The Tennessee Court of Appeals (Middle Section) has ruled that "trial court has the discretion to sanction a party by dismissal of its case where the party’s destruction of evidence severely prejudices an adverse party’s defense irrespective of whether the destruction was inadvertent or intentional."
The Court quoted with approval this language from a court in Michigan: "In cases involving the loss or destruction of evidence, a court must be able to make such rulings as necessary to promote fairness and justice. To deny the courts the power to sanction a party in such circumstances would only encourage unscrupulous parties to destroy damaging evidence before a court order has been issued. Furthermore, regardless of whether evidence is lost as the result of a deliberate act
or simple negligence, the other party is unfairly prejudiced because it is unable to challenge or respond to the evidence."
Presumably, a court could strike an answer and enter a judgment for the plaintiff if a defendant’s "destruction of evidence severely prejudices an adverse party’s defense irrespective of whether the destruction was inadvertent or intentional."
The case is Cincinnati Insurance Co. v. Mid-South Drillers Supply, Inc., No. M2007-00024-COA-R3-CV (Tenn. Ct. App. Jan. 25, 2008).