Court Reviews the Validity of a Land Survey in a Case about a Boundary Dispute between Hunting Clubs

OPEN LAKE SPORTING CLUB v. LAUDERDALE HAYWOOD ANGLING CLUB (Tenn. Ct. App. January 13, 2011)

This appeal involves a dispute over the location of a boundary line between tracts of land owned by two hunting clubs. After many years of litigation, the parties agreed that a new survey would be conducted by a new surveyor and that they would be bound by his decision.

After the new surveyor filed a report and survey, one of the clubs filed a motion to set aside the survey, contending that the new surveyor did not make an independent determination regarding the location of the boundary line, but rather, copied a previous survey that was completed in the past. The trial judge refused to hold a hearing regarding the validity of the survey because the parties had agreed to be bound by the surveyor's decision. We reverse and remand for further proceedings.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2011/openlake_011311.pdf

OSHA: Most Frequently Cited Standards of 2010

The following were the top 10 most frequently cited standards in fiscal year 2010 (October 1, 2009 through September 30, 2010):

1. Scaffolding, general requirements, construction (29 CFR 1926.451)
2. Fall protection, construction (29 CFR 1926.501) 
3. Hazard communication standard, general industry (29 CFR 1910.1200) 
4. Ladders, construction (29 CFR 1926.1053) 
5. Respiratory protection, general industry (29 CFR 1910.134) 
6. Control of hazardous energy (lockout/tagout), general industry (29 CFR 1910.147) 
7. Electrical, wiring methods, components and equipment, general industry (29 CFR 1910.305) 
8. Powered industrial trucks, general industry (29 CFR 1910.178)
9. Electrical systems design, general requirements, general industry (29 CFR 1910.303) 
10. Machines, general requirements, general industry (29 CFR 1910.212) 

The following are the standards for which OSHA assessed the highest penalties in fiscal year 2010 (October 1, 2009 through September 30, 2010):

1. Fall protection, construction (29 CFR 1926.501) 
2. Electrical, general requirements, construction (29 CFR 1926.403)
3. Safety training and education, construction (29 CFR 1910.21) 
4. Control of hazardous energy (lockout/tagout), general industry (29 CFR 1910.147)
5. Machines, general requirements, general industry (29 CFR 1910.212)
6. General duty clause (Section 5(a)(1) of the OSH Act)
7. Excavations, requirements for protective systems, construction (29 CFR 1926.652)
8. Lead, general industry (29 CFR 1910.1025)
9. Grain handling facilities (29 CFR 1910.272)
10. Ladders, construction (29 CFR 1926.1053)

For more detailed information, visit Frequently Cited OSHA Standards. At that site, you can generate a report on the most frequently cited federal or state OSHA standards by your SIC code and the number of employees in your establishment.

Article located at:  http://www.osha.gov/dcsp/compliance_assistance/frequent_standards.html

Court Reviews a Judgment in Favor of a Bank against Defaulting Borrowers

GREENBANK, F/K/A GREENE COUNTY BANK v. BARBARA J. THOMPSON, ET AL. (Tenn. Ct. App. December 29, 2010)

Bank provided a loan to Borrowers for the purchase of real property and construction of a log cabin home. After Borrowers defaulted on the loan, Bank sold the property at a foreclosure sale.

Bank then initiated a lawsuit alleging conversion, negligent business representation, and promissory fraud. Bank also sought a deficiency judgment for the difference in the amount owed on the loan and the foreclosure sale price. After a bench trial, the trial court awarded a judgment for $61,782.12 and a deficiency judgment for $300,644.92 in favor of Bank. Borrowers appeal. We affirm.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/greenbank_122910.pdf

Court Reviews Whether the Trial Court Properly Held Home Inspectors Individually Liable in a Negligence Case

JOHN GALLON, ET AL. v. HARRY ELBERSON, ET AL. (Tenn. Ct. App. December 1, 2010)

The plaintiff home buyers filed suit against two home inspectors and a home inspection company after discovering defects in the home that were not mentioned in the inspection report. The court found that the defendants were negligent and granted the plaintiffs a judgment for damages against the home inspectors and the inspection company, individually, jointly and severally.

The defendants argue on appeal that the judgment was not supported by the evidence and that in holding them individually liable, the court pierced the corporate veil without the proof of the extraordinary circumstances normally required for a court to do so.

We affirm the finding of liability and the judgment for damages, but we vacate the judgment as to one of the individual defendants, because the evidence preponderated against the trial court's finding that he was in partnership with the other individual defendant.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/gallonj_120110.pdf

Court Reviews Whether a Construction Company is Entitled to a Modification of the Incentive Provision of a Contract with TDOT

RAY BELL CONSTRUCTION CO., INC. v. STATE OF TENNESSEE, TENNESSEE DEPARTMENT OF TRANSPORTATION (Tenn. Ct. App. November 29, 2010)

This case concerns an alleged breach of contract involving the incentive clause of a Tennessee Department of Transportation ("TDOT") road construction contract. Before the Claims Commission, TDOT argued that the contract language was clear in prohibiting an extension, alteration, or amendment of the incentive clause.

The Claims Commission agreed with the position of Ray Bell Construction Company ("RBCC") that it was entitled to a modification of the incentive provision. To so find, the Commission held that "a definite latent ambiguity exists for which parol evidence not only is admissible, but frankly, absolutely necessary in both understanding and deciding the issues in this case." TDOT has appealed. We affirm the decision of the Claims Commission.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/raybell_112910.pdf

SWINEY, Dissenting:
http://www.tba2.org/tba_files/TCA/2010/raybell_DIS_112910.pdf

Court Reviews Whether a Quantum Meruit Award and the Denial of an Offset was proper in a case between a Construction Company and a Demolition Subcontractor

DILLARD CONSTRUCTION, INC. v. HAVRON CONTRACTING CORP. ET AL. (Tenn. Ct. App. November 23, 2010)

The only parties left litigating in what started out as a complex construction dispute are, on one side, Dillard Construction, Inc , and, on the other, Dillard's demolition subcontractor, Havron Contracting Corp. After a bench trial and several post-trial motions, the court held that:

(1) Dillard, while not having a contract with Havron, was required by quantum meruit to pay Havron $91,100 for work performed by Havron's subcontractors;
(2) Dillard was not entitled to an offset against that judgment for damage done to electrical equipment by Havron's subcontractor;
(3) Havron was entitled to recover from Dillard, under a "passthrough" indemnity theory, the attorney's fees awarded against Havron and in favor of its subcontractor; and
(4) Havron was not entitled to recover the attorney's fees that it, Havron, incurred in defending against the claims of its subcontractor.

Dillard appeals challenging both the quantum meruit award and the denial of an offset. Havron challenges the trial court's denial of indemnification for attorney's fees Havron incurred in defending the claims of its subcontractor. We affirm.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/dillardconstruction_112310.pdf

Court Reviews Damages Owed in a Defective Driveway Case

EARL FAULKNER, ET AL. v. TOM EMMETT CONSTRUCTION COMPANY (Tenn. Ct. App November 18, 2010)

Earl and Faye Faulkner ("Plaintiffs") hired Tom Emmett Construction Company ("Defendant") to construct a new driveway at their home in Knox County. Plaintiffs refused to pay $8,000 of the total $18,000 contract price because they were dissatisfied with the workmanship of the driveway.

Plaintiffs sued Defendants seeking as damages what it would cost to remove and replace the allegedly defective driveway. Defendant asserted that the driveway was properly constructed and filed a counterclaim for the remaining $8,000 balance owed on the oral contract.

Following a bench trial, the Trial Court concluded that any problems with the driveway were not sufficient to require that it be removed and replaced. Because there was a problem with how the concrete on one portion of the driveway had been poured, the Trial Court required Plaintiffs to pay Defendant only $5,000 of the remaining $8,000 owed on the contract. Plaintiffs appeal. We affirm as modified.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/faulknere_111810.pdf

Court Reviews a Construction Financing Case between Financier and Property Owner

WADE PHELPS/PHELPS HARRINGTON CONSTRUCTION CO., INC. v. C & C CONSTRUCTION CO., LLC, ET AL. (Tenn. Ct. App. November 10, 2010)

Contractor agreed to build duplex for property owner, with plaintiff providing construction financing. At closing, contractor was paid, but contractor did not pay plaintiff as agreed. Plaintiff sued property owner, contractor, and bank.

We previously affirmed the trial court's grant of summary judgment to the bank, finding that contractor and plaintiff were in a joint venture, such that payment to contractor was payment to plaintiff.

Property owner then moved for summary judgment, which the trial court granted. Because we find no separate agreement between property owner and plaintiff requiring repayment directly to plaintiff, plaintiff's cause of action against property owner is precluded, and the trial court's grant of summary judgment is affirmed.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/wadephelps_111010.pdf

Court Reviews Whether Purchaser of Recently-Foreclosed Property has Standing to Bring a Suit Against Property’s Sellers

PROVIDENCE CROSSINGS, LLC v. SC REALTY CAPITAL, L.P., SC CAPITAL, LLC, AND SMITH REALTY INTERESTS, L.P. (Tenn. Ct. App. November 3, 2010)

Purchaser of landlocked property brought action against the sellers, seeking to recover damages allegedly caused by the failure of the sellers to complete a road extension or otherwise to insure reasonable access to the property, which had been purchased for development of multi-family rental units.

The trial court granted summary judgment to the sellers, finding that the right of the purchaser to proceed with the action was extinguished when the bank that provided financing for the development of the property foreclosed on the loan secured by the property and subsequently sold the property to another entity. The court concluded that the purchaser did not have standing to pursue the claims.

Finding that a genuine issue of material fact exists as to whether the purchaser's cause of action was included in the assets foreclosed upon, we reverse the judgment of the trial court and remand for further proceedings.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/providencecrossings_110310.pdf

CLEMENT concurring in the judgement
http://www.tba2.org/tba_files/TCA/2010/providencecrossings_CON_110310.pdf

Court Reviews a Contractor’s Mistake in Making a Construction Bid

PRESTIGE LAND COMPANY v. BRIAN MULLINS EXCAVATING CONTRACTORS, INC. (Tenn. Ct. App. October 29, 2010)

Prestige Land Company ("Developer") owned land upon which it intended to build a commercial shopping center. An estimate to complete the project was obtained. Thereafter, the project was opened up for bidding. Brian Mullins Excavating Contractors, Inc. ("Contractor") bid on the project. Although Contractor's bid was significantly lower than the next lowest bid, it was only 10% lower than the estimated costs of construction. Contractor was unaware that it had made a unilateral mistake in its bid. Contractor was awarded the project. Eventually, Contractor was unable to complete the project because it ran out of money due to its unilateral bidding mistake.

Developer sued for breach of contract, and Contractor filed a counterclaim for fraud and other claims. The Trial Court awarded Contractor a judgment for $101,357.05. Finding no clear and convincing evidence of fraud by Developer, we vacate the judgment for Contractor and enter a judgment for Developer in the amount of $128,326.56.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/prestigeland_102910.pdf

Court Reviews Whether Defendant Signed A Credit Application in His Personal Capacity

84 LUMBER COMPANY v. R. BRYAN SMITH, ET AL. (Tenn. Ct. App. October 28, 2010)

84 Lumber Company ("84 Lumber") sued R. Bryan Smith ("Smith") and Allstates Building Systems, LLC ("Allstates") for a balance owed on an open account. Both sides filed motions for summary judgment. The Circuit Court granted 84 Lumber summary judgment, and entered a judgment against Smith and Allstates in the amount of $27,611.31 plus attorney's fees and costs in the amount of $6,500.00. Smith appeals to this Court.

We find that Smith did not sign the credit application in his personal capacity and, therefore, did not guarantee Allstates' debt. We reverse the grant of summary judgment against Smith, and grant summary judgment to Smith. We affirm the grant of summary judgment against Allstates.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/84lumber_102810.pdf

SUSANO, concurring in part and dissenting in part:
http://www.tba2.org/tba_files/TCA/2010/84lumber_CON_102810.pdf

TN Supreme Court Reviews Whether an Appraisal can Form the Basis of a Fraudulent Misrepresentation Claim

JOSEPH DAVIS ET AL. v. PATRICK J. McGUIGAN ET AL. (Tenn. October 26, 2010)

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.

Opinion may be found at:
http://www.tba2.org/tba_files/TSC/2010/davisj_102610.pdf

KOCH and CLARK, dissenting:
http://www.tba2.org/tba_files/TSC/2010/davisj_DIS_102610.pdf

Court Reviews Summary Judgment Ruling in a Case Between a Home Purchaser and a Licensed Contractor

NATALIE HAGAN v. MICHAEL PHIPPS ET AL. (Tenn. Ct. App. September 29, 2010)

This appeal involves claims by a home purchaser against a licensed contractor and a business associate of the unlicensed builder who built the home in question and sold it to the plaintiff. The trial court granted the contractor defendant's motion for summary judgment on all claims against him based upon its conclusions that the unlicensed builder was not the agent of the licensed contractor and that there was no predicate tort for civil conspiracy because the builder intended to use the house for his personal residence. Because we find that there are issues of material fact that must be resolved, we reverse the trial court's grant of summary judgment.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/hagann_092910.pdf

Court Reviews Priority Issues in a Case Involving Lien Enforcement

EAST TENNESSEE GRADING, INC., v. BANK OF AMERICA, N.A., et al. (Tenn. Ct. App. September 28, 2010)

Plaintiff brought this action to enforce a lien for excavation and road work done in a residential development, because the owner had not paid for the construction work performed. An agreed judgment was entered as to plaintiff's claims against defendant, Seven Lakes Development, awarding judgment against that defendant for materials and labor performed on the property. One parcel of property, however, totaling 6.36 acres was owned by defendants Coughlins, which was subject to a deed of trust in favor of Bank of America. The Trial Court held that Bank of America had priority over plaintiff as to 1.9 acres because plaintiff had not filed its Notice of Lien timely to maintain priority over the subsequent owners pursuant to Tenn. Code Ann. section 66-11-112. The Trial Court also held that plaintiff had priority over Bank of America as to 4.46 acres because plaintiff's Notice of Lien was filed before the Amended Deed of Trust in favor of Bank of America was filed. On appeal, we affirm the Judgment of the Trial Court.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/easttenngrading_092810.pdf

Court Reviews the Enforceability of a Materialman's Lien

CENTURY FIRE PROTECTION, LLC., v. FOWLERS' HOLDINGS, LLLP., et al. (Tenn. Ct. App. September 16, 2010)

Plaintiff alleged that it delivered materials and provided labor for the installation of a fire protection system on the property of defendant and defendant had failed to pay money still owed under the contract. Plaintiff sought a materialmen's lien to enforce any judgment obtained against defendant for the amount of monies owed under the contract. Defendants answered, filed a counter-complaint and raised multiple defenses. The Trial Court conducted an evidentiary hearing and ruled in plaintiff's favor, holding that plaintiff was entitled to recover monetary damages and the materialmen's lien would be enforced. Defendants have appealed and we affirm the Judgment of the Trial Court.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/centuryfire_091610.pdf