Ferguson v. Nationwide Property & Cas.

Decision Date15 December 2006
Docket NumberNo. M2005-02602-COA-R3-CV.,M2005-02602-COA-R3-CV.
Citation218 S.W.3d 42
CourtTennessee Court of Appeals
PartiesKaren E. FERGUSON v. NATIONWIDE PROPERTY & CASUALTY INSURANCE COMPANY, et al.

David L Cooper, Nashville, Tennessee, for the appellant, Karen E. Ferguson.

Parks T. Chastain, David M. Hannah, Nashville, Tennessee, for the appellee, Nationwide Property & Casualty Insurance Company.

M. Bradley Gilmore, Frank M. Gallina, Nashville, Tennessee, for the appellee, Edwin B. Raskin Company.

OPINION

WILLIAM B. CAIN, J., delivered the opinion of the court, in which PATRICIA J. COTTRELL and FRANK G. CLEMENT, JR., JJ., joined.

Apartment manager filed an action against employer and employer's insurance carrier after they refused to reimburse her for the losses she incurred as a result of a fire that began in the apartment's main office which was connected to her personal apartment. We affirm the judgment of the trial court granting summary judgment to the defendants.

Ms. Karen E. Ferguson was employed by Edwin B. Raskin Company ("Raskin") as the on-site property manager of the Royal Oaks Apartments ("Royal Oaks") in Ashland City, Tennessee. As a condition of employment, Ms. Ferguson resided at Royal Oaks and a portion of her apartment was used as Royal Oaks' main office. In addition to monetary compensation, Raskin paid Ms. Ferguson's rental expenses including rent, electricity, water, sewer, and phone service.

On January 19, 2005, a fire broke out in Ms. Ferguson's apartment, destroying all of her personal property. The fire marshal determined that the fire was caused by a halogen floor lamp located within the main office portion of Ms. Ferguson's apartment. Evidently, Ms. Ferguson left the lamp on for extended periods of time for safety purposes. On the date at issue, the lamp which could reach 850 degrees Fahrenheit caused papers pinned to a nearby wall to ignite. Although Ms. Ferguson believed that Raskin owned the lamp since it was present when she moved into the apartment, Raskin claimed that the lamp was in fact owned by Royal Oaks.

On January 30, 2005, Ms. Ferguson notified Raskin by letter that her personal property loss as a result of the fire totaled $75,586.12 and that the loss needed to be paid immediately. Ms. Ferguson also submitted a claim for the loss to Nationwide Property & Casualty Insurance Company ("Nationwide") under the policy issued to Royal Oaks. By letter dated February 3, 2005, Nationwide denied Ms. Ferguson's claim.

As a result, Ms. Ferguson filed a complaint against Nationwide and Raskin on April 14, 2005. She alleged that Nationwide and Raskin wrongfully and willfully denied her claim, which constituted a breach of contract, a breach of implied good faith and fair dealing, and a showing of bad faith. Ms. Ferguson further alleged damages against Nationwide under Tennessee Code Annotated section 56-7-105 and the Tennessee Consumer Protection Act.

On July 20, 2005, Raskin filed a motion for judgment on the pleadings for failure to state a claim upon which relief could be granted, claiming that Ms. Ferguson's claims against it should be dismissed as a matter of law. On August 11, 2005, Nationwide filed a motion for summary judgment, asserting that Ms. Ferguson was not a covered insured under the policy, that there was no bad faith under Tennessee Code Annotated section 56-7-105 or a violation of the Tennessee Consumer Protection Act, and that Ms. Ferguson could not maintain a direct action against it.

On September 23, 2005, Ms. Ferguson sought to amend her complaint to allege that Raskin was negligent in placing an unreasonably dangerous and/or defective lamp in her apartment. The motions were heard before the trial court on October 3, 2005. An order was entered by the court on October 21, 2005, granting Defendants Nationwide and Raskin's motions, denying Ms. Ferguson's motion to amend, and dismissing Ms. Ferguson's cause of action with prejudice. Ms. Ferguson appeals claiming that the trial court erred in (1) granting Raskin's motion for summary judgment; (2) granting Nationwide's motion for summary judgment; and (3) denying her motion to amend her complaint to assert a cause of action against Raskin for negligence.

I.

As the trial court noted in its October 21, 2005, order granting Defendants' motion for summary judgment, the original motion filed by Raskin was one for a judgment on the pleadings while Nationwide's motion was one for summary judgment. As this Court duly noted in Pendleton v. Mills, 73 S.W.3d 115, 120 (Tenn.Ct.App.2001), "[t]he difference between a motion to dismiss and a motion for summary judgment is more than academic when it comes to standard of review." However, it is well settled that "a Tenn. R. Civ. P. 12.02(6) motion must be converted to a summary judgment motion if `matters outside the pleadings are presented to and not excluded by the court.'" Pendleton, 73 S.W.3d at 120 (quoting Pacific Eastern Corp. v. Gulf Life Holding Co., 902 S.W.2d 946, 952 (Tenn.Ct.App. 1995)). In this case, Raskin filed the affidavit of Bill Simons, regional manager of Raskin, as well as a copy of Raskin's standard lease agreement in support of its motion. The affidavit and the lease agreement were considered by the trial court in making its determination, therefore we find that Raskin's motion to dismiss was properly converted to a motion for summary judgment.

The standards for reviewing summary judgments on appeal are well-settled. Summary judgments are proper in virtually any civil case that can be resolved on the basis of legal issues alone. Fruge v. Doe, 952 S.W.2d 408, 410 (Tenn.1997); Byrd v. Hall, 847 S.W.2d 208, 210 (Tenn. 1993); Church v. Perales, 39 S.W.3d 149, 156 (Tenn.Ct.App.2000). They are not, however, appropriate when genuine disputes regarding material facts exist. Tenn. R. Civ. P. 56.04. Thus, a summary judgment should be granted only when the undisputed facts, and the inferences reasonably drawn from the undisputed facts, support one conclusion-that the party seeking the summary judgment is entitled to a judgment as a matter of law. Webber v. State Farm Mut. Auto. Ins. Co., 49 S.W.3d 265, 269 (Tenn.2001); Brown v. Birman Managed Care, Inc., 42 S.W.3d 62, 66 (Tenn. 2001); Goodloe v. State, 36 S.W.3d 62, 65 (Tenn.2001).

The party seeking a summary judgment bears the burden of demonstrating that no genuine dispute of material fact exists and that it is entitled to a judgment as a matter of law. Shadrick v. Coker, 963 S.W.2d 726, 731 (Tenn.1998); Belk v. Obion County, 7 S.W.3d 34, 36 (Tenn.Ct.App.1999). In order to be entitled to a judgment as a matter of law, the moving party must either affirmatively negate an essential element of the non-moving party's claim or establish an affirmative defense that conclusively defeats the non-moving party's claim. Byrd v. Hall, 847 S.W.2d at 215 n. 5; Cherry v. Williams, 36 S.W.3d 78, 82-83 (Tenn.Ct.App.2000).

Once the moving party demonstrates that it has satisfied Tenn. R. Civ. P. 56's requirements, the non-moving party must demonstrate how these requirements have not been satisfied. Nelson v. Martin, 958 S.W.2d 643, 647 (Tenn. 1997). Mere conclusory generalizations will not suffice. Cawood v. Davis, 680 S.W.2d 795, 796-97 (Tenn.Ct.App.1984). The non-moving party must convince the trial court that there are sufficient factual disputes to warrant a trial (1) by pointing to evidence either overlooked or ignored by the moving party that creates a factual dispute, (2) by rehabilitating evidence challenged by the moving party, (3) by producing additional evidence that creates a material factual dispute, or (4) by submitting an affidavit in accordance with Tenn. R. Civ. P. 56.07 requesting additional time for discovery. McCarley v. West Quality Food Serv., 960 S.W.2d 585, 588 (Tenn.1998); Byrd v. Hall, 847 S.W.2d at 215 n. 6. A nonmoving party who fails to carry its burden faces summary dismissal of the challenged claim because, as our courts have repeatedly observed, the "failure of proof concerning an essential element of a cause of action necessarily renders all other facts immaterial." Alexander v. Memphis Individual Practice Ass'n, 870 S.W.2d 278, 280 (Tenn.1993); Strauss v. Wyatt, Tarrant, Combs, Gilbert & Milom, 911 S.W.2d 727, 729 (Tenn.Ct.App. 1995).

Summary judgments enjoy no presumption of correctness on appeal. Scott v. Ashland Healthcare Ctr., Inc., 49 S.W.3d 281, 285 (Tenn.2001); Penley v. Honda Motor Co., 31 S.W.3d 181, 183 (Tenn.2000). Accordingly, appellate courts must make a fresh determination that the requirements of Tenn. R. Civ. P. 56 have been satisfied. Hunter v. Brown, 955 S.W.2d 49, 50-51 (Tenn. 1997); Mason v. Seaton, 942 S.W.2d 470, 472 (Tenn.1997). We must consider the evidence in the light most favorable to the non-moving party, and we must resolve all inferences in the non-moving party's favor. Doe v. HCA Health Servs., Inc., 46 S.W.3d 191, 196 (Tenn. 2001); Memphis Hous. Auth. v. Thompson, 38 S.W.3d 504, 507 (Tenn.2001). When reviewing the evidence, we must determine first whether factual disputes exist. If a factual dispute exists, we must then determine whether the fact is material to the claim or defense upon which the summary judgment is predicated and whether the disputed fact creates a genuine issue for trial. Byrd v. Hall, 847 S.W.2d at 214; Rutherford v. Polar Tank Trailer, Inc., 978 S.W.2d 102, 104 (Tenn.Ct.App.1998).

Pendleton, 73 S.W.3d at 121-22.

II.

Ms. Ferguson first contends that the trial court improperly granted Raskin's motion for summary judgment because there was a genuine issue of material fact as to whether the parties entered into an implied contract in which Raskin was bound to insure or indemnify Ms. Ferguson from personal property loss. According to Ms. Ferguson, Raskin's requirement that she live on the premises although she was unable to obtain renter's insurance as...

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