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Posted on May 20 2013 8:10AM by Attorney, Jason A. Lee
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Analysis: The recent Tennessee Court of Appeals
decision of Robert Thomas
Edmunds v. Delta Partners, LLC, No. M2012-00047-COA-R3-CV, 2012 WL 6604580
(Tenn. Ct. App. December 18, 2012) discussed the concept of piercing the
corporate veil under Tennessee law. This
case, in part, dealt with what is required to be established under Tennessee
law in order to pierce the veil of a corporation. In short, the doctrine of piercing the
corporate veil allows, in certain circumstances, individual members or
executives of a corporation (including an LLC - Limited Liability Company) to
be personally responsible for the liabilities of the corporation. This cased involved a dispute between an
employer and a former employee over back pay (see detailed prior
post on this same case on what constitutes an employment contract under
Tennessee law).
Edmunds at 1 - 3. The employee was ultimately awarded damages
by the trial court which were affirmed by the Appellate Court for back pay
pursuant to an employment contract. Edmunds at 4 - 5. The plaintiff
tried to hold the owner of the company personally responsible under the
doctrine of “piercing the corporate veil”.
The Tennessee Court of Appeals in this
case discussed that a corporation is presumed to be a distinct legal entity
that is separate from its members, shareholders, officers, as follows:
There is a
presumption that a corporation is a distinct legal entity, wholly separate and
apart from its shareholders, officers, directors, or affiliated corporations.
In an appropriate case and in furtherance of the ends of justice, the separate
identity of a corporation may be discarded and the individual or individuals
owning all its stock and assets will be treated as identical to the
corporation. Discarding the fiction of
the corporate entity, or piercing the corporate veil, is appropriate when the
corporation is liable for a debt but is without funds to pay the debt, and the
lack of funds is due to some misconduct on the part of the officers and
directors.
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Posted on May 6 2013 9:26PM by Attorney, Jason A. Lee
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Analysis: The Tennessee Court of Appeals recently
discussed the important issue of when a document or series of documents should
be considered an “employment contract” under Tennessee law in Robert
Thomas Edmunds v. Delta Partners, LLC, No. M2012-00047-COA-R3-CV, 2012 WL 6604580
(Tenn. Ct. App. December 18, 2012).
In this case the employee received several documents from his employer
about his employment with Delta, the employer.
These documents included both a non-disclosure agreement and a
non-competition agreement, to which the employee agreed to and signed. (Edmunds
at 1). These employment documents (that the employee
and employer executed) included the following language:
In consideration
of the performance of all services required by Delta
[ ], the confidentiality provisions and covenant not-to-compete set forth
herein, the Company [i.e. Delta] agrees to pay
Employee [i.e. Mr. Edmunds] a salary outlined in
the Employee Offer Letter. This initial salary and other benefits provided to
Employee pursuant to the Offer Letter may, from time to time as agreed by
Employee and Company, be modified.
It is of note that both the employer
representative and the employee signed the documents as well as the offer
letter identifying the $65,000.00 starting salary. (Edmunds at 1). A dispute eventually arose about the
compensation the employee was owed after the employer informed the employee in
2006 that the employer could no longer afford to pay the employee. (Edmunds at 1). Despite this representation from the
employer, the employee continued to work for the company "out of personal
loyalty" for over two years despite the fact he was only sporadically paid
by the employer. (Edmunds at 1 - 3). Eventually the employee resigned in the fall
of 2008 and then brought suit against the employ...
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Posted on Apr 29 2013 8:44AM by Attorney, Jason A. Lee
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Brief Summary: The recent Tennessee Court of Appeals decision of Karim Skaan v. Federal Express Corporation, No. 2011-01807-COA-R3-CV, 2012 WL 6212891 (Tenn. Ct. App. December 13, 2012) discussed whether parties can shorten a statute of limitations time period for a retaliatory discharge claim in an employment contract. The pertinent facts for purposes of this post are that Federal Express hired Mr. Skaan in 1999 as an employee and in the employment paperwork Mr. Skaan signed an employment agreement. Skaan at 1, 2. Paragraph 15 of the employment agreement provided as follows:
To the extent the law allows an employee to bring legal action against Federal Express Corporation, I agree to bring that complaint within the time prescribed by law or 6 months from the date of the event forming the basis of my lawsuit, whichever expires first.
Skaan at 2. As a result, the plain language of the employment agreement requires that any legal action against Federal Express Corporation by the employee must be filed within six months of the date of the event forming the basis of the lawsuit (or the time period could be even less than six months if the law provides). Skaan at 2. Mr. Skaan was terminated from his job by Federal Express. He claimed he was terminated due to the filing of a workers compensation claim. Skaan at 2.
Mr. Skaan did not file any claim against Federal Express until eight months after his termination from his employment. Skaan at 2. This case has lots of facts and interesting information pertaining to what evidence was presented on appeal however for our purpose the issue we are discussing in this post simply pertains to whether...
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Posted on Apr 22 2013 7:53AM by Attorney, Jason A. Lee
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Analysis: The recent Tennessee Court of Appeals
decision of Brooke Buttrey v.
Holloway's, Inc., No. M2011-01335-COA-R3-CV, 2012 WL 6451802 (Tenn. Ct. App.
December 12, 2012)
discussed the Tennessee tort of intentional misrepresentation in the context of
a construction defect case. In this case
the trial court found there was ample evidence the home was not constructed in
a workmanlike manner. Buttrey at 5. In fact the defendant did not even appeal
this issue to the Tennessee Court of Appeals.
However, the defendant did appeal the trial court's ruling that the
defendant was responsible for intentional misrepresentation under Tennessee
law.
Under Tennessee law in order to establish
a claim for fraudulent or intentional misrepresentation (these two torts have
identical elements) the plaintiff must prove the following:
1) the defendant
made a representation of an existing or past fact; 2) the representation was
false when made; 3) the representation was in regard to a material fact; 4) the
false representation was made either knowingly or without belief in its truth
or recklessly; 5) the plaintiff reasonably relied on the misrepresented
material fact; and 6) the plaintiff suffered damage as a result of the
misrepresentation.
Buttrey at 5 (citing Walker v. Sunrise
Pontiac – GMC Truck, 249 S.W.3d 301, 311 (Tenn. 2008)). One of the alleged misrepresentations in this
case was testified about by the plaintiff as follows:
Q: When you approached Mr. Holloway
about building this home, did he make any representati...
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Posted on Apr 11 2013 3:04PM by Attorney, Jason A. Lee
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Analysis: The Tennessee Supreme Court recently decided a case pertaining to the liability of an assisted living facility's management company for failing to provide appropriate staff to the facility (Celebration Way facility). Wilson v. Americare Systems, Inc., No. M2011-00240-SC-R11-CV, 2013 WL 658078 (Tenn. 2013). At trial the jury found the management company (Americare Systems, Inc.) of an assisted living facility was negligent, causing the death of a resident, based on the fact it understaffed the facility. Wilson at 1. The resident of the facility, Mable Farrar, died from a perforated colon. The testimony at trial showed that the assisted living facility failed to follow Ms. Farrar’s physician’s order to administer medicine for constipation. Wilson at 1. As a result of this failure to provide the prescribed medicine, Ms. Farrar became significantly constipated and her doctor therefore ordered the assisted living facility to give her three to four enemas a day. Wilson at 1. The assisted living facility only gave Ms. Farrar one enema on the first day after the order, none on the second day and one on the third day. On the third day, after she received the enema, her colon perforated and she died. Wilson at 1, 2. The testimony at trial established she should not have been provided an enema by the facility nurse based on her physical status at that time.
Testimony at trial showed there were only two licensed nurses that worked at this facility. Wilson at 7. One of the nurses testified she was "always on call, twenty-four hours a day". Wilson at 7. The two licensed nurses had to cover a lot of shifts and were not paid overtime compensation because they were salaried employees. Wilson at 7. The nurses that worked at the facility as well as the regional operations director for the assisted living facility management company testified there were staffing problems at the facility. There were numerous complaints from the staff at the facility requesting additional staffing in order to be able to provide adequate care for the residents. Wilson at 6-8. Despite these complaints, no additional staffing was provided to the facility. Wilson at 7, 8
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Posted on Apr 9 2013 11:55PM by Attorney, Jason A. Lee
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Every year the Tennessee Administrative Office
of the Courts publishes the “Annual
Report of the Tennessee Judiciary” to provide information on cases filed
and decided in Tennessee. I previously provided an article showing the percentage of
trials in each Tennessee jurisdiction that resulted in damages (for personal
injury or death cases) for fiscal year 2011-2012. Based on the positive response to that
article, I decided a longer term review was warranted to get more accurate
numbers on how conservative or liberal a particular Tennessee jurisdiction is for
trials involving personal injury cases.
The statistics in the below chart are for a seven year period from July
1, 2005 – June 30, 2012. I will list the
counties in order with the...
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Posted on Apr 3 2013 11:49PM by Attorney, Jason A. Lee
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The
Tennessee legislature is considering many interesting pieces of legislation in
the 2013 legislative session. One bill
that is of great interest to Tennessee attorneys as well as anyone handling Tennessee
personal injury claims is SB 1184/HB 0978. The bill is aptly named the “Phantom Damages
Elimination Act”. This bill would
effectively abolish the collateral source rule in Tennessee.
The
collateral source rule prevents a defendant from introducing evidence that the
injured plaintiff received payments from any other source to try to reduce or mitigate
the damages sustained by the plaintiff.
The Tennessee Court of Appeals in Fye v. Kennedy,
991 S.W. 2d 754, 763 (Tenn. Ct. App. 1998) stated that:
An
injured party's right to recover his or her “reasonable and necessary expenses”
must be viewed in connection with the collateral
source rule: Normally,
of course, in an action for damages in tort, the fact that the plaintiff has
received payments from a collateral
source, other than the
defendant, is not admissible in evidence and does not reduce or mitigate the
defendant's liability.
See
also John
Day’s detailed discussion of the collateral source rule on his blog for a
more detailed discussion of the collateral source rule.
Proposed
SB 1184/HB 0978
would effectively eliminate the collateral source rule in Tennessee. In fact, the language in the bill would only
allow a plaintiff in a personal injury or wrongful death case to recover economic
damages for medical and other costs of medical care for:
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Posted on Apr 1 2013 7:51AM by Attorney, Jason A. Lee
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Analysis: The recent Tennessee Court of Appeals decision of Thomas Grigsby v. W. Arlen Harris, Sr., No. M2012-00370-COA-R3-CV, 2012 WL 6449782 (Tenn.Ct.App. December 12, 2012) discussed whether a party can withdraw a settlement agreement after it has been announced in open court. This case involved a boundary line dispute between two parties. Grigsby at 1. On the morning of the trial, the parties announced in open court that they reached a settlement agreement resolving the boundary line dispute. Grigsby at 1. The parties agreed to swap two pieces of property and a rough non-scale drawing was presented to the court at the hearing showing the parties agreement to the land swap. Grigsby at 1. An order of the court was not entered at that time but rather the parties represented they were going to determine the exact terms of the swap based on a new survey that was to be completed and then the parties would submit a final order. Grigsby at 1, 2.
After the hearing one of the parties decided they no longer wanted to submit to the terms of the settlement agreement. They informed the court that they “misunderstood the amount of land that they were giving away and that land swap deprives them of their only means of access; to wit, the driveway, to their property” Grigsby at 2. The trial court ultimately enforced the settlement agreement that was announced on the day of trial and entered an order approving the land swap. Grigsby at 2, 3.
On appeal the Tennessee Court of Appeals found that Tennessee courts "now uniformly hold that if the terms of a settlement are announced to the court or memorialized in a signed, enforceable contract, a judgment may be entered thereon, even if one party later repudiates." Grigsby at 4 (citing
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Posted on Mar 24 2013 9:21PM by Attorney, Jason A. Lee
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Brief Summary: In a Tennessee GTLA Health Care Liability Action, the statute of limitations tolling provisions found in T.C.A. § 29-26-121 for the pre-suit notice requirements do not apply. A Health Care Liability Action brought under the GTLA must therefore be filed within the one year statute of limitations with no tolling available under this statute.
Analysis: In Betty Lou Lawing v. Greene County EMS, No. E2011-01201-COA-R9-CV, 2012 WL 6562155 (Tenn. Ct. App. December 17, 2012) the Tennessee Court of Appeals discussed the Health Care Liability Action (Medical Malpractice) pre-suit notice requirements and their applicability in a GTLA case (the Tennessee Governmental Tort Liability Act can be found in T.C.A. § 29-20-101 et seq.). In the Lawing case there was an alleged medical malpractice event on July 8, 2009 that resulted in an injury. Notice pursuant to T.C.A. § 29-26-121 was provided on July 2nd, 2010, which was within the one year statute of limitations. The lawsuit was then filed on October 27, 2010, outside of the one year statute of limitations but within the 120 day tolling provision contained in T.C.A. § 29-26-121 (the statute provides a 120 day extension of the one year statute of limitations when notice is provided to the opposing party within the one year statute of limitations). The question, therefore, was whether the plaintiff could take advantage of the tolling provisions found in T.C.A. § 29-26-121 for this Health Care Liability Action brought under the GTLA.
The Tennessee Supreme Court has previously held that claims against governmental entities “must be brought in strict compliance with the GTLA, and that our courts have thus held that the savings statute as well as joinder provisions in the comparative fault statute do not operate to extend the statute of limitations in the GTLA because the legislature did not expressly provide that they would apply to claims under the GTLA”. Lawing at 2 (citing Lynn v. City of Jackson, 63 S.W.3d 332 (Tenn. 2001); Daniel v. Hardin County General Hospital, 971 S.W.2d 21 (Tenn. Ct. App. 1997)) (Note that T.C.A. § 20-1-119 was amended by the legislature in 1999 after the Daniel decision to explicitly apply the comparative fault joinder provisions to GTLA cases – however it took a specific act of the Tennessee legislature to make this clear as required under the GTLA).
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Posted on Mar 18 2013 8:20AM by Attorney, Jason A. Lee
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Analysis: Tennessee Rule of Civil Procedure § 26.03 allows a party to file a motion for a protective order preventing or limiting discovery that is requested by the opposing party under certain circumstances. Rule 26.03 provides that the party requesting the protective order must show "good cause" and the specifically listed circumstances that allow a party to obtain a protective order include when "justice requires to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense." Tennessee Rule of Civil Procedure § 26.03
Tennessee Rule of Civil Procedure § 26.03 provides a list of things the court can do in a protective order. This list includes the following
(1) that the discovery not be had;
(2) that the discovery may be had only on specified terms and conditions, including a designation of the time or place;
(3) that the discovery may be had only by a method of discovery other than that selected by the party seeking discovery;
(4) that certain matters not be inquired into, or that the scope of the discovery be limited to certain matters;
(5) that discovery be conducted with no one present except persons designated by the court;
(6) that a deposition after being sealed be opened only by order of the court;
(7) that a trade secret or other confidential research, development, or commercial information not be disclosed or be disclosed only in a designated way;
(8) that the parties simultaneously file specified documents or information enclosed in sealed envelopes to be opened as directed by the court.
In Ballard v. Herzke, 924 S.W.2d 652 (Tenn. 1996) the Tennes...
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