Justia Tennessee Supreme Court Opinion Summaries

The Supreme Court held that the economic loss doctrine applies when a fraud claim seeks recovery of only economic losses and is premised solely on nondisclosures or misrepresentations about the quality of goods that are the subject of a contract between sophisticated commercial parties.Plaintiff sued Defendants alleging breach of express and implied warranties, breach of contract, negligent misrepresentation, fraud, and a Tennessee Consumer Protection Act (TCPA) claim. The trial court granted Defendants summary judgment on the breach of contract, breach of warranty, and negligent misrepresentation claims. After a trial, the jury returned a verdict for Plaintiff on the fraud and TCPA claims and awarded compensatory and punitive damages. The trial court entered judgment on the jury's verdicts and awarded Plaintiff attorney's fees. On appeal, the court of appeals ruled in favor of Defendants and against Plaintiff, concluding that the economic loss doctrine barred the fraud claim and that the claim under the TCPA was barred as a matter of law. The Supreme Court set aside Plaintiff's award of attorney's fees and costs based on the TCPA and otherwise affirmed, holding that because Plaintiff's TCPA claim failed as a matter of law, the award of attorney's fees and costs under the TCPA could not stand. View "Milan Supply Chain Solutions, Inc. v. Navistar, Inc." on Justia Law

The Supreme Court reversed the decision of the court of appeals affirming the decision of the trial court enjoining Defendant's proposal to build a structure for the operation of a retail business, holding that restrictive covenants executed and recorded by the developers of a subdivision after they had sold the parties' lots did not apply to Defendant's property.The developers in this case platted a subdivision and sold the majority of lots with time-limited restrictions against non-residential use stated in the deeds that conveyed the lots. The developers then recorded a declaration of non-time-limited restrictive covenants, including a restriction against non-residential use, purporting to apply to all lots in the subdivision. Years later, Defendant purchased lots and proposed a commercial use of the property. Plaintiffs brought a declaratory judgment action seeking to enforce the restriction against non-residential use. The trial court enjoined Defendant from constructing any retail business or commercial enterprise on his property. The Supreme Court reversed, holding (1) the developers lacked the authority to impose the declaration's restrictions as a servitude upon Defendant's property because they did not own the property when they executed and recorded those restrictive covenants; and (2) the developers' re-acquisition and re-sale of some of Defendant's lots after the recording of the declaration did not retroactively restrict Defendant's property through the declaration. View "Phillips v. Hatfield" on Justia Law

The Supreme Court reversed the decision of the court of appeals affirming the trial court's judgment dismissing Plaintiff's second lawsuit, holding that the doctrine of res judicata did not bar the lawsuit.Plaintiff originally filed suit against Defendant in the Circuit Court for Shelby County, but, unbeknownst to the parties, the trial court sua sponte dismissed the lawsuit for failure to prosecute. Ten months later, Plaintiff learned of the dismissal and filed a motion to set aside the dismissal. The trial court denied the motion but entered an order stating that the dismissal did not bar Plaintiff from refiling its lawsuit. When Plaintiff subsequently refiled its lawsuit, the trial court granted Defendant's motion to dismiss based on the doctrine of res judicata. The court of appeals affirmed. The Supreme Court reversed the decision of the court of appeals and vacated the judgment of the trial court, holding that the involuntary dismissal of the first suit for failure to prosecute did not operate as an adjudication on the merits, and therefore, the present lawsuit was not barred by the doctrine of res judicata. View "Regions Bank v. Prager" on Justia Law

In this case involving the correct interpretation of provisions in the Prompt Pay Act, Tenn. Code Ann. 66-34-101 to -704, relating to retainage withheld on construction projects, the Supreme Court held that the $300 per day penalty is assessed each day retaining is not deposited in a statutorily-compliant escrow account.The Act requires the party withholding retain age to deposit the funds into a separate, interest-bearing escrow account, and failure to do so results in a $300 per day penalty. Here, Subcontractor's retainage was not placed into an interest-bearing escrow account, and the retainage was not timely remitted to Contractor. Three years after completing its contractual duties, Subcontractor sued Contractor for unpaid retainage plus amounts due under the Act. Thereafter, Contractor tendered the retainage. At issue was the statutory penalty. The trial court concluded that Subcontractor's claim under the Act was barred by Tenn. Code Ann.'s one-year statute of limitations. The court of appeals affirmed. The Supreme Court reversed, holding that while Subcontractor's claim for the statutory penalty was subject to the one-year statute of limitations, if Subcontractor can establish that Contractor was required to deposit the retainage into an escrow account, Subcontractor was not precluded from recovering the penalty assessed each day during the period commencing one year before the complaint was filed. View "Snake Steel, Inc. v. Holladay Construction Group, LLC" on Justia Law

In this healthcare liability action filed by a surgery patient and her husband, the Supreme Court reversed the holding of the court of appeals affirming the judgment of the trial court applying the statutory cap to Plaintiffs separately, holding that the language to Tenn. Code Ann. 29-39-102 allowed both plaintiffs to recover only $750,000 in the aggregate for noneconomic damages.The patient brought this negligence action against defendant physicians for noneconomic damages, arguing that a portion of a Gelport device was unintentionally left in her body after surgery. The patient's husband claimed damages for loss of consortium in the same action. The jury awarded the patient $4 million in damages and awarded her spouse $500,000 in damages for loss of consortium. The trial court initially entered a judgment of $750,000 in the aggregate in favor of both Plaintiffs but subsequently granted Plaintiffs' motion to alter or amend. The court then applied the statutory cap to each plaintiff separately, awarding the patient $750,000 and her husband $500,000. The court of appeals affirmed. The Supreme Court reversed, holding that section 29-389-102 creates a single cap on noneconomic damages that includes those awarded to the injured spouse, as well as those damages award to the other spouse for a derivative loss of consortium claim. View "Yebuah v. Center For Urological Treatment, PLC" on Justia Law

The Supreme Court answered a question of law certified by the United States District Court for the Western District of Tennessee by holding that Tenn. Code Ann. 56-7-111 does not provide for a private right of action.Section 56-7-111 states that when an insured property owner's home or other structure sustains more than $1,000 in damages, the casualty or property insurance company shall name the general contractor of an uncompleted construction contract as a payee when issuing payment to the property owner. In the instant case, the insurance company issued a check to the owner but did not name the general contractor as a payee. The general contractor brought this suit alleging that the insurance company did not comply with section 56-7-111. The federal court certified to the Supreme Court the question of whether a general contractor has a private right of action against an insurance company for violating section 56-7-111. The Supreme Court held that the statute does not expressly grant such a private right of action and that the legislature did not intend to imply a private right of action. View "Affordable Construction Services, Inc. v. Auto-Owners Insurance Co." on Justia Law

In this appeal in a capital case, the Supreme Court affirmed the decision of the court of criminal appeals affirming Defendant's convictions and sentence, holding that Defendant was not entitled to relief on his claims of error.After a second trial, a jury found Defendant guilty of first-degree premeditated murder, murder in the perpetration of robbery, and aggravated robbery. Defendant was sentenced to death. The court of criminal appeals affirmed. The Supreme Court affirmed, holding (1) double jeopardy principles did not bar retrial on the felony murder count; (2) alleged prosecutorial misconduct in the first trial did not bar Defendant's retrial; (3) the trial court did not err in denying Defendant's motion to suppress, in admitting evidence of Defendant's prior convictions for rape and assault of the victim and in admitting evidence of Defendant's escape attempts; (4) imposition of the death penalty was not arbitrary; and (5) the sentence of death was neither excessive nor disproportionate. View "State v. Rimmer" on Justia Law

The Supreme Court reversed the decision of the court of criminal appeals reversing the trial court's order denying Petitioner's motion to correct an illegal sentence under Tenn. R. Crim. P. 36.1, holding that Petitioner's sentence was voidable, not void and illegal.Petitioner pled guilty to possession of cocaine with intent to sell and possession of a firearm by a convicted felon. The firearm sentence was enhanced pursuant to the criminal gang enhancement statute. Thereafter, in State v. Bonds, 502 S.W.3d 118 (Tenn. Crim. App. 2016), the court of criminal appeals declared the criminal gang enhancement statute unconstitutional. Instead of filing a postconviction petition challenging his guilty plea Petitioner filed a motion to correct an illegal sentence. The trial court denied the motion. The court of appeals reversed, holding that Petitioner's sentence was rendered void and thus illegal under Bonds. The Supreme Court reversed, holding (1) under Taylor v. State, 995 S.W.2d 78 (Tenn. 1999), Petitioner's sentence was voidable, not void and illegal; and (2) therefore, Petitioner was not entitled to relief under Rule 36.1. View "State v. Reid" on Justia Law

The Supreme Court reversed the judgment of the court of criminal appeals and vacated the decision of the trial court to grant Defendant's motion for judgment of acquittal as to an aggravated child neglect charge, holding that a reasonable jury could have found the necessary elements of the crime of aggravated child neglect.Following the death of her infant child, Defendant was convicted of reckless homicide and aggravated child neglect. The trial court granted Defendant's motion for judgment of acquittal as to the aggravated child neglect charge. The court of criminal appeals affirmed, concluding that the evidence was insufficient to prove that Defendant knowingly neglected her child. The Supreme Court reversed, holding that a reasonable jury could have concluded that Defendant knowingly neglected her child by not feeding her and her child died as a result. View "State v. Weems" on Justia Law

The Supreme Court reversed the judgment of the court of appeals affirming the trial court's dismissal of Plaintiffs' action seeking a declaratory judgment concerning the rights and obligations of the parties under a 2001 contract, holding that the court of appeals erred in concluding that dismissal was appropriate on the grounds that the complaint was barred by the doctrine of res judicata.In a previously filed action, Plaintiffs sought similar relief, but the case was dismissed for failure to exhaust administrative remedies. In the instant case, the trial court granted Defendants' motions to dismiss, finding that Plaintiffs lacked standing. The court of appeals affirmed on other grounds, concluding that res judicata barred the complaint and, as such, declined to address the standing issue. The Supreme Court reversed, holding that dismissal of the previous case did not constitute an adjudication on the merits for purposes of res judicata. The Court then remanded the case to the court of appeals for consideration of the standing issue. View "Elvis Presley Enterprises, Inc. v. City of Memphis" on Justia Law