Jack Stevens v. Karns Volunteer Fire Department ( 2013 )

IN THE COURT OF APPEALS OF TENNESSEE
AT KNOXVILLE
November 5, 2013 Session
JACK STEVENS V. KARNS VOLUNTEER FIRE DEPARTMENT
Appeal from the Chancery Court for Knox County
No. 1805623 Hon. Michael W. Moyers, Chancellor
No. E2013-01298-COA-R3-CV-FILED-NOVEMBER 27, 2013
This is a declaratory judgment action in which Plaintiffs sought the return of property that
had been donated to the Karns Volunteer Fire Department (“Fire Department”). Plaintiffs
alleged that a reversionary clause in the warranty deed had been triggered when Fire
Department began paying firefighters and charging subscription fees for its services. The
parties filed competing motions for summary judgment. The trial court determined that the
reversionary clause had not been triggered and granted Fire Department’s motion for
summary judgment. Plaintiffs appeal. We affirm the decision of the trial court.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court
Affirmed; Case Remanded
J OHN W. M CC LARTY, J., delivered the opinion of the Court, in which D. M ICHAEL S WINEY
and T HOMAS R. F RIERSON, II, JJ., joined.
W. Tyler Chastain and Margo J. Maxwell, Knoxville, Tennessee, for the appellants, Jack
Stevens and Emmett G. Stevens, Jr.
Jack Warner Piper, Jr., Knoxville, Tennessee, for the appellee, Karns Volunteer Fire
Department.
OPINION
I. BACKGROUND
On July 20, 1992, Dewey B. Hickman and Irene S. Hickman (collectively “the
Hickmans”) donated .28 acres of real property in Knoxville, Tennessee to Fire Department.
The warranty deed contained a reversionary clause, which provided,
TO HAVE AND TO HOLD the said premises to the said Second Party for so
long as the property is used by Second Party for a fire station under the name
of Karns Volunteer Fire Department to the end that should the Karns
Volunteer Fire Department cease to exist either by name or function or should
the above described property permanently cease to be used for the foregoing
purpose and in the foregoing name, the above described property will revert
to the First Parties.
The grant of the property was made because volunteer firefighters helped the Hickmans when
their home caught fire several years earlier. They sought to provide land for a fire station in
Ball Camp because a railroad track separated the community from the existing fire station
in Karns. Once Fire Department obtained the land, it built a two-bay fire station in Ball
Camp. Approximately six years later, the Hickmans deeded the same property to Jack
Stevens and Emmett G. Stevens, Jr. (collectively “Plaintiffs”) by way of a quitclaim deed.
Fire Department, which Emmett G. Stevens, Jr. helped establish by charter in 1978,
was operated by unpaid volunteers until 2001, when Fire Department hired its first paid
personnel. At present, approximately 8 firefighters are paid, while 46 firefighters serve on
a volunteer basis. Fire Department had been funded solely by donations received from the
community from the time of its existence until January 2011, when Fire Department began
offering its services on a subscription basis. Residents serviced by Fire Department were
advised to either pay the requisite subscription fee or pay hefty charges in the event that
services were needed. As a result of the switch to subscription based services, revenue
increased from approximately $300,000 per year to $1,500,000 per year. Despite the increase
in revenue, Fire Department maintained its status as a non-profit organization. The
additional revenue allowed Fire Department to hire more paid personnel and update
equipment, vehicles, and fire stations in the area, which allowed them to provide more
comprehensive coverage to the growing communities serviced by Fire Department. As the
improvements were made, Fire Department began dropping the “Volunteer” in its name
when labeling uniforms, trucks, and buildings.
On June 3, 2011, Plaintiffs filed the instant complaint, requesting a declaratory
judgment providing that the reversionary clause had been triggered by the hiring of paid
personnel and the switch to subscription based services. Plaintiffs asserted that the warranty
deed was offered so long as Fire Department functioned solely as a volunteer fire department.
Plaintiffs claimed that as a result of the decision to pay personnel and charge for services,
Fire Department was no longer a volunteer fire department, thereby triggering the
reversionary clause and requiring the property to revert back to them. They noted that Fire
Department had been specifically classified as a combination fire department. Three months
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later, Plaintiffs filed a motion for summary judgment, asserting that Fire Department had
changed its function and that the reversionary clause had been triggered.
Fire Department responded by asserting that the hiring of paid personnel and the
switch to subscription based services did not change the function of Fire Department, which
had always been to provide fire protection services to the communities of Karns, Ball Camp,
Hardin Valley, and Solway. Likewise, Fire Department filed a competing motion for
summary judgment, requesting the court to determine as a matter of law that the reversionary
clause in the warranty deed had not been triggered.
A hearing was held, after which the trial court found that the use of the words
“function” and “purpose” had essentially the same meaning. The court stated,
[T]he language read in a plain and ordinary sense suggests that the intention
of the parties was that this property be in the possession of Karns Volunteer
Fire Department so long as it was used as a fire station. If they ever stopped
using it as a fire station, [the property] would revert back to the initial parties.
[T]he language of the case does not suggest that the funding mechanism of the
volunteer fire department was the primary consideration in rendering the gift.
In so holding, the trial court granted Fire Department’s motion for summary judgment and
dismissed the complaint. This timely appeal followed.
II. ISSUE
We consolidate and restate the issues raised on appeal by Plaintiffs as follows:
Whether the court erred in holding that the reversionary clause had not been
triggered when Fire Department no longer operated solely as a volunteer fire
department and had begun offering its services on a subscription basis.
III. STANDARD OF REVIEW
Summary judgment is appropriate where: (1) there is no genuine issue with regard to
the material facts relevant to the claim or defense contained in the motion and (2) the moving
party is entitled to judgment as a matter of law on the undisputed facts. Tenn. R. Civ. P.
56.04. A properly supported motion for summary judgment “must either (1) affirmatively
negate an essential element of the nonmoving party’s claim; or (2) show that the nonmoving
party cannot prove an essential element of the claim at trial.” Hannan v. Alltel Publ’g. Co.,
270 S.W.3d 1, 9 (Tenn. 2008), superseded by statute, 2011 Tenn. Pub. Acts ch. 498 §§ 1, 3
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(codified at Tenn. Code Ann. § 20-16-101).1 When the moving party has made a properly
supported motion, the “burden of production then shifts to the nonmoving party to show that
a genuine issue of material fact exists.” Id. at 5; see Robinson v. Omer, 952 S.W.2d 423, 426
(Tenn. 1997); Byrd v. Hall, 847 S.W.2d 208, 215 (Tenn. 1993). The nonmoving party may
not simply rest upon the pleadings but must offer proof by affidavits or other discovery
materials to show that there is a genuine issue for trial. Tenn. R. Civ. P. 56.06. If the
nonmoving party “does not so respond, summary judgment, if appropriate, shall be entered.”
Tenn. R. Civ. P. 56.06.
On appeal, this court reviews a trial court’s grant of summary judgment de novo with
no presumption of correctness. See City of Tullahoma v. Bedford Cnty., 938 S.W.2d 408,
412 (Tenn. 1997). In reviewing the trial court’s decision, we must view all of the evidence
in the light most favorable to the nonmoving party and resolve all factual inferences in the
nonmoving party’s favor. Luther v. Compton, 5 S.W.3d 635, 639 (Tenn. 1999); Muhlheim
v. Knox. Cnty. Bd. of Educ., 2 S.W.3d 927, 929 (Tenn. 1999). If the undisputed facts support
only one conclusion, then the court’s summary judgment will be upheld because the moving
party was entitled to judgment as a matter of law. See White v. Lawrence, 975 S.W.2d 525,
529 (Tenn. 1998); McCall v. Wilder, 913 S.W.2d 150, 153 (Tenn. 1995).
IV. DISCUSSION
Plaintiffs argue that the trial court erred in finding that the words “function” and
“purpose” had essentially the same meaning in the warranty deed. They claim that the initial
function of Fire Department was to operate its activities as a volunteer fire department
staffed by volunteers and funded by gifts and donations. They assert that the reversionary
clause was triggered when Fire Department’s function changed. Fire Department responds
that its function has always been to offer fire protection services for the communities in the
area and that the argument presented by Plaintiffs requires a “strained and contorted”
interpretation of the warranty deed.
“The interpretation of a deed is a question of law.” Hughes v. New Life Dev. Corp.,
387 S.W.3d 453, 466 (Tenn. 2012) (citations omitted). “In interpreting a deed, courts are
primarily concerned with ascertaining the intent of the grantor.” Id. “Courts ascertain the
grantor’s intent from the words of the deed as a whole and from the surrounding
circumstances.” Id. (citations omitted). The court must examine the language of the
1
The Tennessee General Assembly legislatively reversed the Tennessee Supreme Court’s holding in Hannan.
See Tenn. Code Ann. § 20-16-101. The statute is applicable to cases filed on or after July 1, 2011. Thus,
in this appeal, we will continue to apply the summary judgment standard set forth in Hannan because the
complaint was filed prior to July 1, 2011.
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document, giving each word its usual, natural, and ordinary meaning. See Wilson v. Moore,
929 S.W.2d 367, 373 (Tenn. Ct. App. 1996). The court’s initial task in construing the
document is to determine whether the language is ambiguous. Planters Gin Co. v. Fed.
Compress & Warehouse Co., 78 S.W.3d 885, 889-90 (Tenn. 2002). A document is
ambiguous if its meaning is uncertain and is susceptible to more than one reasonable
interpretation. See Bonastia v. Berman Bros., 914 F. Supp. 1533, 1537 (W.D. Tenn. 1995);
Frank Rudy Heirs Assocs. v. Moore & Assocs., Inc., 919 S.W.2d 609, 613 (Tenn. Ct.
App.1995); Gredig v. Tennessee Farmers Mut. Ins. Co., 891 S.W.2d 909, 912 (Tenn. Ct.
App. 1994). If we determine that the language of a document is ambiguous, we construe the
ambiguity against the drafter of the document. See Hanover Ins. Co. v. Haney, 425 S.W.2d
590, 592 (Tenn. 1968); Realty Shop, Inc. v. RR Westminster Holding, Inc., 7 S.W.3d 581, 598
(Tenn. Ct. App. 1999).
The parties agree that the Hickmans conveyed a fee simple determinable but retained
a reversionary interest in the property. This type of conveyance is described as follows:
A fee simple determinable is a fee simple which may endure in the grantee
forever, but which is subject to a special limitation that may cause the estate
to revert to the grantor. The future interest retained by the grantor of a fee
simple determinable is a mere possibility of reverter. A fee simple
determinable estate terminates naturally and automatically when the property
is no longer used as required. Termination is automatic because the limitation
forms part of the estate’s very nature.
Griffis v. Davidson Cnty. Metro. Gov., 164 S.W.3d 267, 274-75 (Tenn. 2005) (internal
citations omitted). As previously mentioned, the clause at issue in this case provides,
TO HAVE AND TO HOLD the said premises to the said Second Party for so
long as the property is used by Second Party for a fire station under the name
of Karns Volunteer Fire Department to the end that should the Karns
Volunteer Fire Department cease to exist either by name or function or should
the above described property permanently cease to be used for the foregoing
purpose and in the foregoing name, the above described property will revert
to the First Parties.
(Emphasis added). Function is defined, by Black’s Law Dictionary, 9th edition, as an
“[a]ctivity that is appropriate to a particular business or profession” or as “office; duty; the
occupation of an office.” Similarly, function is also defined as “the special purpose or
activity for which a thing exists or is used.” Merriam-Webster Online Dictionary (2013)
(www.merriam-webster.com (derived from Merriam-Webster’s Collegiate Dictionary (11th
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Ed.))). Purpose is defined, by Black’s Law Dictionary, 9th edition, as “[a]n objective, goal,
or end; specif[ally], the business activity that a corporation is chartered to engage in.”
Similarly, purpose is also defined as “the reason why something is done or used” or “the aim
or intention of something.” Merriam-Webster Online Dictionary (2013) (www.merriam-
webster.com (derived from Merriam-Webster’s Collegiate Dictionary (11th Ed.))).
Admittedly, the definitions of function and purpose are extremely similar regardless
of which publication is relied upon in defining the terms. What is clear is that the use of the
word function cannot be read to mean that Fire Department risks the loss of the property
unless it remains staffed solely by unpaid volunteers and relies solely upon donations. We
acknowledge that Fire Department was initially staffed with volunteers and that its reliance
upon donations was likely a reason for the decision to donate the property. However,
adopting the interpretation of the deed presented by Plaintiffs would require us to rely upon
an interpretation that is simply not merited when considering the surrounding circumstances
and giving each word in the deed its usual, natural, and ordinary meaning. The record
reflects that the Hickmans executed the deed in gratitude for the work of the volunteer
firefighters and to provide a fire station for the Ball Camp community. At present, Fire
Department continues to provide services for the community and continues to be staffed by
volunteer firefighters in addition to paid personnel, who ensure that Fire Department is an
effective resource for the community. Even the switch to subscription based services has not
jeopardized the availability of Fire Department for the community as long as Fire Department
provides services to everyone, regardless of the home occupant’s subscription status. With
these considerations in mind, we hold that the reversionary clause was not triggered by the
employment of paid personnel and the switch to subscription based services. Accordingly,
we affirm the court’s grant of Fire Department’s motion for summary judgment.
V. CONCLUSION
The judgment of the trial court is affirmed, and the case is remanded for such further
proceedings as may be necessary. Costs of the appeal are taxed equally to the appellants,
Jack Stevens and Emmett G. Stevens, Jr.
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JOHN W. McCLARTY, JUDGE
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