MICHAEL LLOYD MEIER, ET AL. v. HUNTINGTON RIDGE TOWNHOUSE HOMEOWNERS ASSOCIATION, INC. (Tn. Ct. App. October 24, 2008)
Homeowners association appeals the grant of summary judgment in favor of owners who sued for a declaration that the Association was responsible for the cost of repair of defective floor trusses. The trial court found that found that the defective floor trusses were considered "common elements" under the covenants of the Association. We affirm the decision of the trial court.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/meierm_102408.pdf
October 24, 2008
October 10, 2008
Court examines County's right to collect overlooked privilege taxes
HOME BUILDERS ASSOCIATION OF MIDDLE TENNESSEE v. WILLIAMSON COUNTY, ET AL. (Tn. Ct. App. October 10, 2008)
Appellants, a group of homebuilders, appeal the trial court's grant of summary judgment in favor of Appellee Williamson County. Homebuilders filed a complaint for declaratory judgment against Williamson County, seeking interpretation of Chapter 118 of the Private Acts of 1987 as amended. Under the alleged authority granted by the Act, Williamson County levied additional adequate facilities taxes on homebuilders based upon its audit of actual square footage built. Builders contend that Williamson County exceeded its authority under the Act by calculating taxes at the time of the issuance of the certificate of occupancy as opposed to the time the building permit was issued. Finding that the Legislature intended to give the County broad authority to levy its tax at the time of the issuance of the building permit or at the time of the issuance of the certificate of occupancy, we affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/homebuilders_101008.pdf
Appellants, a group of homebuilders, appeal the trial court's grant of summary judgment in favor of Appellee Williamson County. Homebuilders filed a complaint for declaratory judgment against Williamson County, seeking interpretation of Chapter 118 of the Private Acts of 1987 as amended. Under the alleged authority granted by the Act, Williamson County levied additional adequate facilities taxes on homebuilders based upon its audit of actual square footage built. Builders contend that Williamson County exceeded its authority under the Act by calculating taxes at the time of the issuance of the certificate of occupancy as opposed to the time the building permit was issued. Finding that the Legislature intended to give the County broad authority to levy its tax at the time of the issuance of the building permit or at the time of the issuance of the certificate of occupancy, we affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/homebuilders_101008.pdf
County given broad discretion to levy and collect taxes on new home construction
HOME BUILDERS ASSOCIATION OF MIDDLE TENNESSEE v. WILLIAMSON COUNTY, ET AL. (Tenn.Ct.App. October 10, 2008).
Appellants, a group of homebuilders, appeal the trial court's grant of summary judgment in favor of Appellee Williamson County. Homebuilders filed a complaint for declaratory judgment against Williamson County, seeking interpretation of Chapter 118 of the Private Acts of 1987 as amended. Under the alleged authority granted by the Act, Williamson County levied additional adequate facilities taxes on homebuilders based upon its audit of actual square footage built. Builders contend that Williamson County exceeded its authority under the Act by calculating taxes at the time of the issuance of the certificate of occupancy as opposed to the time the building permit was issued. Finding that the Legislature intended to give the County broad authority to levy its tax at the time of the issuance of the building permit or at the time of the issuance of the certificate of occupancy, we affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/homebuilders_101008.pdf
"The overarching goal of the tax is also clearly stated in Section 3 of the Act. The purpose of the tax is “to ensure and require that the persons responsible for new development share in the burdens of growth by paying their fair share for the cost of new and expanded public facilities...” (emphasis added). In order to facilitate the goal of the Act, the tax should necessarily be based upon the actual square footage of the improvement." Id.
"From this language, it is clear that the Legislature did not intend to limit the County’s ability to collect this tax. Rather, in order to ensure that the tax is levied upon the full square footage,
Williamson County is given broad discretion to calculate the tax at a time suitable to ascertaining the actual square footage." Id.
Appellants, a group of homebuilders, appeal the trial court's grant of summary judgment in favor of Appellee Williamson County. Homebuilders filed a complaint for declaratory judgment against Williamson County, seeking interpretation of Chapter 118 of the Private Acts of 1987 as amended. Under the alleged authority granted by the Act, Williamson County levied additional adequate facilities taxes on homebuilders based upon its audit of actual square footage built. Builders contend that Williamson County exceeded its authority under the Act by calculating taxes at the time of the issuance of the certificate of occupancy as opposed to the time the building permit was issued. Finding that the Legislature intended to give the County broad authority to levy its tax at the time of the issuance of the building permit or at the time of the issuance of the certificate of occupancy, we affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/homebuilders_101008.pdf
"The overarching goal of the tax is also clearly stated in Section 3 of the Act. The purpose of the tax is “to ensure and require that the persons responsible for new development share in the burdens of growth by paying their fair share for the cost of new and expanded public facilities...” (emphasis added). In order to facilitate the goal of the Act, the tax should necessarily be based upon the actual square footage of the improvement." Id.
"From this language, it is clear that the Legislature did not intend to limit the County’s ability to collect this tax. Rather, in order to ensure that the tax is levied upon the full square footage,
Williamson County is given broad discretion to calculate the tax at a time suitable to ascertaining the actual square footage." Id.
September 30, 2008
Contingent benefits offered under annexation in a plan of services are not subject to mandamus under Tenn. Code Ann. § 6-51-108.
STATE OF TENNESSEE EX REL CLAUDE CAIN, ET AL. v. CITY OF CHURCH HILL, TENNESSEE (Tenn.Ct.App. September 30, 2008).
The State of Tennessee, proceeding on relation of six individuals and one entity (who, for ease of reference, will collectively be referred to as "the plaintiffs"), sought mandamus in 2002 to force the City of Church Hill ("the City") to extend a sewer line to the individuals' homes. The individuals are residents of a neighborhood in Hawkins County that was annexed by the City in 1988. They claim that the City failed to adhere to the plan of services adopted as part of the annexation process, and that the plaintiffs are therefore entitled to mandamus under Tenn. Code Ann. section 6-51-108 (2005). The plan of services adopted in 1988 states that "[a] sanitary sewer system will be provided as soon as economically feasible."
The trial court granted the plaintiffs summary judgment, finding that the long delay in installing a sewer system, which continued at the time of trial, was unreasonable, and that there were no disputed issues of material fact preventing the court from granting mandamus under section 6-51-108. However, the court ordered a trial on the issue of how quickly the City could reasonably install the sewer line. At the conclusion of this limited-purpose trial, the court ordered the City to extend sewer service to the plaintiffs within 16 months. The City appeals. We vacate the trial court's grant of summary judgment and remand for further proceedings.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/cainc_093008.pdf
"The City’s first issue on appeal is whether the trial court erred by applying Tenn. Code Ann. § 6-51-108 retroactively. The City argues that the general presumption against applying laws retroactively ... However, as the plaintiffs correctly point out, this presumption is reversed for statutes which are remedial or procedural in nature. Such statutes apply retrospectively ... unless the legislature indicates a contrary intention or immediate application would produce an unjust result. ... Accordingly, we conclude that the statute is applicable to this case." Id. (citations and quotations omitted).
"The trial court declared this provision “vague,” and on that basis, essentially replaced the phrase “as soon as economically feasible” with the phrase “within a reasonable time.” The court then concluded that an 18-year delay is “unreasonable.” In essence, the court held that the City materially and substantially failed to comply with a requirement that sewer service be provided within a reasonable time after annexation. But no such requirement ever existed, because that is not what the plan of services says." Id. (italics in original).
"[T]he sewer provision is the only portion of the plan of services that is wholly indefinite, hinging upon a contingency – economic feasibility – that may or may not occur. We must assume that the plan’s drafters intended the plain meaning of their words. We therefore conclude that this unique aspect of the sewer provision was not a coincidence, but rather reflected an intentional decision to refrain from promising sewer service with the same sort of unconditional language that was used for other matters elsewhere in the plan. Accordingly, the court erred when it interpreted this provision as an unconditional promise to provide server services within a “reasonable time.”" Id.
The State of Tennessee, proceeding on relation of six individuals and one entity (who, for ease of reference, will collectively be referred to as "the plaintiffs"), sought mandamus in 2002 to force the City of Church Hill ("the City") to extend a sewer line to the individuals' homes. The individuals are residents of a neighborhood in Hawkins County that was annexed by the City in 1988. They claim that the City failed to adhere to the plan of services adopted as part of the annexation process, and that the plaintiffs are therefore entitled to mandamus under Tenn. Code Ann. section 6-51-108 (2005). The plan of services adopted in 1988 states that "[a] sanitary sewer system will be provided as soon as economically feasible."
The trial court granted the plaintiffs summary judgment, finding that the long delay in installing a sewer system, which continued at the time of trial, was unreasonable, and that there were no disputed issues of material fact preventing the court from granting mandamus under section 6-51-108. However, the court ordered a trial on the issue of how quickly the City could reasonably install the sewer line. At the conclusion of this limited-purpose trial, the court ordered the City to extend sewer service to the plaintiffs within 16 months. The City appeals. We vacate the trial court's grant of summary judgment and remand for further proceedings.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/cainc_093008.pdf
"The City’s first issue on appeal is whether the trial court erred by applying Tenn. Code Ann. § 6-51-108 retroactively. The City argues that the general presumption against applying laws retroactively ... However, as the plaintiffs correctly point out, this presumption is reversed for statutes which are remedial or procedural in nature. Such statutes apply retrospectively ... unless the legislature indicates a contrary intention or immediate application would produce an unjust result. ... Accordingly, we conclude that the statute is applicable to this case." Id. (citations and quotations omitted).
"The trial court declared this provision “vague,” and on that basis, essentially replaced the phrase “as soon as economically feasible” with the phrase “within a reasonable time.” The court then concluded that an 18-year delay is “unreasonable.” In essence, the court held that the City materially and substantially failed to comply with a requirement that sewer service be provided within a reasonable time after annexation. But no such requirement ever existed, because that is not what the plan of services says." Id. (italics in original).
"[T]he sewer provision is the only portion of the plan of services that is wholly indefinite, hinging upon a contingency – economic feasibility – that may or may not occur. We must assume that the plan’s drafters intended the plain meaning of their words. We therefore conclude that this unique aspect of the sewer provision was not a coincidence, but rather reflected an intentional decision to refrain from promising sewer service with the same sort of unconditional language that was used for other matters elsewhere in the plan. Accordingly, the court erred when it interpreted this provision as an unconditional promise to provide server services within a “reasonable time.”" Id.
Court review of zoning ordinance limited to whether decision has a rational or justifiable basis; Compliance with land use plan not legally required
DENNIS B. GANN, ET AL. v. THE CITY OF CHATTANOOGA, ET AL (Tenn.Ct.App. September 30, 2008).
The plaintiffs, Chattanooga residents whose homes are adjacent to a tract of land that was rezoned to make way for the construction of a grocery store, sought a declaratory judgment that the zoning amendment was illegal. The City of Chattanooga, the Chattanooga City Council, and the developer, Wilwat Properties, Inc., were named as defendants. Plaintiffs argue that the rezoning did not comply with the Hixson-North River Land Use Plan; that the City Council's approval of the application is arbitrarily inconsistent with the council's prior denial of a similar application; and that the council impermissibly relied upon the recommendation of the Hixson North River Leadership Committee - a recommendation that was made at an informal meeting of which the plaintiffs claim to have had no notice. The trial court dismissed the case at the close of the plaintiffs' proof, finding that the plaintiffs had failed to prove that the zoning decision lacked a rational basis or was arbitrary, capricious or unconstitutional. Plaintiffs appeal. We affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/gannd_093008.pdf
"When a municipal governing body acts under its delegated police powers either to adopt or amend a zoning ordinance, it acts in a legislative capacity and the scope of judicial review of such action is quite restricted. [] In fact, legislative classification in a zoning law, ordinance or resolution is valid if any possible reason can be conceived to justify it.” [] Put another way, in cases where the validity of a zoning ordinance is fairly debatable, the court cannot substitute its judgment for that of the legislative authority. If there is a rational or justifiable basis for the enactment and it does not violate any state statute or positive constitutional guaranty, the wisdom of the zoning regulation is a matter exclusively for legislative determination. [] The courts should not interfere with the exercise of the zoning power ... unless the enactment ... is shown to be clearly arbitrary, capricious, or unreasonable, having no substantial relation to the public health, safety, or welfare, or is plainly contrary to the zoning laws. ... The law deliberately makes the plaintiffs’ burden high, out of deference to the legislative power over zoning matters." Id. (citations and quotations omitted).
"[T]he plaintiffs’ extensive elucidation of the action’s non-compliance is ultimately a non-sequitur, because compliance with the Land Use Plan is not legally required. It is a plan, not a law. The City Council is allowed to deviate from it, and did so here." Id.
"The notion that we would invalidate the City Council’s 2006 action because of a perceived inconsistency with the council’s stated rationale for an action on a similar matter, four years prior, totally misconceives our role in cases such as this. ... If we can find any rational basis –
or, stated even more broadly, “any possible reason” – to uphold the council’s decision, we must do so, absent evidence of arbitrary, capricious, or illegal action by the council." Id.
The plaintiffs, Chattanooga residents whose homes are adjacent to a tract of land that was rezoned to make way for the construction of a grocery store, sought a declaratory judgment that the zoning amendment was illegal. The City of Chattanooga, the Chattanooga City Council, and the developer, Wilwat Properties, Inc., were named as defendants. Plaintiffs argue that the rezoning did not comply with the Hixson-North River Land Use Plan; that the City Council's approval of the application is arbitrarily inconsistent with the council's prior denial of a similar application; and that the council impermissibly relied upon the recommendation of the Hixson North River Leadership Committee - a recommendation that was made at an informal meeting of which the plaintiffs claim to have had no notice. The trial court dismissed the case at the close of the plaintiffs' proof, finding that the plaintiffs had failed to prove that the zoning decision lacked a rational basis or was arbitrary, capricious or unconstitutional. Plaintiffs appeal. We affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/gannd_093008.pdf
"When a municipal governing body acts under its delegated police powers either to adopt or amend a zoning ordinance, it acts in a legislative capacity and the scope of judicial review of such action is quite restricted. [] In fact, legislative classification in a zoning law, ordinance or resolution is valid if any possible reason can be conceived to justify it.” [] Put another way, in cases where the validity of a zoning ordinance is fairly debatable, the court cannot substitute its judgment for that of the legislative authority. If there is a rational or justifiable basis for the enactment and it does not violate any state statute or positive constitutional guaranty, the wisdom of the zoning regulation is a matter exclusively for legislative determination. [] The courts should not interfere with the exercise of the zoning power ... unless the enactment ... is shown to be clearly arbitrary, capricious, or unreasonable, having no substantial relation to the public health, safety, or welfare, or is plainly contrary to the zoning laws. ... The law deliberately makes the plaintiffs’ burden high, out of deference to the legislative power over zoning matters." Id. (citations and quotations omitted).
"[T]he plaintiffs’ extensive elucidation of the action’s non-compliance is ultimately a non-sequitur, because compliance with the Land Use Plan is not legally required. It is a plan, not a law. The City Council is allowed to deviate from it, and did so here." Id.
"The notion that we would invalidate the City Council’s 2006 action because of a perceived inconsistency with the council’s stated rationale for an action on a similar matter, four years prior, totally misconceives our role in cases such as this. ... If we can find any rational basis –
or, stated even more broadly, “any possible reason” – to uphold the council’s decision, we must do so, absent evidence of arbitrary, capricious, or illegal action by the council." Id.
September 24, 2008
Easement by necessity for landlocked property terminates when other means of ingress and egress become available
VICKIE ROBNETT v. EDWARD H. TENISON, JR. (Tenn.Ct.App. September 24, 2008).
The issue is whether a court-ordered easement by necessity for ingress and egress to landlocked property may be terminated on the ground it is no longer necessary because the landlocked owner has an express easement through which that owner has reasonable, although not as desirable, ingress and egress. The trial court denied the petition to terminate the easement by necessity upon a finding it would place an undue burden on the landlocked property owner to have it terminated. We have determined the trial court applied an incorrect legal standard, that of undue burden, to deny the petition to terminate the easement at issue. Easements by necessity are dependent on the necessity that created them; therefore, a way of necessity continues only as long as a necessity for its use continues. The fact that the way of necessity would be the most convenient does not prevent its extinguishment when it ceases to be absolutely necessary. Accordingly, we reverse the decision of the trial court
Opinion may be found at the TBA website: http://www.tba2.org/tba_files/TCA/2008/robnettv_092408.pdf
"[A]n easement by necessity may continue only as long, as a necessity for its use continues [] The fact the way of necessity continues to be the most convenient is not sufficient to prevent its extinguishment if it ceases to be absolutely necessary. [] The easement was created for the purpose of affording Ms. Robnett ingress and egress from a public road. Due to recent improvements to the easement that leads to Highway 412, the easement through Mr. Tenison’s property is no longer absolutely necessary. Because the purpose for which the easement through Mr. Tenison’s property was created no longer exists, there is an end to the easement by necessity through Mr. Tenison’s property." Id. (citations and quotations omitted).
The issue is whether a court-ordered easement by necessity for ingress and egress to landlocked property may be terminated on the ground it is no longer necessary because the landlocked owner has an express easement through which that owner has reasonable, although not as desirable, ingress and egress. The trial court denied the petition to terminate the easement by necessity upon a finding it would place an undue burden on the landlocked property owner to have it terminated. We have determined the trial court applied an incorrect legal standard, that of undue burden, to deny the petition to terminate the easement at issue. Easements by necessity are dependent on the necessity that created them; therefore, a way of necessity continues only as long as a necessity for its use continues. The fact that the way of necessity would be the most convenient does not prevent its extinguishment when it ceases to be absolutely necessary. Accordingly, we reverse the decision of the trial court
Opinion may be found at the TBA website: http://www.tba2.org/tba_files/TCA/2008/robnettv_092408.pdf
"[A]n easement by necessity may continue only as long, as a necessity for its use continues [] The fact the way of necessity continues to be the most convenient is not sufficient to prevent its extinguishment if it ceases to be absolutely necessary. [] The easement was created for the purpose of affording Ms. Robnett ingress and egress from a public road. Due to recent improvements to the easement that leads to Highway 412, the easement through Mr. Tenison’s property is no longer absolutely necessary. Because the purpose for which the easement through Mr. Tenison’s property was created no longer exists, there is an end to the easement by necessity through Mr. Tenison’s property." Id. (citations and quotations omitted).
September 23, 2008
Owner who failed to notify State that land purchased for road construction was subject to a lease interest must indemnify State against suit by lessee
STATE OF TENNESSEE, ET AL. v. GOOD TIMES, LTD., ET AL. (Tenn.Ct.App. September 23, 2008).
The State of Tennessee ("State") sued Good Times, Ltd. ("Good Times") and others with regard to real property deeded to the State by Good Times after the State was sued for inverse condemnation by Good Times' lessee, Pun Wun Chan d/b/a #1 China Buffet ("China Buffet"). The State claimed that it was entitled to indemnity from Good Times in the inverse condemnation action under its warranty deed. The Trial Court consolidated the State's case against Good Times with the inverse condemnation action and then bifurcated the trial. The inverse condemnation case was tried before a jury and China Buffet was awarded a judgment against the State. The Trial Court then granted summary judgment to Good Times in the State's case against Good Times and dismissed the State's case. The State appeals to this Court. We vacate the grant of summary judgment to Good Times, grant the State summary judgment against Good Times, and remand this case to the Trial Court for a determination of the amount of damages, and for further proceedings as necessary with regard to all other parties and claims.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/goodtimes_092308.pdf
"China Buffet had a leasehold interest in the entire property including the portion deeded to the State. China Buffet claimed, and was awarded, incidental damages to its interest in the entire property because the fair market value of the property has been affected by a significant and permanent loss of parking space, which has resulted in the loss of access to and utility of the restaurant." Id. (quotations omitted)
"Plus, the Agreement of Sale executed by Cazana on behalf of Good Times provided a space for Good Times to disclose the names of lessees or any other party who had any interest in the property being conveyed and that space was left blank. Cazana could have filled in this blank and taken this opportunity to inform the State that China Buffet had not been compensated by Good Times for its interest in the Property. He did not." Id.
The State of Tennessee ("State") sued Good Times, Ltd. ("Good Times") and others with regard to real property deeded to the State by Good Times after the State was sued for inverse condemnation by Good Times' lessee, Pun Wun Chan d/b/a #1 China Buffet ("China Buffet"). The State claimed that it was entitled to indemnity from Good Times in the inverse condemnation action under its warranty deed. The Trial Court consolidated the State's case against Good Times with the inverse condemnation action and then bifurcated the trial. The inverse condemnation case was tried before a jury and China Buffet was awarded a judgment against the State. The Trial Court then granted summary judgment to Good Times in the State's case against Good Times and dismissed the State's case. The State appeals to this Court. We vacate the grant of summary judgment to Good Times, grant the State summary judgment against Good Times, and remand this case to the Trial Court for a determination of the amount of damages, and for further proceedings as necessary with regard to all other parties and claims.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/goodtimes_092308.pdf
"China Buffet had a leasehold interest in the entire property including the portion deeded to the State. China Buffet claimed, and was awarded, incidental damages to its interest in the entire property because the fair market value of the property has been affected by a significant and permanent loss of parking space, which has resulted in the loss of access to and utility of the restaurant." Id. (quotations omitted)
"Plus, the Agreement of Sale executed by Cazana on behalf of Good Times provided a space for Good Times to disclose the names of lessees or any other party who had any interest in the property being conveyed and that space was left blank. Cazana could have filled in this blank and taken this opportunity to inform the State that China Buffet had not been compensated by Good Times for its interest in the Property. He did not." Id.
"Substantial completion" under the construction statute of repose occurs when a residential structure can be used for its intended purpose
DEBORAH JENKINS as Personal Representative of THE ESTATE OF MALCOM WILLIAMS et al v. SOUTHLAND CAPITAL CORPORATION et al (Tenn.Ct.App. September 23, 2008).
This is a consolidated wrongful death and personal injury case. In May 2002, three young boys walking beside the road were struck by a drunken driver in a residential subdivision. Two were killed, the third severely injured. The plaintiffs sued the developers of the subdivision, arguing that the absence of sidewalks in the area where the boys were walking was a cause of the accident. The trial court granted summary judgment in favor of the developers on grounds that the plaintiffs' lawsuit was time-barred under the four-year statute of repose for improvements to real property, T.C.A. section 28-3-202. We agree with the trial court that the improvements to the real property on which the accident occurred were substantially completed more than four years prior to the filing of the lawsuits under the statutory definition at T.C.A. section 28-3-201(2), and therefore affirm.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/jenkinsd_092308.pdf
"[T]he absence of sidewalks on the two lots – is too circumscribed an interpretation of the statute. Concomitantly, defining the “real property” at issue to mean the entire subdivision is overly broad. Both interpretations defeat the essential purpose of Section 28-3-202, that is, to limit claims to those arising within four years after substantial completion of the improvements to the real property at issue." Id.
"[S]ubstantial completion would occur under the facts of this case when the lot at issue, including but not limited to the house, can be used for its intended purpose as a residence. ... [T]his may or may not coincide with the approval of a governmental entity ... ; passing such a final inspection is indicative of substantial completion but not necessarily determinative. Under the facts of this case, however, it is undisputed that the homes were transferred to individual homeowners the same year, 1995, and had been occupied as residences thereafter. The Plaintiffs put forth no evidence, save the absence of sidewalks, indicating that the lots had not been used for their intended purpose, as residences, since the transfer to individual homeowners. Here, the defect focused on by the Plaintiffs is the absence of sidewalks on these lots. However important that defect may be in the context of the Plaintiffs’ claims, it is not a defect that would prevent the lots from being used for their intended purpose, as residences." Id.
This is a consolidated wrongful death and personal injury case. In May 2002, three young boys walking beside the road were struck by a drunken driver in a residential subdivision. Two were killed, the third severely injured. The plaintiffs sued the developers of the subdivision, arguing that the absence of sidewalks in the area where the boys were walking was a cause of the accident. The trial court granted summary judgment in favor of the developers on grounds that the plaintiffs' lawsuit was time-barred under the four-year statute of repose for improvements to real property, T.C.A. section 28-3-202. We agree with the trial court that the improvements to the real property on which the accident occurred were substantially completed more than four years prior to the filing of the lawsuits under the statutory definition at T.C.A. section 28-3-201(2), and therefore affirm.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/jenkinsd_092308.pdf
"[T]he absence of sidewalks on the two lots – is too circumscribed an interpretation of the statute. Concomitantly, defining the “real property” at issue to mean the entire subdivision is overly broad. Both interpretations defeat the essential purpose of Section 28-3-202, that is, to limit claims to those arising within four years after substantial completion of the improvements to the real property at issue." Id.
"[S]ubstantial completion would occur under the facts of this case when the lot at issue, including but not limited to the house, can be used for its intended purpose as a residence. ... [T]his may or may not coincide with the approval of a governmental entity ... ; passing such a final inspection is indicative of substantial completion but not necessarily determinative. Under the facts of this case, however, it is undisputed that the homes were transferred to individual homeowners the same year, 1995, and had been occupied as residences thereafter. The Plaintiffs put forth no evidence, save the absence of sidewalks, indicating that the lots had not been used for their intended purpose, as residences, since the transfer to individual homeowners. Here, the defect focused on by the Plaintiffs is the absence of sidewalks on these lots. However important that defect may be in the context of the Plaintiffs’ claims, it is not a defect that would prevent the lots from being used for their intended purpose, as residences." Id.
September 17, 2008
Court finds against landowner who argued different easement theories for access to a secluded portion of property
TERESA WALKER NEWMAN v. WAYNE WOODARD, ET AL. (Tenn.Ct.App. September 17, 2008).
This case concerns the access rights of a landowner to a section of her property divided from the rest of her land by a steep bluff. The trial court held that the landowner did not have an implied easement through her neighbor's land to access her property at the bottom of the bluff because the there was insufficient evidence that the right-of-way preexisted severance of the properties. The trial court determined that Mrs. Newman did not have an implied easement by necessity because there was insufficient evidence that Mrs. Newman would be unable build a road down the bluff for a reasonable cost. Because the evidence does not preponderate otherwise, we affirm that Mrs. Newman does not have an implied easement or an implied easement by necessity over the right-of- way. The trial court also held that Mrs. Newman lacked a prescriptive easement over the right-or- way because she failed to prove that her use was exclusive; we affirm on the basis that Mrs. Newman failed to demonstrate that her use of the right-of-way was continuous.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/newmant_091708.pdf
"Implied Easement. ... The party seeking to establish an easement by implication has the burden of proving the following three elements by a preponderance of the evidence: (1) A separation of title; (2) Necessity that before the separation takes place, the use which gives rise to the easement shall have been so long continued and obvious or manifest as to show that it was meant to be permanent; and (3) Necessity that the easement be essential to the beneficial enjoyment of the land granted or retained." Id.
"the trial court also found that Mrs. Newman failed to present evidence that there was a preexisting route between the two properties at the time of separation. At trial, Mrs. Newman presented the minutes of the Lauderdale County Court dated July 26, 1910, as evidence that both the Woodards’ and Mrs. Newman’s property were once part of the greater “Marley tract” divided in 1910. Although Mrs. Newman presented witnesses that testified that the field road existed for decades before trial, none of the witnesses could testify to the use of the field road before the previous owners severed the property in 1910. The trial court noted evidence that there was no preexisting route in the 1910 County Court Minutes Book and that a surveyor’s map indicated that Lot 7 and Lot 8 of the Marley tract, which comprised the modern-day Newman and Woodard properties, were not cleared at the time of separation." Id.
"Easement by Necessity. ... [A]n implied easement by necessity allows for the establishment of a right-of-way where one previously did not exist. [] An easement by necessity is a type of implied easement based upon the premise that wherever one conveys property he also conveys whatever is necessary for its beneficial use and enjoyment, including access to one’s property. [] The party claiming the right-of-way bears the burden of proving the following: (1) the titles to the two tracts in question must have been held by one person; (2) the unity of title must have been severed by a conveyance of one of the tracts; (3) the easement must be necessary in order for the owner of the dominant tenement to use his land with the necessity existing both at the time of the severance of title and the time of exercise of the easement." Id. (citations omitted).
"Where the party claiming the right can, at reasonable cost, create a substitute on his own estate the easement is not necessary. ... The bulldozer operator ... asserted at trial that for six hundred to a thousand dollars he could improve the overgrown field road so that Mrs. Newman could drive farm equipment down the bluff. Although Mrs. Newman questioned the feasibility and durability of the road Mr. Blankenship claimed he could create, she failed to present evidence at trial contradicting Mr. Blankenship’s testimony that he could create a road at a reasonable expense. ... Mrs. Newman, therefore, failed to prove that the cost of creating a road down the bluff was unreasonable," Id.
"Easement By Prescription. ... In order to demonstrate a prescriptive easement, a claimant must prove that the use and enjoyment of land which gives rise to a prescriptive easement must be adverse, under claim of right, continuous, uninterrupted, open, visible, exclusive, with knowledge and acquiescence of the owner of the servient tenement, and must continue for the full twenty year prescriptive period." Id.
"Mrs. Newman simply failed to demonstrate by clear and convincing evidence that she or her predecessors in title continuously used the field road. The record is not clear how often Mrs. Newman, her family, or her tenants used the field road to access the fifteen acres. ... At most, the evidence indicated that Mrs. Newman’s predecessors intermittently used the road during the years that they may have farmed the fifteen acres of their land. This is insufficient evidence to prove continuous use of the field road by clear and convincing evidence." Id.
This case concerns the access rights of a landowner to a section of her property divided from the rest of her land by a steep bluff. The trial court held that the landowner did not have an implied easement through her neighbor's land to access her property at the bottom of the bluff because the there was insufficient evidence that the right-of-way preexisted severance of the properties. The trial court determined that Mrs. Newman did not have an implied easement by necessity because there was insufficient evidence that Mrs. Newman would be unable build a road down the bluff for a reasonable cost. Because the evidence does not preponderate otherwise, we affirm that Mrs. Newman does not have an implied easement or an implied easement by necessity over the right-of- way. The trial court also held that Mrs. Newman lacked a prescriptive easement over the right-or- way because she failed to prove that her use was exclusive; we affirm on the basis that Mrs. Newman failed to demonstrate that her use of the right-of-way was continuous.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/newmant_091708.pdf
"Implied Easement. ... The party seeking to establish an easement by implication has the burden of proving the following three elements by a preponderance of the evidence: (1) A separation of title; (2) Necessity that before the separation takes place, the use which gives rise to the easement shall have been so long continued and obvious or manifest as to show that it was meant to be permanent; and (3) Necessity that the easement be essential to the beneficial enjoyment of the land granted or retained." Id.
"the trial court also found that Mrs. Newman failed to present evidence that there was a preexisting route between the two properties at the time of separation. At trial, Mrs. Newman presented the minutes of the Lauderdale County Court dated July 26, 1910, as evidence that both the Woodards’ and Mrs. Newman’s property were once part of the greater “Marley tract” divided in 1910. Although Mrs. Newman presented witnesses that testified that the field road existed for decades before trial, none of the witnesses could testify to the use of the field road before the previous owners severed the property in 1910. The trial court noted evidence that there was no preexisting route in the 1910 County Court Minutes Book and that a surveyor’s map indicated that Lot 7 and Lot 8 of the Marley tract, which comprised the modern-day Newman and Woodard properties, were not cleared at the time of separation." Id.
"Easement by Necessity. ... [A]n implied easement by necessity allows for the establishment of a right-of-way where one previously did not exist. [] An easement by necessity is a type of implied easement based upon the premise that wherever one conveys property he also conveys whatever is necessary for its beneficial use and enjoyment, including access to one’s property. [] The party claiming the right-of-way bears the burden of proving the following: (1) the titles to the two tracts in question must have been held by one person; (2) the unity of title must have been severed by a conveyance of one of the tracts; (3) the easement must be necessary in order for the owner of the dominant tenement to use his land with the necessity existing both at the time of the severance of title and the time of exercise of the easement." Id. (citations omitted).
"Where the party claiming the right can, at reasonable cost, create a substitute on his own estate the easement is not necessary. ... The bulldozer operator ... asserted at trial that for six hundred to a thousand dollars he could improve the overgrown field road so that Mrs. Newman could drive farm equipment down the bluff. Although Mrs. Newman questioned the feasibility and durability of the road Mr. Blankenship claimed he could create, she failed to present evidence at trial contradicting Mr. Blankenship’s testimony that he could create a road at a reasonable expense. ... Mrs. Newman, therefore, failed to prove that the cost of creating a road down the bluff was unreasonable," Id.
"Easement By Prescription. ... In order to demonstrate a prescriptive easement, a claimant must prove that the use and enjoyment of land which gives rise to a prescriptive easement must be adverse, under claim of right, continuous, uninterrupted, open, visible, exclusive, with knowledge and acquiescence of the owner of the servient tenement, and must continue for the full twenty year prescriptive period." Id.
"Mrs. Newman simply failed to demonstrate by clear and convincing evidence that she or her predecessors in title continuously used the field road. The record is not clear how often Mrs. Newman, her family, or her tenants used the field road to access the fifteen acres. ... At most, the evidence indicated that Mrs. Newman’s predecessors intermittently used the road during the years that they may have farmed the fifteen acres of their land. This is insufficient evidence to prove continuous use of the field road by clear and convincing evidence." Id.
Contractual provision requiring approval from an architectural review committee prior to construction of a new home requires a good faith effort
JAMES B. JOHNSON , ET AL v. CHARLIE B. MITCHELL, JR., ET AL. (Tenn.Ct.App. September 17, 2008).
Plaintiffs appeal the Chancery Court's grant of summary judgment in this breach of contract action. Finding no error, we affirm the Chancery Court's judgment.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/johnsonj_091708.pdf
"Plaintiffs ... entered into a contract with defendant ... for the purchase of an unimproved lot ... on November 11, 2004. The contract price was $150,000.00, to be paid upon approval of the Johnsons’ building plans and their securing a construction loan; they tendered $1,000.00 as an earnest money deposit. The Johnsons were given a copy of design criteria for the subdivision, including architectural guidelines and design review procedures, when they signed the contract; they were also given a copy of the Declaration of Protective Covenants, Conditions and Restrictions for Phase II of Magnolia Vale. The design criteria required the Johnsons to receive approval of their plans from the architectural review committee prior to commencing construction." Id.
"The Johnsons filed suit against CBM and Charlie B. Mitchell, Jr., (“Mitchell”) for breach of contract, asserting that CBM’s action in voiding the contract constituted a breach of the contract
and requesting specific performance." Id.
"[T]he Johnsons were obligated to submit plans to the architectural review committee for approval, with such approval being a precondition of closing on the sale. Approval of the plans was in the sole discretion of the committee and that approval was never obtained. The affidavit of Mr. Lowry established that, as early as August 3, 2005, Mr. Johnson had indicated dissatisfaction with the decisions of the committee rejecting the two sets of plans submitted as of that date and had stated his unwillingness to cooperate further with CBM, thereby supporting CBM’s contention that the Johnsons did not deal in good faith. Inasmuch as a party who has materially breached a contract cannot recover on it [], a finding that the Johnsons breached the contract would negate an essential element of their claim and entitle CBM to judgment as a matter of law. ... The actions and inactions of the Johnsons support a finding that they breached the contract with CBM by repudiating it and in failing and refusing to perform their responsibilities." Id. (citations omitted).
Plaintiffs appeal the Chancery Court's grant of summary judgment in this breach of contract action. Finding no error, we affirm the Chancery Court's judgment.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/johnsonj_091708.pdf
"Plaintiffs ... entered into a contract with defendant ... for the purchase of an unimproved lot ... on November 11, 2004. The contract price was $150,000.00, to be paid upon approval of the Johnsons’ building plans and their securing a construction loan; they tendered $1,000.00 as an earnest money deposit. The Johnsons were given a copy of design criteria for the subdivision, including architectural guidelines and design review procedures, when they signed the contract; they were also given a copy of the Declaration of Protective Covenants, Conditions and Restrictions for Phase II of Magnolia Vale. The design criteria required the Johnsons to receive approval of their plans from the architectural review committee prior to commencing construction." Id.
"The Johnsons filed suit against CBM and Charlie B. Mitchell, Jr., (“Mitchell”) for breach of contract, asserting that CBM’s action in voiding the contract constituted a breach of the contract
and requesting specific performance." Id.
"[T]he Johnsons were obligated to submit plans to the architectural review committee for approval, with such approval being a precondition of closing on the sale. Approval of the plans was in the sole discretion of the committee and that approval was never obtained. The affidavit of Mr. Lowry established that, as early as August 3, 2005, Mr. Johnson had indicated dissatisfaction with the decisions of the committee rejecting the two sets of plans submitted as of that date and had stated his unwillingness to cooperate further with CBM, thereby supporting CBM’s contention that the Johnsons did not deal in good faith. Inasmuch as a party who has materially breached a contract cannot recover on it [], a finding that the Johnsons breached the contract would negate an essential element of their claim and entitle CBM to judgment as a matter of law. ... The actions and inactions of the Johnsons support a finding that they breached the contract with CBM by repudiating it and in failing and refusing to perform their responsibilities." Id. (citations omitted).
September 11, 2008
Allegedy inflated appraisal made prior to construction of new home cannot support a fraudulent misrepresentation claim; Court endorses "cost approach"
JOSEPH AND KIMBERLI DAVIS v. PATRICK J. MCGUIGAN, ET AL. (Tenn.Ct.App. September 11, 2008).
Homeowners filed suit against Appraiser for intentional and negligent misrepresentation and violation of the Tennessee Consumer Protection Act. Appraiser moved for summary judgment on all claims. The trial court denied Appraiser's motion on the negligent misrepresentation claim, but dismissed the intentional misrepresentation claim and the Tennessee Consumer Act claim. During the course of the proceedings, the trial court also excluded certain witnesses who were tendered as experts. Both parties appeal. We affirm the trial court's grant of summary judgment on both claims, and decline to address the remaining issues for lack of justiciability.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/davisj_091108.pdf
"The Appraiser contends that the appraisal is an estimation or opinion, and is not a representation of an existing or past fact. Therefore, the Appraiser argues, an essential element of the Homeowners’ claim for intentional misrepresentation is conclusively negated and summary judgment was proper on this claim. Homeowners argue that the appraisal value was not the opinion of the Appraiser, but rather an opinion he gave which the Appraiser did not have or knew to be false. Although Homeowners’ argument applies to the fourth element for fraudulent misrepresentation, their contention does not change the requirement of the first element - that the defendant make a representation of an existing or past fact. In Tennessee, appraisals are not considered facts, but rather estimates or opinions." Id.
"Further, we note that when the Appraiser conducted the Appraisal, he was appraising a home that had not yet been constructed. The Appraiser used the “cost approach” analysis, and referred to, among other resources, the specifications and building plans provided by the Homeowners. At that point, the Appraiser only had plans for the future Home on which to base his appraisal; he could not verify that the materials planned for in the Home were actually used in the construction or examine the workmanship of the construction. In Tennessee, conjecture or representations concerning future events are not actionable even though they may later prove to be false." Id. (citations omitted).
Homeowners filed suit against Appraiser for intentional and negligent misrepresentation and violation of the Tennessee Consumer Protection Act. Appraiser moved for summary judgment on all claims. The trial court denied Appraiser's motion on the negligent misrepresentation claim, but dismissed the intentional misrepresentation claim and the Tennessee Consumer Act claim. During the course of the proceedings, the trial court also excluded certain witnesses who were tendered as experts. Both parties appeal. We affirm the trial court's grant of summary judgment on both claims, and decline to address the remaining issues for lack of justiciability.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/davisj_091108.pdf
"The Appraiser contends that the appraisal is an estimation or opinion, and is not a representation of an existing or past fact. Therefore, the Appraiser argues, an essential element of the Homeowners’ claim for intentional misrepresentation is conclusively negated and summary judgment was proper on this claim. Homeowners argue that the appraisal value was not the opinion of the Appraiser, but rather an opinion he gave which the Appraiser did not have or knew to be false. Although Homeowners’ argument applies to the fourth element for fraudulent misrepresentation, their contention does not change the requirement of the first element - that the defendant make a representation of an existing or past fact. In Tennessee, appraisals are not considered facts, but rather estimates or opinions." Id.
"Further, we note that when the Appraiser conducted the Appraisal, he was appraising a home that had not yet been constructed. The Appraiser used the “cost approach” analysis, and referred to, among other resources, the specifications and building plans provided by the Homeowners. At that point, the Appraiser only had plans for the future Home on which to base his appraisal; he could not verify that the materials planned for in the Home were actually used in the construction or examine the workmanship of the construction. In Tennessee, conjecture or representations concerning future events are not actionable even though they may later prove to be false." Id. (citations omitted).
September 08, 2008
Counties are not required to obtain utility easements to undertake repair of existing sewer lines
Authority of Governmental Entity to Replace/Repair Sewer Lines on Private Property (TN Attorney General Opinion No. 08-143, September 8, 2008).
"The provisions of Tenn. Code Ann. § 7-35-401(c)(1)(D), therefore, effectively eliminate the need for a utility easement when the objective is to reduce sanitary sewer overflows, as long as the private property owner provides consent and agrees to hold the municipality harmless for the work. Once the rehabilitative construction is completed, each affected private property owner would be responsible in the future for maintaining that portion of the sanitary sewer connection that is located on the property of the owner. Tenn. Code Ann. § 7-35-201(2) and § 68-221-209(a)(2)." Id.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/AG/2008/ag_08_143.pdf
"The provisions of Tenn. Code Ann. § 7-35-401(c)(1)(D), therefore, effectively eliminate the need for a utility easement when the objective is to reduce sanitary sewer overflows, as long as the private property owner provides consent and agrees to hold the municipality harmless for the work. Once the rehabilitative construction is completed, each affected private property owner would be responsible in the future for maintaining that portion of the sanitary sewer connection that is located on the property of the owner. Tenn. Code Ann. § 7-35-201(2) and § 68-221-209(a)(2)." Id.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/AG/2008/ag_08_143.pdf
August 28, 2008
Easement reserved on a recorded plat is "express" and does not terminate with the reason for prescription
ERVIN D. SMITH, ET AL. v. PAUL EVANS, ET AL. (Tenn.Ct.App. August, 28, 2008).
Owners of property brought suit to terminate an ingress/egress easement across their land, contending that the necessity for the easement no longer existed. Following a trial, the Chancery Court ruled against the owners, finding that since the easement was reserved in a recorded plat, it was not an easement by necessity; consequently, the easement was not destroyed upon the sale of the dominant estate. On appeal, the owners maintain that the easement was destroyed at the end of the necessity. Finding the easement to be express, we affirm the decision of the Chancery Court. Finding the appeal not to be frivolous, no attorney's fees are awarded.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/smithve_082808.pdf
"Mr. Cook retained ownership of a 14.2 acre tract of land immediately behind the lots which fronted on the west side of Sawmill Road (the “Cook Property”). To ensure access to the Cook Property, he reserved a 20 foot ingress/egress easement over lot 5 of the subdivision; this easement was included in the recorded plat and allows access to Sawmill Road." Id.
"An easement by reservation is “in behalf of the grantor [of] a new right issuing out of the thing granted, and an easement appurtenant to the grantor’s remaining land may be created by reservation.” [] Even though an easement by reservation is a separate type of easement, it can still be sub-categorized as being either express or implied. ... An express easement by reservation “arises when a property owner conveys part of his or her property to another, but includes language in the conveyance reserving the right to use some part of the transferred land as a right-of-way.” [] Any reservation of an easement “is equivalent, for the purpose of creation of the easement, to an express grant of the easement by the grantee of the lands.” Id." Id. (citations omitted).
"An easement by express grant can be extinguished: by an act of the dominant owner, either by release or abandonment, by act of the servient owner by prescription or conveyance to a bona fide purchaser without notice, by the conduct of both parties, such as by merger or estoppel, or by eminent domain, mortgage, foreclosure, or tax sale. [] An easement “created by reference to a filed map can be extinguished only by the united action of all lot owners for whose benefit the easement is created...” [] No such measures were taken in this case; indeed, the deed conveying the Cook Property to the Evanses includes the following language ... . The easement was not terminated when the Evanses bought the Cook Property." Id. (citations omitted).
Owners of property brought suit to terminate an ingress/egress easement across their land, contending that the necessity for the easement no longer existed. Following a trial, the Chancery Court ruled against the owners, finding that since the easement was reserved in a recorded plat, it was not an easement by necessity; consequently, the easement was not destroyed upon the sale of the dominant estate. On appeal, the owners maintain that the easement was destroyed at the end of the necessity. Finding the easement to be express, we affirm the decision of the Chancery Court. Finding the appeal not to be frivolous, no attorney's fees are awarded.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/smithve_082808.pdf
"Mr. Cook retained ownership of a 14.2 acre tract of land immediately behind the lots which fronted on the west side of Sawmill Road (the “Cook Property”). To ensure access to the Cook Property, he reserved a 20 foot ingress/egress easement over lot 5 of the subdivision; this easement was included in the recorded plat and allows access to Sawmill Road." Id.
"An easement by reservation is “in behalf of the grantor [of] a new right issuing out of the thing granted, and an easement appurtenant to the grantor’s remaining land may be created by reservation.” [] Even though an easement by reservation is a separate type of easement, it can still be sub-categorized as being either express or implied. ... An express easement by reservation “arises when a property owner conveys part of his or her property to another, but includes language in the conveyance reserving the right to use some part of the transferred land as a right-of-way.” [] Any reservation of an easement “is equivalent, for the purpose of creation of the easement, to an express grant of the easement by the grantee of the lands.” Id." Id. (citations omitted).
"An easement by express grant can be extinguished: by an act of the dominant owner, either by release or abandonment, by act of the servient owner by prescription or conveyance to a bona fide purchaser without notice, by the conduct of both parties, such as by merger or estoppel, or by eminent domain, mortgage, foreclosure, or tax sale. [] An easement “created by reference to a filed map can be extinguished only by the united action of all lot owners for whose benefit the easement is created...” [] No such measures were taken in this case; indeed, the deed conveying the Cook Property to the Evanses includes the following language ... . The easement was not terminated when the Evanses bought the Cook Property." Id. (citations omitted).
August 25, 2008
Court endorses zoning board's reading of its zoning ordinances
MOORE & ASSOCIATES, INC. v. METROPOLITAN BOARD OF ZONING APPEALS (Tenn.Ct.App. August 25, 2008).
Zoning administrator denied a waiver of the Metropolitan Zoning Code's landscape buffer requirement and the Board of Zoning Appeals upheld the administrator's interpretation of the ordinance. Plaintiff contractor appealed to the circuit court, which determined that the zoning administrator's interpretation of the ordinance was incorrect and granted the waiver. The Board of Zoning Appeals appealed. The trial court's interpretation of the ordinance is affirmed, but the decision to grant the waiver is vacated, and the case is remanded to the trial court with instructions to return the matter to the board for further action.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/moore_assoc_082508.pdf
"During construction, a mud seam was discovered which, Moore and Associates claim, made the planned vertical wall “unsafe and impractical.” With the apparent approval of the building inspector and without seeking any approval from the zoning authorities to amend the original plans, Moore and Associates constructed a wall that begins by sloping slightly toward the adjacent property. About halfway to its height of approximately 39 feet, the wall turns and makes a gentler slope to the top, ending near the property line. In September 2001, Moore and Associates requested a waiver of the landscape buffer requirement. The zoning administrator, Mr. West, denied the request." Id.
"The trial court granted the waiver because of the Board of Zoning Appeal’s error in approving Mr. West’s interpretation. Doing so was a natural reaction in which the court sought to end litigation that had gone on far too long. We, however, must disagree with the trial court’s action. Under § 17.24.240G, a waiver is not automatic even if there is a demonstration of unusual site-grade conditions which would clearly negate the effects of the required yard. ... Therefore, we vacate the trial court’s issuance of the waiver and remand the case to the trial court with instructions to return the case to the Board of Zoning Appeals for further action consistent with this opinion." Id.
Zoning administrator denied a waiver of the Metropolitan Zoning Code's landscape buffer requirement and the Board of Zoning Appeals upheld the administrator's interpretation of the ordinance. Plaintiff contractor appealed to the circuit court, which determined that the zoning administrator's interpretation of the ordinance was incorrect and granted the waiver. The Board of Zoning Appeals appealed. The trial court's interpretation of the ordinance is affirmed, but the decision to grant the waiver is vacated, and the case is remanded to the trial court with instructions to return the matter to the board for further action.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/moore_assoc_082508.pdf
"During construction, a mud seam was discovered which, Moore and Associates claim, made the planned vertical wall “unsafe and impractical.” With the apparent approval of the building inspector and without seeking any approval from the zoning authorities to amend the original plans, Moore and Associates constructed a wall that begins by sloping slightly toward the adjacent property. About halfway to its height of approximately 39 feet, the wall turns and makes a gentler slope to the top, ending near the property line. In September 2001, Moore and Associates requested a waiver of the landscape buffer requirement. The zoning administrator, Mr. West, denied the request." Id.
"The trial court granted the waiver because of the Board of Zoning Appeal’s error in approving Mr. West’s interpretation. Doing so was a natural reaction in which the court sought to end litigation that had gone on far too long. We, however, must disagree with the trial court’s action. Under § 17.24.240G, a waiver is not automatic even if there is a demonstration of unusual site-grade conditions which would clearly negate the effects of the required yard. ... Therefore, we vacate the trial court’s issuance of the waiver and remand the case to the trial court with instructions to return the case to the Board of Zoning Appeals for further action consistent with this opinion." Id.
August 22, 2008
Court denies waiver and awards attorneys fees to contractor after appeal establishes contractual right to recover
HOMEBUILDERS McGEE & STORY, LLC v. HENRY BUCKNER (Tenn.Ct.App. August 22, 2008).
This is the second appeal of a contract dispute between a homeowner and the contractor he engaged to make improvements to his home. The homeowner contends that the trial court erred by awarding the contractor attorney's fees on remand following the first appeal because the contractor waived its claim of attorney's fees, the contractor is judicially estopped to claim attorney's fees, and the trial court lacked jurisdiction to award attorney's fees following remand. We have determined the contractor had not waived its claim and it was not judicially estopped to assert a claim for attorney's fees. We have also determined that the trial court had jurisdiction to award attorney's fees pursuant to the contract following remand of the first appeal.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/bucknerh_082208.pdf
"Litigation between the parties arose after Mr. Buckner unilaterally terminated the services of Homebuilders when the project was only 30% complete. ... When Mr. Buckner refused to pay any portion of the final bill, Homebuilders filed a Complaint against Mr. Buckner for breach of contract in the circuit court. ... Mr. Buckner filed a Complaint in chancery court against Homebuilders and its principals for fraud, breach of contract, violations of the Tennessee Consumer Protection Act, negligent misrepresentation, negligence, and breach of fiduciary duty. The two cases were soon consolidated into the circuit court action. ... [T]he trial court dismissed the parties’ respective breach of contract claims on a finding the Construction Management Agreement was not enforceable because the parties did not have a meeting of the minds. The trial court also dismissed all other claims of each party, including Mr. Buckner's claims for fraud, violations of the Tennessee Consumer Protection Act, negligent misrepresentation, negligence, and breach of fiduciary duty. Within a week of the foregoing judgment being entered by the trial court, Homebuilders filed a motion seeking to recover its attorney’s fees. Prior to that motion being heard, Mr. Buckner filed his notice of appeal. Immediately thereafter, the trial court entered an order stating that the motion for attorney’s fees would be taken under advisement pending the appeal. Thus, Homebuilders’ motion for attorney’s fees remained unresolved while Mr. Buckner pursued his first appeal." Id.
"We determined in the first appeal that the Agreement constituted an enforceable contract because it sufficiently identified the scope of the work and the price of the work, which was an agreed budget of $175,000 with a management fee of “Cost Plus 17%.” [] We also found that Homebuilders was entitled to damages resulting from Mr. Buckner’s breach of the contract in the amount of $25,328." Id. (citations omitted).
"Homebuilders had filed a motion to recover its attorney’s fees prior to the first appeal ... based on the fact that Homebuilders had been the prevailing party on Mr. Buckner’s claims based on the Tennessee Consumer Protection Act. Homebuilders had not filed a motion for attorney’s fees pursuant to the contract because the court found there was no enforceable contract between the parties. Thus, at that time, there was no contractual basis upon which Homebuilders could recover its attorney’s fees. It was not until this court had respectfully disagreed with the trial court’s conclusion on the contract claim that Homebuilders was in a posture to file a motion to recover its attorney’s fees based on contract." Id.
This is the second appeal of a contract dispute between a homeowner and the contractor he engaged to make improvements to his home. The homeowner contends that the trial court erred by awarding the contractor attorney's fees on remand following the first appeal because the contractor waived its claim of attorney's fees, the contractor is judicially estopped to claim attorney's fees, and the trial court lacked jurisdiction to award attorney's fees following remand. We have determined the contractor had not waived its claim and it was not judicially estopped to assert a claim for attorney's fees. We have also determined that the trial court had jurisdiction to award attorney's fees pursuant to the contract following remand of the first appeal.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/bucknerh_082208.pdf
"Litigation between the parties arose after Mr. Buckner unilaterally terminated the services of Homebuilders when the project was only 30% complete. ... When Mr. Buckner refused to pay any portion of the final bill, Homebuilders filed a Complaint against Mr. Buckner for breach of contract in the circuit court. ... Mr. Buckner filed a Complaint in chancery court against Homebuilders and its principals for fraud, breach of contract, violations of the Tennessee Consumer Protection Act, negligent misrepresentation, negligence, and breach of fiduciary duty. The two cases were soon consolidated into the circuit court action. ... [T]he trial court dismissed the parties’ respective breach of contract claims on a finding the Construction Management Agreement was not enforceable because the parties did not have a meeting of the minds. The trial court also dismissed all other claims of each party, including Mr. Buckner's claims for fraud, violations of the Tennessee Consumer Protection Act, negligent misrepresentation, negligence, and breach of fiduciary duty. Within a week of the foregoing judgment being entered by the trial court, Homebuilders filed a motion seeking to recover its attorney’s fees. Prior to that motion being heard, Mr. Buckner filed his notice of appeal. Immediately thereafter, the trial court entered an order stating that the motion for attorney’s fees would be taken under advisement pending the appeal. Thus, Homebuilders’ motion for attorney’s fees remained unresolved while Mr. Buckner pursued his first appeal." Id.
"We determined in the first appeal that the Agreement constituted an enforceable contract because it sufficiently identified the scope of the work and the price of the work, which was an agreed budget of $175,000 with a management fee of “Cost Plus 17%.” [] We also found that Homebuilders was entitled to damages resulting from Mr. Buckner’s breach of the contract in the amount of $25,328." Id. (citations omitted).
"Homebuilders had filed a motion to recover its attorney’s fees prior to the first appeal ... based on the fact that Homebuilders had been the prevailing party on Mr. Buckner’s claims based on the Tennessee Consumer Protection Act. Homebuilders had not filed a motion for attorney’s fees pursuant to the contract because the court found there was no enforceable contract between the parties. Thus, at that time, there was no contractual basis upon which Homebuilders could recover its attorney’s fees. It was not until this court had respectfully disagreed with the trial court’s conclusion on the contract claim that Homebuilders was in a posture to file a motion to recover its attorney’s fees based on contract." Id.
August 19, 2008
In a dispute over land ownership, payment of taxes is controlling only in the absence of contrary facts and circumstances
BOBBY E. WHITE AND ANN H. WHITE v. PULASKI ELECTRIC SYSTEM (Tenn.Ct.App. August 19, 2008).
Bobby E. White and Ann H. White sought judgment granting them title to a small portion of property that they claim to own by deed, adverse possession and by payment of taxes. The trial court granted Pulaski Electric System, a public electric company, summary judgment. Finding no reversible error, we affirm the judgment of the trial court.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/whiteb_081908.pdf
"The Whites contend they should be granted relief based on the presumption of ownership through payment of taxes contained in Tenn. Code Ann. § 28-2-109. In support of this contention, they assert that they and their predecessors have been assessed and paid taxes on Parcel 24.03 since 1985 and that the tax assessor’s maps and records as well as every deed since 1985 describes the property as running 100 feet west from South First Street. They also contend that PES has not paid taxes on the disputed portion of property, and is therefore barred from its claim under Tenn. Code Ann. § 28-2-110."" Id.
"The evidence shows that the Whites and their predecessors paid city and county taxes on the disputed property for over twenty (20) years; however, inasmuch as neither they nor their predecessors had legal title or equitable interest in the disputed 19 foot tract of land, they were not entitled to the presumption of legal ownership granted by the statute. Moreover, the tax map cannot be used to establish the boundary lines of the property." Id. (citations omitted).
"Even if the Whites did meet the statutory requirements to receive the benefit of the presumption that they are the legal owners of the disputed tract, PES rebutted the presumption by showing by clear and convincing proof that any purported title to the disputed tract claimed by the Whites was not valid. The statutory presumption is that the claimant is the prima facie legal owner of the land; as such, it is controlling only in the absence of contrary facts and circumstances. [] Through the recorded deeds and other public records dating as far back as 1929, PES has shown, by a preponderance of evidence, that the property description contained in the Whites’ deed is erroneous." Id. (citations omitted).
"Pursuant to Tenn. Code Ann. § 67-5-203(a)(1),5 the property at issue, being property of the City of Pulaski, is exempt from taxation. Thus, the fact that PES did not pay taxes on the property does not preclude it from defending the title to same." Id.
Bobby E. White and Ann H. White sought judgment granting them title to a small portion of property that they claim to own by deed, adverse possession and by payment of taxes. The trial court granted Pulaski Electric System, a public electric company, summary judgment. Finding no reversible error, we affirm the judgment of the trial court.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/whiteb_081908.pdf
"The Whites contend they should be granted relief based on the presumption of ownership through payment of taxes contained in Tenn. Code Ann. § 28-2-109. In support of this contention, they assert that they and their predecessors have been assessed and paid taxes on Parcel 24.03 since 1985 and that the tax assessor’s maps and records as well as every deed since 1985 describes the property as running 100 feet west from South First Street. They also contend that PES has not paid taxes on the disputed portion of property, and is therefore barred from its claim under Tenn. Code Ann. § 28-2-110."" Id.
"The evidence shows that the Whites and their predecessors paid city and county taxes on the disputed property for over twenty (20) years; however, inasmuch as neither they nor their predecessors had legal title or equitable interest in the disputed 19 foot tract of land, they were not entitled to the presumption of legal ownership granted by the statute. Moreover, the tax map cannot be used to establish the boundary lines of the property." Id. (citations omitted).
"Even if the Whites did meet the statutory requirements to receive the benefit of the presumption that they are the legal owners of the disputed tract, PES rebutted the presumption by showing by clear and convincing proof that any purported title to the disputed tract claimed by the Whites was not valid. The statutory presumption is that the claimant is the prima facie legal owner of the land; as such, it is controlling only in the absence of contrary facts and circumstances. [] Through the recorded deeds and other public records dating as far back as 1929, PES has shown, by a preponderance of evidence, that the property description contained in the Whites’ deed is erroneous." Id. (citations omitted).
"Pursuant to Tenn. Code Ann. § 67-5-203(a)(1),5 the property at issue, being property of the City of Pulaski, is exempt from taxation. Thus, the fact that PES did not pay taxes on the property does not preclude it from defending the title to same." Id.
August 18, 2008
Municipal planning commission may approve/disprove a plan with a majority vote, if a quorum is present
Vote of Municipal Planning Commission to Approve or Disapprove a Plat
TN Attorney General Opinions
Date: 2008-08-18
Opinion Number: 08-135
"Under Tenn. Code Ann. § 13-4-202, the planning commission may adopt a municipal master plan by a resolution carried by the “affirmative votes of not less than a majority of all the members of the commission.” (Emphasis added). Under Tenn. Code Ann. § 13-4-302, once the planning commission adopts a master plan, a plat of a subdivision of land within the city must be approved by the planning commission before it may be filed or recorded. Where the plat divides a tract into no more than two lots, the approval may be endorsed in writing on the plat by the secretary of the commission or another designee of the commission without the approval of the commission, provided certain conditions are met." Id.
"Tenn. Code Ann. § 13-4-304(a)--(c) ... does not specify the number of board members who must vote to approve or disapprove a plat. A quorum generally consists of a simple majority of a collective body. In the absence of a statutory provision to the contrary, the common law provides that a majority of such a quorum is empowered to act for the body." Id. (citation omitted).
Opinion may be found at:
http://www.tba2.org/tba_files/AG/2008/ag_08_135.pdf
TN Attorney General Opinions
Date: 2008-08-18
Opinion Number: 08-135
"Under Tenn. Code Ann. § 13-4-202, the planning commission may adopt a municipal master plan by a resolution carried by the “affirmative votes of not less than a majority of all the members of the commission.” (Emphasis added). Under Tenn. Code Ann. § 13-4-302, once the planning commission adopts a master plan, a plat of a subdivision of land within the city must be approved by the planning commission before it may be filed or recorded. Where the plat divides a tract into no more than two lots, the approval may be endorsed in writing on the plat by the secretary of the commission or another designee of the commission without the approval of the commission, provided certain conditions are met." Id.
"Tenn. Code Ann. § 13-4-304(a)--(c) ... does not specify the number of board members who must vote to approve or disapprove a plat. A quorum generally consists of a simple majority of a collective body. In the absence of a statutory provision to the contrary, the common law provides that a majority of such a quorum is empowered to act for the body." Id. (citation omitted).
Opinion may be found at:
http://www.tba2.org/tba_files/AG/2008/ag_08_135.pdf
August 13, 2008
Conflicting surveys are subject to Court's review of the ambiguous and contradictory evidence supporting them
BART LAY ET AL. v. HOWARD HOLMES ET AL. (Tenn.Ct.App. August 13, 2008).
In this boundary dispute, the trial court had to choose between conflicting surveys. After a trial, the court determined that the survey for the defendants was correct due to the failure of the plaintiffs' surveyor to locate a landmark beech tree. We affirm.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/layb_081308.pdf
"[This case] contains conflicting evidence, the recollections of elderly members of the community, errors in deeds, deeds describing the property boundaries by who borders the property rather than by landmarks, and boundary descriptions using landmarks such as trees which may or may not exist today." Id.
"The court made a factual determination that the beech tree identified ... was the tree mentioned in the deeds. It is the oldest in the hollow, it is clearly old enough to be the one in the deeds, and it is located near a spring. This is a crucial factual determination that is central to the dispute. ...The spring located near the beech tree was identified by Mitchell Adcock as Boles Spring. While others identified a spring to the north as Boles Spring, the presence of the beech tree by this spring lends much credence to the trial court’s decision that this spring is indeed Boles Spring." Id.
"The second point implicit in the trial court’s endorsement of the Denny survey is that the old fence line upon which the Bradley survey relies is not a boundary. Bradley believed it was a boundary because it ran northward as the Lay deed recited, it had no gates, and it ended up around the area where the boundary agreements came together. The error in the deeds undercuts Bradley’s first reason. Testimony indicated that the fence was built by Mr. Baker, the prior owner of the property, to fence in his goats. This makes sense, in light of the fact that while a steep hollow may deter cows from wandering, steep terrain will not deter a goat. To keep the goats from wandering away up or down the hollow, a fence was a necessity. The fact that the fence ended up around the area where the boundary agreements came together is not a determinative factor. The apparent lack of gates is not determinative either. " Id.
In this boundary dispute, the trial court had to choose between conflicting surveys. After a trial, the court determined that the survey for the defendants was correct due to the failure of the plaintiffs' surveyor to locate a landmark beech tree. We affirm.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/layb_081308.pdf
"[This case] contains conflicting evidence, the recollections of elderly members of the community, errors in deeds, deeds describing the property boundaries by who borders the property rather than by landmarks, and boundary descriptions using landmarks such as trees which may or may not exist today." Id.
"The court made a factual determination that the beech tree identified ... was the tree mentioned in the deeds. It is the oldest in the hollow, it is clearly old enough to be the one in the deeds, and it is located near a spring. This is a crucial factual determination that is central to the dispute. ...The spring located near the beech tree was identified by Mitchell Adcock as Boles Spring. While others identified a spring to the north as Boles Spring, the presence of the beech tree by this spring lends much credence to the trial court’s decision that this spring is indeed Boles Spring." Id.
"The second point implicit in the trial court’s endorsement of the Denny survey is that the old fence line upon which the Bradley survey relies is not a boundary. Bradley believed it was a boundary because it ran northward as the Lay deed recited, it had no gates, and it ended up around the area where the boundary agreements came together. The error in the deeds undercuts Bradley’s first reason. Testimony indicated that the fence was built by Mr. Baker, the prior owner of the property, to fence in his goats. This makes sense, in light of the fact that while a steep hollow may deter cows from wandering, steep terrain will not deter a goat. To keep the goats from wandering away up or down the hollow, a fence was a necessity. The fact that the fence ended up around the area where the boundary agreements came together is not a determinative factor. The apparent lack of gates is not determinative either. " Id.
July 31, 2008
No compensation for inverse condemnation resulting from "careful" construction by the government; No nuisance if government's conduct is reasonable
J. HANNAH FRANK v. THE GOVERNMENT OF THE CITY OF MORRISTOWN (Tenn.Ct.App. July 31, 2008).
The city of Morristown appeals a judgment in favor of a commercial leaseholder who brought an inverse condemnation and nuisance action against the city for damages allegedly sustained as a result of dirt, debris, odor, noise, and interference with ingress and egress caused by the city's road and bridge construction project. After careful review, we reverse the judgment of the trial court as to the inverse condemnation claim upon our finding that the damages complained of by the leaseholder were the necessary effects of careful construction and not different from the effects suffered by the leaseholder's neighbors and because damages resulting from inconvenience during construction are not recoverable. We also reverse the trial court's judgment in favor of the leaseholder upon the claim of nuisance because the leaseholder failed to establish that the construction project was conducted in an unreasonable manner.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/frankj_073108.pdf
"'Inverse condemnation' is the popular description for a cause of action brought by a property owner to recover the value of real property that has been taken for public use by a governmental defendant even though no formal condemnation proceedings under the government’s power of eminent domain have been instituted." Id. (citations omitted).
"Owners of land, no part of which has been taken for public purposes, are not entitled to compensation for damages naturally and unavoidably resulting from the careful construction and operation of the public improvement which damages are shared generally by owners whose lands lie within the range of the inconveniences necessarily attending that improvement." Id. (citations omitted).
"A nuisance has been defined as anything which annoys or disturbs the free use of one’s property, or which renders its ordinary use or physical occupation uncomfortable. Under the circumstances presented in the present matter, it is clear that the noise, dirt, debris, and obstruction complained of annoyed or disturbed Ms. Frank’s free use of her leasehold and rendered its ordinary use uncomfortable. However, as this court has further noted, the key element of any nuisance is the reasonableness of the defendant’s conduct under the circumstances. Acts of the government are not nuisances per se and it is actionable only when a nuisance is established by evidence that the governmental function is conducted in an unreasonable manner. Our careful review of the record reveals no finding by the trial court that the City acted unreasonably at any time during the construction project." Id. (citations and quotations omitted).
The city of Morristown appeals a judgment in favor of a commercial leaseholder who brought an inverse condemnation and nuisance action against the city for damages allegedly sustained as a result of dirt, debris, odor, noise, and interference with ingress and egress caused by the city's road and bridge construction project. After careful review, we reverse the judgment of the trial court as to the inverse condemnation claim upon our finding that the damages complained of by the leaseholder were the necessary effects of careful construction and not different from the effects suffered by the leaseholder's neighbors and because damages resulting from inconvenience during construction are not recoverable. We also reverse the trial court's judgment in favor of the leaseholder upon the claim of nuisance because the leaseholder failed to establish that the construction project was conducted in an unreasonable manner.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/frankj_073108.pdf
"'Inverse condemnation' is the popular description for a cause of action brought by a property owner to recover the value of real property that has been taken for public use by a governmental defendant even though no formal condemnation proceedings under the government’s power of eminent domain have been instituted." Id. (citations omitted).
"Owners of land, no part of which has been taken for public purposes, are not entitled to compensation for damages naturally and unavoidably resulting from the careful construction and operation of the public improvement which damages are shared generally by owners whose lands lie within the range of the inconveniences necessarily attending that improvement." Id. (citations omitted).
"A nuisance has been defined as anything which annoys or disturbs the free use of one’s property, or which renders its ordinary use or physical occupation uncomfortable. Under the circumstances presented in the present matter, it is clear that the noise, dirt, debris, and obstruction complained of annoyed or disturbed Ms. Frank’s free use of her leasehold and rendered its ordinary use uncomfortable. However, as this court has further noted, the key element of any nuisance is the reasonableness of the defendant’s conduct under the circumstances. Acts of the government are not nuisances per se and it is actionable only when a nuisance is established by evidence that the governmental function is conducted in an unreasonable manner. Our careful review of the record reveals no finding by the trial court that the City acted unreasonably at any time during the construction project." Id. (citations and quotations omitted).
Breach of construction contract fails because signature was induced for discussion purposes only
THOMAS BUILDERS, INC. v. SHAILESH PATEL, ET AL. (Tenn.Ct.App. July 31, 2008).
Thomas Builders, Inc. sued Shailesh Patel and his LLC, alleging that Mr. Patel breached a construction contract. The parties had been in negotiations to build a hotel in downtown Knoxville. Thomas Builders' president, Darrell Thomas, claims that he and Mr. Patel agreed to a binding contract; Mr. Patel claims that no contract was ever made. At a bench trial, Mr. Patel testified that Mr. Thomas asked him to sign the purported contract as an "indication that I am really serious to continue discussions." This testimony was not directly rebutted. At the conclusion of the trial, the trial court stated that it believed Mr. Patel's testimony, and held that there was no breach. We affirm.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/thomasbuilders_073108.pdf
"If, as the court declared in its primary holding, Mr. Thomas induced Mr. Patel’s signature by telling him that the signature would only indicate that Mr. Patel was serious about continuing discussions, then it follows necessarily that Mr. Patel’s signature was not an acceptance of an offer by Thomas Builders. Indeed, on these facts, Mr. Thomas was not even making an offer; asking someone to sign a "proposal” in order to prove his "seriousness" is not the same thing as making a contractual offer to build a hotel. And if Mr. Patel’s signature was not given in response to an offer, it cannot have been an acceptance, nor a counter-offer, nor an acceptance in escrow." Id. (quotations omitted).
"The dispute in this case is not over the terms of the contract, but over whether a contract was formed at all, and we do not believe Mr. Patel’s scribbling of the word “accepted” necessarily speaks for itself in that regard. ... [W]e hold that the evidence does not preponderate against the trial court’s factual finding that Mr. Thomas induced Mr. Patel to sign the proposal “for discussion purposes only.” Based on these facts, we find that no contract was formed. Thomas Builders’ breach of contract claim therefore must fail." Id. (quotations omitted).
Thomas Builders, Inc. sued Shailesh Patel and his LLC, alleging that Mr. Patel breached a construction contract. The parties had been in negotiations to build a hotel in downtown Knoxville. Thomas Builders' president, Darrell Thomas, claims that he and Mr. Patel agreed to a binding contract; Mr. Patel claims that no contract was ever made. At a bench trial, Mr. Patel testified that Mr. Thomas asked him to sign the purported contract as an "indication that I am really serious to continue discussions." This testimony was not directly rebutted. At the conclusion of the trial, the trial court stated that it believed Mr. Patel's testimony, and held that there was no breach. We affirm.
Opinion may be found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/thomasbuilders_073108.pdf
"If, as the court declared in its primary holding, Mr. Thomas induced Mr. Patel’s signature by telling him that the signature would only indicate that Mr. Patel was serious about continuing discussions, then it follows necessarily that Mr. Patel’s signature was not an acceptance of an offer by Thomas Builders. Indeed, on these facts, Mr. Thomas was not even making an offer; asking someone to sign a "proposal” in order to prove his "seriousness" is not the same thing as making a contractual offer to build a hotel. And if Mr. Patel’s signature was not given in response to an offer, it cannot have been an acceptance, nor a counter-offer, nor an acceptance in escrow." Id. (quotations omitted).
"The dispute in this case is not over the terms of the contract, but over whether a contract was formed at all, and we do not believe Mr. Patel’s scribbling of the word “accepted” necessarily speaks for itself in that regard. ... [W]e hold that the evidence does not preponderate against the trial court’s factual finding that Mr. Thomas induced Mr. Patel to sign the proposal “for discussion purposes only.” Based on these facts, we find that no contract was formed. Thomas Builders’ breach of contract claim therefore must fail." Id. (quotations omitted).
July 30, 2008
Judgment for fraudulent misrepresentation against seller for covering up termite damage; 30% comparative fault against termite company
STEVE L. ELCHLEPP, JR., ET AL. v. EMOL HATFIELD, ET AL (Tenn.Ct.App. July 30, 2008).
The buyers of a house and real property brought this action against the sellers and a termite control company, alleging that the house was completely infested with termites to the extent that it was worthless and unsalvageable. The buyers charged the sellers with fraudulent and negligent misrepresentation, fraudulent concealment of the extent of termite damage, and breach of contract. The buyers alleged that the termite control company was negligent in its inspection of the house.
Following a six-day jury trial, the jury found in favor of the buyers, holding the sellers 70 percent at fault and the termite control company 30 percent at fault and awarding the buyers $55,000 in damages. The trial court also awarded the buyers $25,000 in attorney's fees pursuant to the real estate sales contract. We find that the jury verdict is supported by material evidence and that the trial court committed no reversible error in its jury instructions and evidentiary rulings, and consequently affirm the trial court's judgment.
Opinion located on the TBA website:
http://www.tba2.org/tba_files/TCA/2008/elchlepps_073008.pdf
"The clear and convincing standard of proof is appropriate to those cases where a party seeks the reform or rescission of a written instrument due to fraudulent inducement. But in all other cases involving claims of fraud, the standard of proof is preponderance of evidence." Id. (quotation omitted).
"Limit your damage consideration specifically to termite damage and the value of the land is not a consideration in determining the amount of damages in this case." Id. (quoting and affirming trial court's jury instruction).
"When a party intentionally misrepresents a material fact or produces a false impression in order to mislead another or to obtain an undue advantage over him, there is a positive fraud. The representation must have been made with knowledge of its falsity and with a fraudulent intent. The representation must have been to an existing fact which is material and the plaintiff must have reasonably relied upon that misrepresentation to his injury." Id. (quotation omitted).
"Simply stated, the central factual issue in this case was the credibility of the Hatfields’ assertion that they were unaware that the house was infested with termites. There is an abundance of evidence supporting the conclusion, obviously drawn by the jury, that the Hatfields were not believable on this point. ... The testimony of Mr. Elchlepp, including his testimony that Mr. Hatfield assured him that the termite damage discovered before closing was a limited and localized problem, also supports the jury verdict. ... We find that there is ample material evidence supporting the jury verdict in the case, and the Hatfields’ argument to the contrary is without merit." Id.
The buyers of a house and real property brought this action against the sellers and a termite control company, alleging that the house was completely infested with termites to the extent that it was worthless and unsalvageable. The buyers charged the sellers with fraudulent and negligent misrepresentation, fraudulent concealment of the extent of termite damage, and breach of contract. The buyers alleged that the termite control company was negligent in its inspection of the house.
Following a six-day jury trial, the jury found in favor of the buyers, holding the sellers 70 percent at fault and the termite control company 30 percent at fault and awarding the buyers $55,000 in damages. The trial court also awarded the buyers $25,000 in attorney's fees pursuant to the real estate sales contract. We find that the jury verdict is supported by material evidence and that the trial court committed no reversible error in its jury instructions and evidentiary rulings, and consequently affirm the trial court's judgment.
Opinion located on the TBA website:
http://www.tba2.org/tba_files/TCA/2008/elchlepps_073008.pdf
"The clear and convincing standard of proof is appropriate to those cases where a party seeks the reform or rescission of a written instrument due to fraudulent inducement. But in all other cases involving claims of fraud, the standard of proof is preponderance of evidence." Id. (quotation omitted).
"Limit your damage consideration specifically to termite damage and the value of the land is not a consideration in determining the amount of damages in this case." Id. (quoting and affirming trial court's jury instruction).
"When a party intentionally misrepresents a material fact or produces a false impression in order to mislead another or to obtain an undue advantage over him, there is a positive fraud. The representation must have been made with knowledge of its falsity and with a fraudulent intent. The representation must have been to an existing fact which is material and the plaintiff must have reasonably relied upon that misrepresentation to his injury." Id. (quotation omitted).
"Simply stated, the central factual issue in this case was the credibility of the Hatfields’ assertion that they were unaware that the house was infested with termites. There is an abundance of evidence supporting the conclusion, obviously drawn by the jury, that the Hatfields were not believable on this point. ... The testimony of Mr. Elchlepp, including his testimony that Mr. Hatfield assured him that the termite damage discovered before closing was a limited and localized problem, also supports the jury verdict. ... We find that there is ample material evidence supporting the jury verdict in the case, and the Hatfields’ argument to the contrary is without merit." Id.
July 10, 2008
Noncompletion is not contemplated by the Tennessee construction statute of repose
PIERRE PONS, ET AL. v. BARRY HARRISON d/b/a B. HARRISON HOUSEWRIGHTS (Tenn.Ct.App. July 10, 2008).
Defendant Homebuilder left plaintiff Homeowners' job site before completing construction of their residence. Homebuilder appeals the chancery court's confirmation of an adverse arbitration award, arguing that the arbitrator exceeded his authority by refusing to enforce a provision of the contract that would have rendered the plaintiff Homeowners' suit time barred. The limitation provision applied to suits for defective improvements to real estate. The gravamen of this breach of contract action was partial performance, not defective performance. Further, the arbitrator awarded to Homeowners the cost to complete the construction plus interest, attorney's fees, and arbitration costs. Finding that the limitation period does not apply to this action, we affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/ponsp_071008.pdf
"Paragraph 14 of the contract, which addressed the builder’s limited warranty and provided for the repair of covered defects, contained the provision in question. Subparagraph (F) provided as follows:
Repairs. Upon receipt of Owner’s written report of a defect, if the defective item is covered by Builder’s Limited Warranty, Builder shall repair or replace it at no charge to Owner, within thirty (30) days, (extended for delays caused by weather conditions, labor problems or material shortages). Notwithstanding the foregoing, Builder and Owner expressly waive the statutory limitations on actions for defective improvements of real estate, as provided by Tennessee Code Section 28-3-201 et seq., and in lieu thereof covenant and agree that all actions recoverable under this statutory provision shall be brought within one (1) year after substantial completion of the House." Id.
"To determine whether this lawsuit falls within the ambit of the referenced statute of repose, thus making it subject to the one-year limitation, we look to the gravamen of the complaint and to the basis for which the damages are sought. [] Although there are some references made to inferior workmanship[] in the complaint, the suit plainly rests upon nonfeasance more so than malfeasance, or partial performance rather than defective performance. The Ponses averred, and it is undisputed, that the following items were left uncompleted by Mr. Harrison ... . Moreover, it appears that the arbitrator awarded them the cost to complete the residence." Id. (citations omitted).
"In this breach of contract case, the chief complaint was nonfeasance, not malfeasance. This distinction removes the action from the purview of Tennessee Code Annotated Section 28-3-202 because the statute applies to actions predicated upon defective improvements to real property, property damage, and personal injury or wrongful death attributable to the defective work. Because the statute does not apply, neither do the contractual waiver and one-year limitation period. We accordingly affirm the chancellor’s confirmation of the award." Id.
Defendant Homebuilder left plaintiff Homeowners' job site before completing construction of their residence. Homebuilder appeals the chancery court's confirmation of an adverse arbitration award, arguing that the arbitrator exceeded his authority by refusing to enforce a provision of the contract that would have rendered the plaintiff Homeowners' suit time barred. The limitation provision applied to suits for defective improvements to real estate. The gravamen of this breach of contract action was partial performance, not defective performance. Further, the arbitrator awarded to Homeowners the cost to complete the construction plus interest, attorney's fees, and arbitration costs. Finding that the limitation period does not apply to this action, we affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/ponsp_071008.pdf
"Paragraph 14 of the contract, which addressed the builder’s limited warranty and provided for the repair of covered defects, contained the provision in question. Subparagraph (F) provided as follows:
Repairs. Upon receipt of Owner’s written report of a defect, if the defective item is covered by Builder’s Limited Warranty, Builder shall repair or replace it at no charge to Owner, within thirty (30) days, (extended for delays caused by weather conditions, labor problems or material shortages). Notwithstanding the foregoing, Builder and Owner expressly waive the statutory limitations on actions for defective improvements of real estate, as provided by Tennessee Code Section 28-3-201 et seq., and in lieu thereof covenant and agree that all actions recoverable under this statutory provision shall be brought within one (1) year after substantial completion of the House." Id.
"To determine whether this lawsuit falls within the ambit of the referenced statute of repose, thus making it subject to the one-year limitation, we look to the gravamen of the complaint and to the basis for which the damages are sought. [] Although there are some references made to inferior workmanship[] in the complaint, the suit plainly rests upon nonfeasance more so than malfeasance, or partial performance rather than defective performance. The Ponses averred, and it is undisputed, that the following items were left uncompleted by Mr. Harrison ... . Moreover, it appears that the arbitrator awarded them the cost to complete the residence." Id. (citations omitted).
"In this breach of contract case, the chief complaint was nonfeasance, not malfeasance. This distinction removes the action from the purview of Tennessee Code Annotated Section 28-3-202 because the statute applies to actions predicated upon defective improvements to real property, property damage, and personal injury or wrongful death attributable to the defective work. Because the statute does not apply, neither do the contractual waiver and one-year limitation period. We accordingly affirm the chancellor’s confirmation of the award." Id.
June 30, 2008
Court awards sanctions and attorneys fees for intereference with a prescriptive easement
BRUCE WAYNE FERGUSON v. DARRYL SHARP, ET AL. (Tenn.Ct.App. June 30, 2008).
Bruce Wayne Ferguson (“the Plaintiff”) filed this lawsuit after Darryl and Denise Sharp (“the Defendants”) installed a gate on a right-of-way over their land that the Plaintiff utilized to reach his property. The Defendants claimed the gate was necessary for their safe use and enjoyment of their land because the right-of-way area was being subjected to trespassing, vandalism, and theft. The trial court agreed with the Plaintiff that the gate was not necessary and permanently enjoined the Defendants from maintaining it on the right-of-way. The Defendants appeal the judgment of the trial court. We affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/fergusonb_063008.pdf
"The preponderance of the evidence presented to the court establishes that the Defendants have utilized their gate in an improper and illegal manner to deny the Plaintiff access to his property and to harass him despite the court order prohibiting these actions by the Defendants. The Plaintiff has an easement by prescription free of the impairment of the easement by the erection of gates." Id.
"This case involved a clear violation of the orders of the trial court. Our review of the record reveals that the Defendants interfered with and denied access by the Plaintiff to his property by use of the easement. The Plaintiff had to file motions requesting that the court find the Defendants in contempt of court. ... The trial court had clear authority to assess attorney’s fees against the Defendants pursuant to Tenn. Code Ann. § 29-9-105. The award served to compensate the Plaintiff for the loss he sustained as a result of the actions of the Defendants." Id.
Bruce Wayne Ferguson (“the Plaintiff”) filed this lawsuit after Darryl and Denise Sharp (“the Defendants”) installed a gate on a right-of-way over their land that the Plaintiff utilized to reach his property. The Defendants claimed the gate was necessary for their safe use and enjoyment of their land because the right-of-way area was being subjected to trespassing, vandalism, and theft. The trial court agreed with the Plaintiff that the gate was not necessary and permanently enjoined the Defendants from maintaining it on the right-of-way. The Defendants appeal the judgment of the trial court. We affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/fergusonb_063008.pdf
"The preponderance of the evidence presented to the court establishes that the Defendants have utilized their gate in an improper and illegal manner to deny the Plaintiff access to his property and to harass him despite the court order prohibiting these actions by the Defendants. The Plaintiff has an easement by prescription free of the impairment of the easement by the erection of gates." Id.
"This case involved a clear violation of the orders of the trial court. Our review of the record reveals that the Defendants interfered with and denied access by the Plaintiff to his property by use of the easement. The Plaintiff had to file motions requesting that the court find the Defendants in contempt of court. ... The trial court had clear authority to assess attorney’s fees against the Defendants pursuant to Tenn. Code Ann. § 29-9-105. The award served to compensate the Plaintiff for the loss he sustained as a result of the actions of the Defendants." Id.
June 27, 2008
Court limits use of an easement to the extent that a driveway runs onto the adjacent property; Dominant estate may not materially increase burden
GARY W. FRYE, ET AL. v. CARL PRESLEY, ET AL. (Tenn.Ct.App. June 27, 2008).
This case involves a dispute between the owners of adjoining properties over the use of a driveway. The dispute focuses on the easement rights of the defendants, if any, to a right-of-way across the north edge of the plaintiffs' property and a portion of the west edge. The court, following a bench trial, made findings regarding the subject driveway. The defendants appeal. We affirm in part and reverse in part.
Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/fryeg_062708.pdf
"An easement is a right an owner has to some lawful use of the real property of another. [] Any easement in this case would be an easement appurtenant, involving two tracts of land – the dominant tenement (in this case, the defendants’ property) and the servient tenement (the plaintiffs’ property). The dominant tenement benefits in some way from the use of the servient tenement. [] A prescriptive easement arises when a person acting under an adverse claim of right makes uninterrupted, open, visible, and exclusive use of another’s property for at least twenty (20) years with the owner’s knowledge and acquiescence. []." Id. (citations omitted).
"While the Presleys’ deed to their son refers to an easement 30 feet in width, that easement, to the extent it crosses the plaintiffs’ property, is limited in width to the 14 feet found by the trial court. ... Simply stated, the son’s easement over the Fryes’ property is limited to a width of 14 feet. If the driveway on the ground is more than 14 feet wide, the excess over 14 feet must be located entirely on the Presleys’ property." Id. (quotations to transcript omitted).
"[T]he owner of an easement “cannot materially increase the burden of it upon the servient estate or impose thereon a new and additional burden.” [] Accordingly, the use of the driveway has been expanded over time from originally benefitting only Mr. and Mrs. Presley to now being used by at least nine drivers, owning a combined fleet of approximately 15 vehicles including boats, trailers, and farm equipment. Mr. Frye testified that a number of the defendants speed along the driveway and “create the nuisance of dust”[]. ... It is clear to us that this testimony is related to the roadway along the northern section of the Frye property, not the portion of the driveway along a portion of their western boundary. The trial court concluded that the defendants’ use of the easement along the northern boundary did not result in an unreasonable increase in the burden to the servient estate. ... Furthermore, our review of the record likewise reveals no evidence of an increased burden along the western section of the easement. Accordingly, we find the plaintiffs’ argument to be without merit." Id. (citations omitted).
This case involves a dispute between the owners of adjoining properties over the use of a driveway. The dispute focuses on the easement rights of the defendants, if any, to a right-of-way across the north edge of the plaintiffs' property and a portion of the west edge. The court, following a bench trial, made findings regarding the subject driveway. The defendants appeal. We affirm in part and reverse in part.
Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/fryeg_062708.pdf
"An easement is a right an owner has to some lawful use of the real property of another. [] Any easement in this case would be an easement appurtenant, involving two tracts of land – the dominant tenement (in this case, the defendants’ property) and the servient tenement (the plaintiffs’ property). The dominant tenement benefits in some way from the use of the servient tenement. [] A prescriptive easement arises when a person acting under an adverse claim of right makes uninterrupted, open, visible, and exclusive use of another’s property for at least twenty (20) years with the owner’s knowledge and acquiescence. []." Id. (citations omitted).
"While the Presleys’ deed to their son refers to an easement 30 feet in width, that easement, to the extent it crosses the plaintiffs’ property, is limited in width to the 14 feet found by the trial court. ... Simply stated, the son’s easement over the Fryes’ property is limited to a width of 14 feet. If the driveway on the ground is more than 14 feet wide, the excess over 14 feet must be located entirely on the Presleys’ property." Id. (quotations to transcript omitted).
"[T]he owner of an easement “cannot materially increase the burden of it upon the servient estate or impose thereon a new and additional burden.” [] Accordingly, the use of the driveway has been expanded over time from originally benefitting only Mr. and Mrs. Presley to now being used by at least nine drivers, owning a combined fleet of approximately 15 vehicles including boats, trailers, and farm equipment. Mr. Frye testified that a number of the defendants speed along the driveway and “create the nuisance of dust”[]. ... It is clear to us that this testimony is related to the roadway along the northern section of the Frye property, not the portion of the driveway along a portion of their western boundary. The trial court concluded that the defendants’ use of the easement along the northern boundary did not result in an unreasonable increase in the burden to the servient estate. ... Furthermore, our review of the record likewise reveals no evidence of an increased burden along the western section of the easement. Accordingly, we find the plaintiffs’ argument to be without merit." Id. (citations omitted).
Notemakers obligated to indemnify owner of land that secured the note after foreclosure sale
ESTATE OF LORINE GOODWIN HINDMON v. JIMMIE R. JONES, ET AL. (Tenn.Ct.App. June 27, 2008).
This appeal focuses on a dispute as to whether the defendants, Jimmie R. Jones ("Mrs. Jones") and Larry D. Jones ("Mr. Jones"), are obligated to indemnify the plaintiff, the Estate of Lorine Goodwin Hindmon ("the Estate"), for the value of property owned by Mrs. Hindmon that was foreclosed upon and sold, the proceeds from which were applied against a debt for which the Joneses were obligated. The trial court held that the plaintiff had a right to indemnification from the defendants and, as a consequence of that holding, granted the plaintiff summary judgment. We affirm.
Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/hindmonl_062708.pdf
"The Estate is entitled to a judgment for indemnity against Mr. and Mrs. Jones. Indemnity may be recovered on the basis of implied indemnity. A right to indemnity “exists whenever one party is exposed to liability by the action of another who, in law or equity, should make good the loss of the other.” 41 Am. Jur. 2 Indemnity § 25 (1968). It is undisputed that Mr. and Mrs. Jones owed a note obligation to Capital Bank. This note obligation was secured by two parcels of real estate owned by the Decedent. The note obligation went into default. The note and deed of trust were subsequently assigned to the Moores, who foreclosed upon the Decedent’s real estate. The amount of $330,000 was realized from the sale of the property and applied toward the note obligations owed by Mr. and Mrs. Jones. In Jarnigen v. Stratton, 32 S.W. 625 (Tenn. 1895), the Tennessee Supreme Court noted as follows:
Mr. Story says: “Where the note is the several as well as the joint note of the makers, the holder is at liberty to elect upon whom he will make the demand and presentment.” Story, Prom. Notes, § 256. To the same effect, see 1 Daniel, Neg. Inst. § 596. The reason of the rule in both cases is the same. It is only necessary to make demand in the one case of all the makers where they are joint makers, and to give notice to all the indorsers where they are joint indorsers, to bind those notified. If they are joint and several indorsers, notice to any one is sufficient to bind him. Id., 32 S.W. at 626. The estate was entitled to choose from whom it desired to seek indemnification. As to the assertion by Mr. and Mrs. Jones that this claim is barred by any statute of limitation, the contention lacks merit, as the action did not arise until the foreclosure occurred in 2006." Id.
This appeal focuses on a dispute as to whether the defendants, Jimmie R. Jones ("Mrs. Jones") and Larry D. Jones ("Mr. Jones"), are obligated to indemnify the plaintiff, the Estate of Lorine Goodwin Hindmon ("the Estate"), for the value of property owned by Mrs. Hindmon that was foreclosed upon and sold, the proceeds from which were applied against a debt for which the Joneses were obligated. The trial court held that the plaintiff had a right to indemnification from the defendants and, as a consequence of that holding, granted the plaintiff summary judgment. We affirm.
Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/hindmonl_062708.pdf
"The Estate is entitled to a judgment for indemnity against Mr. and Mrs. Jones. Indemnity may be recovered on the basis of implied indemnity. A right to indemnity “exists whenever one party is exposed to liability by the action of another who, in law or equity, should make good the loss of the other.” 41 Am. Jur. 2 Indemnity § 25 (1968). It is undisputed that Mr. and Mrs. Jones owed a note obligation to Capital Bank. This note obligation was secured by two parcels of real estate owned by the Decedent. The note obligation went into default. The note and deed of trust were subsequently assigned to the Moores, who foreclosed upon the Decedent’s real estate. The amount of $330,000 was realized from the sale of the property and applied toward the note obligations owed by Mr. and Mrs. Jones. In Jarnigen v. Stratton, 32 S.W. 625 (Tenn. 1895), the Tennessee Supreme Court noted as follows:
Mr. Story says: “Where the note is the several as well as the joint note of the makers, the holder is at liberty to elect upon whom he will make the demand and presentment.” Story, Prom. Notes, § 256. To the same effect, see 1 Daniel, Neg. Inst. § 596. The reason of the rule in both cases is the same. It is only necessary to make demand in the one case of all the makers where they are joint makers, and to give notice to all the indorsers where they are joint indorsers, to bind those notified. If they are joint and several indorsers, notice to any one is sufficient to bind him. Id., 32 S.W. at 626. The estate was entitled to choose from whom it desired to seek indemnification. As to the assertion by Mr. and Mrs. Jones that this claim is barred by any statute of limitation, the contention lacks merit, as the action did not arise until the foreclosure occurred in 2006." Id.
June 26, 2008
Restrictive covenants may not apply if the deed is ambiguous; Negative reciprocal easements require a common plan or scheme
GREIG MASSEY, ET AL., v. R.W. GRAF, INC., ET AL. (Tenn.Ct.App. June 26, 2008)
Plaintiffs brought this declaratory judgment action, asking the Court to declare that building restrictions on platted parcels of property from a common grantor applied to a non-platted parcel purchased by defendants from a subsequent grantor. The Trial Court, responding to a summary judgment motion, made detailed findings of facts, and concluded that the "subject to" language in the deeds was ambiguous and construed the language against the inclusion of restrictions on any portion of the property that lay outside the platted subdivisions. Plaintiffs have appealed, and we affirm the Judgment of the Trial Court.
Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/masseyg_062608.pdf
Dissenting opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/masseyg_DIS_062608.pdf
"Because restrictive covenants are in derogation of the fundamental right of free use and enjoyment of real property, they are not favored under Tennessee law. [] Restrictive covenants are strictly construed. [] Any doubt concerning the applicability of a restrictive covenant will be resolved against the restriction, [] and, likewise, any ambiguity in the terms of the restrictive covenant will be resolved against the restriction. [] Similarly, when the terms of a covenant may be construed more than one way, the courts must resolve any ambiguities against the party seeking to enforce the restriction and in a manner which advances the unrestricted use of the property. []" Id. (citations omitted).
"The language in the Warranty Deed from the Dean Estate to the University of Tennessee is as follows: “This conveyance, however, is made subject to Restrictive Covenants applicable to all of the lots located in the Deanbrook Sub-divisions of record in book of deeds 954, page 564, in the Register’s Office of Knox County, Tennessee, to which said instrument specific reference is hereby made for said conditions, limitations, reservations and restrictions.” This language is susceptible to two very different meanings. It could mean that the referenced restrictive covenants applies to all of the property conveyed including the unsubdivided tract, that included the Graf Property. Or it could mean that the Dean Estate intended to have the referenced restrictive covenants apply only to the lots within the Deanbrook subdivisions as was the original intent when the restrictions were recorded in 1954. Accordingly, we conclude that ambiguity exists." Id.
"Both the grantor and the fellow grantees whose titles contain similar restrictive covenants may enforce their reciprocal negative easement rights in either a legal or an equitable proceeding. [] Grantees seeking equitable enforcement of a reciprocal negative easement must prove: (1) that the parties derived their titles from a common grantor; (2) that the common grantor had a general plan for the property involved; (3) that the common grantor intended for the restrictive covenant to benefit the property involved; and (4) that the grantees had actual or constructive knowledge of the restriction when they purchased their parcels. [] Grantees seeking judicial enforcement of their negative reciprocal easement rights are not necessarily limited to the recitals in the deeds to prove their case. In addition to the deeds from the common grantor [], they may also use recorded plats [], or parol evidence of the circumstances surrounding the purchase of the property. []" Id. (citations omitted).
"In this case, the properties known as Deanbrook Subdivision were platted with restrictions that expressly applied only to Deanbrook Subdivisions, and were recorded. The tract of land that encompassed the Dean properties adjacent to the Deanbrook Subdivisions was not platted and was not expressly included in the recorded restrictions. Further, there was no general plan or scheme of development to include the unsubdivided properties in the Deanbrook Subdivisions[.]" Id.
DISSENTING OPINION: "When I give the words in the subject language their usual and ordinary meaning – as I am required to do – I do not find the warranty deed to be ambiguous. As I understand the language at hand, it cannot be construed as being limited to the conveyed lots in the platted subdivisions. The language at issue addresses “[t]his conveyance.” The only reasonable interpretation of these two words is that they refer to the conveyed platted lots in the Deanbrook Subdivisions and the conveyed acreage outside the platted subdivisions. This is what was “convey[ed].” There can be no doubt about this." Id.
Plaintiffs brought this declaratory judgment action, asking the Court to declare that building restrictions on platted parcels of property from a common grantor applied to a non-platted parcel purchased by defendants from a subsequent grantor. The Trial Court, responding to a summary judgment motion, made detailed findings of facts, and concluded that the "subject to" language in the deeds was ambiguous and construed the language against the inclusion of restrictions on any portion of the property that lay outside the platted subdivisions. Plaintiffs have appealed, and we affirm the Judgment of the Trial Court.
Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/masseyg_062608.pdf
Dissenting opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/masseyg_DIS_062608.pdf
"Because restrictive covenants are in derogation of the fundamental right of free use and enjoyment of real property, they are not favored under Tennessee law. [] Restrictive covenants are strictly construed. [] Any doubt concerning the applicability of a restrictive covenant will be resolved against the restriction, [] and, likewise, any ambiguity in the terms of the restrictive covenant will be resolved against the restriction. [] Similarly, when the terms of a covenant may be construed more than one way, the courts must resolve any ambiguities against the party seeking to enforce the restriction and in a manner which advances the unrestricted use of the property. []" Id. (citations omitted).
"The language in the Warranty Deed from the Dean Estate to the University of Tennessee is as follows: “This conveyance, however, is made subject to Restrictive Covenants applicable to all of the lots located in the Deanbrook Sub-divisions of record in book of deeds 954, page 564, in the Register’s Office of Knox County, Tennessee, to which said instrument specific reference is hereby made for said conditions, limitations, reservations and restrictions.” This language is susceptible to two very different meanings. It could mean that the referenced restrictive covenants applies to all of the property conveyed including the unsubdivided tract, that included the Graf Property. Or it could mean that the Dean Estate intended to have the referenced restrictive covenants apply only to the lots within the Deanbrook subdivisions as was the original intent when the restrictions were recorded in 1954. Accordingly, we conclude that ambiguity exists." Id.
"Both the grantor and the fellow grantees whose titles contain similar restrictive covenants may enforce their reciprocal negative easement rights in either a legal or an equitable proceeding. [] Grantees seeking equitable enforcement of a reciprocal negative easement must prove: (1) that the parties derived their titles from a common grantor; (2) that the common grantor had a general plan for the property involved; (3) that the common grantor intended for the restrictive covenant to benefit the property involved; and (4) that the grantees had actual or constructive knowledge of the restriction when they purchased their parcels. [] Grantees seeking judicial enforcement of their negative reciprocal easement rights are not necessarily limited to the recitals in the deeds to prove their case. In addition to the deeds from the common grantor [], they may also use recorded plats [], or parol evidence of the circumstances surrounding the purchase of the property. []" Id. (citations omitted).
"In this case, the properties known as Deanbrook Subdivision were platted with restrictions that expressly applied only to Deanbrook Subdivisions, and were recorded. The tract of land that encompassed the Dean properties adjacent to the Deanbrook Subdivisions was not platted and was not expressly included in the recorded restrictions. Further, there was no general plan or scheme of development to include the unsubdivided properties in the Deanbrook Subdivisions[.]" Id.
DISSENTING OPINION: "When I give the words in the subject language their usual and ordinary meaning – as I am required to do – I do not find the warranty deed to be ambiguous. As I understand the language at hand, it cannot be construed as being limited to the conveyed lots in the platted subdivisions. The language at issue addresses “[t]his conveyance.” The only reasonable interpretation of these two words is that they refer to the conveyed platted lots in the Deanbrook Subdivisions and the conveyed acreage outside the platted subdivisions. This is what was “convey[ed].” There can be no doubt about this." Id.
June 24, 2008
Local governments may enforce strict submission requirements for service contracts
BAIRD TREE COMPANY, INC. v. CITY OF OAK RIDGE, ET AL. (Tenn.Ct.App. June 24, 2008).
Baird Tree Company, Inc. ("Plaintiff") was one of three bidders on a tree trimming and removal project submitted for bid by the City of Oak Ridge ("Oak Ridge"). Plaintiff was notified by letter of several deficiencies in its bid and Oak Ridge requested that the bid be supplemented with additional information. Plaintiff explicitly refused to do so and informed Oak Ridge that its bid was fine just the way it was.
After the contract was awarded to a different company, Plaintiff filed suit claiming it should have been awarded the contract because it was the lowest bidder and further claiming that Oak Ridge violated the Tennessee Trade Practices Act, Tenn. Code Ann. section 47-25-101, et seq. Oak Ridge filed a motion for summary judgment claiming, among other things, that it was entitled to summary judgment because Plaintiff's bid was invalid to begin with and the Trade Practices Act did not apply to this case. The Trial Court agreed and granted the motion for summary judgment. Plaintiff appeals raising numerous issues. We affirm.
Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/bairdtree_062408.pdf
"The undisputed material facts demonstrate that there were numerous deficiencies in Plaintiff’s original bid. Although not required to do so, Dover sent a letter to Plaintiff’s owner and president requesting the additional necessary information. Mr. Baird refused to supply any additional information and even went so far as to inform Dover that he (i.e., Mr. Baird) would be sending questions to Dover that he wanted answered. The Trial Court correctly characterized this response as being “in your face.” This Court is at a loss as to how a company can send such a response to legitimate questions that were raised about its bid, and then complain when it is not awarded the bid." Id.
Baird Tree Company, Inc. ("Plaintiff") was one of three bidders on a tree trimming and removal project submitted for bid by the City of Oak Ridge ("Oak Ridge"). Plaintiff was notified by letter of several deficiencies in its bid and Oak Ridge requested that the bid be supplemented with additional information. Plaintiff explicitly refused to do so and informed Oak Ridge that its bid was fine just the way it was.
After the contract was awarded to a different company, Plaintiff filed suit claiming it should have been awarded the contract because it was the lowest bidder and further claiming that Oak Ridge violated the Tennessee Trade Practices Act, Tenn. Code Ann. section 47-25-101, et seq. Oak Ridge filed a motion for summary judgment claiming, among other things, that it was entitled to summary judgment because Plaintiff's bid was invalid to begin with and the Trade Practices Act did not apply to this case. The Trial Court agreed and granted the motion for summary judgment. Plaintiff appeals raising numerous issues. We affirm.
Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/bairdtree_062408.pdf
"The undisputed material facts demonstrate that there were numerous deficiencies in Plaintiff’s original bid. Although not required to do so, Dover sent a letter to Plaintiff’s owner and president requesting the additional necessary information. Mr. Baird refused to supply any additional information and even went so far as to inform Dover that he (i.e., Mr. Baird) would be sending questions to Dover that he wanted answered. The Trial Court correctly characterized this response as being “in your face.” This Court is at a loss as to how a company can send such a response to legitimate questions that were raised about its bid, and then complain when it is not awarded the bid." Id.
May 29, 2008
Owner found 40% at fault for failing to provide sunroom kit manufacturer's instructions to contractor
JAY S. GORBAN v. DAVID HARRIS (Tenn.Ct.App. May 29, 2008)
This is a dispute between a homeowner and the contractor he hired to build a sunroom onto his home. We have concluded that the evidence does not preponderate against the trial court's award of a judgment in favor of the homeowner for 60 percent of the requested damages, based upon its allocation of 40 percent of the fault to the homeowner.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/gorbanj_052908.pdf
"Dr. Gorban assigns error to the trial court’s allocation of 40% of the fault to him. The trial court’s comparative fault determination was predicated upon its finding that Dr. Gorban did not provide Mr. Harris with the manufacturer’s instructions regarding the foundation requirements. ... Dr. Gorban further argues that, even if he did not have the foundation instructions, Mr. Harris should have contacted the manufacturer himself. There is no proof that Mr. Harris was aware that additional instructions existed. While Mr. Harris could have contacted the manufacturer, we cannot say that the trial court erred in finding Dr. Gorban at fault for failing to provide the relevant instructions that were in his possession to Mr. Harris." Id.
This is a dispute between a homeowner and the contractor he hired to build a sunroom onto his home. We have concluded that the evidence does not preponderate against the trial court's award of a judgment in favor of the homeowner for 60 percent of the requested damages, based upon its allocation of 40 percent of the fault to the homeowner.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/gorbanj_052908.pdf
"Dr. Gorban assigns error to the trial court’s allocation of 40% of the fault to him. The trial court’s comparative fault determination was predicated upon its finding that Dr. Gorban did not provide Mr. Harris with the manufacturer’s instructions regarding the foundation requirements. ... Dr. Gorban further argues that, even if he did not have the foundation instructions, Mr. Harris should have contacted the manufacturer himself. There is no proof that Mr. Harris was aware that additional instructions existed. While Mr. Harris could have contacted the manufacturer, we cannot say that the trial court erred in finding Dr. Gorban at fault for failing to provide the relevant instructions that were in his possession to Mr. Harris." Id.
May 19, 2008
Decision reversed because trial court awarded punitive damages based on environmental tort theory, which was rejected by the jury
DAVID GOFF, ET UX, ET AL. v. ELMO GREER & SONS CONSTRUCTION CO., INC. (Tenn.Ct.App. May 19, 2008).
This appeal involves a jury's award of punitive damages. The construction company entered into a contract with the State of Tennessee to widen a portion of a highway. The homeowners entered into a contract with the construction company allowing the construction company to place excess materials generated from the highway project on the homeowners' property. In exchange, the homeowners would receive compensation based on the cubic fill area, and the company would fill and grade that portion of the homeowners' property. The project required that the construction company conduct extensive blasting near the homeowners' house and vehicles. One of the homeowners became concerned when he witnessed the construction company placing various garbage items and tires on his property near the fill area. After three years, the construction company finished the project.
The homeowners brought suit, alleging that the company failed to pay the amount due under the contract and caused damage to their house due to the blasting. The complaint also alleged that the company buried certain items, including tires, on the property which constituted an environmental tort. The homeowners' amended complaint stated a cause of action in nuisance and also sought an award of punitive damages in the amount of $1 million dollars.
The jury returned a verdict in favor of the homeowners for the nuisance claim in the amount of $3,305.00 and found that punitive damages should be imposed on the construction company. The jury found in favor of the construction company for the environmental tort claim. After the second phase of the trial, the jury returned an award of $2 million in punitive damages. The trial court remitted the award to $1 million, the amount of the homeowners' ad damnum. The construction company appeals, and we reverse and remand in part and affirm in part.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/goffd_051908.pdf
"Our Supreme Court, in Hodges v. S.C. Toof & Co., 833 S.W.2d 896, 901–02 (Tenn. 1992), laid out the procedural framework for awarding punitive damages. First, the plaintiff must prove by clear and convincing evidence that the defendant acted (1) intentionally, (2) fraudulently, (3) maliciously, or (4) recklessly. Id. at 900–01. Upon such a finding, the jury must then determine the amount of damages during the second phase of the trial[.]" Id.
Trial court: "By intentionally burying tires eight feet tall, thirty-two inches in diameter, and weighing over one ton, the defendant clearly violated the solid waste disposal act. The policy of the state to avoid pollution and the creation of unpermitted landfills was intentionally violated on the lands of another and justifies a substantial punitive damages award." Id. (quoting the trial court).
"The trial court’s findings of fact and conclusions of law are insufficient in that they rely heavily on the environmental tort claim, a theory which the jury rejected. We therefore reverse the award of punitive damages and remand the case to the trial court. On remand, the trial court should apply the Hodges factors and make appropriate findings of fact and conclusions of law in approving or decreasing the award of punitive damages, if the court deems appropriate, based on the nuisance theory." Id.
This appeal involves a jury's award of punitive damages. The construction company entered into a contract with the State of Tennessee to widen a portion of a highway. The homeowners entered into a contract with the construction company allowing the construction company to place excess materials generated from the highway project on the homeowners' property. In exchange, the homeowners would receive compensation based on the cubic fill area, and the company would fill and grade that portion of the homeowners' property. The project required that the construction company conduct extensive blasting near the homeowners' house and vehicles. One of the homeowners became concerned when he witnessed the construction company placing various garbage items and tires on his property near the fill area. After three years, the construction company finished the project.
The homeowners brought suit, alleging that the company failed to pay the amount due under the contract and caused damage to their house due to the blasting. The complaint also alleged that the company buried certain items, including tires, on the property which constituted an environmental tort. The homeowners' amended complaint stated a cause of action in nuisance and also sought an award of punitive damages in the amount of $1 million dollars.
The jury returned a verdict in favor of the homeowners for the nuisance claim in the amount of $3,305.00 and found that punitive damages should be imposed on the construction company. The jury found in favor of the construction company for the environmental tort claim. After the second phase of the trial, the jury returned an award of $2 million in punitive damages. The trial court remitted the award to $1 million, the amount of the homeowners' ad damnum. The construction company appeals, and we reverse and remand in part and affirm in part.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/goffd_051908.pdf
"Our Supreme Court, in Hodges v. S.C. Toof & Co., 833 S.W.2d 896, 901–02 (Tenn. 1992), laid out the procedural framework for awarding punitive damages. First, the plaintiff must prove by clear and convincing evidence that the defendant acted (1) intentionally, (2) fraudulently, (3) maliciously, or (4) recklessly. Id. at 900–01. Upon such a finding, the jury must then determine the amount of damages during the second phase of the trial[.]" Id.
Trial court: "By intentionally burying tires eight feet tall, thirty-two inches in diameter, and weighing over one ton, the defendant clearly violated the solid waste disposal act. The policy of the state to avoid pollution and the creation of unpermitted landfills was intentionally violated on the lands of another and justifies a substantial punitive damages award." Id. (quoting the trial court).
"The trial court’s findings of fact and conclusions of law are insufficient in that they rely heavily on the environmental tort claim, a theory which the jury rejected. We therefore reverse the award of punitive damages and remand the case to the trial court. On remand, the trial court should apply the Hodges factors and make appropriate findings of fact and conclusions of law in approving or decreasing the award of punitive damages, if the court deems appropriate, based on the nuisance theory." Id.
May 16, 2008
Case replete with tenets of construction law
CATHERINE SMITH BOWLING, ET AL. V. TODD JONES, ET AL. (Tenn.Ct.App. May 16, 2008).
Plaintiff homeowners sued defendant residential building contractors for breach of a home construction contract upon allegations of defective workmanship and abandonment of contract. The trial court entered judgment in favor of plaintiffs and awarded actual damages in an amount based upon the finding that the house was of no value. The trial court also awarded damages under the Tennessee Consumer Protection Act upon a finding that the defendants violated the Act by willfully and knowingly misrepresenting that they were bonded. Upon appeal, we find no error in the judgment of the trial court, and accordingly, the judgment is affirmed in all respects.
Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/bowlingc_051608.pdf
IMPLIED WARRANTY TO BUILD NEW HOME IN A WORKMANLIKE MANNER:
"A contract to construct an entire building is essentially a contract for material and labor, and includes an implied warranty protecting the owner from defective construction. Once a builder undertakes a construction contract, the common law imposes upon him or her a duty to perform the work in a workmanlike manner, and there is an implied agreement that the building or work performed will be sufficient for the particular purpose desired or to accomplish a certain result. Thus, a failure to perform a building contract in a workmanlike manner constitutes a breach of the contract." Id. (citing 13 AM. JUR. 2d Building and Construction Contracts §10 (2000)).
ABANDONMENT = BREACH OF CONTRACT; CONTRACTOR BREACHES BY REFUSING TO PERFORM WORK; OWNER BREACHES BY REFUSING TO PAY:
"The abandonment of a contract gives rise to a cause of action for breach. [] In the instant matter, each party contends that the other abandoned the contract; the Andersons argue that the Jones brothers simply left the job and quit performing their duties under the contract, while the Jones brothers argue that the only reasons they did not complete their contractual duties were that the Andersons abandoned the contract first, by failing to continue to pay draws and purchase building materials and later, by firing them." Id. (citation omitted).
DELEGATION TO INDEPENDENT CONTRACTORS DOES NOT ABSOLVE A CONTRACTOR OF ITS DUTIES TO THE HOMEOWNER:
"[T]he Jones brothers [contend that the subcontractors were independent contractors] and therefore [they] were not ordinarily liable for the negligence of an independent contractor.” ... We find no merit in this argument. The Jones brothers had a contractual duty to construct the house to completion and to perform the construction in a workmanlike manner. Their unilateral delegation of work to third parties did not absolve them of this duty." Id.
NEW HOME CONSTRUCTION WITH SEVER STRUCTURAL DEFECTS IS HELD TO HAVE ZERO VALUE (i.e., $0):
"It is well settled that an owner of property is competent to testify to the value of such property. [] Given the above referenced testimony of the owners and other evidence confirming the house’s structural instability, we believe the trial court’s determination that the house is of zero value is well supported, and we do not find that the evidence preponderates otherwise." Id. (citation omitted).
CONTRACTOR VIOLATED TCPA BY FALSELY REPRESENTING THAT THEY ARE BONDED; IF CONTRACTOR'S BUSINESS CARD SAYS "BONDED" AND CONTRACTOR IS NOT, THEY MUST APPRISE THE OWNER:
"The Jones brothers contend that insufficient evidence was presented to support the trial court’s finding that their violation of the TCPA was willful and knowing. They do not deny that they were not bonded, nor do they deny that they misrepresented to the Andersons that they were bonded and that the Andersons relied upon this misrepresentation. However, the Jones brothers insist that such misrepresentation was unintentional and that the record does not show otherwise. We disagree. First, we note Jerry Jones’s own testimony that prior to their employment by the Andersons, he gave Kimberly Anderson the Jones brothers’ business card, a copy of which is in the record before us. Among other things, this card states that the Jones brothers are “Licensed, Insured, and Bonded.”" Id.
Plaintiff homeowners sued defendant residential building contractors for breach of a home construction contract upon allegations of defective workmanship and abandonment of contract. The trial court entered judgment in favor of plaintiffs and awarded actual damages in an amount based upon the finding that the house was of no value. The trial court also awarded damages under the Tennessee Consumer Protection Act upon a finding that the defendants violated the Act by willfully and knowingly misrepresenting that they were bonded. Upon appeal, we find no error in the judgment of the trial court, and accordingly, the judgment is affirmed in all respects.
Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2008/bowlingc_051608.pdf
IMPLIED WARRANTY TO BUILD NEW HOME IN A WORKMANLIKE MANNER:
"A contract to construct an entire building is essentially a contract for material and labor, and includes an implied warranty protecting the owner from defective construction. Once a builder undertakes a construction contract, the common law imposes upon him or her a duty to perform the work in a workmanlike manner, and there is an implied agreement that the building or work performed will be sufficient for the particular purpose desired or to accomplish a certain result. Thus, a failure to perform a building contract in a workmanlike manner constitutes a breach of the contract." Id. (citing 13 AM. JUR. 2d Building and Construction Contracts §10 (2000)).
ABANDONMENT = BREACH OF CONTRACT; CONTRACTOR BREACHES BY REFUSING TO PERFORM WORK; OWNER BREACHES BY REFUSING TO PAY:
"The abandonment of a contract gives rise to a cause of action for breach. [] In the instant matter, each party contends that the other abandoned the contract; the Andersons argue that the Jones brothers simply left the job and quit performing their duties under the contract, while the Jones brothers argue that the only reasons they did not complete their contractual duties were that the Andersons abandoned the contract first, by failing to continue to pay draws and purchase building materials and later, by firing them." Id. (citation omitted).
DELEGATION TO INDEPENDENT CONTRACTORS DOES NOT ABSOLVE A CONTRACTOR OF ITS DUTIES TO THE HOMEOWNER:
"[T]he Jones brothers [contend that the subcontractors were independent contractors] and therefore [they] were not ordinarily liable for the negligence of an independent contractor.” ... We find no merit in this argument. The Jones brothers had a contractual duty to construct the house to completion and to perform the construction in a workmanlike manner. Their unilateral delegation of work to third parties did not absolve them of this duty." Id.
NEW HOME CONSTRUCTION WITH SEVER STRUCTURAL DEFECTS IS HELD TO HAVE ZERO VALUE (i.e., $0):
"It is well settled that an owner of property is competent to testify to the value of such property. [] Given the above referenced testimony of the owners and other evidence confirming the house’s structural instability, we believe the trial court’s determination that the house is of zero value is well supported, and we do not find that the evidence preponderates otherwise." Id. (citation omitted).
CONTRACTOR VIOLATED TCPA BY FALSELY REPRESENTING THAT THEY ARE BONDED; IF CONTRACTOR'S BUSINESS CARD SAYS "BONDED" AND CONTRACTOR IS NOT, THEY MUST APPRISE THE OWNER:
"The Jones brothers contend that insufficient evidence was presented to support the trial court’s finding that their violation of the TCPA was willful and knowing. They do not deny that they were not bonded, nor do they deny that they misrepresented to the Andersons that they were bonded and that the Andersons relied upon this misrepresentation. However, the Jones brothers insist that such misrepresentation was unintentional and that the record does not show otherwise. We disagree. First, we note Jerry Jones’s own testimony that prior to their employment by the Andersons, he gave Kimberly Anderson the Jones brothers’ business card, a copy of which is in the record before us. Among other things, this card states that the Jones brothers are “Licensed, Insured, and Bonded.”" Id.
May 07, 2008
Res judicata bars challenge to performance bond after judgment on injunctive relief claim; Privity gives right to assert defensive collateral estoppel
TRAVELERS CASUALTY & SURETY COMPANY OF AMERICA as subrogee of SMITH MECHANICAL CONTRACTORS, INC. v. LAWYER'S TITLE INSURANCE CORPORATION, ET AL. (Tenn.Ct.App. May 7, 2008).
Travelers Casualty & Surety Company of America ("Travelers") as subrogee of Smith Mechanical Contractors, Inc. ("Smith Mechanical") sued Lawyer's Title Insurance Company ("Lawyer's Title") and First Tennessee Bank National Association ("the Bank") seeking, among other things, a judgment declaring a mechanic's lien filed by Smith Mechanical to have priority over a deed of trust held by the Bank with regard to real property located in Johnson City, Tennessee. Lawyer's Title and the Bank filed a motion to dismiss or for summary judgment.
After a hearing, the Trial Court entered an order finding and holding, inter alia, that Travelers' complaint was barred under the doctrine of res judicata; that the complaint was barred under the compulsory counterclaim rule; that Travelers never acquired Smith Mechanical's mechanic's lien rights; and, that the Bank had recorded a payment bond ("Performance Bond"), which operated to discharge Smith Mechanical's lien from the real property. Travelers appeals to this Court. We affirm.
Opinion may be found on TBA website:
http://www.tba2.org/tba_files/TCA/2008/travelerscasualty_050708.pdf
"Parties asserting a res judicata defense must demonstrate that (1) a court of competent jurisdiction rendered the prior judgment, (2) the prior judgment was final and on the merits, (3) the same parties or their privies were involved in both proceedings, and (4) both proceedings involved the same cause of action." Id. (citations omitted).
"[O]nce the judgment on the merits became final in the second lawsuit seeking injunctive relief, the doctrine of res judicata through the principle of claim preclusion operates to bar any claims involving the same cause of action which were or could have been brought by Barker Building and Travelers against the Bank in that same action. This includes any claims against the Bank challenging the validity of the Subordination Agreement and Performance Bond." Id.
"Collateral estoppel, an issue preclusion doctrine, ... bars the parties or their privies from relitigating issues that were actually raised and determined in an earlier suit. ... Collateral estoppel may be used by a defendant in the second suit (defensive collateral estoppel), or it may be used by a plaintiff in a second suit (offensive collateral estoppel). In Tennessee the offensive use of collateral estoppel requires that the parties be identical in both actions. Without saying so specifically, however, Tennessee has not required party mutuality in applying defensive collateral estoppel." Id. (citations omitted).
"The issue sought to be precluded in this instance is the issue regarding the validity of the Performance Bond. Lawyer’s Title is in privity with the Bank with regard to this issue. Given this and the fact that the issue sought to be precluded went to final judgment on the merits in [the case] discussed above, Lawyer’s Title can utilize defensive collateral estoppel." Id. (citations omitted).
Travelers Casualty & Surety Company of America ("Travelers") as subrogee of Smith Mechanical Contractors, Inc. ("Smith Mechanical") sued Lawyer's Title Insurance Company ("Lawyer's Title") and First Tennessee Bank National Association ("the Bank") seeking, among other things, a judgment declaring a mechanic's lien filed by Smith Mechanical to have priority over a deed of trust held by the Bank with regard to real property located in Johnson City, Tennessee. Lawyer's Title and the Bank filed a motion to dismiss or for summary judgment.
After a hearing, the Trial Court entered an order finding and holding, inter alia, that Travelers' complaint was barred under the doctrine of res judicata; that the complaint was barred under the compulsory counterclaim rule; that Travelers never acquired Smith Mechanical's mechanic's lien rights; and, that the Bank had recorded a payment bond ("Performance Bond"), which operated to discharge Smith Mechanical's lien from the real property. Travelers appeals to this Court. We affirm.
Opinion may be found on TBA website:
http://www.tba2.org/tba_files/TCA/2008/travelerscasualty_050708.pdf
"Parties asserting a res judicata defense must demonstrate that (1) a court of competent jurisdiction rendered the prior judgment, (2) the prior judgment was final and on the merits, (3) the same parties or their privies were involved in both proceedings, and (4) both proceedings involved the same cause of action." Id. (citations omitted).
"[O]nce the judgment on the merits became final in the second lawsuit seeking injunctive relief, the doctrine of res judicata through the principle of claim preclusion operates to bar any claims involving the same cause of action which were or could have been brought by Barker Building and Travelers against the Bank in that same action. This includes any claims against the Bank challenging the validity of the Subordination Agreement and Performance Bond." Id.
"Collateral estoppel, an issue preclusion doctrine, ... bars the parties or their privies from relitigating issues that were actually raised and determined in an earlier suit. ... Collateral estoppel may be used by a defendant in the second suit (defensive collateral estoppel), or it may be used by a plaintiff in a second suit (offensive collateral estoppel). In Tennessee the offensive use of collateral estoppel requires that the parties be identical in both actions. Without saying so specifically, however, Tennessee has not required party mutuality in applying defensive collateral estoppel." Id. (citations omitted).
"The issue sought to be precluded in this instance is the issue regarding the validity of the Performance Bond. Lawyer’s Title is in privity with the Bank with regard to this issue. Given this and the fact that the issue sought to be precluded went to final judgment on the merits in [the case] discussed above, Lawyer’s Title can utilize defensive collateral estoppel." Id. (citations omitted).
April 30, 2008
Court allows geotechnical engineer to testify about structural issues in a home construction defect case based on "special and practical" knowledge
DONALD W. MCCUTCHEON, ET AL. V. TND ASSOCIATES, L.P., ET AL. (Tenn.Ct.App. April 30, 2008).
A jury awarded the plaintiff homeowners judgment against their residential building contractor for damages sustained by the plaintiffs when the slope upon which their home was constructed failed. The defendant contractor appeals, arguing that the trial court abused its discretion by allowing an expert witness to testify outside his area of expertise and by allowing another witness to testify as an expert when the plaintiff had failed to identify him as a witness before trial. Upon careful review of the record, it is our determination that the trial court did not abuse its discretion in the admission of the testimony of these witnesses. Accordingly, we affirm the judgment of the trial court.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/mccutcheond_043008.pdf
"Mr. Huckaba testified that in his opinion as a professional engineer, the depth of the foundation that he saw was not adequate, based upon his experience and his observation as to the configuration of the lot and the quality of the soil. Thereafter, Mr. Huckaba further testified that he also held opinions set forth in an exhibit designated Geotechnical Expert. ... TND argues that the trial court erred in allowing the admission of the above three statements of opinion because Mr. Huckaba admitted during voir dire that he is not a structural engineer. We disagree." Id.
"a trial court may consider in determining the reliability of an expert’s methodology include: (1) “the expert’s qualifications for testifying on the subject at issue” and (2) “the connection between the expert’s knowledge and the basis for the expert’s opinion.” [] Upon review of the record in this matter, we are compelled to conclude that Mr. Huckaba has both “special as well as practical” knowledge qualifying him to render an expert opinion as to the matters objected to and that the reliability of his methodology is confirmed by his qualifications and by the connection between his knowledge and the basis of his opinion." Id. (citation omitted).
A jury awarded the plaintiff homeowners judgment against their residential building contractor for damages sustained by the plaintiffs when the slope upon which their home was constructed failed. The defendant contractor appeals, arguing that the trial court abused its discretion by allowing an expert witness to testify outside his area of expertise and by allowing another witness to testify as an expert when the plaintiff had failed to identify him as a witness before trial. Upon careful review of the record, it is our determination that the trial court did not abuse its discretion in the admission of the testimony of these witnesses. Accordingly, we affirm the judgment of the trial court.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/mccutcheond_043008.pdf
"Mr. Huckaba testified that in his opinion as a professional engineer, the depth of the foundation that he saw was not adequate, based upon his experience and his observation as to the configuration of the lot and the quality of the soil. Thereafter, Mr. Huckaba further testified that he also held opinions set forth in an exhibit designated Geotechnical Expert. ... TND argues that the trial court erred in allowing the admission of the above three statements of opinion because Mr. Huckaba admitted during voir dire that he is not a structural engineer. We disagree." Id.
"a trial court may consider in determining the reliability of an expert’s methodology include: (1) “the expert’s qualifications for testifying on the subject at issue” and (2) “the connection between the expert’s knowledge and the basis for the expert’s opinion.” [] Upon review of the record in this matter, we are compelled to conclude that Mr. Huckaba has both “special as well as practical” knowledge qualifying him to render an expert opinion as to the matters objected to and that the reliability of his methodology is confirmed by his qualifications and by the connection between his knowledge and the basis of his opinion." Id. (citation omitted).
April 29, 2008
Notification requirement in the Tennessee One-Call statute is strictly construed; Knowledge of excavation may give rise to a duty to warn excavator
ROBERT A. WARD and wife, SALLY WARD, v. CITY OF LEBANON, TENNESSEE; CITY OF LEBANON GAS DEPARTMENT; JAMES N. BUSH CONSTRUCTION, INC.; FOSTER ENGINEERING & ENERGY, INC.; and WATER MANAGEMENT SERVICES, LLC. (Tenn.Ct.App. April 28, 2008).
Plaintiff, while excavating, struck a gas line which resulted in an explosion and fire, seriously injuring plaintiff. Plaintiffs brought this action against several defendants and the case went to trial against the City of Lebanon and Bush Construction Company, Inc. A jury returned a verdict for the plaintiffs and allocated percentages of fault as to both defendants and the plaintiff. The Trial Court entered Judgment in favor of the plaintiffs and defendants appealed. We reverse the Trial Court Judgment and remand for a new trial on the grounds that a part of the charge to the jury was erroneous.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/wardr_042808.pdf
"The Underground Utility Damage Prevention Act (also known as the Tennessee One-Call statute), codified at Tenn. Code Ann. §65-31-101 et seq., states that “no person may excavate in a street, highway, public space, a private easement of an operator or within one hundred feet (100') of the edge of the pavement of a street or highway, or demolish a building, without giving the notice required by §65-31-106 in the manner provided by such section.” Tenn. Code Ann. §65-31-106 states that before beginning any excavation, a person shall serve written or telephonic notice of intent to excavate at least three working days prior to the actual date of excavation, and that if 15 calendar days expire and the excavation is not complete, then the person shall serve an additional notice at least three working days prior to the expiration of time on the fifteenth day. There is no dispute in this case that Ward did not comply with the provisions of the One-Call statute." Id.
"The record shows that all the parties knew that Ward had to return for further excavations and that the gas line had been reconnected. The UUDPA does not indicate that an excavator’s failure to make the notifying call absolves the utility in all circumstances from negligence or from any common law duty to act reasonably to prevent harm. As stated above, a “risk is unreasonable and gives rise to a duty to act with due care if the foreseeable probability and gravity of harm posed by defendant's conduct outweigh the burden upon defendant to engage in alternative conduct that would have prevented the harm.” Id. In this case, the foreseeable probability and gravity of harm to plaintiff posed by defendants’ re-connection of the subject gas line, with the knowledge that plaintiff would be excavating in the area, outweigh the burden upon defendant to warn plaintiff that the gas line had been re-connected." Id.
Plaintiff, while excavating, struck a gas line which resulted in an explosion and fire, seriously injuring plaintiff. Plaintiffs brought this action against several defendants and the case went to trial against the City of Lebanon and Bush Construction Company, Inc. A jury returned a verdict for the plaintiffs and allocated percentages of fault as to both defendants and the plaintiff. The Trial Court entered Judgment in favor of the plaintiffs and defendants appealed. We reverse the Trial Court Judgment and remand for a new trial on the grounds that a part of the charge to the jury was erroneous.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/wardr_042808.pdf
"The Underground Utility Damage Prevention Act (also known as the Tennessee One-Call statute), codified at Tenn. Code Ann. §65-31-101 et seq., states that “no person may excavate in a street, highway, public space, a private easement of an operator or within one hundred feet (100') of the edge of the pavement of a street or highway, or demolish a building, without giving the notice required by §65-31-106 in the manner provided by such section.” Tenn. Code Ann. §65-31-106 states that before beginning any excavation, a person shall serve written or telephonic notice of intent to excavate at least three working days prior to the actual date of excavation, and that if 15 calendar days expire and the excavation is not complete, then the person shall serve an additional notice at least three working days prior to the expiration of time on the fifteenth day. There is no dispute in this case that Ward did not comply with the provisions of the One-Call statute." Id.
"The record shows that all the parties knew that Ward had to return for further excavations and that the gas line had been reconnected. The UUDPA does not indicate that an excavator’s failure to make the notifying call absolves the utility in all circumstances from negligence or from any common law duty to act reasonably to prevent harm. As stated above, a “risk is unreasonable and gives rise to a duty to act with due care if the foreseeable probability and gravity of harm posed by defendant's conduct outweigh the burden upon defendant to engage in alternative conduct that would have prevented the harm.” Id. In this case, the foreseeable probability and gravity of harm to plaintiff posed by defendants’ re-connection of the subject gas line, with the knowledge that plaintiff would be excavating in the area, outweigh the burden upon defendant to warn plaintiff that the gas line had been re-connected." Id.
April 22, 2008
Party improving adjacent land without an express contract is awarded quantum meruit for value of materials and labor
SAMUEL DEAN WILLIAMS v. RUSSELL W. COFFEY (Tenn.Ct.App. April 21, 2008).
This case involves a dispute over the improvements made to defendant's land by plaintiff, which alleged that defendant had agreed to sell the land on which the improvements were made. The Trial Court found an implied contract between the parties and awarded plaintiff damages. On appeal, we hold that the Trial Court employed the wrong measure of damages, vacate the damage award and remand for determination of damages under quantum meruit.
Opinions may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/williamss_042108.pdf
"Under Tennessee law there are two distinct types of implied contracts: contracts implied in fact and contracts implied in law, which are often referred to as quasi contracts. A contract implied in fact arises under circumstances which show mutual intent of assent to contract, consideration and lawful purpose. Mutual assent may be shown by the conduct of the parties and the surrounding circumstances. [] In contrast to a contract implied in fact, “contracts implied in law are created by law without the assent of the party bound, on the basis that they are dictated by reason and justice.” [] The Supreme Court has established that a party seeking to recover on an implied contract in law or quasi contract theory must prove the following elements: (1) there is no existing, enforceable contract between the parties covering the same subject matter; (2) the party seeking recovery proves that it provided valuable goods or services; (3) the party to be charged received the goods or services; (4) the circumstances indicate that the parties to the transaction should have reasonably understood that the person providing the goods or services expected to be compensated and; (5) the circumstances demonstrate that it would be unjust for a party to retain the goods or services without payment. []" Id. (citations omitted).
"The most cogent factor for consideration regarding recovery under a quasi contract is unjust enrichment of the parties. [] A quantum meruit recovery is limited to the actual value of the goods and services received by the defendant. [] The reasonable value of services should be based on the customs and practices prevailing in the same sort of business in which the services would normally be provided. [] To prove the reasonable value of the goods and services, the party seeking to recover in quantum meruit can explain the method used to arrive at the fee or offer proof from other professionals in the same business or trade." Id. (citations omitted).
"On this theory, the case law is clear that a quantum meruit recovery must be the reasonable value of the material and labor furnished. [] The Trial Court erred in basing the plaintiff’s recovery on the increased value of defendant’s property. The Court reasoned “Damages to real estate are generally measured by the fair market value of the land immediately prior to the loss, less the fair market value immediately after the loss”. With due deference to the Trial Court, this reasoning is flawed as the property at issue was not damaged, but rather it was possibly improved by plaintiff’s services." Id. (citations omitted).
This case involves a dispute over the improvements made to defendant's land by plaintiff, which alleged that defendant had agreed to sell the land on which the improvements were made. The Trial Court found an implied contract between the parties and awarded plaintiff damages. On appeal, we hold that the Trial Court employed the wrong measure of damages, vacate the damage award and remand for determination of damages under quantum meruit.
Opinions may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/williamss_042108.pdf
"Under Tennessee law there are two distinct types of implied contracts: contracts implied in fact and contracts implied in law, which are often referred to as quasi contracts. A contract implied in fact arises under circumstances which show mutual intent of assent to contract, consideration and lawful purpose. Mutual assent may be shown by the conduct of the parties and the surrounding circumstances. [] In contrast to a contract implied in fact, “contracts implied in law are created by law without the assent of the party bound, on the basis that they are dictated by reason and justice.” [] The Supreme Court has established that a party seeking to recover on an implied contract in law or quasi contract theory must prove the following elements: (1) there is no existing, enforceable contract between the parties covering the same subject matter; (2) the party seeking recovery proves that it provided valuable goods or services; (3) the party to be charged received the goods or services; (4) the circumstances indicate that the parties to the transaction should have reasonably understood that the person providing the goods or services expected to be compensated and; (5) the circumstances demonstrate that it would be unjust for a party to retain the goods or services without payment. []" Id. (citations omitted).
"The most cogent factor for consideration regarding recovery under a quasi contract is unjust enrichment of the parties. [] A quantum meruit recovery is limited to the actual value of the goods and services received by the defendant. [] The reasonable value of services should be based on the customs and practices prevailing in the same sort of business in which the services would normally be provided. [] To prove the reasonable value of the goods and services, the party seeking to recover in quantum meruit can explain the method used to arrive at the fee or offer proof from other professionals in the same business or trade." Id. (citations omitted).
"On this theory, the case law is clear that a quantum meruit recovery must be the reasonable value of the material and labor furnished. [] The Trial Court erred in basing the plaintiff’s recovery on the increased value of defendant’s property. The Court reasoned “Damages to real estate are generally measured by the fair market value of the land immediately prior to the loss, less the fair market value immediately after the loss”. With due deference to the Trial Court, this reasoning is flawed as the property at issue was not damaged, but rather it was possibly improved by plaintiff’s services." Id. (citations omitted).
March 31, 2008
This opinion discusses several of the ways that courts use to decide which survey is correct
CONNIE R. (DAVIS) PHILLIPS, ET AL., V. LAWRENCE WOODS, ET AL. (Tenn.Ct.App. March 31, 2008).
This appeal involves a dispute over a boundary line and the ownership of a driveway. The plaintiffs, Connie R. (Davis) Phillips and Carol J. (Davis) Miller ("the plaintiffs" or "the Davis heirs"), and the defendants, Lawrence Woods and Charlotte Woods ("the defendants" or "the Woods"), own adjacent tracts of real property in Morgan County. When the initial complaint was filed, the northern tract of property was owned by the plaintiffs' mother, Stella Davis ("Mrs. Davis"), who had filed suit against the Woods, the owners of the southern tract, to quiet title, to establish the common boundary line, and for libel of title. After Mrs. Davis' death prior to trial, her daughters were substituted as plaintiffs.
Upon the conclusion of a bench trial, the trial court found, inter alia, that the Davis heirs owned the property over which the driveway ran, but that the defendants retained an easement by necessity in the roadway, and that the Woods had committed libel of title. While the trial court agreed with the common boundary line described by the surveyor for the Davis heirs, the court reformed the boundary between the parties upon finding that the defendants were entitled to a portion of the Davis property as a result of adversely possessing it for over 30 years. The Woods appeal. We affirm. Case remanded for further proceedings.
Opinion found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/phillipsc_033108.pdf
"In determining disputed boundaries, resort is to be had first to natural objects or landmarks, because of their very permanent character; next, to artificial monuments or marks, then to the boundary lines of adjacent landowners, and then to courses and distances. [] This rule of construction is to aid in determining the intention of the parties to a deed which is to be determined, if possible, from the instrument in connection with the surrounding circumstances." Id.(citations omitted; quoting Thornburg v. Chase, 606 S.W.2d 672, 675 (Tenn.Ct.App. 1980)).
"The legal description for Tract 1 of the Davis property also calls for the property described to contain about half an acre. ... The dimensions of Tract 1 as depicted on the Nance survey are much closer to the quantity of land called for by the deed than the dimensions of Tract 1 as depicted on the Steelman survey. The call for the quantity of land in a deed may be resorted to for the purpose of locating and identifying the land in certain circumstances. [] “The boundaries of a tract of land are not usually delineated by the quantity or acreage,” but “where boundaries are in doubt, the quantity may become an important factor.” [] Thus, the fact that the Nance survey more closely produces the quantity of land called for in the deed supports the conclusion that it correctly located Tract 1." Id.(citations omitted).
This appeal involves a dispute over a boundary line and the ownership of a driveway. The plaintiffs, Connie R. (Davis) Phillips and Carol J. (Davis) Miller ("the plaintiffs" or "the Davis heirs"), and the defendants, Lawrence Woods and Charlotte Woods ("the defendants" or "the Woods"), own adjacent tracts of real property in Morgan County. When the initial complaint was filed, the northern tract of property was owned by the plaintiffs' mother, Stella Davis ("Mrs. Davis"), who had filed suit against the Woods, the owners of the southern tract, to quiet title, to establish the common boundary line, and for libel of title. After Mrs. Davis' death prior to trial, her daughters were substituted as plaintiffs.
Upon the conclusion of a bench trial, the trial court found, inter alia, that the Davis heirs owned the property over which the driveway ran, but that the defendants retained an easement by necessity in the roadway, and that the Woods had committed libel of title. While the trial court agreed with the common boundary line described by the surveyor for the Davis heirs, the court reformed the boundary between the parties upon finding that the defendants were entitled to a portion of the Davis property as a result of adversely possessing it for over 30 years. The Woods appeal. We affirm. Case remanded for further proceedings.
Opinion found at TBA website:
http://www.tba2.org/tba_files/TCA/2008/phillipsc_033108.pdf
"In determining disputed boundaries, resort is to be had first to natural objects or landmarks, because of their very permanent character; next, to artificial monuments or marks, then to the boundary lines of adjacent landowners, and then to courses and distances. [] This rule of construction is to aid in determining the intention of the parties to a deed which is to be determined, if possible, from the instrument in connection with the surrounding circumstances." Id.(citations omitted; quoting Thornburg v. Chase, 606 S.W.2d 672, 675 (Tenn.Ct.App. 1980)).
"The legal description for Tract 1 of the Davis property also calls for the property described to contain about half an acre. ... The dimensions of Tract 1 as depicted on the Nance survey are much closer to the quantity of land called for by the deed than the dimensions of Tract 1 as depicted on the Steelman survey. The call for the quantity of land in a deed may be resorted to for the purpose of locating and identifying the land in certain circumstances. [] “The boundaries of a tract of land are not usually delineated by the quantity or acreage,” but “where boundaries are in doubt, the quantity may become an important factor.” [] Thus, the fact that the Nance survey more closely produces the quantity of land called for in the deed supports the conclusion that it correctly located Tract 1." Id.(citations omitted).
March 28, 2008
Evidence of "significant and pervasive" problems in an newly constructed home starts the statute of limitations period in claims against homebuilders
WILLIAM H. LIGGETT, JR. ET AL. v. BRENTWOOD BUILDERS, LLC (Tenn.Ct.App. March 28, 2008).
Home buyers brought suit against home builder alleging fraud, breach of contract, consumer protection violations, negligent misrepresentation, and negligence. The trial court granted the builder's motion for summary judgment based upon the statute of limitations and statute of repose. We affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/liggettw_032808.pdf.
"It is well-settled law in this state that 'the gravamen of an action, rather than its designation as an action for tort or contract, determines the applicable statute of limitations.' ... Pursuant to these authorities, we must conclude that, with respect to all but the consumer protection claims, the Liggetts’ claims are governed by the three-year statute of limitations set forth at Tenn. Code Ann. § 28-3-105. The claim for violations of the Consumer Protection Act is governed by the special one-year statute of limitations set forth at Tenn. Code Ann. § 47-18-110." Id.
"In interpreting the provisions of Tenn. Code Ann. § 28-3-105, the courts have held that, in a suit for property damages, 'the cause of action accrues at the time the injury occurs, or when it is discovered, or when in the exercise of reasonable care and diligence the injury should have been discovered.' ... The Liggetts filed their complaint on March 2, 2004. Under the statute of limitations of Tenn. Code Ann. 28-3--05, any cause of action that accrued prior to March 2, 2001 would be barred because the complaint would not be filed within three years of the accrual of the cause of action. ... In light of the overall picture of the information known to the Liggetts prior to March 2001, however, this Court has reached the conclusion that they were on notice that there were significant and pervasive problems with the construction of their home. ... Viewing the evidence in the light most favorable to the Liggetts, we must conclude that they knew of significant defects prior to March 2001 and either knew or should have known that they had a cause of action against Brentwood Builders for fraud and/or negligent misrepresentation." Id.
Home buyers brought suit against home builder alleging fraud, breach of contract, consumer protection violations, negligent misrepresentation, and negligence. The trial court granted the builder's motion for summary judgment based upon the statute of limitations and statute of repose. We affirm.
Opinion may be found at the TBA website:
http://www.tba2.org/tba_files/TCA/2008/liggettw_032808.pdf.
"It is well-settled law in this state that 'the gravamen of an action, rather than its designation as an action for tort or contract, determines the applicable statute of limitations.' ... Pursuant to these authorities, we must conclude that, with respect to all but the consumer protection claims, the Liggetts’ claims are governed by the three-year statute of limitations set forth at Tenn. Code Ann. § 28-3-105. The claim for violations of the Consumer Protection Act is governed by the special one-year statute of limitations set forth at Tenn. Code Ann. § 47-18-110." Id.
"In interpreting the provisions of Tenn. Code Ann. § 28-3-105, the courts have held that, in a suit for property damages, 'the cause of action accrues at the time the injury occurs, or when it is discovered, or when in the exercise of reasonable care and diligence the injury should have been discovered.' ... The Liggetts filed their complaint on March 2, 2004. Under the statute of limitations of Tenn. Code Ann. 28-3--05, any cause of action that accrued prior to March 2, 2001 would be barred because the complaint would not be filed within three years of the accrual of the cause of action. ... In light of the overall picture of the information known to the Liggetts prior to March 2001, however, this Court has reached the conclusion that they were on notice that there were significant and pervasive problems with the construction of their home. ... Viewing the evidence in the light most favorable to the Liggetts, we must conclude that they knew of significant defects prior to March 2001 and either knew or should have known that they had a cause of action against Brentwood Builders for fraud and/or negligent misrepresentation." Id.
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