Summary Judgment Reversed in Conversion Case

In Garner v. Coffee County Bank, No. M2014-01956-COA-R3-CV (Tenn. Ct. App. Oct. 23, 2015), the Court of Appeals partially overturned a trial court’s grant of summary judgment to defendants on several claims, including the torts of conversion and trespass to chattels.

Plaintiff and his former wife had purchased a home together, but wife moved out in 2009, taking her belongings with her. The home and its contents were damaged by fire in 2010. Wife was named on the insurance policy, so the checks from the insurer were made to both plaintiff and wife. The checks were for home damage, property loss and living expenses. Plaintiff believed that wife was not entitled to any of the proceeds for personal property loss and living expenses, since wife was not living at the home at the time and did not have any of her belongings there. According to plaintiff, however, the president of the bank where the home mortgage was held told plaintiff that he could not cash the checks and get any money unless he gave wife half of the proceeds. Plaintiff averred that, feeling coerced, he gave wife half the proceeds, and that money was used to pay down wife’s separate loan from the bank. The bank ultimately foreclosed on plaintiff’s home, and plaintiff filed suit for conversion, trespass to chattels, and conspiracy, among other causes of action.

Defendants moved for summary judgment on all of plaintiff’s claims. Plaintiff, however, failed to file any response to the summary judgment motion until after the time required by Tennessee Rule of Civil Procedure 56.03, and the trial court refused to use its discretion to excuse this delay. While the court acknowledged that plaintiff had been sick in the days leading up to the hearing and that could have affected his ability to sign his affidavit, it also pointed out that no other papers not requiring plaintiff’s signature and no motion for an extension of time were filed. Accordingly, plaintiff’s late-filed responsive documents were not considered in the summary judgment decision.

Because his response was too late to be considered, plaintiff’s first argument on appeal was that the trial court should have considered his sworn affidavit as “an affidavit in opposition to the Defendants’ motion for summary judgment.” While plaintiff was correct that a verified complaint can have “the force and effect of an affidavit when considered in opposition to a motion for summary judgment,” in the present matter the language used prevented the complaint from considered. (internal citation and quotation omitted). Plaintiff “did not verify that the facts contained in his amended complaint were true; rather, he made an oath that the statements were ‘true and correct to the best of his knowledge, information, and belief.’” When this language is used, Tennessee courts have held that the complaint cannot be considered an affidavit under Rule 56.06. Thus, the only evidence to be considered here was that presented by defendants in connection with their motion—the defendants’ statement of undisputed material facts and the deposition transcripts of plaintiff and the bank president.

After establishing what evidence could be considered, the Court looked at the torts of conversion and trespass of chattels. Conversion required plaintiff to show “the appropriation of property to the party’s own use and benefit, by the exercise of dominion over it, in defiance of plaintiff’s right,” while trespass to chattel required a showing that “one party intentionally use[d] or intermeddle[d] with personal property in rightful possession of another without authorization.” Plaintiff alleged that these torts were supported by his allegations that the bank and president “strong armed plaintiff into signing over half of the insurance proceeds to [wife] so that she could use the money to pay the mortgage on her son’s home, which was her residence.”

In its statement of facts, defendants asserted that the checks were split 50/50; that if the president had not helped with the negotiation of the checks, plaintiff would likely have gotten nothing from the checks; and that both plaintiff and wife were named on the insurance policy and had a one-half interest in the house. The Court of Appeals noted, though, that “the truth of these statements…does not support the defendants’ position that they are entitled to summary judgment” on the conversion and trespass to chattel claims. The Court pointed out portions of plaintiff’s deposition wherein he testified that the bank president was “actively involved in making sure [wife] received one-half of each check from the insurance company that was issued to cover property loss and living expenses following the fire.” Moreover, the Court disagreed with how the trial court analyzed the summary judgment motion. The trial court had found as follows:

The undisputed facts do not support the Plaintiff’s contentions that (1) he was entitled to all of the proceeds from the checks in question which were issued by [the insurance company]; (2) he was coerced or pressured by [president] to equally divide the insurance proceeds with [wife]; or (3) [president] and [wife] conspired to interfere with or deprive the Plaintiff of his alleged right to all of the insurance proceeds. As a matter of law, the undisputed facts and depositions do not support the Plaintiff’s allegation that Defendants appropriated any insurance proceeds that belonged to him, that Defendants acted in defiance of Plaintiff’s rights to insurance proceeds, that the Defendants wrongfully interfered with the Plaintiff’s alleged right to the insurance proceeds or that Defendants deprived the Plaintiff of the use of said insurance proceeds.

Looking at this ruling, the Court of Appeals determined that the trial court incorrectly analyzed the summary judgment motion. “When ruling on a motion for summary judgment, the court must decide whether the undisputed facts show that the parties moving for summary judgment, the Defendants here, are entitled to judgment as a matter of law, not whether the undisputed facts support the plaintiff’s contentions.” Here, the Court found that plaintiff’s deposition testimony raised material fact issues such as the ownership of the property damaged by the fire, whether wife should have received proceeds for living expenses, and the extent of the president’s involvement in the situation. Accordingly, summary judgment was inappropriate on the conversion and trespass to chattels claims.*

Here, the Court of Appeals engaged in a thoughtful analysis to reach the correct result. Although plaintiff’s responsive documents could not be considered, his deposition could, as defendants submitted it with their motion. Portions of his deposition raised fact issues, and the tort claims should have therefore survived summary judgment. This case has a few takeaway lessons. First, be sure to file all responsive pleadings in a timely fashion or at least move for an extension of time. When a trial court only has one side of the story before it, it is likely to rule in that party’s favor rather then dig for factual issues itself. Second, if a trial court does fail to find issues of fact where they exist or use an incorrect analysis on a summary judgment motion, there is hope on appeal. Although plaintiff’s counsel here did not manage his trial court filings well, he still managed to present his case on appeal in such a way that allowed the Court to save his client from summary judgment.

 

*Due to this holding, the Court also reinstated plaintiff’s claim for civil conspiracy.