Michael J. Boeh v. Arthur M. Dial ( 2022 )

07/12/2022
IN THE COURT OF APPEALS OF TENNESSEE
AT NASHVILLE
January 5, 2022 Session
MICHAEL J. BOEH ET AL. v. ARTHUR M. DIAL ET AL.
Appeal from the Circuit Court for Williamson County
No. 2018-188 Joseph A. Woodruff, Judge
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No. M2021-00520-COA-R3-CV
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This case pertains to the purchase of real property in a residential subdivision. The dispute
arises from the fact that, at the time of sale, the lot was incorrectly listed as not being in a
flood plain. Upon learning of the flood plain issue, the seller filled and graded the lot and
abutting property, after which the regulatory authorities removed the lot from the flood
plain zone. Despite the fact the lot was removed from the flood plain, the buyers
commenced this action against the seller and its engineering firm, asserting claims for
negligent misrepresentation, breach of contract, and violation of the Tennessee Consumer
Protection Act (“TCPA”). Following discovery, the defendants filed separate motions for
summary judgment, and the motions were set for hearing on the same day. When the buyers
did not file a response in opposition to either of the motions and did not appear at the
summary judgment hearing, the seller voluntarily continued the hearing on its motion. The
engineering defendants, however, proceeded with the hearing, and the trial court granted
summary judgment in their favor. The buyers, claiming they did not receive proper notice
of the hearing, filed a Tennessee Rule of Civil Procedure 59 motion to set aside the order
granting summary judgment to the engineering defendants. Following a hearing on the
remaining motions, the trial court denied the buyers’ Rule 59 motion on the finding the
buyers had constructive notice of the hearing. The court also granted summary judgment
in favor of the seller on the claims of breach of contract and the TCPA. The trial court
determined that the contract permitted the defendants to “grade” the land and rectify the
flood plain issue even after closing. As such, the trial court found that the buyers did not
have a claim for breach of contract. As to the claim that the seller violated the TCPA, the
trial court explained that the TCPA requires some degree of fault, which was not present.
Having determined that the buyers had constructive notice of the hearing on the
engineering defendants’ motion for summary judgment, we conclude that the trial court
did not abuse its discretion in denying the buyers’ Rule 59.04 motion. We also affirm the
trial court’s decision to grant summary judgment in favor of the seller concerning the
claims for breach of contract and TCPA. Thus, we affirm the trial court in all respects.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed
FRANK G. CLEMENT JR., P.J., M.S., delivered the opinion of the Court, in which ANDY D.
BENNETT and J. STEVEN STAFFORD, P.J., M.S., JJ., joined.
Matthew A. Grossman, Richard E. Graves, and Benjamin W. Weigel, Knoxville,
Tennessee, for the appellants Michael J. Boeh and Anna M. Boeh.
John Willet, Memphis, Tennessee, for the appellees, Arthur Dial and Energy Land &
Infrastructure, LLC.
Christopher B. Fowler and Scott R. Brown, Nashville, Tennessee, for the appellees, NVR
Homes, Inc. d/b/a Ryan Homes and Thomas K. Sidwell.
OPINION
FACTS AND PROCEDURAL BACKGROUND
On October 10, 2016, Michael and Anna Boeh entered into a Purchase Agreement
with NVR, Inc. d/b/a Ryan Homes (“NVR”). The Purchase Agreement required NVR to
construct a new house on a recently plotted lot in the Stream Valley Subdivision in
Franklin, Tennessee, commonly known as 212 Coffenbury Court, Franklin, Tennessee
37064, and more fully described as Lot No. 431 on the plan of Stream Valley PUD
Subdivision, Section 13, of record at Plat Book P64, Page 124 of the Register’s Office for
Williamson County, Tennessee (hereinafter, the “Property”). The agreed-upon price for the
lot and newly constructed home was $441,920. The sale closed on April 20, 2017.
Engineering services were provided by Energy, Land & Infrastructure, LLC and its
employee Arthur Dial (hereinafter, collectively “ELI”) prior to and subsequent to the
execution of the Purchase Agreement as well as subsequent to closing. Initially, ELI
rendered services necessary to complete the development of the Stream Valley Subdivision
and subdivide the land into lots so that residential homes could be constructed. Moreover,
the development of the subdivision necessitated a Letter of Map Revision Request
(“LOMR”) to be sent to the Federal Emergency Management Agency (“FEMA”) to revise
the location of the boundary for the 100-year flood plain line as declared on FEMA’s flood
plain maps, which were based on the as-developed conditions of Stream Valley
Subdivision after all cut and fill of the lots and the construction of rainwater detention areas
was completed.
Prior to the Boehs’ closing on April 20, 2017, ELI recorded the Original Plat, which
was last revised on July 28, 2016, in the Williamson County, Tennessee Register’s Office
on September 9, 2016. The Original Plat was recorded before the FEMA LOMR process
was complete and depicted an estimated location for the revised FEMA LOMR flood plain
line based upon as-developed conditions. According to the Original Plat, the Property was
wholly outside the bounds of the 100-year flood plain with no part of the Property
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bordering the flood plain. The Original Plat incorrectly depicted the location of the flood
plain since the FEMA map depicted the FEMA 100-year flood plain as encroaching upon
a portion of the rear of the Property. Critically, the Boehs never received or reviewed the
Original Plat before entering the Purchase Agreement.
It was not until July 24, 2017, that NVR discovered a potential issue with the flood
plain. According to Mr. Boeh’s deposition, in July of 2017, an NVR employee, Dan Crunk,
came to the Boehs’ house and said:
[T]hey discovered that the corner of [the] property was in the floodplain, in
a high-risk floodplain. And that they were going to work with the city of
Franklin and with FEMA to get that taken out of the floodplain and they
would have to do some work on the property.
According to Mr. Boeh’s deposition testimony, this is when the Boehs became
aware of a flood plain issue. When the issue came to their attention, ELI and NVR took
measures to grade, fill, and re-plat the Property so that it would be removed from the flood
plain once the LOMR process was completed.
Pursuant to the LOMR request, FEMA revised its 100-year flood plain map for the
area in which the Property was located, and the Revised Plat was recorded in the
Williamson County Register’s Office on January 24, 2018. The Revised Plat showed that
the 100-year flood plain did not encroach on the Property. Nevertheless, the Boehs were
still unhappy with the Property because the flood plain bordered the Property.
Accordingly, the Boehs sold the Property for $510,000 on September 9, 2020.
Despite selling the Property for more than they paid to acquire it, the Boehs claimed that
the Property was less valuable than it would have been had the Original Plat been correct.
Specifically, the Boehs complained that if not for the difference in the location of the flood
plain boundary, they likely could have sold the Property for $515,000. Further, the Boehs
argued that they would not have purchased the Property in the first place had they known
of its proximity to the flood plain.
The Boehs commenced this action against NVR and ELI on April 17, 2018.1 They
alleged, inter alia, a claim against ELI for negligent misrepresentation and claims for
breach of contract and violation of the TCPA against NVR. The claim against ELI for
negligent misrepresentation was based on the Original Plat, which incorrectly depicted the
1
In addition to NVR and ELI, the complaint asserted claims against K. Thomas Sidwell, Mortgage
Electronic Registration Systems, Inc., NVR Mortgage Finance, Inc., and Stream Valley Franklin, LLC. In
its Answer Stream Valley asserted a cross-claim against ELI for implied indemnification. All of the claims
against these defendants, as well as the cross-claim, were ultimately pretermitted by settlement agreements
and orders dismissing the claims. Thus, these claims are not discussed in this opinion.
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Property as being located outside the flood zone. Despite never having seen the Original
Plat, the Boehs argued they justifiably relied on its accuracy. Essentially, they claimed that
the local zoning ordinance requires that property not overlap with a flood plain to acquire
a building permit. The Boehs asserted that if the Original Plat had accurately reflected the
location of the flood plain, no building permit would have been issued. Because of the
inference that government action is valid, they claimed that their reliance was justified.
As for NVR, the Complaint asserted a claim for breach of contract and a claim
violation of the TCPA. The contract claim was based on the contention that NVR breached
the Purchase Agreement by “failing to convey the Property in a manner consistent with the
depiction of the Property shown on the Original Plat.” The Boehs TCPA claim was sought
pursuant to Tennessee Code Annotated § 47-18-104(b)(12), which states that “unfair or
deceptive acts or practices” such as “[r]epresenting that a consumer transaction confers or
involves rights, remedies or obligations that it does not have or involve or which are
prohibited by law” constitute an unlawful violation of the Act.
On September 3, 2019, ELI moved for summary judgment, arguing that the Boehs
could not establish a prima facie case for negligent misrepresentation. The trial court
scheduled the hearing for November 21, 2019, but notice of the summary judgment
hearing—which was provided by the circuit court clerk—was only provided via email, and
the email addresses for two of the Boehs’ attorneys—Matthew Grossman and Richard
Graves—were misspelled. However, the email was sent to the correct address for the
Boehs’ third attorney, Benjamin Weigel.
Shortly after ELI’s motion was filed, NVR filed its motion for summary judgment
on September 20, 2019, and gave notice that its motion would be heard on November 21,
2019, the same date ELI’s was set for hearing. NVR asserted that summary judgment was
appropriate on the Boehs’ claims for breach of contract and TCPA on the basis that: no
contractual breach occurred, the Boehs waived any claim regarding the location of the
flood plain line, NVR had no liability under the TCPA, and the Boehs were not damaged
by the representations in the Original Plat.
The Boehs did not file a response in opposition to either motion for summary
judgment. Moreover, although it is undisputed that the Boehs had actual notice of the
hearing for NVR’s motion and were aware that it was set at the same date and time as ELI’s
motion, no one appeared to oppose either motion. Following discussion among the trial
court, counsel for ELI, and counsel for NVR, the trial court granted ELI’s motion and
summarily dismissed the Boehs’ claims against ELI. NVR, however, elected to continue
the hearing on its motion for summary judgment.
Claiming they did not receive notice that ELI’s motion was set for hearing on
November 21, 2019, the Boehs timely filed a Rule 59.04 motion to alter or amend the order
granting summary judgment in favor of ELI.
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On January 25, 2021, the parties filed a joint motion for status conference to address
the Boehs’ outstanding motion to alter or amend and NVR’s outstanding motion for
summary judgment. Following a status conference, the trial court entered an order setting
all pending motions for a hearing on March 25, 2021. Because the Boehs had not yet filed
a Rule 56 response in opposition to ELI’s or NVR’s motion for summary judgment, the
court permitted the Boehs to submit their Rule 56 response in opposition to both NVR’s
and ELI’s motion for summary judgment.2 Accordingly, the Boehs filed written responses
opposing ELI’s and NVR’s motions for summary judgment.
On March 25, 2021, the court heard arguments on the Boehs’ motion to alter or
amend and NVR’s motion for summary judgment. Following the hearing, the trial court
found that notice of the November 21, 2019 hearing was provided to the Boehs via email.
Although the email incorrectly listed two of the email addresses for the Boehs’ attorneys,
the email address for the third attorney was correct. Based on this and other facts before
the court, the trial court held that the Boehs had actual notice of the hearing and denied the
Boehs’ motion to alter or amend. With regard to the Boehs’ contention that they had a
meritorious defense to ELI’s motion for summary judgment, the court additionally found:
[The Boehs] do not dispute that they had no actual notice of the floodplain
line as depicted on the Original Plat. Instead, [the Boehs] creatively argue
that they were on constructive notice of the contents of the Original Plat. The
Court finds no basis in the law for allowing [the Boehs]’ negligent
misrepresentation claim to proceed on a theory of constructive reliance.
Because it is undisputed that [the Boehs] did not rely on the Original Plat,
their negligent misrepresentation claims must fail as a matter of law, and the
Court’s December 9, 2018 ruling would remain unchanged on the merits.
(Footnotes omitted).
The court also granted NVR summary judgment as to both of the Boehs’ claims—
breach of contract and violation of the TCPA. As to the breach of contract claim, the court
explained that changes to “grading” included changes to the location of the flood plain line
in relation to the Property.
Notably, § 1 of the Purchase Agreement provides:
2
Court approval was necessary because Civil Rule 5.03(c) of the Twenty-First Judicial District
Local Rules of Practice requires the responses in opposition to motions for summary judgment be filed no
less than three days prior to the scheduled hearing on the motion, and the date of the scheduled hearing had
already passed.
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We make no representations or warranties about what other improvements
may be constructed within the Community including home types, sizes,
location or prices or the uses of property adjacent to the Property or to the
Community. Any plan or information You may have seen for this community
are subject to change. Unless otherwise stated in an addendum to this
Agreement, We have no obligation to provide You with copies of the
preliminary or final site plans, the record plat, blueprints, general plan maps
or other planning documents which may affect the planning and development
of the surrounding area.
Further, the court noted that the “Tree Save, Grading, Conservation Easement and
Limit/Line of Disturbance Acknowledgment” in the Purchase Agreement provided that the
Property was subject to change:
2. The tree save areas, limits of clearing or limits of disturbance, and grading
are shown on the Plat for the Property; however, these areas and the actual
grading are subject to change based on actual site conditions.
Additionally, the Purchase Agreement specifically precludes reliance on any oral
statements made on behalf of NVR through § 16, which states that unless provided in
writing, no oral promises are enforceable.
The trial court explained that “it is clear from the plain language of the agreement
that the parties understood and agreed that certain conditions on and surrounding [the
Boehs’] lot were subject to change.” In particular, the court found that the parties
“expressly agreed that any grading shown on the Original Plat was subject to change.”
Regarding the Boehs’ TCPA claim, the trial court held that it was undisputed that
NVR had no intent to deceive the Boehs. The court also noted that a violation of the TCPA
required some evidence of fault by NVR, and there was no proof of fault. Accordingly, the
trial court granted NVR’s motion for summary judgment on the TCPA claim as well.
This appeal followed.
ISSUES
We have consolidated the Boehs’ issues on appeal as follows:
1. Whether the trial court erred by denying the Boehs’ Rule 59 motion to alter or
amend?
2. Whether the trial court erred in granting NVR summary judgment?
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STANDARD OF REVIEW
We review a trial court’s ruling on a Rule 59.04 motion to alter or amend under the
abuse of discretion standard. Linkous v. Lane, 276 S.W.3d 917, 924 (Tenn. Ct. App. 2008)
(citing Stovall v. Clarke, 113 S.W.3d 715, 721 (Tenn. 2003)). Pursuant to this standard, we
review a trial court’s decision to determine, where applicable, (1) whether there is a factual
basis for the decision in the record, (2) whether the court properly identified and applied
the applicable legal principles, and (3) whether the decision is “within the range of
acceptable alternative dispositions.” Lee Med., Inc. v. Beecher, 312 S.W.3d 515, 524
(Tenn. 2010). Our review of a trial court’s determinations on issues of law is de novo,
without any presumption of correctness. See Lind v. Beaman Dodge, Inc., 356 S.W.3d 889,
895 (Tenn. 2011).
A trial court’s decision to grant summary judgment is reviewed “de novo, without
a presumption of correctness.” Rye v. Women’s Care Ctr. of Memphis, MPLLC, 477
S.W.3d 235, 250 (Tenn. 2015). Accordingly, this court must make a fresh determination
of whether the requirements of Tennessee Rule of Civil Procedure 56 have been satisfied.
Id. In so doing, we consider “the evidence in the light most favorable to the nonmoving
party and must draw all reasonable inferences in that party’s favor.” Godfrey v. Ruiz, 90
S.W.3d 692, 695 (Tenn. 2002).
Summary judgment should be granted when “the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any, show that there
is no genuine issue as to any material fact and that the moving party is entitled to a judgment
as a matter of law.” Tenn. R. Civ. P. 56.04. When the party moving for summary judgment
does not bear the burden of proof at trial, it “may satisfy its burden of production either (1)
by affirmatively negating an essential element of the nonmoving party’s claim or (2) by
demonstrating that the nonmoving party’s evidence at the summary judgment stage is
insufficient to establish the nonmoving party’s claim or defense.” Rye, 477 S.W.3d at 264.
When a motion for summary judgment is made and supported as provided in
Tennessee Rule of Civil Procedure 56, the nonmoving party may not rest on the allegations
or denials in its pleadings. Id. at 265. Instead, the nonmoving party must respond with
specific facts showing there is a genuine issue for trial. Id. A fact is material “if it must be
decided in order to resolve the substantive claim or defense at which the motion is
directed.” Byrd v. Hall, 847 S.W.2d 208, 215 (Tenn. 1993). A “genuine issue” exists if “a
reasonable jury could legitimately resolve that fact in favor of one side or the other.” Id.-7-
ANALYSIS
I. MOTION TO ALTER OR AMEND
Within thirty days of the court granting ELI’s motion for summary judgment, the
Boehs filed a Tennessee Rule of Civil Procedure 59 motion to alter or amend the order—
more specifically, to set aside the order—based on the failure of the trial court clerk to
properly serve the notice of hearing for ELI’s motion for summary judgment in compliance
with Rule 5.02(2)(a) of the Twenty-First Judicial District Local Rules of Practice, Civil
Rules. The Boehs contend that service was not proper for the following reasons: (1) the
circuit court clerk only attempted to serve the notice via email; (2) the email was incorrectly
addressed to two of the Boehs’ three attorneys;3 (3) nothing in the subject line of the email
advised the recipients that email service was being made pursuant to Tennessee Rule of
Civil Procedure 5.02(2)(a); and (4) and the circuit court clerk did not mail a subsequent
certificate to the parties to alert them of the attempted service by email—the certificate was
sent via email only. Following a hearing, the court denied the motion to alter or amend,
and we find no error with this discretionary decision.
The basis of the Boehs’ contentions is that they did not receive proper notice of the
scheduled hearing of ELI’s motion for summary judgment. The record, however, as we
discuss in more detail below, reveals that counsel for the Boehs were aware that ELI’s
motion had been set for hearing on November 21, 2019, and that the Boehs requested a
stay of the hearing, but the request for a stay of the hearing was denied by ELI’s counsel.
ELI’s motion for summary judgment was properly filed and served on all counsel
on September 3, 2019. Moreover, it is undisputed that all three counsel for the Boehs
received the motion. Thereafter, NVR filed its motion, which included a notice of hearing
that read:
THIS MOTION IS SET TO BE ON THIS COURT’S MOTION
DOCKET ON THE 21ST DAY OF NOVEMBER 2019. PURSUANT TO
LOCAL RULE 26.04(G), FAILURE TO FILE AND SERVE A
TIMELY WRITTEN RESPONSE WILL INDICATE THAT THE
MOTION IS UNOPPOSED AND IT MAY BE GRANTED WITHOUT
FURTHER HEARING.
Then, on September 24, 2019, Christopher Fowler—one of NVR’s attorneys—sent
an email asking the Boehs’ counsel if they had any objection to NVR’s motion for summary
judgment being heard “along with ELI’s.” Mr. Grossman—one of the Boehs’ attorneys—
3
The clerk sent emails to mgrossman@fmsllp.cpom instead of mgrossman@fmsllp.com and
rgrave@fmsllp.com instead of rgraves@fmsllp.com. The email to Mr. Weigel was sent to his correct email
address.
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responded on September 24, 2019, stating that he would prefer for both of the motions
for summary judgment be “put off” pending settlement efforts between NVR and the
Boehs regarding construction disputes.
Approximately one month later, on October 18, 2019, Mr. Grossman emailed Mr.
Dial, ELI, and NVR’s counsel—Mr. Fowler and John Willet—to explain that the Boehs
were attempting to resolve warranty issues and requesting “that the parties put this matter
(including dispositive motions) on hold pending completion of the warranty work.” Mr.
Grossman continued in the same email: “I would be happy to prepare an agreed stay order,
if anyone feels it would be necessary.” Mr. Willet, counsel for ELI, responded by
explaining that while his clients hoped the Boehs would be able to resolve their dispute
with NVR, his clients could not agree to stay the hearing on their motion for summary
judgment. As a consequence, both motions remained on the docket for hearing on
November 21, 2019.
Of additional significance is the fact that, although more than thirty days had passed
since the filing of motions for summary judgment by ELI and NVR, no response in
opposition to either motion for summary judgment was filed by the Boehs prior to the
hearing on November 21, 2019. This is significant because the Twenty-First Judicial
District Local Rules of Practice, Civil Rule 5.03(d) reads:
If, at the time a motion is filed the moving party sets the motion to be heard,
the motion shall conspicuously state the date and time of the hearing and
shall advise the non-moving party that the failure to file and serve a written
response may result in the motion being granted without further hearing.
Based on the foregoing and other facts in the record, the court found that it could
“infer constructive notice of the November 21, 2019 summary judgment hearing from the
various communications between counsel for Plaintiffs and counsel for Defendants after
the Notice was served.” Having reviewed the record, we conclude that the evidence does
not preponderate against this finding.
Furthermore, and the foregoing notwithstanding, when relief from a judgment due
to “excusable neglect” is sought pursuant to Rule 59, the motion asserting excusable
neglect must discuss not only whether the defaulting parties’ conduct was willful but also
“whether the defaulting party has a meritorious defense and whether the non-defaulting
party will be prejudiced by the granting of relief.” See Discover Bank v. Morgan, 363
S.W.3d 479, 493–94 (Tenn. 2012). Here, however, the Boehs’ Rule 59 motion was devoid
of any meritorious defense or argument as to whether the non-defaulting parties, ELI and
NVR, would be prejudiced by the granting of relief. Instead, the Boehs’ motion focused
exclusively on notice and procedural due process. This omission is important because, as
this court has explained:
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Although failure to serve a proper party may lead to reversal of the judgment
against that party, “[a] simple denial of service by a party is never sufficient
to set aside a judgment.” “That is not to say that [the] presumption may not
be rebutted, if the testimony of a party is supported by other disinterested
witnesses or by corroborating circumstances.” “[T]here obviously exists the
possibility of proof that a document was not received even though a
certificate of service appears on it.” However, “[t]he burden is on the
complaining party to show by clear and convincing evidence that he was not
served.” Rebuttal evidence of non-receipt creates an issue of fact for the court
to resolve.
Christy v. Christy, No. M2021-00192-COA-R3-CV, 2022 WL 951254, at *6 (Tenn. Ct.
App. Mar. 30, 2022) (citations omitted) (quoting Se. Bank & Tr. v. Caldarera, No. E2015-
00353-COA-R3-CV, 2015 WL 7890039, at *3 (Tenn. Ct. App. Dec. 4, 2015)).
This court was presented with a similar scenario in Howes v. Swanner, No. M2016-
01892-COA-R3-CV, 2017 WL 2192065 (Tenn. Ct. App. May 17, 2017), wherein the trial
court granted the plaintiff’s motion for summary judgment after the defendants failed to
file a response or appear at the hearing. Id. at *2. The defendants subsequently filed a
motion for relief under Rule 60.02,4 asserting that they did not receive notice of the hearing.
Id. at *3. We found that, under the circumstances, the defendant’s failure to respond to the
motion for summary judgment and to appear at the hearing was not willful. Id. at * 6. Yet,
the trial court denied the defendants’ motion, and this court affirmed, finding, inter alia,
that the defendants did not address the meritorious-defense and prejudice factors in their
motion. Id. at *6.
4
This court has explained that the standard for setting aside a default judgment due to “excusable
neglect” applies when the judgment is the result of a party’s failure to respond to a motion for summary
judgment and appear at the hearing. Berge v. Warlick, No. M2018-00767-COA-R3-CV, 2019 WL 93281,
at *3 (Tenn. Ct. App. Jan. 3, 2019) (citing Howes, 2017 WL 2192065, at *4). The standard for setting aside
a default judgment due to “excusable neglect” is:
[W]hen a party seeks relief from a default judgment due to “excusable neglect,” whether
pursuant to Rule 54.02 (for interlocutory judgments), Rule 59.04 (for final judgments
within thirty days of entry), or Rule 60.02 (for final judgments more than thirty days after
entry), a reviewing court must first determine whether the conduct precipitating the default
was willful. If the court finds that the defaulting party has acted willfully, the judgment
cannot be set aside on “excusable neglect” grounds, and the court need not consider the
other factors. If the conduct was not willful, however, then the court must consider whether
the defaulting party has a meritorious defense and whether the non-defaulting party would
be prejudiced by the granting of relief. The court may also consider any other factor that it
deems relevant.
Discover Bank, 363 S.W.3d at 493–94 (emphasis added) (footnote omitted).
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Therefore, we conclude that the trial court did not abuse its discretion in denying
the Boehs’ Rule 59 motion to alter or amend. See Linkous v. Lane, 276 S.W.3d 917, 924
(Tenn. Ct. App. 2008) (stating that we review a trial court’s ruling on a Rule 59.04 motion
to alter or amend under the abuse of discretion standard (citing Stovall v. Clarke, 113
S.W.3d 715, 721 (Tenn. 2003))).
Because the motion to alter or amend was correctly denied, we do not reach the
merits of the Boehs’ negligent misrepresentation claim against ELI on appeal.
II. BREACH OF CONTRACT
The trial court granted NVR summary judgment on the breach of contract claim,
finding the Purchase Agreement allowed for changes to the FEMA floodplain in relation
to the Property. More specifically, the court based this conclusion on the provision in an
addendum which provided that “grading . . . shown on the Plat” was “subject to change
based on actual site conditions.”
The Boehs contend that NVR breached the Purchase Agreement because it
“required NVR to sell [the Boehs] Lot 431 as shown on the Original Plat.” They also
contend the trial court erroneously concluded that the Purchase Agreement allowed for
changes to the FEMA flood plain. In this regard, the Boehs assert that the trial court erred
by relying on extrinsic evidence to supply a technical meaning for the term “grading”
instead of the ordinary meaning.
NVR insists the breach of contract claim was properly dismissed because NVR did
not materially breach the contract. In this regard, NVR notes that it sold the Boehs a legal
and buildable residential home that was approved by the City of Franklin. Moreover, any
potential breach was cured, as the Property is no longer located in a flood plain. More
specifically, as NVR notes in its brief, “[t]o the extent there were any discrepancies or
inaccuracies in the plat, they have been corrected.” Thus, NVR argues that the Boehs
suffered no damages, which is an essential element of any breach of contract claim.
It is undisputed that the Original Plat incorrectly depicted the Property as being
separated from the 100-year flood plain line by a few yards when in actuality the 100-year
flood plain encroached upon the Property at closing. As such, the Boehs insist that NVR
breached the Purchase Agreement at closing and that the court’s inquiry should stop there.
However, the court’s inquiry did not stop there.
Instead, the trial court relied on extrinsic evidence to supply a technical meaning for
“grading” instead of using the ordinary meaning. Specifically, the trial court relied on the
definition of “grading” as set forth in the Franklin Municipal Code, which defines
“grading” as:
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Any operation or occurrence by which the existing site elevations are
changed; or where any ground cover, natural or manmade, is removed; or
any watercourse or body of water, either natural or manmade, is relocated on
any site, thereby creating an unprotected area. This includes stripping,
cutting, filling, stockpiling, or any combination thereof, and shall apply to
the land in its cut or filled condition. Grading activities may only be
performed with a stormwater management permit and grading permit.
Franklin, Tenn., Code § 23-103(33).
Based on the definition for “grading” in the Franklin Municipal Code, the trial court
held that “[t]he literal meaning of the term ‘grading,’ as that term is commonly understood
in Williamson County, includes changes in site elevation for the purpose of directing
water.” The trial court interpreted the Purchase Agreement as contemplating that the
“grading shown on the Original Plat was subject to change” and concluded that the
subsequent changes to the Property had been anticipated and were permitted by the plain
language of the Purchase Agreement.
The Boehs assert that had the trial court relied on “established dictionaries,” it would
have found that the “ordinary meaning” of grading “does not mean a change in site
elevation for the specific purpose of directing water” but would have determined the
“ordinary meaning” of grading means “a change in site elevation generally, without any
required connection to directing water.” The Boehs take issue with the nexus created by
the trial court’s definition between “grading” and water direction.5
“Questions of contract interpretation . . . are questions of law, which we review de
novo without a presumption of correctness.” Circle C Constr., LLC v. Nilsen, 484 S.W.3d
914, 917 (Tenn. 2016). In doing so, “[w]e are guided by well-settled principles and general
rules of construction. ‘A cardinal rule of contractual interpretation is to ascertain and give
effect to the intent of the parties.’” Dick Broad. Co. of Tennessee v. Oak Ridge FM, Inc.,
395 S.W.3d 653, 659 (Tenn. 2013) (quoting Allmand v. Pavletic, 292 S.W.3d 618, 630
(Tenn. 2009)). We initially determine the parties’ intent by examining the plain and
ordinary meaning of the written words that are “contained within the four corners of the
5
According to the Boehs, the court should have adopted Webster’s New College Dictionary
definition of “grading,” which is “to level or slope (ground, a road, etc.) evenly.” Webster’s New College
Dictionary 615 (Wiley Publ’g, Inc. 2009). Alternatively, the Boehs point to the Webster’s II New Riverside
University Dictionary definition of “grading,” which is “[t]o smooth or level to a desired or horizontal
gradient.” Webster’s II New Riverside University Dictionary 542 (Riverside Publ’g Co. 1984). The Boehs
argue that even if the trial court’s reference to the Franklin Municipal Code is acceptable, that when
compared with the definition in established dictionaries, the meaning becomes ambiguous, necessitating a
trial.
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contract.” 84 Lumber Co. v. Smith, 356 S.W.3d 380, 383 (Tenn. 2011). Yet, as our Supreme
Court has explained,
When the parties’ contracts are fully integrated, general extrinsic evidence
of context may be used to interpret the contractual language in line with
the parties’ intent, but the parol evidence rule prohibits the use of evidence
of pre-contract negotiations in order to vary, contradict, or supplement the
contractual terms of a fully integrated agreement.
Individual Healthcare Specialists, Inc. v. BlueCross BlueShield of Tenn., Inc., 566 S.W.3d
671, 697 (Tenn. 2019) (emphasis added). Further, “[c]ommon sense must be applied to
each case, rather than any technical rules of construction.” Id. at 688 (quoting Barnes v.
Black Diamond Coal Co., 47 S.W. 498, 499 (Tenn. 1898)).
In relevant part, the Purchase Agreement provides “[a]ny plan or information You
may have seen for this community are subject to change,” and the Tree Save addendum to
the Purchase Agreement provides that “grading . . . shown on the Plat” is “subject to
change based on actual site conditions.”
The Purchase Agreement is fully integrated,6 meaning “it is intended to be the
complete and exclusive statement of the parties’ agreement.” Id. at 696. Because the
Purchase Agreement is fully integrated, extrinsic evidence may provide context, “but it
may not be used to vary, contradict, or supplement” the terms of the Purchase Agreement
itself. Id. at 698.
Thus, the trial court did not err by referencing the Franklin Municipal Code to
determine the context in which the term “grading” was used. As such, we affirm the trial
court’s determination that “grading,” as used in the Purchase Agreement, permitted
“changes in site elevation for the purpose of directing water.”
The foregoing notwithstanding, the Boehs insist that had there not been a breach,
there should not have been anything to correct following the closing. The Boehs contend
that there is no dispute that at closing, NVR conveyed the Property to the Boehs with the
deed, which referenced the Original Plat to describe the Property being conveyed and
6
Section 25 of the Purchase Agreement is titled “Entire Agreement” and states:
This Agreement, together with the Tennessee Addendum to Purchase Agreement, the
Affiliated Business Arrangement Disclosure, and all other addenda pertaining thereto are
incorporated by reference and constitute the entire and final Agreement. No other prior or
contemporaneous agreements, representations, promises or terms (written or oral) are part
of this Agreement, but are superseded by this written Agreement. No additions or changes
to this Agreement shall be valid or binding unless signed by You and Our authorized
officer.
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showed that the Property was “wholly outside the flood zone.” Yet, because the Property
was located inside the flood plain at closing, the Boehs insist that it is undisputable that
NVR did not convey “Lot 431 as shown on the Original Plat.”
For its part, NVR asserts that the trial court properly dismissed the Boehs’ breach
of contract claim because the Boehs received exactly what they bargained for—a legal and
buildable residential home and that any damage they suffered was cured when the Property
was removed from the flood plain.
Finding there was no material breach of contract, the trial court explained, “It is
undisputed that [the Boehs] received a buildable lot in Williamson County, wholly outside
the 100-year floodplain.” Accordingly, the trial court granted NVR summary judgment on
the breach of contract claim, concluding that there was “no genuine dispute of material fact
remaining for trial on the question of whether NVR breached its agreement with [the
Boehs] when it conveyed the property to them.”
Importantly, to establish a claim for breach of contract, the Boehs were required to
prove: “(1) the existence of an enforceable contract, (2) nonperformance amounting to a
breach of the contract, and (3) damages caused by the breach of the contract.” ARC
LifeMed, Inc. v. AMC-Tennessee, Inc., 183 S.W.3d 1, 26 (Tenn. Ct. App. 2005) (quoting
Custom Built Homes v. G.S. Hinsen Co., No. 01A01-9511-CV-00513, 1998 WL 960287(Tenn. Ct. App. Feb. 6, 1998)). Interpretation of a written agreement is a matter of law, not
of fact. APAC-Tennessee, Inc. v. J.M. Humphries Constr. Co., 732 S.W.2d 601, 604 (Tenn.
Ct. App. 1986) (citations omitted).
The Purchase Agreement included the following provisions: any grading shown on
the Original Plat was subject to change; NVR reserved the right “to make changes in the
Plans and Specifications for purposes of mechanical installations, building code and site
requirements”; and detailed that even after closing, NVR retained the right to enter the
Property “for the purpose of making exterior changes to the Lot or to adjacent lots,
including but not limited to grading and drainage system changes and the removal or
planting of trees.” Thus, NVR retained the authority, even after closing, to re-enter the
Property to fill, grade and make changes necessary to complete the LOMR process and
deliver the Property “wholly outside the flood zone.” NVR did just that. Therefore, NVR
fulfilled its contractual obligation that the Property be “wholly outside the flood zone.”
For the foregoing reasons, NVR was entitled to summary judgment as a matter of
law on the breach of contract claim.
III. TCPA & STRICT LIABILITY
The Boehs contend the trial court erred by summarily dismissing their TCPA claim
against NVR. More specifically, they contend the court “misapplied the legal requirements
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for TCPA . . . liability by holding that fault on the part of NVR is a pre-requisite to TCPA
liability.”
For its part, NVR insists dismissal of the TCPA claim was appropriate because it
affirmatively negated an essential element required for a TCPA claim. More specifically,
it established that “(1) the Property is not in a floodplain, (2) NVR knew nothing about the
floodplain until after the closing, and (3) NVR made no deceptive statements regarding the
floodplain.” For these reasons, NVR contends the Boehs were unable to “put up” proof that
NVR engaged in a deceptive act.
The Boehs’ TCPA claim is based on subsection 12 of Tennessee Code Annotated
§ 47-18-104(b), which states that “unfair or deceptive acts or practices” such as
“[r]epresenting that a consumer transaction confers or involves rights, remedies or
obligations that it does not have or involve or which are prohibited by law” constitute an
unlawful violation of the Act. The Boehs insist they presented substantial and material
evidence to support their claim. Specifically, they assert that prior to signing the Purchase
Agreement, NVR’s employee, Brittany Walker, represented that the Property was not in
the flood plain.7 They further insist that additional representations that the Property was
not in the flood plain were made as part of the Purchase Agreement and the Deed, which
detailed that the Boehs were acquiring fee simple rights in the Property as shown on the
Original Plat, which depicted the Property as being located outside the flood plain.
Accordingly, they complain that the trial court erred by granting summary judgment to
NVR.
In support of this argument, the Boehs cite Ganzevoort v. Russell, 949 S.W.2d 293(Tenn. 1997) for the proposition that “actionable fault is not a prerequisite to liability.”
Essentially, the Boehs argue that liability under the TCPA is not dependent on evidence of
knowledge; therefore, NVR may be held liable even though they had no knowledge of the
alleged misrepresentations.
Notably, the Tennessee Supreme Court rejected this proposition in Ganzevoort by
clarifying that “[t]he Act does not impose strict liability.” Id. at 299 (emphasis added). In
its Order on Petition to Rehear, the Court elaborated:
The Tennessee Legislature did not define “unfair” and “deceptive” in the
Consumer Protection Act. Where a particular act or practice has not been
specifically addressed in the statute, the definition of those terms are left to
the courts on a case by case basis. See Jeffrey L. Reed, The Tennessee
Consumer Protection Act: An Overview, 58 Tenn. L. Rev. 455, 460 (1991).
7
Section 16 of the Purchase Agreement states that unless they are written into the agreement, oral
statements or promises are not enforceable. There were no oral statements or promises written into the
agreement, so Ms. Walker’s statement is not enforceable.
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The conclusion that the same definition does not apply in every case is
consistent with the varying provisions of the Act defining unfair and
deceptive acts in particular situations. Tenn. Code Ann. § 47-18-104(b)(1–
26) and (28–30). A review of these provisions shows that though in most
situations actionable fault is not a prerequisite to liability, in others,
knowledge is a prerequisite, and in still others, intent to deceive is the
standard. Consequently, the petitioner’s second contention, that under the
Act proof of deception is never dependent upon evidence of intent or
knowledge, is contrary to the plain language of the Act.
Id. at 300 (footnote omitted).
Further distinguishing Ganzevoort from the present case, Ganzevoort addressed
subsection 27 of § 47-18-104(b) as it applied to real estate brokers. See id. at 298–99. The
Court explained that the Act neither imposes strict liability nor imposes duties beyond those
generally accepted in the business as good practice for real estate brokers. Id. at 299. In its
Order on Petition to Rehear, the court clarified that the same definition of “unfair” or
“deceptive” acts is not applicable to all provisions of the Act. Id. at 300.
As the terms “unfair” and “deceptive” are not defined by the TCPA,8 “the standards
to be used in determining whether a representation is ‘unfair’ or ‘deceptive’ under the
TCPA are legal matters to be decided by the courts.” Tucker v. Sierra Builders, 180 S.W.3d
109, 116 (Tenn. Ct. App. 2005) (citations omitted). “However, whether a specific
representation in a particular case is ‘unfair’ or ‘deceptive’ is a question of fact.” Id. (citing
Davidson v. Gen. Motors Corp., 786 N.E.2d 845, 851 (Mass. App. Ct. 2003)). As a
question of fact, our review on appeal is de novo with a presumption of correctness. Tenn.
R. App. P. 13(d).
In determining the TCPA’s intended meaning, the Act directs courts to look to
opinions interpreting a similar provision in the Federal Trade Commission Act. In the 1994
legislation reauthorizing the Federal Trade Commission, Congress stated “that an act or
practice should not be deemed unfair ‘unless the act or practice causes or is likely to cause
substantial injury to consumers which is not reasonably avoidable by consumers
themselves and not outweighed by countervailing benefits to consumers or to
8
The Supreme Court has previously explained,
To be considered deceptive, an act is not necessarily required to be knowing or intentional.
Negligent misrepresentations may be found to be violations of the Act. A deceptive act or
practice is, in essence, “a material representation, practice or omission likely to
mislead . . . reasonable consumer[s]” to their detriment.
Fayne v. Vincent, 301 S.W.3d 162, 177 (Tenn. 2009) (citations omitted) (quoting Ganzevoort, 949 S.W.2d
at 299).
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competition.’” Tucker, 180 S.W.3d at 116–17 (quoting 15 U.S.C. § 45(n)). “To be
considered ‘substantial,’ consumer injury must be more than trivial or speculative.” Id. at
117 (citing Tungate v. MacLean-Stevens Studios, Inc., 714 A.2d 792, 797 (Me. 1998); Legg
v. Castruccio, 642 A.2d 906, 917 (Md. Ct. Spec. App. 1994)). Consumer injury should
only be considered substantial if a relatively small harm is inflicted on many consumers
“or if a greater harm is inflicted on a relatively small number of consumers.” Id. (citing
Orkin Exterminating Co. v. FTC, 849 F.2d 1354, 1365 (11th Cir. 1988)).9 “The concept of
unfairness is even broader than the concept of deceptiveness, and it applies to [various]
abusive business practices that are not necessarily deceptive.” Id. at 116 (citing Jonathan
Sheldon & Carolyn L. Carter, Unfair and Deceptive Acts and Practices § 4.3.3.1, at 156
(5th ed. 2001)).
Importantly, this court has previously defined a deceptive act or practice as “one
that causes or tends to cause a consumer to believe what is false or that misleads or tends
to mislead a consumer as to a matter of fact.” Id. at 116. Thus, “the essence of deception is
misleading consumers by a merchant’s statements, silence, or actions.” Id. (citing Sheldon
& Carter, supra, § 4.2.3.1, at 118–19)).
Because there are differing standards for each provision of the Act, we look to other
cases that define “unfair” or “deceptive” acts within the parameters of § 47-18-104(b)(12),
the section cited by the Boehs. In Roby v. NationStar Mortgage, LLC, No. W2019-00730-
COA-R3-CV, 2020 WL 2315784 (Tenn. Ct. App. May 11, 2020) this court explained that
recovery under § 47-18-104(b)(12) requires more “than a disagreement or
misunderstanding.” Id. at *11. Meanwhile, in Overton v. Westgate Resorts, Ltd., L.P., No.
E2014-00303-COA-R3-CV, 2015 WL 399218 (Tenn. Ct. App. Jan. 30, 2015) this court
found that there had been a violation of § 47-18-104(b)(12) where the plaintiffs
demonstrated by clear and convincing evidence that the defendants had engaged in
intentional and fraudulent conduct, which amounted to a willful violation of the Act. Id. at
*7. Based on these cases and Ganzevoort, it is apparent that strict liability is not imposed
under § 47-18-104(b)(12).
The trial court found that to trigger liability under the TCPA, NVR was required to
have acted with some level of fault. The trial court determined there were no facts or
9
In Tucker v. Sierra Builders, 180 S.W.3d 109 (Tenn. Ct. App. 2005), this court further explained:
Even if an act or practice causes or is likely to cause substantial injury, it will not be
considered unfair unless the injury is not reasonably avoidable by consumers themselves.
Consumers cannot reasonably avoid injury when a merchant’s sales practices unreasonably
create or take advantage of an obstacle to the free exercise of consumer decision-making.
Practices that unreasonably interfere with consumer decision-making include (1)
withholding important information from consumers, (2) overt coercion, or (3) exercising
undue influence over a highly susceptible class of consumers.
Id. at 117.
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allegations to support a claim that NVR acted with any level of fault and that the undisputed
facts established that the Boehs neither relied on the Original Plat or any representations
made by NVR with respect to the location of the flood plain. We agree.
In his deposition testimony, Mr. Boeh conceded that it was his understanding that
NVR was not aware of the flood plain issues on the Property until after closing. Upon
learning of the flood plain issues, NVR communicated with the Boehs and began the
process of rectifying the issues. Thus, it cannot be said that NVR engaged in unfair or
deceptive acts that conferred “rights, remedies or obligations.”
For the foregoing reasons, we affirm the trial court’s decision to summarily dismiss
the Boehs’ TCPA claim against NVR.
IN CONCLUSION
The judgment of the trial court is affirmed in all respects, and this matter is
remanded for further proceedings consistent with this opinion. Costs of appeal are assessed
against Michael and Anna Boeh.
________________________________
FRANK G. CLEMENT JR., P.J., M.S.
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