Unigard Security Insurance Co. vs. Scott Hickman, et ux, et al. vs. The Mackorell Group, Inc., et al.

Annotate this Case

Download PDF

I N THE COURT OF APPEALS OF TENNESSEE EASTERN SECTI ON FILED January 12, 1996 Cecil Crowson, Jr. UNI GARD SECURI TY I NSURANCE COM PANY Pl a i nt i f f - Appe l l e e v. SCOTT HI CKM AN a nd wi f e SUSAN DENI SE HI CKM AN, a nd M AKATO' S OF TENNESSEE, I NC. De f e nda nt s - Appe l l a nt s AND M AKATO' S OF TENNESSEE, I NC. Th i r d- Pa r t y Pl a i nt i f f , Ap pe l l a nt v. THE M ACKORELL GROUP, I NC. J AM ES T. M ACKORELL a nd wi f e W ENDY L. M ACKORELL Th i r d- Pa r t y De f e nda nt s , Ap pe l l e e s ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) Appellate C ourt Clerk W ASHI NGTON COUNTY 03A01- 9508- CV- 00261 HON. G. RI CHARD J OHNSON, CHANCELLOR ( Si t t i ng by I nt e r c ha nge ) AFFI RM ED AND REM ANDED VANCE W CHEEK, J R. , OF J OHNSON CI TY FOR M . AKATO' S OF TENNESSEE, I NC. J . DAVI D M LLER OF KI NGSPORT FOR SCOTT HI CKM I AN AND W FE SUSAN I DENI SE HI CKM AN J ACK M VAUGHN OF KI NGSPORT FOR UNI GARD SECURI TY I NSURANCE . COM PANY DAVI D S. HAYNES OF BRI STOL FOR THE M ACKORELL GROUP, I NC. , J AM ES T. M ACKORELL a nd wi f e W ENDY L. M ACKORELL O P I N I O N Godda r d, P. J . Sc ot t Hi c kma n a nd wi f e Sus a n D. Hi c kma n a nd M ka t o' s o f a Te nn e s s e e , I nc . , h e r e i na f t e r r e f e r r e d t o a s t he De f e nda nt s , a p p e a l a de c l a r a t or y j udgme nt e nt e r e d by t he Ci r c ui t Cour t f or W s h i n g t on Count y whi c h f o und t ha t a l i a bi l i t y pol i c y i s s ue d b y a Un i g a r d Se c ur i t y I ns ur a nc e Compa ny t o M ka t o' s di d not c ove r a n a i n j u r y t o M . Hi c kma n be c a us e M ka t o' s ha d not c ompl i e d wi t h t h e r a n o t i c e r e qui r e me nt of t he pol i c y. M ka t o' s a l s o a ppe a l s a d i s mi s s a l of i t s t hi r d- pa r t y a c t i on a ga i ns t t he M c kor e l l Gr ou p , a I nc . , 1 a nd J a me s T. M c kor e l l a nd wi f e W ndy L. M c kor e l l . a e a J a me s T. M c k or e l l a nd W ndy L. M c kor e l l owne d t he c a pi t a l s t oc k of a e a M k a t o ' s a t t he t i me of M . Hi c kma n' s i nj ur y, but s hor t l y a r t h e r e a f t e r s ol d i t t o Thoma s M c kor e l l a nd wi f e J ul i e A. a M c ko r e l l a nd Da vi d Le Ve a u. a The De f e nda nt s a s t o t he or i gi na l a c t i on i ns i s t t ha t t h e e v i de nc e pr e ponde r a t e s a ga i ns t t he Cha nc e l l or ' s f i ndi ng t ha t M k a t o ' s di d not c ompl y wi t h t he " a s s oon a s pr a c t i c a bl e " not i c e a r e q u i r e me nt unde r t he pol i c y, t ha t t he i r de l a y i n not i c e wa s e x c u s a b l e be c a us e of t he t r i vi a l na t ur e of M . Hi c kma n' s i nj ur y r a n d t h a t Uni ga r d wa s not pr e j udi c e d by t he de l a y. 1 It i s u n c l e a r wh y t h e M c k o r e l l a De f e n d a n t . 2 Gr o u p wa s ma d e a t h i r d - p a r t y M ka t o' s a ppe a l s di s mi s s a l of i t s t hi r d- pa r t y a c t i on, a c o mp l a i ni ng of t he Tr i a l Cour t ' s di s mi s s i ng t he t hi r d- pa r t y c o mp l a i nt " wi t hout a mot i on t o di s mi s s , " a nd t ha t t he p r e p o n d e r a nc e of t he e vi de nc e s uppor t s i t s t hi r d- pa r t y c ompl a i n t . The f i r s t not i c e Uni ga r d r e c e i ve d of t he i nj ur y t o M . r Hi c k ma n , whi c h oc c ur r e d on Se pt e mbe r 1, 1991, a nd r e s ul t e d f r om a c h a i r i n whi c h he wa s s i t t i ng a t M ka t o' s r e s t a ur a nt c ol l a ps i n g , a wa s o n J ul y 30, 1992, s ome 16 da ys a f t e r s ui t wa s f i l e d by t he Hi c kma ns . Ac c or di ng t o M . Hi c kma n, upon l e a vi ng t he r e s t a ur a n t r h e ga ve a bus i ne s s c a r d t o t he c a s h i e r wi t h hi s na me , a ddr e s s a nd p h o n e n umbe r a nd a s ke d t o be c ont a c t e d " ASAP, " whi c h he t e s t i f i e d me a nt " a s s oon a s p os s i bl e . " Thi s c a r d, a l ong wi t h ot he r ma t e r i a l i nc i de nt t o t he b us i ne s s , wa s de l i ve r e d t o Te d M c kor e l l a b y Ke n n e t h As hl e y, a n a s s i s t a nt ma na ge r of t he r e s t a ur a nt . 2 As h l e y ' s t e s t i mony r e ga r di ng de l i ve r y of t he c a r d, whi c h wa s d e n i e d by M . M c kor e l l , i s a s f ol l ows : r a Q. You s a i d you put t he not e t ha t you got f r om M . M [ t he c a s hi e r ] i n a box or a c ont a i ne r . . . s a A. Ri ght . Q. . . . t ha t you e ve nt ua l l y t ook t o M . Te d r M c kor e l l . a A. Q. 2 Ri ght . I s t ha t c or r e c t ? M . r As h l e y ' s wi f e wa s t h e ma n a g e r . 3 M. r A. Ye s . Q. W t we r e your i ns t r uc t i ons f r om M . ha r M c kor e l l , M . a nd M s . M c kor e l l wi t h r e ga r d t o a r r a i n f or ma t i on s uc h a s t ha t ? A. The y j us t t o l d me t o ge t a nyt hi ng l i ke t ha t a n d br i ng i t t o t he m. Q. Al l r i ght . A. The y, t he y' d do i t e ve r s o of t e n. Q. Al l r i ght . Di d t he y - - woul d M . M c kor e l l r a c a l l you on a we e kl y ba s i s t o br i ng t ha t ove r , or wa s i t s ome t i me l onge r t ha n t ha t ? A. I t de pe nde d on hi s ne e ds , whe ne ve r he woul d n e e d s ome t hi ng. Some t i me s i t wa s qua r t e r l y, a nd s o me t i me s i t wa s we e kl y. Q. Al l r i ght . Do you know whe n a f t e r t hi s i n c i de nt you t ook t hi s not e a nd t he ot he r i nf or ma t i on t o M . M c kor e l l ? r a A. No. Q. Fa i r e nough. A. Ye s . Q. Di d y ou, i n f a c t , t a ke i t t o hi m . . . A. Ye s . Do you r e c a l l t a ki ng i t t o hi m? Q. . . . i s wha t I ' m a s ki ng you? i t t o hi m, di d he s e e t he not e ? And whe n you t ook A. Ye s . Q. And how do you know he s a w t he not e ? A. Be c a us e he a s ke d me a bout i t . He wa s goi ng t h r ough t he pa pe r s , a nd he a s ke d me wha t i t wa s , a nd I e x pl a i ne d t o hi m wha t i t wa s . Q. Oka y. a nd t he not e we ' r e t a l ki ng a bout i s t he n o t e t ha t M . M . . . s a A. Tha t M . M ga ve me . s a Q. . . . ga ve you? A. Ye s . 4 Q. And di d - - wha t di d you r e l a t e t o M . r M c kor e l l a t t ha t t i me ? a A. I j us t e xpl a i ne d t o hi m wha t M . M ha d t ol d s a me - t ha t he ha d f e l l out of t he c ha i r a nd wa s c o mpl a i ni ng of ba c k pa i n. Q. Oka y. And di d he gi ve you a ny i ns t r uc t i ons t h a t you we r e s uppos e d t o do a nyt hi ng a bout t hi s i n c i de nt ? A. No, he di dn' t . Our r e vi e w of t he r e c or d pe r s ua de s us t ha t a s t o t he f i r s t c ont e nt i on- - t ha t of f a i l ur e t o gi ve not i c e - - i t i s a pp r o p r i a t e t ha t t he Tr i a l Cour t be a f f i r me d i n a c c or da nc e wi t h Ru l e 1 0 ( a ) of t hi s Cour t . Our c onc l us i on i s ba s e d upon our a gr e e me nt wi t h t he Tr i a l Cour t ' s c ha r a c t e r i z a t i on of t he vi de o d e p o s i t i on of Ke nne t h As hl e y, whi c h we ha ve r e vi e we d, a s c r e d i t a bl e , a nd our de f e r r i ng t o t he Cha nc e l l or ' s c h a r a c t e r i z a t i on of Te d M c kor e l l ' s t e s t i mony, whi c h he obs e r v e d , a a s n o t c r e di t a bl e . W a l s o c onc l ude t ha t t he e vi de nc e doe s not e p r e p o n d e r a t e a ga i ns t t he Tr i a l Cour t ' s f i ndi ng t ha t t he o c c u r r e nc e wa s s uc h a s t o put a r e a s ona bl e pe r s on on not i c e t h a t M . Hi c kma n' s i nj ur i e s we r e s uf f i c i e nt l y s e r i ous t o a nt i c i pa t e a r c l a i m b e i ng ma de . Pr o c e d u r e . Rul e 13( d) , Te nne s s e e Rul e s of Appe l l a t e I nde e d, i n a ddi t i on t o t he f or e goi ng t e s t i mony, t h e r e i s a l s o t e s t i mony i n t he r e c or d t ha t a not he r a s s i s t a nt ma na ge r i n t h e r e s t a ur a nt t ol d Te d M c kor e l l whe n r e por t i ng t he a c c i de nt t o a h i m t h a t " t hi s guy i s goi ng t o s ue . " 5 W t h r e ga r d t o t he De f e nda nt s ' i l a s t i s s ue , s i nc e t he c a s e of Phoe ni x Cot t on Oi l Co. v. Roya l I nde mni t y Co. , 140 Te nn . 4 3 8 , 2 0 5 S. W 128 ( 1918) , a ppe l l a t e c our t s of t hi s s t a t e ha ve . c o n s i s t e nt l y he l d t ha t not i c e pr ovi s i ons of a pol i c y a r e va l i d c o n d i t i ons pr e c e de nt t o c ove r a ge , a nd i n t he a bs e nc e of not i c e n o c o v e r a g e i s a f f or de d e ve n t hough ( 1) t he pol i c y doe s not c ont a i n a f o r f e i t ur e c l a us e , a nd ( 2) t he i ns ur e r ha s not be e n pr e j udi c e d b y t h e de l a y. I n a c c or d: Os bor ne v. Ha r t f or d Ac c i de nt & I n d e mn i t y Co. , 63 Te nn. App. 518, 476 S. W 2d 256 ( 1971) ; Ba r f i e l d . v . I n s u r a nc e Compa ny of No r t h Ame r i c a , 59 Te nn. App. 631, 443 S. W 2 d 482 ( 1968) ; For e ma n v. Uni on I nde mni t y Co. , 12 Te nn. App. . 8 9 ( 1 9 2 8) . W l e t he De f e nda nt s c onc e de t ha t t hi s i s t he pr e s e nt hi s t a t e o f t he l a w, t he y ur g e us t o ove r r ul e e ve n Supr e me Cour t c a s e s o n t he s ubj e c t a nd t o hol d t ha t t he i ns ur a nc e c a r r i e r mu s t s h o w p r e j udi c e be f or e t he de f e ns e of l a c k of not i c e i s a va i l a b l e . I t i s not t he pr e r oga t i ve of a n i nt e r me di a t e a ppe l l a t e c o u r t t o di s r e ga r d s e t t l e d l a w, a nd a ny s uc h c ha nge s houl d c ome a t t h e ha nds of t he Le gi s l a t ur e or t he Supr e me Cour t . M ka t o' s t hi r d- pa r t y i s s ue s , whi c h a r e pr e di c a t e d up o n a t h e c on t r a c t o f t he s a l e of M ka t o' s s t oc k be t we e n J a me s T. a M c k o r e l l , J r . , a nd W ndy L. M c kor e l l , s e l l e r s , a nd Thoma s a e a M c ko r e l l , J ul i e A. M c kor e l l a nd Da vi d Le Ve a u, pur c ha s e r s . a a d o n o t pe r c e i ve t ha t whe r e t he pr oof ha s be e n c onc l ude d i t i s 6 W e n e c e s s a r y t ha t a mot i on be ma de be f or e t he Cour t c a n a c t upon p e n d i n g i s s ue s . I nde e d, i t i s t he Cour t ' s dut y t o do s o. I n di s pos i ng of t he t hi r d- pa r t y c ompl a i nt , t he Cour t f o u n d a s f ol l ows : Th i s Cour t i s a wa r e of t he t hi r d pa r t y s ui t whi c h t he Co ur t now ha s a vi e w t ha t pe r ha ps i t wa s j us t f i l e d a s a , s ome k i nd o f t a c t i c ; t ha t , i n f a c t , t h e pa r t i e s a nd t h e a t t or ne ys ha ve no t t a ke n t hi s s o- c a l l e d t hi r d pa r t y s u i t ve r y s e r i ous l y a s a l l e ga t i ons we r e ma de i n t he t h i r d pa r t y s ui t a bout t he c ont r a c t a nd t he a l l e ga t i on o f t he c ont r a c t o f s a l e or pur c ha s e be t we e n Te d a nd W ndy M c kor e l l , s ol e s t oc khol de r s , t o Tom a nd J ul i e e a M c kor e l l a nd Da vi d Le Ve a u. a And t he Pl e a di ng, t he Th i r d Pa r t y Compl a i nt , ma ke s a c oupl e of r e f e r e nc e s t o t h i s Cont r a c t of Sa l e a nd pur c ha s e a nd ma ke s a c oupl e o f r e f e r e nc e s t o t he r e not be i ng a pr ovi s i on i n t he r e t h a t r e a ds s ubs t a nc e t o t he e f f e c t i n t he c ont r a c t t ha t t h e s ubs t a nc e of i s t ha t t he r e a r e no pe ndi ng l i t i ga t i on. And, of c our s e , on t he da t e of s a l e , No ve mbe r ' 91, t he r e wa s no pe ndi ng l i t i ga t i on. Thi s l i t i ga t i on wa s not pe ndi ng t he n. And t he f a c t t ha t t he y wi l l i nde mni f y, t h e s e l l e r s wi l l i nde mni f y t he b u ye r s f or a ny unknown de bt s . The Cour t doe s not t hi nk t h a t c ouns e l t a ke s t h a t Thi r d Pa r t y Compl a i nt s e r i ous l y a s no one of f e r e d t o i nt r oduc e t he Cont r a c t of Sa l e f or t h i s Cour t t o e xa mi ne a nd I don' t know wha t t he c ont r a c t s a ys . I ' ve ne ve r s e e n i t . I ' ve ne ve r r e a d it. I onl y k now wha t i s , wha t i s a l l e ge d t ha t t he c o nt r a c t s a ys i n t he Thi r d Pa r t y Compl a i nt . The Cour t d i s mi s s e s t he Thi r d Pa r t y Compl a i nt f i ndi ng t ha t t he t h e or i e s of r e c ove r y a dvoc a t e d i n t ha t Thi r d Pa r t y Co mpl a i nt ha ve not be e n pr ove n by a pr e ponde r a nc e of t h e e vi de nc e . W f ul l y c onc ur i n t he Cour t ' s e va l ua t i on of t he t hi r d e p a r t y c ompl a i nt a nd obs e r ve t ha t t he r e wa s l i t t l e or no a dvoc a c y r e l a t i v e t he r e t o. Fi na l l y, we que s t i on whe t he r M ka t o' s woul d b e a a p r o p e r pa r t y t o s e e k i nd e mni t y a nd s ugge s t t ha t i f t he r e i s a 7 v i a bl e c l a i m t he r e f or i t i s by t he pur c ha s e r s , who we r e pa r t i e s t o t h e c ont r a c t , not t he c or por a t i on. For t he f or e goi ng r e a s ons t he j udgme nt of t he Tr i a l Co u r t i s a f f i r me d a nd t he c a us e r e ma nde d f or c ol l e c t i on of c os t s b e l o w. Cos t s of a ppe a l a r e a dj udge d a ga i ns t t he De f e nda nt s a nd t he i r s ur e t y. _______________________________ Hous t on M Godda r d, P. J . . CONCUR: _ _ _ _ _ _ _ _________________________ He r s c he l P. Fr a nks , J . _ _ _ _ _ _ _ _________________________ Do n T. M M r a y, J . c ur 8

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.