April 19–April 25, 2025

  • Plaintiffs file suit in 2021 related to a 2017 property sale contract between their LLC and Defendants.  The Plaintiffs amend their complaint in 2023 but do not add the LLC as a party.  In 2024, the Plaintiffs move for leave to file a second amended complaint that would clarify that both the LLC and the Plaintiffs are plaintiffs.  The trial court denies the motion for leave to amend and then grants the Defendants’ motion to dismiss because the Plaintiffs were not parties to the contract under which they are suing.  Plaintiffs appeal.  Tennessee Court of Appeals: “Although reasonable minds could disagree with the Trial Court’s decision to deny Plaintiffs’ motion to amend, we discern no abuse of discretion in the Trial Court’s decision, given that Plaintiffs knew the LLC was the named buyer on the contract four years prior to filing their original complaint.”  Further, “LLCs are legal entities distinct from their members,” and “[b]y listing the LLC as the buyer, and thereby, obtaining the benefit of shielding themselves against personal liability, [the Plaintiffs] restricted their ability to individually and personally sue Defendants.”  As a result, the trial court correctly granted the motion to dismiss.
  • HOA and Homeowner sue one another over whether Homeowner has an obligation to install asphalt shingles that match the rest of her property.  After hearing competing motions for summary judgment, the trial court dismisses Homeowner’s declaratory judgment claim “for lack of subject-matter jurisdiction”—which we apparently are back to hyphenating—on the asserted basis that Homeowner failed to join necessary parties.  The trial court also grants the HOA’s cross-motion for summary judgment and awards the HOA some $40k in attorney’s fees.  Homeowner appeals.  Tennessee Court of Appeals: The trial court did not bother to explain its subject-matter jurisdiction ruling, which also makes no sense given that the trial court considered the competing claims to be “two sides of the same coin” but did not find a subject-matter jurisdiction defect as to the HOA’s claim.  So we vacate that order with instructions to make adequate findings of fact.  And “the record is replete with disputes of facts that negate the trial court’s grant of summary judgment to the HOA,” including “whether [Homeowner’s] home should be held to a standard ‘in keeping with other lots,’” when her Property has never been ‘in keeping with other lots.’”  Thus, the trial court’s decision is vacated in part and reversed in part.  [Editorial note: If you were wondering: (a) where a trial court order this bad originated and (b) assumed correctly that it had to be either Shelby County or Williamson County, the answer is Shelby County.]
  • Pro se Plaintiff who is incarcerated in Colorado petitions to contest his late father’s will.  Tennessee has a statute that requires incarcerated plaintiffs to pay filing fees absent various exceptions.  The trial court initially dismisses the Plaintiff’s claim for failure to comply with the statute; it later issues a different order requiring payment within 30 days.  Plaintiff appeals.  Tennessee Court of Appeals: Dismissed for lack of finality.  “[T]he order that [Plaintiff] appeals from is not a final judgment. The order resolves no claims. It only imposes a new deadline for [Plaintiff] to pay the filing fee. There is still work for the trial court to do. So the order is not appealable as of right.”
  • After a mediation, family members sign a settlement agreement resolving their business dispute.  Part of the agreement provides for “due diligence to be completed within 10 days[.]”  Afterward, one family member seeks to withdraw from the agreement, claiming that his due diligence yielded information that merited rejecting the agreement.  Other family members file a motion to enforce the settlement, which the trial court grants.  Tennessee Court of Appeals: “[T]he one-page agreement is silent as to the scope of the due diligence provision,” and “an evidentiary hearing is necessary to resolve the ambiguity.”  So the trial court’s order granting the motion to enforce is vacated, and we remand with instructions to hold an evidentiary hearing on what the parties meant by the due diligence provision.
  • HOA sues Homeowner for violations of CC&Rs.  Homeowner files an answer denying liability but declines to respond to requests for admission.  The trial court thus deems the allegations admitted as contemplated by Tennessee Rule of Civil Procedure 36.01 and enters judgment against Homeowner, who appeals.  Tennessee Court of Appeals: “By ignoring the requests for admission, [Homeowner] admitted everything against him” and “foreclosed the need for a merits hearing because he admitted all the facts supporting the [HOA’s] case.”  So we affirm.
  • Pro se litigants square off in pro se appeal that concerns whether one party failed to complete home improvement work.  Tennessee Court of Appeals: “Parties have the responsibility to see to it that the record contains the evidence necessary to support their arguments on appeal,” and “the burden falls on the party asserting error.”  Here, the record here is inadequate to enable review.  So we affirm.
  • Tennessee statute provides Utility a presumptive monopoly over services.  According to the statute, the Utility “is the sole public corporation empowered to furnish those services in the district, and another person, firm, or corporation shall not furnish or attempt to furnish those services in the area embraced by the district, unless and until it has been established that the public convenience and necessity requires other or additional services[.]”  Thus, when Company starts “servicing water customers in the district’s service area,” Utility gets mad and sues.  Trial court rules for the Company on the basis that Company is not a public utility, and Utility appeals.  Tennessee Court of Appeals: “This appeal presents a question of law: whether the trial court erred in determining that [a] Utility’s claim for a declaratory judgment . . . failed because the Utility failed to prove that [a] Company was a public utility.”  And the trial court did err, because the relevant statute clearly and unambiguously “does not require the Company to be a public utility[;]” instead, any “person, firm, or corporation” will do.  So we reverse.  [Editorial note: If you were wondering: (a) where a trial court order this bad originated and (b) assumed correctly that it had to be either Shelby County or Williamson County, the answer is Williamson County.]
  • Family business dispute spills into litigation.  Defendant both overpays himself without approval of fellow LLC members in violation of the LLC’s operating agreement and fails to maintain essential company records, but he insists that the other LLC members ratified his conduct or otherwise consented to it.  Trial Court: They did not.  Tennessee Court of Appeals: Indeed, they did not.  Defendant was not authorized to pay himself management fees in excess of his commissions without member approval in violation of the LLC’s operating agreement, and he “was not authorized to hide or destroy documents or to refuse to turn over documents when requested by other members[,]” either.  Thus, the trial court’s merits ruling is affirmed.  “[T]he trial court did not specify whether it awarded damages based upon the individual or derivative causes of action” and did not specify “to which causes of action the [Plaintiffs’ awarded] attorney fees related,” though, so we can’t resolve the parties’ dispute over attorney’s fees here and have to vacate it for further findings.  We also exercise our discretion not to award attorney’s fees on appeal, even though fees are permitted under the operating agreement.  [Editorial Note: Congratulations to friend of Intermediate Scrutiny Rob Peal on the win.]

Firm Updates

Congratulations to Horwitz Law, PLLC’s Sarah Martin!  Sarah won a big Tennessee Supreme Court case yesterday.  You can read about it here: https://www.tncourts.gov/press/2025/04/25/tennessee-supreme-court-holds-lawsuit-invasion-privacy-does-not-end-if-plaintiff.