In a Tennessee Breach of Contract Action Does a Voluntary Dismissal Make the Defendant the “Prevailing Party” for Contractual Attorney’s Fees?

Analysis:  In a Tennessee breach of contract case if the defendant has a counterclaim pending to recover attorney’s fees under the contract and the plaintiff voluntary dismisses the case, the defendant can recover attorney fees if not timely refiled.  This is governed by a Tennessee statute, T.C.A. § 20-6-306 that provides as follows:

(a) If a plaintiff voluntarily dismisses an action while a counterclaim is pending for contractual attorney fees, and if the plaintiff does not timely recommence the action, the court, upon proper showing, may order that the counterclaimant is the prevailing party for the purpose of recovering contractual attorney fees.

(b) This section shall only apply if the contract clause providing for attorney fees applies equally to all parties to the contract.

As a result, the counterclaiming party is essentially considered the prevailing party for the purpose of determining if contractual attorney’s fees must be paid (this is the usual terminology in contracts that discuss when attorney’s fees are due).  However, this only occurs after the plaintiff does not recommence the action in a timely manner (usually this will be within one year from the dismissal).  Even though a voluntary dismissal under Tennessee Rule of Civil Procedure 41.01 is not a determination on the merits, under this statute, it does have the impact of essentially finding the defendant is the prevailing party under a contractual term for attorney’s fees. 

This statute was adopted and put in effect on July 1, 2004.  A search on Westlaw shows this statute has not been substantively addressed by the Court of Appeals or the Tennessee Supreme Court.  I am not sure how well known this statute is but it is certainly something to consider in the context of a counterclaim in a bre...

Does the Tennessee Disabilities Act Require Employers to Make "Reasonable Accommodations" for Employees?

Analysis:  The recent Tennessee Court of Appeals decision of Lataynia Jones v. Sharp Electronics Corp., 2014 WL 806131 (Tenn. Ct. App. 2014) discussed whether the Tennessee Disabilities Act requires employers to make “reasonable accommodations” when an employee has a disability.  In this case the employee took leave for medical conditions multiple times under the FMLA (Family and Medical Leave Act) and under her union collective bargaining agreement.  After she exhausted the total time allowed under FMLA and her collective bargaining agreement she was informed she must return to her employment by a specific date.  She did not return to her employment by that date and therefore she was terminated. 

As a result, the employee filed a lawsuit against her employer under the FMLA and under the Tennessee Disability Act.  The FMLA case was previously dismissed.  The Tennessee Disability Act claim remained.  The question before the Tennessee Court of Appeals was whether a “reasonable accommodation” is required under the Tennessee Disability Act for disabled employees.  The court found that several Tennessee cases have already found that “unlike its federal counterpart, the Americans with Disabilities Act (“ADA”), the Tennessee Disabilities Act does not impose a duty on employers to make reasonable accommodations to accommodate a disabled employee.”  Jones at 3 (citing, Bennett v. Nissan North America, Inc., 315 S.W.3d 832, 841-42 (Tenn. Ct. App. 2009)).  As a result, due to this difference in the Tennessee Disability Act

If a person’s disability to some degree prevents the applicant from performing the duties required by the employment sought or impairs the performance of the work involved, a defendant employer will not be considered to have discriminated against that person in an action under the TDA. Bennett at 852.

Jones at 3.  The court further noted that the question of whether Tennessee should adopt a reasonable accommodation requirement com...

When is a Manufacturer of a Product Liable for an Injury Caused by the Product in Tennessee?

Analysis:  Under Tennessee law a manufacturer of a product is not liable for injuries caused by the product unless it is found to be in a defective condition or unreasonably dangerous at the time it left the control of the manufacturer.  As a result, it can often be very important to determine exactly when the alleged defect occurred.  T.C.A. § 29-28-105(a) specifically provides as follows:

(a) A manufacturer or seller of a product shall not be liable for any injury to a person or property caused by the product unless the product is determined to be in a defective condition or unreasonably dangerous at the time it left the control of the manufacturer or seller.

The term “defective condition” is defined in this statute as, “a condition of a product that renders it unsafe for normal or anticipatable handling and consumption.”  T.C.A. § 29-28-102(2).  The term “unreasonably dangerous” is defined in T.C.A. § 29-28-102(8) as follows:

(8) “Unreasonably dangerous” means that a product is dangerous to an extent beyond that which would be contemplated by the ordinary consumer who purchases it, with the ordinary knowledge common to the community as to its characteristics, or that the product because of its dangerous condition would not be put on the market by a reasonably prudent manufacturer or seller, assuming that the manufacturer or seller knew of its dangerous condition.

In making the determination as to whether a product is defective or unreasonably dangerous, the knowledge available to the manufacturer or seller at the time the product was placed on market is what is important.  Later acquired knowledge is not necessarily held against the manufacturer.  Specifically, T.C.A. § 29-28-105(b) provides as follows:

(b) In making this determination, the state of scientific and technological knowledge available to the manufacturer or seller at the time the product was placed on the market, rather than at the time of injury, is applicable. Consideration is given a...

In Tennessee One Year Healthcare Liability Action Statute of Limitations is Not Extended by Pre-Suit Notice When Dealing with GTLA Lawsuit

Analysis:  Last year the Tennessee Supreme Court decided another important case that interprets the Governmental Tort Liability Act (“GTLA”) in conjunction with other Tennessee statutes.  In this case the Tennessee Supreme Court found that the 120 day extension of time to file a healthcare liability action (formerly medical malpractice cause of action) when pre-suit notice is provided does not apply to GTLA lawsuits.  The Tennessee Supreme Court in Walton Cunningham v. Williamson County Hospital District et al, 405 S.W.3d 41 (Tenn. 2013) dealt with a medical malpractice claim that was filed 15 months after the claim accrued at the time of the death.  The plaintiffs relied upon T.C.A. § 29-26-121 that provides a 120 day extension of time beyond the one year statute of limitations to file suit after pre-suit notice is provided under the statute.  The pertinent part of T.C.A. § 29-26-121 provides as follows:

(c) When notice is given to a provider as provided in this section, the applicable statutes of limitations and repose shall be extended for a period of one hundred twenty (120) days from the date of expiration of the statute of limitations and statute of repose applicable to that provider...

The question in this case therefore was whether the extension found in T.C.A. § 29-26-121 applies to a GTLA healthcare liability claim (essentially a medical malpractice case against a governmental entity).  The statute of limitations for a GTLA claim is one year as explicitly provided in T.C.A. § 29-20-305(b) which provides as follows:

(b) The action must be commenced within twelve (12) months after the cause of action arises.

As a result, there is a conflict between the SOL of 12 months for a GTLA claim and 12 months + 120 days (with pre-suit notice) in the healthcare liability statute.  The GTLA is a specific statute where the government waives immunity in certain limited circumstances.  However, “because waiver of immunity is in derogation of the common law, any claim for damages brought under the GTLA must be in stri...