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Prewitt v. Brown

Court of Appeals of Tennessee, Nashville

January 30, 2017


          Session November 1, 2016

         Appeal from the Circuit Court for Davidson County No. 13-C-2894 Kelvin D. Jones, Judge

         This appeal arises from a two-car accident. The parties do not dispute that Plaintiff's vehicle sustained irreparable damage and that Defendant, the driver of the other vehicle, was 100% at fault. Prior to the commencement of this action, the automobile insurance carrier for Defendant, Allstate Insurance Company, paid the lien-holder of Plaintiff's vehicle $7, 852.57, the amount Allstate believed to be the fair market value of the vehicle. Thereafter, Plaintiff sued Defendant to recover the balance of the fair market value of her car and damages for loss of use. She also asserted a direct action against Allstate, alleging that Allstate reached a settlement with her lien-holder before exploring the full extent of her damages. The trial court dismissed the direct action against Allstate for failure to state a claim upon which relief could be granted, pursuant to Tenn. R. Civ. P. 12.02(6), because Tennessee law does not permit a direct action against an insured's insurance carrier "without first establishing that the insured . . . has become 'legally obligated' to pay damages." Ferguson v. Nationwide Prop. & Cas. Ins. Co., 218 S.W.3d 42, 52 (Tenn. Ct. App. 2006) (quoting Seymour v. Sierra, 98 S.W.3d 164, 165 (Tenn. Ct. App. 2002)). Following the dismissal of Plaintiff's claims against Allstate, the trial court summarily dismissed Plaintiff's claims against Defendant upon the finding that Plaintiff failed to present any evidence that the fair market value was more than Allstate paid on behalf of Defendant. The court also summarily dismissed Plaintiffs claim for the loss of use of her car, because it could not be repaired and she never sought to rent a replacement vehicle. Plaintiff appealed. We affirm.

         Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed

          Candes Prewitt, Nashville, Tennessee, for the appellant, Sandra Prewitt.

          Jay R. McLemore and J. David Watkins, Franklin, Tennessee, for the appellee, Kamal Brown.

          Frank G. Clement, Jr., P.J., M.S., delivered the opinion of the Court, in which Richard H. Dinkins and W. Neal McBrayer, JJ., joined.


          FRANK G. CLEMENT, JR., P.J., M.S.

         Sandra Prewitt ("Plaintiff) entered into an installment sales agreement with DriveTime a/k/a DT Corporation ("DriveTime") in February 2010 to purchase a 2008 Mitsubishi Galant. Plaintiff made an initial down payment of $1, 900.00, and financed the remainder of the purchase price-$15, 542.62-with DriveTime over a period of fifty-two months at an 18.738% interest rate. According to the agreement, DriveTime held the title to the vehicle until Plaintiff paid the entire purchase price. The agreement further provided that Plaintiff would be in default of the loan if, inter alia, "the Vehicle is lost, damaged beyond repair, or destroyed."

         On June 1, 2013, Candes Prewitt, Plaintiffs adult daughter, was driving alone in Plaintiffs car when she was involved in a motor vehicle accident with an automobile driven by Kamal Brown ("Defendant").[1] Plaintiffs vehicle was totaled as a result of the accident. Plaintiff was not in the vehicle when the accident occurred; thus, she did not sustain personal injuries. Candes Prewitt, however, claims to have sustained personal injuries as a result of the accident.

         Because Plaintiffs vehicle was totaled, DriveTime acted upon the default provision in the installment sales agreement and repossessed Plaintiffs vehicle. Shortly thereafter, Defendant's insurer, Allstate Insurance Company ("Allstate"), paid DriveTime $7, 852.57 in exchange for the title to Plaintiffs vehicle. Subsequently, DriveTime informed Plaintiff that it applied the $7, 852.57 payment to her account but that she still owed a balance of $4, 667.53.

         On July 19, 2013, Plaintiff commenced this action against Defendant and Allstate seeking to recover damages for the total loss of the car and for the loss of use of the car. As for her claims against Allstate, Plaintiff alleged that Allstate had reached a settlement before exploring the full extent of her damages, and that "Allstate . . . used coercive means to force [Plaintiff] to accept their less than fair settlement offer."

         Allstate and Defendant filed a consolidated Tenn. R. Civ. P. 12.02(6) motion to dismiss the complaint on several grounds. Regarding the claims against Allstate, they argued that Tennessee law does not allow direct actions by a plaintiff in a vehicular accident against an alleged tortfeasor's automobile insurance carrier. Additionally, they argued that the allegations against Defendant failed to state a legal basis for recovery against him because there were no factual allegations of fault. After a hearing, the trial court granted the motion in part by dismissing all claims against Allstate. The court also determined that the complaint failed to state any allegation of fault against Defendant; however, instead of dismissing the claims against Defendant, the court granted Plaintiff leave to amend the complaint to properly assert a claim against him.

         Plaintiff then filed an amended complaint, which alleged that Defendant caused the collision through the negligent operation of his automobile and that "the force of the collision totally destroyed [Plaintiff's] vehicle. . . ."[2] The amended complaint also included claims for both the value and the loss of use of her car.

         Following discovery, Defendant filed a "Motion for Summary Judgment for Claims of Sandra Prewitt." Defendant argued that summary judgment was proper for Plaintiffs claims for several reasons. First, he argued that Plaintiff could not recover the value of the car because, by her own admission, she held no equity interest in it and the lienholder accepted the fair market value of the car paid on Defendant's behalf. Second, Defendant argued that he was not responsible for Plaintiff's outstanding contractual debt. Third, he argued that, absent commercial property, Tennessee law prohibits recovery for loss of use to personal property that has been damaged beyond repair.

         Plaintiff filed a response to Defendant's motion, arguing that summary judgment was improper because many of the material facts were in dispute. First, she contended that Allstate colluded with DriveTime by paying DriveTime $7, 852.57 following repossession, and that this conduct wrongfully interfered with her contract with DriveTime. Second, she argued that Defendant submitted documents in support of his motion that were "unauthenticated, " and thus inadmissible. Third, she argued that DriveTime did not pay the fair market value of Plaintiff's car (though she did not supply any evidence supporting this contention).

         Following a hearing, the trial court announced the legal grounds for its decision to grant Defendant's motion and ordered Defendant to submit a memorandum memorializing the trial court's decision. After receiving Defendant's draft order, the trial court drafted its final order summarily dismissing all of Plaintiff's remaining claims. This appeal followed.[3]


         Plaintiff raises several issues for our consideration.[4] We have determined that the dispositive issues of this appeal are better stated as follows:

1. Whether the trial court erred in dismissing Plaintiff's direct action against Defendant's insurer, Allstate?
2. Whether the trial court erred in summarily dismissing Plaintiff's claim for the property damage to her vehicle and ...

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