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Benz-Elliott v. Barrett Enterprises, LP

Supreme Court of Tennessee, Nashville

January 23, 2015

BRENDA BENZ-ELLIOTT
v.
BARRETT ENTERPRISES, LP ET AL

Session: October 9, 2014.

Tenn. R. App. P. 11 Appeal by Permission; Judgment of the Court of Appeals Reversed; Case Remanded to the Court of Appeals. Appeal by Permission from the Court of Appeals, Middle Section Chancery Court for Rutherford County. No. 081355CV. John D. Wootten, Jr., Judge, sitting by interchange.

G. Sumner R. Bouldin, Jr., Murfreesboro, Tennessee, for the appellant, Brenda Benz-Elliott.

Peter V. Hall, Murfreesboro, Tennessee, for the appellees, Barrett Enterprises, LP and Ronnie Barrett.

CORNELIA A. CLARK, delivered the opinion of the Court, in which SHARON G. LEE, C.J., and GARY R. WADE, and JEFFREY S. BIVINS, JJ., joined. HOLLY M. KIRBY, J., not participating.

OPINION

Page 141

CORNELIA A. CLARK, JUSTICE.

We granted permission to appeal to clarify the analysis that should be used to determine the applicable statute of limitations when a complaint alleges more than one claim. We hold that a court must identify the gravamen of each claim alleged to determine the applicable statute of limitations. Identifying the gravamen of a claim requires a court to consider both the legal basis of the claim and the injury for which damages are sought. Here, the plaintiff contracted to sell the defendants real property in Rutherford County. The contract provided that the plaintiff would retain ownership of a sixty-foot wide strip of property along Interstate 24 to provide access to her remaining property. The contract also provided that its covenants would survive the closing. The warranty deed failed to include the sixty-foot reservation required by the contract. The plaintiff sued the defendants, alleging claims of breach of contract, intentional misrepresentation, and negligent misrepresentation. The defendants raised several defenses, including the statute of limitations. The trial court dismissed the plaintiff's intentional and negligent misrepresentation claims but ruled for the plaintiff on the breach of contract claim and awarded her $650,000 in damages for the diminution in value of her remaining property due to the lack of the contractually guaranteed access route. The defendants appealed, raising six issues, including an assertion that the plaintiff's claim is barred by the statute of limitations. The Court of Appeals, focusing almost exclusively on the type of damages awarded, concluded that the gravamen of the plaintiff's prevailing claim is injury to real property, and as a result, held that the claim is barred by the three-year statute of limitations applicable to " [a]ctions for injuries to personal or real property." Tenn. Code Ann. § 28-3-105(1) (2000 & Supp. 2014). We disagree with the Court of Appeals' conclusions and hold that the gravamen of the plaintiff's prevailing claim is breach of contract, to which the six-year statute of limitations for " [a]ctions on contracts not otherwise expressly provided for" applies. Id. § 28-3-109(a)(3) (2000). Because the plaintiff's

Page 142

claim is not barred by the statute of limitations, we reverse the judgment of the Court of Appeals and remand this matter to the intermediate appellate court for resolution of the other issues the defendants raised on appeal.

OPINION

I. Factual and Procedural History

A. Trial Proof

The facts relevant to the dispositive issue in this appeal are not in dispute.[1] The plaintiff, Brenda Benz-Elliott (" Ms. Elliott" ), owned about ninety-one acres of real property located between Interstate 24 (" I--24" ) and Manchester Pike in Rutherford County. One of the defendants, Barrett Enterprises, LP (" BE" ), a firearms manufacturing business, owned four acres adjacent to Ms. Elliott's property. BE's property was located on Miller Lane, a frontage road running along I--24. Miller Lane also provided access to Ms. Elliott's property but terminated " somewhere around" her property line.

The other defendant, Ronnie Barrett (" Mr. Barrett" ), was the general partner of BE. Mr. Barrett and Ms. Elliott had known each other for about twenty-five years.[2] In 2004, Mr. Barrett approached Ms. Elliott about purchasing a portion of her property, which he needed to expand BE's firearms manufacturing business. Ms. Elliott initially refused to sell; however, she changed her mind when Mr. Barrett told her to " name [her] price" and agreed to sell him a little more than five acres at $82,500 per acre.

After obtaining Ms. Elliott's agreement to sell, Mr. Barrett contacted the Tennessee Department of Transportation (" TDOT" ) concerning a proposal to move the existing I--24 right-of-way fence so that Miller Lane could be extended in a straight-line fashion to a point near what would become the boundary line of Ms. Elliott's remaining property after the sale closed. Meanwhile, Mr. Barrett and Ms. Elliott continued working to finalize the terms of a contract that would memorialize their agreement. At the suggestion of Ms. Elliott's attorney, the following provision was added to the contract to ensure that Ms. Elliott retained access to her remaining property after the deal closed.

CONDITIONS: Seller to reserve ownership of a sixty feet (60') wide strip along I--24 for extension of Miller Road to connect remaining Seller's property. Buyer agrees to extend Miller Road built to county specifications along I--24 to a point ten (10) feet south of his new south property line.

Other provisions of the final contract detailed the parties' obligations as to the closing. For instance, the contract obligated Ms. Elliott to arrange and pay for a survey of the property and to engage an attorney to prepare the warranty deed and to conduct the closing. The contract also expressly provided that its covenants would survive the closing.

Mr. Barrett and Ms. Elliott signed the contract on August 5, 2004. After doing so, the parties continued to meet with and speak to officials from TDOT and other governmental agencies regarding the proposed relocation of the I--24 right-of-way fence and the straight-line extension of Miller Lane. After attending earlier meetings in which the extension of Miller Lane

Page 143

was discussed, in February of 2005, Cecil C. Elliott, Ms. Elliott's husband, wrote a letter to TDOT stating that the parties had met with various county and state officials and requesting authorization to move the right-of-way fence. Paul Degges, a TDOT civil engineer, responded by the following letter:

Thank you for your letter concerning our recent meeting to discuss the possible relocation of the right[-]of[-]way fence along I--24 and the Miller Lane frontage road in Rutherford County. I was glad to read of the support that you have garnered for the expansion of [BE] and the extension of Miller Lane.
As we discussed, [TDOT] is in support of this economic development for the local area, although this is contingent on [TDOT] agreeing to relocate our fence in order to accommodate the extension of the county right[-]of[-]way for Miller Lane, the existing frontage road.
When formal plans are available, we will allow the relocation of the fence to a point to be determined by [TDOT]. Also, as you stated, this agreement in no way binds [TDOT] to any financial responsibility as regards to the future project.
We look forward to working with all parties as this project becomes more fully developed.

Based on Mr. Degges's letter, Mr. Barrett began obtaining the permits necessary for the expansion of BE's facilities. He also made arrangements to obtain the documents necessary for closing the land sale with Ms. Elliott. Although the August 5, 2004 contract obligated Ms. Elliott to arrange and pay for the property survey, to engage an attorney to prepare the warranty deed, and to conduct the closing, Mr. Barrett actually undertook these obligations. Ms. Elliott did not know a land surveyor, so she agreed to allow Mr. Barrett to choose the surveyor. Additionally, Ms. Elliott agreed with Mr. Barrett's suggestion to use a single lawyer for the closing to minimize costs. Mr. Barrett engaged attorney Jeff Reed, who had represented Mr. Barrett and BE in other matters, to prepare the warranty deed, draft the closing documents, and conduct the closing.

The property transfer closed on March 25, 2005. On the same day, the parties executed a written agreement amending certain provisions of the sale contract.[3] The parties did not revise or amend in any way the contractual provision requiring the reservation to Ms. Elliott of a sixty-foot wide strip of property along I--24 by which she could access her remaining property. Nevertheless, the warranty deed failed to include the contractually required reservation.

After the closing, Mr. Barrett, with the help of Mr. and Ms. Elliott, continued negotiations with TDOT and other governmental entities on the proposal to relocate the I--24 right-of-way fence and extend Miller Lane in a straight-line fashion along the right-of-way. In late 2005 or early 2006, Mr. Barrett began construction on the expansion of BE's manufacturing facilities. Meanwhile, in June 2006, TDOT forwarded Mr. Barrett a letter and a plan for extending Miller Lane, which TDOT characterized as meeting " both your need to accommodate truck traffic to your new facility and our need to preserve the integrity of the interstate right[-]of[-]way." TDOT's plan did not involve a straight-line extension of Miller Lane, which Mr. Barrett and Ms. Elliott agreed would be most beneficial to their properties. Rather, the TDOT proposal consisted of what the parties

Page 144

referred to as a " dog-leg" extension, including a curve of Miller Lane. The TDOT plan would have required relocation of just a short portion of the I--24 right-of-way fence. By the time of receipt, the TDOT plan was unacceptable to Mr. Barrett because it called for extending Miller Lane into an area where detention ...


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