Court examines presumption of ownership under T.C.A. §28-2-110(a)

KINZEL SPRINGS PARTNERSHIP v. HAROLD KING, ET AL. (Tenn. Ct. App. July 31, 2009)

In this action to quiet title, the plaintiff sought the declaration of the true boundary line between the parties, along with an award of the litigation expenses, discretionary costs, and attorneys' fees incurred in protecting the title to the property. Following a bench trial, the court agreed with the property line claimed by the plaintiff. The defendants appeal. We affirm.

Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2009/kinzel_073109.pdf

Court examines revocability of plaintiff's personal license to use defendant's boat dock

BOBBY J. COLLINS v. LYNDA C. FUGATE (Tenn. Ct. App. July 31, 2009)

This appeal arises out of litigation in the trial court pertaining to a disputed interest in the use of a boat dock. Bobby J. Collins filed suit against Lynda C. Fugate seeking compensation for labor expended and materials used in the construction of a boat dock. He claimed that, some ten years before filing suit, he helped build the dock on lakeside property owned by Ms. Fugate. The plaintiff contended that, in exchange for building the dock, the defendant gave him a "lifetime dowry" to use her property and dock his houseboat. The defendant acknowledged an agreement between the parties, but contended that it ended by its own terms before she revoked her permission for the defendant's continued use of the property. Following a bench trial, the court found that the plaintiff had a revocable personal license to use the defendant's property that was terminated when and by virtue of the fact he had sold his boat. The complaint was dismissed. We affirm.

Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2009/collinsb_073109.pdf

Attorney General Reviews Legality of a Guest Worker's Program

Legality of a Guest Workers Program

TN Attorney General Opinion Number: 09-134 (July 29, 2009)

Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/AG/2009/ag_09_134.pdf

Court rules that general contrator's indemnity claim barred by exclusive remedy provision of contract

BAPTIST MEMORIAL HOSPITAL and BAPTIST MEMORIAL HEALTH CARE CORPORATION v. ARGO CONSTRUCTION CORPORATION, HANSON PIPE & PRODUCTS SOUTH, INC., and ETI CORPORATION and ARGO CONSTRUCTION CORPORATION v. HANSON PIPE & PRODUCTS SOUTH, INC. (Tenn. Ct. App. July 29, 2009)

This appeal involves a cross-claim for indemnity. The cross-plaintiff construction company served as the general contractor on a drainage improvement project for a hospital. The cross-defendant subcontractor manufactured and provided concrete pipe for the project, which was installed by the general contractor. After completion of the project, a sinkhole developed in the hospital's parking lot. An investigation revealed that the internal steel reinforcement for the concrete pipe was improperly positioned.

The hospital sued, among others, the general contractor and the pipe subcontractor. The general contractor then filed a cross-claim against the pipe subcontractor for indemnity in the event the hospital received a judgment against the general contractor. The subcontractor filed a motion for summary judgment as to the general contractor's indemnity claim, arguing that the claim was barred by (1) the one-year limitations period contained in the parties' contract, as permitted under Tennessee Code Annotated section 47-2-725, and (2) the exclusive remedy provision in the parties' contract, which provided that the only remedies available to the general contractor were repair, replacement, or refund of the purchase price of the pipe. The general contractor argued that the one-year contractual limitations period was not applicable to its indemnity claim, and that the exclusive remedy provision did not preclude its indemnity claim. In the alternative, the general contractor argued that, because the defect in the pipe was latent and not discoverable upon reasonable inspection, the exclusive remedy in the contract failed of its essential purpose and the general contractor was not bound by it.

The trial court granted the subcontractor's motion for summary judgment, concluding that the indemnity claim was barred by the one-year contractual limitations period and the exclusive remedy provision, and also that the latency of the alleged defect in the pipe did not cause the exclusive remedy to fail of its essential purpose. The general contractor appeals. We affirm, finding that the exclusive remedy provision applies to bar the indemnity claim and that the exclusive remedy in the contract does not fail of its essential purpose.

Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2009/baptist_072909.pdf

Court examines warranty of fitness, warranty of merchantability, breach of contract, measure of damages in breach of contract case

DAN STERN HOMES, INC. v. DESIGNER FLOORS & HOMES, INC., ET AL. (Tenn. Ct. App. June 30, 2009).

Appellants, a flooring company hired to install hardwood flooring at a home being built by Appellee, appeal the judgment of the trial court finding them liable for breach of contract and breach of warranty and awarding damages to Appellee. Appellants were hired to install hardwood flooring at a home being built by Appellee. After installation of the floors, problems developed; Appellants tried to correct the problems on numerous occasions to no avail. Appellee hired another subcontractor to refinish the hardwood flooring and to resolve the problems associated therewith. Appellee subsequently brought action against Appellant to recover amounts paid to subcontractor and the trial court awarded Appellee full measure of damages sought. We modify and affirm the judgment of the trial court.

Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2009/dansternhomes_070109.pdf

Court examines whether chancery court has subject matter jurisdiction; whether defendant is required to exhaust administrative remedies before trial

CHEATHAM COUNTY by and through its Floodplain Administrator, A. M. Armstrong v. JAMES KONG, ET AL. (Tenn. Ct. App. June 30, 2009)

Appellee was issued a building permit for a carport by Appellant, County. County subsequently revoked the permit and ordered demolition of the carport claiming the structure exceeded that permitted. Appellee failed to demolish the structure, and County sued in the chancery court. Appellee moved to dismiss for lack of subject matter jurisdiction, claiming that he should be allowed to exhaust his administrative remedies-an appeal to the Board of Zoning Appeals-before the chancery court could assume jurisdiction. The trial court granted Appellee's motion to dismiss. We find the chancery court had subject matter jurisdiction over the case, and thus, reverse and remand to the chancery court for a trial on the merits.

Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2009/cheathamcounty_070109.pdf

TCA affrims summary judgment based on statute of repose

GEORGE R. CALDWELL, Jr., ET AL. v. PBM PROPERTIES (Tenn. Ct. App. June 29, 2009)

George R. Caldwell, Jr., and Angie R. Caldwell ("the Homeowners") sued PBM Properties and others alleging that alterations made by PBM in 1998 to the natural drainage conditions on properties that neighbor the Homeowners created a continuing temporary nuisance that recurred in 2005 and caused flooding to the Homeowners' property. PBM filed a motion for summary judgment on the ground that the cause of action was barred by the statute of repose for improvements to real property found at Tenn. Code Ann. section 28-3-202 (2000). The trial court agreed and granted the motion. The Homeowners appeal. We affirm.

The full text of this opinion may be found on the TBA Website at:
http://www.tba2.org/tba_files/TCA/2009/caldwellg_092909.pdf

TCA examines breach of construction contract issues

MADDEN PHILLIPS CONSTRUCTION, INC. v. GGAT DEVELOPMENT CORPORATION (Tenn. Ct. App. June 29, 2009)

This appeal arises out of a dispute between a contractor and landowner over the parties' duties under a construction contract. Plaintiff/Appellee Madden Phillips Construction, Inc. ("Madden Phillips") filed suit to enforce a mechanics' and materialmen's lien and to recover damages in breach of contract against Defendant/Appellant GGAT Development Corporation ("GGAT"). Madden Phillips' complaint included a claim for damages and attorney's fees pursuant to Tennessee Code Annotated sections 66-34-101 to -703, also known as the Prompt Pay Act of 1991 ("Prompt Pay Act"). GGAT counterclaimed and asserted, inter alia, that Madden Phillips failed to perform its contractual obligations in a "workmanlike and expeditious fashion to coincide with the completion schedule of [GGAT]."

The trial court ruled in favor of Madden Phillips. The trial court determined that GGAT wrongfully terminated Madden Phillips from the construction project and refused to compensate Madden Phillips in bad faith. The court further concluded that GGAT's actions constituted a material breach and prevented GGAT from recovering on its counterclaim. The trial court entered judgment in favor of Madden Phillips for damages and attorney's fees in the amount of $88,739.51, plus interest and court costs. We affirm.

The full text of this opinion may be found on the TBA Website at:
http://www.tba2.org/tba_files/TCA/2009/maddenphillips_092509.pdf

Court of Appeals examines permit granting issue

WIRELESS PROPERTIES, LLC, v. THE BOARD OF APPEALS FOR THE CITY OF CHATTANOOGA, ET AL. (Tenn. Ct. App. June 25, 2009)

The plaintiff filed a petition challenging the grant of a building permit to Verizon Wireless. The decision of the City was affirmed by the Board. After the trial court conducted a hearing, it affirmed and dismissed the petition. The plaintiff appeals. We affirm.

The full text of this opinion may be found on the TBA Website at:
http://www.tba2.org/tba_files/TCA/2009/wireless_092509.pdf

Procedure for Local Approval of Landfills

Procedure for Local Approval of Landfills Under Tenn. Code Ann. section 68-211-703

TN Attorney General Opinion (June 11, 2009)

Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/AG/2009/ag_09_115.pdfAG/2009/ag_09_115.pdf

Court reviews Water Quality Control Board decision.

PUBLIC EMPLOYEES FOR ENVIRONMENTAL RESPONSIBILITY (PEER) v. TENNESSEE WATER QUALITY CONTROL BOARD, ET AL. (Tenn. Ct. App. June 10, 2009)

Upon review under the Uniform Administrative Procedures Act, the trial court affirmed the decision of the Water Quality Control Board upholding the decision of the Tennessee Department of Environment and Conservation to approve Waste Management's application for a permit to expand a landfill into a mitigation wetlands area. Petitioner appeals. We dismiss the appeal for lack of standing and as moot.
 

Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2009/peer_061109.pdf

Court examines whether lost rent claim is speculative; perfected security interest; lease/disguised security agreement

METRO CONSTRUCTION CO., LLC v. SIM ATTRACTIONS, LLC, ET AL. (Tenn. Ct. App. June 9,2009)

This case originated with a mechanic's and materialman's lien asserted by Plaintiff Metro Construction against commercial real property owned by Defendant/Cross Plaintiff Peabody Place Center in Memphis. It arises from improvements made by Metro Construction to a leasehold held by Defendant Sim Attractions. Sim Attractions abandoned the leasehold without compensating Metro Construction for the improvements, which included the installation of a several-ton race car simulator that remained in the abandoned leasehold. Defendant Fitraco claimed the simulator was its property under the terms of a lease agreement between Fitraco and Sim Attractions. It alternatively asserted a superior security interest.

The trial court found that the simulator was personal property and determined that that the agreement between Sim Attractions and Fitraco was not a lease but an unperfected, disguised security agreement. The trial court attached the simulator to secure judgment in favor of Metro Construction. It also awarded Metro Construction discovery sanctions against Fitraco. The trial court awarded Peabody Place damages for lost rent. Fitraco appeals, asserting it had leased the simulator to Sim Attractions or, in the alternative, that it had properly perfected its security interest prior to judicial attachment by the trial court. It further asserts the damages claimed by Peabody Place were speculative. We reverse the judgment in favor of Metro Construction and affirm the judgment in favor of Peabody Place.

Opinion may be found at the TBA website:

http://www.tba2.org/tba_files/TCA/2009/construction_060909.pdf

Witness testimony was contradictory but created issue of material fact as to whether witness had procured insurance coverage for company

URBAN HOUSING SOLUTIONS, INC., v. ASSURANCE COMPANY OF AMERICA ARTECH, INC., AND SIGNATURE PROPERTIES, LLC v. ZANDER INSURANCE AGENCY, INC., D/B/A ZANDER INSURANCE GROUP AND ASSURANCE COMPANY OF AMERICA (Tenn. Ct. App. March 18, 2009).

Plaintiff entered into an agreement with defendant Artech for renovation of plaintiff’s building. The agreement provided that Artech would obtain builder’s risk insurance naming Artech and plaintiff as the insured under the policy. Artech procured insurance through defendant Zander Insurance Agency, but the policy did not name plaintiff as an additional insured. A loss occurred and the insurance company refused to pay plaintiff’s claim because plaintiff was not named as an insured on the policy. A consent Judgment was entered in favor of plaintiff against Artech (which had become insolvent) and Artech assigned its cause of action against the insurance agency to plaintiff.

The Trial Court granted Zander Insurance Agency summary judgment and plaintiff has appealed. On appeal, we hold that there is a disputed issue of material fact as to whether Artech asked the insurance agency to add plaintiff as an additional insured under the policy which was procured through the agency. We vacate the summary judgment and remand for further proceedings.

Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2009/urbanh_031809.pdf

“Urban insists that it established that Mrs. Malakouti asked for Urban to be listed as an additional insured, but Zander failed to take the proper steps to effectuate that request, thus breaching its duty as an insurance agency. The representatives from Zander who testified stated that Mrs. Malakouti did not ask for Urban to be listed, as was evidenced by the form she filled out and sent to Zurich. Mrs. Malakouti testified in parts of her deposition that she did ask for Urban to be listed and that she was seeking coverage for the structure itself in addition to the work being done by Artech, but in other parts of her deposition stated that she only sought coverage for Artech’s work, and admitted that she told them that the owner had other insurance. She also admitted she filled out the form and did not list Urban, but stated that she filled out the form the way she was instructed to by someone at Zander. She testified that she never read the AIA contract and did not know what it required regarding insurance.” Id.

Court holds that easement was abandoned by predecessor-in-interest who had other direct access

DONNIE VAUGHT, ET AL. v. ALAN JAKES, SR. and wife DEBORAH JAKES, ET AL. (Tenn. Ct. App. May 27, 2009)

A group of Rutherford County landowners whose property abutted one side of a private road which they maintained at their own expense filed a suit for trespass against a neighbor and developer who used the same road for access to houses he was building on the other side. Their suit also included a due process claim against the County for erroneously granting building permits for those houses. 

The trial court agreed that the building permits were granted in error, but ruled that the county's action was an innocent error rather than a due process violation. The trial court also dismissed the plaintiffs' claims against the developer, holding that he was entitled to use the road because of a permanent easement he had acquired from his predecessors-in-interest. We affirm the trial court's dismissal of the due process claim, but reverse its dismissal of the trespass claim because the evidence shows that the individual who sold the property to the defendant had abandoned the easement and, thus, that the defendant had no right to use the road.

Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2009/vaughtd_052709.pdf

"The record indicates that the County correctly informed Mr. Baltz that he was not entitled to sell tracts of his land that did not adjoin Trimble Road, and that the building permits obtained by Mr. Jakes were granted in error. We cannot infer, however, from his acceptance of the Planning Director’s decision that the land could not be subdivided in the way he wished that Mr. Baltz did not know or believe that he could use Bowen Road for other purposes. We conclude on the basis of our examination of the entire record, including the testimony of Henry Parsley and Ronald Baltz, that the Parsleys and Mr. Baltz did know that they could use Bowen Road if they needed to or wanted to, but that they used it only sparingly because they had better access to their property by way of their entrances on Trimble Road. We therefore hold that any easement on Bowen Road enjoyed by the Parsleys or Mr. Baltz was abandoned prior to the sale to Mr. Jakes and that his use of the road amounted to a trespass. We accordingly remand this case to the trial court for further proceedings to determine the damages arising from the defendants’ trespasses which should be awarded to the plaintiffs." Id.

Legislation limiting development in certain rural communities that meet specified criteria, doe not constitute a taking

Validity of Pending Legislation Affecting Development in Rural Communities
TN Attorney General Opinions (March 12, 2009). Opinion Number: 09-26

Does House Bill 2361/Senate Bill 2217, which would limit development in certain predominantly rural communities, amount to a compensable taking of property under Article I, Section 21 of the Tennessee Constitution?

Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/AG/2009/ag_09_26.pdf

“[T]he Supreme Court established its threshold categorical formulation in Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 112 S.Ct. 2886, 120 L.Ed.2d 798 (1992), in which it determined that two categories of regulatory action would be compensable without reference to the three-part Penn Central type inquiry. But the Court acknowledged that, with respect to the second category, i.e., the deprivation of all economically viable use, it had not clarified the property interest against which the loss of value is to be measured. The Court went on to suggest that the answer might require an examination of how the property owner’s reasonable expectations had been shaped by the state’s laws affecting land use.Id.
“Applying all of this jurisprudence to the pending legislation that is the subject of this request, it is the opinion of this Office that the provisions of House Bill 2361/Senate Bill 2217 limiting development in predominantly rural communities, as long as those communities meet certain specified standards, are, on their face, constitutionally permissible. Any takings analysis of the enforcement of those provisions will be fact-dependent and must rely upon application of the case law and criteria listed above to the specific facts involved.”Id.