Recent Tennessee Court of Appeals Decision Finds that One Year Statute of Limitations May Not Apply to Uninsured Motorist Claims

The Tennessee Court of Appeals in Larry Stine Bates v. Michael J. Greene, W2016-01868-COA-R3-CV, 2017 WL 3206599 (Tenn. Ct. App. 2017) dealt with an interesting issue involving the statute of limitations that applies to the filing of a claim against an uninsured motorist carrier.  The uninsured motorist carrier in this case was Shelter Insurance. The plaintiff filed suit against the defendant, the alleged tortfeasor, within one year of the accident. However, the civil warrant was returned unserved. An alias was then issued for the defendant but it was also returned unserved. Over two years after the actual accident, an amended alias civil warrant was issued against the defendant, which added Shelter Insurance Company, plaintiff’s uninsured motorist carrier, as a defendant. The uninsured motorist carrier was served over two years after the accident occurred.

As a result, the insurance company filed a Motion for Summary Judgment and claimed that the action against it was barred by the one-year statute of limitations applicable to personal injury actions. The circuit court agreed and granted the Motion for Summary Judgment, dismissing the case against the uninsured motorist carrier. The court found the one-year personal injury statute of limitations applied to the uninsured motorist claim.

On appeal, the Tennessee Court of Appeals reviewed the situation in detail. They reviewed a significant amount of prior cases as well as statutory changes to the uninsured motorist statute.  Ultimately, the Court concluded that in this case, the one-year statute of limitations for a personal injury claim did not apply. Instead, the six-year statute of limitations for a contract cause of action applied for the claim against the uninsured motorist carrier.  Multiple prior Tennessee cases have held consistent with this opinion in the past. The Court also analyzed T.C.A. § 56 -7-1206(d) which provides the following:

(d) In the event that service of process against the uninsured motorist, which was issued to the motorist's last known address, is returned by the sheriff or other process server marked, “Not to be found in my county,” or words to that effect, or if service of process is being made upon the secretary of state for a nonresident uninsured motorist and the registered notice to the last known address is returned without service on the uninsured motorist, the service of process against the uninsured motorist carrier, pursuant to this section, shall be sufficient for the court to require the insurer to proceed as if it is the only defendant in the case.

Based on this statute the Court noted that the legislator intended that a plaintiff could sue the uninsured motorist carrier directly if they are unable to obtain service or process over the uninsured motorist defendant. As a result, the Court stated that “we discern nothing in the uninsured motorist statute that mandates service on an uninsured motorist carrier within one year of an accident.” Bates at 5. The Court went on to discuss prior decisions that rejected these similar arguments. As a result, this case ultimately stands for the proposition that, in certain circumstances (although I would certainly not risk this argument if it can be avoided), the uninsured motorist carrier can be served with a complaint and added as a party, greater than one year after the accident.  Further, generally, that the one-year statute of limitations for personal injury actions does not apply to claims against the uninsured motorist carrier.

One argument that the insurance company raised for the first time on appeal was that the claim should nevertheless be barred “because Shelter has been prejudiced by plaintiff’s delay in serving it with process, within the meaning of Robbins.” Bates at 7.  However, the Court found that they were not going to address that issue because it was not properly raised at the trial court. As a result, that argument would not be entertained on appeal.  This is certainly a possible argument in subsequent cases where it is properly raised before the trial court.

Overall, it is my recommendation to always to try to add the uninsured motorist carrier as a party within one year.  That is the safest path forward.  However, this case certainly provides hope for those that fail to do so within the appropriate time period. This is true as long as the underlying tortfeasor is sued within the one-year statute of limitations.  There are nuances to this situation and an intentional or negligent delay in service of the uninsured motorist carrier may be held against a plaintiff in that situation. The Court did not address that situation in this case. Regardless, this case provides a great overview of Tennessee cases on this issue and should be thoroughly considered when dealing with any issue on the statute of limitations involving uninsured motorist claims.