing a new direct cause of action is unnecessary and would impede corporate governance. We further hold that the trial court properly excluded evidence of conspiracy to interfere with contract and dismissed the claim for punitive damages. The judgment of the Court of Appeals is reversed.

Davidson County Supreme Court 12/17/10
Elizabeth Leanne Hudson v. Larson Douglas Hudson - Order
M2008-01143-SC-R11-CV
Authoring Judge: Justice Janice M. Holder
Trial Court Judge: Judge Carol Soloman

The matter before this Court arises from a petition to relocate filed by Elizabeth Leanne Hudson (“Mother”) following her divorce from Larson Douglas Hudson (“Father”) and the appeal from the trial court’s order of May 22, 2008, granting the petition and awarding attorney’s fees to Mother. We granted Father permission to appeal and scheduled the appeal for argument. Mother requests that Father’s appeal be dismissed as moot. For the reasons stated below, we grant Mother’s request. In addition, we vacate the trial court’s order of May 22, 2008.

Davidson County Supreme Court 12/17/10