Supreme Court Opinions

Format: 03/22/2013
Format: 03/22/2013
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
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
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
State of Tennessee v. Terry Phelps
M2008-01096-SC-R11-CD
Authoring Judge: Chief Justice Corneila A. Clark
Trial Court Judge: Judge Lee Russell

The defendant, a convicted violent sexual offender, was released on parole in 2006. He registered pursuant to the Tennessee Sexual Offender and Violent Sexual Offender Registration, Verification, and Tracking Act of 20041 (“the Registration Act”), listing a primary address in Bedford County and a secondary address in Rutherford County. He was subsequently arrested in Lincoln County and charged with violating the Registration Act. Defendant tendered an “open” guilty plea but moved to withdraw his plea prior to being sentenced. After a hearing, the trial court ruled that the defendant had “merely had a change of heart” and denied the motion. The trial court later sentenced the defendant as a Range II offender to three years in the Department of Correction. The defendant appealed the trial court’s decision on his motion to withdraw plea and his sentence. The Court of Criminal Appeals affirmed. We hold that the trial court committed reversible error in failing to apply the correct analysis in determining whether the defendant had established a “fair and just reason” for withdrawing his guilty plea. We further hold that Defendant established sufficient grounds for the withdrawal of his guilty plea. The judgments of the trial court and the Court of Criminal Appeals are reversed, the defendant’s motion to withdraw his guilty plea is granted, and this matter is remanded to the trial court for further proceedings consistent with this opinion.

Bedford County Supreme Court 12/16/10
CAO Holdings, Inc. v. Charles A. Trost, Commissioner of Revenue
M2008-01679-SC-R11-CV
Authoring Judge: Justice William C. Koch, Jr.
Trial Court Judge: Chancellor Carol L. McCoy

This appeal involves a corporation’s liability for the payment of use tax following its purchase of a business jet. After it received an assessment from the Tennessee Department of Revenue for over $700,000, the corporation paid the tax and filed suit in the Chancery Court for Davidson County seeking a refund on the ground that it qualified for the sale for resale exemption under Tenn. Code Ann. § 67-6-102(a) (28)(A) (Supp. 2004) because it had leased the aircraft to another corporation. Both the corporation and the Department filed motions for summary judgment. The trial court granted the corporation’s motion for summary judgment, and the Department appealed. A divided Court of Appeals panel affirmed the trial court. CAO Holdings, Inc. v. Chumley, No. M2008-01679-COA-R3-CV, 2009 WL 1492230 (Tenn. Ct. App. May 27, 2009). We granted the Department’s application for permission to appeal. We have now determined that neither party is entitled to a summary judgment because material disputes exist regarding the factual inferences or conclusions that can be drawn from the facts.

Davidson County Supreme Court 12/15/10
Debra M. Barkes, et al. v. River Park Hospital, Inc.
M2006-01214-SC-R11-CV
Authoring Judge: Justice Sharon G. Lee
Trial Court Judge: Judge Larry B. Stanley, Jr.

River Park Hospital has filed a Tenn. R. App. P. 39 petition for rehearing requesting this Court to reconsider its opinion filed on October 20, 2010. We have carefully reviewed the entire record and appellate briefs, from all of which we conclude that our opinion addressed and considered all issues raised by River Park in its appeal. Accordingly, the petition for rehearing is respectfully denied and the costs of this petition are taxed to River Park Hospital, Inc., d/b/a River Park Hospital, for which execution may issue if necessary.

Warren County Supreme Court 11/30/10
Dawn Brown, et al. vs. Tennessee Title Loans, Inc.
E2008-01758-SC-R11-CV
Authoring Judge: Chief Justice Cornelia A. Clark
Trial Court Judge: Judge Jacqueline E. Bolton

We granted this interlocutory appeal to answer a single question of first impression: whether the Tennessee Title Pledge Act, Tenn. Code Ann. __ 45-15-101 to -120 (2000), permits a private right of action on behalf of pledgors against title pledge lenders who allegedly charged excessive interest and prohibited fees. The trial court granted the defendant's motion to dismiss plaintiffs' Title Pledge Act allegations for failure to state a claim, and the Court of Appeals reversed. We hold that the Title Pledge Act does not expressly create an individual private right of action, and plaintiffs have not carried their burden of establishing that the legislature intended to imply such a right. Accordingly, we reverse the judgment of the Court of Appeals and reinstate the judgment of the trial court.

Hamilton County Supreme Court 11/29/10
Lou Ella Sherrill, et al. v. Bob T. Souder, M.D., et al.
W2008-00741-SC-R11-CV
Authoring Judge: Justice Gary R. Wade
Trial Court Judge: Judge Donald H. Allen

This litigation involves a claim of medical malpractice against the two defendants, a physician and the corporation operating his clinical practice, alleging negligence in the prescription of a drug. The trial court granted the defendants' motion for summary judgment on grounds that the suit was barred by the one-year statute of limitations. The Court of Appeals affirmed. The question before the Court is the propriety of summary judgment on statute of limitations grounds. Although the trial court properly concluded that the cause of action accrued more than a year before the suit was filed, there is a genuine issue of material fact regarding whether the plaintiff was of unsound mind on the date the cause of action accrued, thus tolling the limitations period. Because the suit was not time-barred as a matter of law, the grant of summary judgment must be reversed. The cause is remanded to the trial court for proceedings consistent with this opinion.

Madison County Supreme Court 10/28/10
Joseph Davis, et al. v. Patrick J. McGuigan, et al.
M2007-02242-SC-R11-CV
Authoring Judge: Justice Janice M. Holder
Trial Court Judge: Judge Hamilton V. Gayden, Jr.

This appeal arises from a trial court's grant of summary judgment in an action against a real estate appraiser for fraudulent misrepresentation and for violation of the Tennessee Consumer Protection Act. A husband and wife alleged that the appraiser, who was hired by the bank financing the husband and wife's home construction, recklessly overestimated the value of their proposed construction and that they reasonably relied on the appraisal value to their detriment. The Court of Appeals affirmed the trial court's ruling, holding that an appraisal is an opinion that cannot form the basis for a fraudulent misrepresentation claim. We hold that an opinion can form the basis of a fraudulent misrepresentation claim. We further hold that genuine issues of material fact preclude summary judgment as to the husband and wife's claims against the appraiser. We reverse the Court of Appeals and remand the case to the trial court for further proceedings consistent with this opinion.

Davidson County Supreme Court 10/26/10
Joseph Davis, et al. v. Patrick J. McGuigan, et al. - Dissenting
M2007-02242-SC-R11-CV
Authoring Judge: Justice William C. Koch, Jr.
Trial Court Judge: Judge Hamilton V. Gayden, Jr.

This appeal arises from a trial court's grant of summary judgment in an action against a real estate appraiser for fraudulent misrepresentation and for violation of the Tennessee Consumer Protection Act. A husband and wife alleged that the appraiser, who was hired by the bank financing the husband and wife's home construction, recklessly overestimated the value of their proposed construction and that they reasonably relied on the appraisal value to their detriment. The Court of Appeals affirmed the trial court's ruling, holding that an appraisal is an opinion that cannot form the basis for a fraudulent misrepresentation claim. We hold that an opinion can form the basis of a fraudulent misrepresentation claim. We further hold that genuine issues of material fact preclude summary judgment as to the husband and wife's claims against the appraiser. We reverse the Court of Appeals and remand the case to the trial court for further proceedings consistent with this opinion.

Davidson County Supreme Court 10/26/10
Martha Graham v. Clinton Caples et al.
W2009-00200-SC-S09-CV
Authoring Judge: Sharon G. Lee, J.
Trial Court Judge: Kay S. Robilio, Judge
The issue presented in this interlocutory appeal is whether the plaintiff's suit for damages was timely filed. The plaintiff and the defendant were involved in a traffic accident on November 4, 2006. Within a year of the accident, on November 2, 2007, the plaintiff filed a civil warrant with the general sessions court clerk against the defendant driver and, erroneously, against herself, seeking damages for personal injuries and property damages. The warrant, although marked "filed," was not signed by the clerk, had no docket number or issuance date, and was not served on the defendants. Thereafter, on November 13, 2007, the plaintiff filed an "Amended Civil Warrant" against the defendant driver and the defendant owner of the vehicle, seeking damages for personal injuries and property damages. This warrant was properly signed by the clerk, had a docket number and an issuance date, and was served on the defendants. The defendants filed a motion to dismiss, asserting that the first warrant was not valid and that the second warrant had been filed outside the one-year statute of limitations for personal injuries. The trial court granted the motion to dismiss as to the defendant owner and denied the motion as to the defendant driver. We hold that pursuant to Tennessee Code Annotated sections 16-15-710 and 16-15- 716, a civil action in the general sessions court is not commenced for purposes of tolling the statute of limitations until the warrant is issued by the clerk. Because the original warrant filed by the plaintiff on November 2, 2007, was not issued by the clerk, the plaintiff's cause of action was not commenced at that time. The plaintiff's claim for personal injuries in the "Amended Civil Warrant" filed on November 13, 2007, was not timely filed within the oneyear statute of limitations period and must be dismissed. The plaintiff's claim for property damages in the "Amended Civil Warrant" was timely filed within the three-year statute of limitations period.
Shelby County Supreme Court 10/20/10