O ra l ar g u m e n t wa s h e a rd in this c a se o n F e b ru a ry 2 3 , 2 0 0 7 , i n M a d iso n v ill e , T e n n e sse e a s p a rt o f t h e C o u rt’s 1 C .A .S .E . ( C o urt o f

A p p ea l s A f

f ect i ng S tud e n t E d u c a tio n ) p ro je c t. 

### IN THE COURT OF APP EALS OF TENNESS EE

AT KNOXVI LLE Fe br ua ry 23, 200 7 S es sio n he ar d a t M ad iso nvi lle 1


### TERESAD. SHERLIN v. SA ND RAG. HA LL Appeal f rom the Circ uit Court for Bradley County No. V-99- 912 John B . Hagler, Jr., Judge

No. E2005-2745-COA- R3-CV- F ILED APRIL 10, 2007

Tere sa D. Sherlin (“Plaintiff”) sued Sandra G. Hall i n the C ircuit Court for Bra dley County (“Tr ial Court ” ) s e e kin g c omp e ns atio n f or pe rs on a l in

jur ie s and pr op e rt y dama g e su sta ine d wh e n a ve hic le driven by Ms. Hall collided head -o n wi t h a v ehicle be ing dr iven by Plaintiff while Plaintiff was actingin the course and scope of her employ ment. At the t ime of the a ccide nt, Ms. Hall did not have a drive r’s lice nse and w as an u n in s u r e d mo to r is t. Plaintiff’ s uninsured/underinsure d motorist carrie r, Fa rmers Insuranc e Exch an g e (“ Fa rmers” ), answe red Plaintiff’s c omplaint and filed a motion for summary judgme nt. The Trial Court g rante d Fa rmers summary judgme nt finding a nd holding, inter ali a , that Plaintiff was re ceivi ng worke rs’ c ompensation bene fits, these worke rs’ c ompensation benef its ex cee ded the limits of liabilit y o f Plaintiff’s uninsured motorist policy , and bec ause the lim its of lia bil ity of the un ins ur e d mo tor ist

po lic y are re du c e d b y

the amou

nt o f t he wo rk e rs ’ compensat i o n benef

its pursuant to the insurance policy , Fa rmers ha d no liability

to Plainti ff. Plaintiff appea ls to thi s Court. W e af firm.
Te nn. R . A pp. P . 3 App e al a s o f Rig ht ; J udgm e ntof t he Ci r c uitCo ur t A ffirm e d; Case Re m anded D. M I CH A EL S WI NEY , J ., delivere d the opinion of the cour t, in which H ER SCH EL P. F RAN KS , P.J ., and S HAR ON G. L EE , J ., joined.
J ames F . L og an, Jr., Cl evela nd, Tenne ssee f

or the Appe llant, Tere sa D. Sherlin. Parks T. Chastain and Micha el K. Smith, Nashville, Tennessee for the Appellee , Fa rmers I nsuranc e Ex chang e.-2- OP IN ION

Bac kgr ound
In October

of 1998, a ve hicle being driven by Plaintiff while in the course and scope of her employ ment was struc k h ea d -o n b y a v ehicle driven by Ms. Hall. Ms. Hall did not have a driver’ s license, wa s an uninsured motorist, and a dmitted in an aff idavit that she “fa iled to yield the rig ht of way to [P laintiff].” Plaintiff sued Ms

. Hall and, pursuant to Tenn. Code Ann. § 56-7-1206, serve d proce ss upon Plainti ff’ s uninsured/underinsure d motorist carrie r, F arme rs. Plaintiff a ls o f ile d a sepa rate lawsuit s ee k i n g worke rs’ c ompensation bene fits in the Chancer y Court for B radle y County

. Fa

rmers answer ed the complaint ag ainst Ms. Hall and filed a motion for partial summary jud g me nt a s to the iss ue of the amou

nt o f u nin sure d mo tor ist

ins ur anc e c ov e ra g e ava ila ble to Plaintiff. The motorist insurance policy issued to Plainti ff by

Fa rmers pr ovides, in pert i n ent pa rt : Limit s of L iabil ity T h e l i m i t s o f l i ab i l i ty

s h o wn i nth e D ec l ar at i o n s ap p l y s u b j ec tt o th e f

o l l o wi n g: * * * 4. The amount of Uninsured Motorist Coverag e we will pay shall be re duced by

the amount of any Workers’ Compensation be nefits pay able or paid in the same ac c ide nt to an insu red person

. The Tr ial Court gr anted F arme rs par tial summary

judgme nt and fo u n d t hat the wo rk e rs ’ c omp e ns atio n s uit sti ll w a s p e nd ing. Th e Tr ia l Co ur t he ld t hat f ur the r p ro c e e din g s in Plaintiff’s case ag ainst Ms. H all would awa it f inal resolution of the worke rs’ c ompensation ac tion.
In D e c e mbe r o f 200 4, the Cha nc e ry Court fo r B ra dle y

County e nte re d a jud g me nt i n Plaintiff’s worke rs’ c ompensation ac tion finding a nd holding, inte r a lia , that Plaintiff suffer ed and su sta ine d s e ve re inj ur ie s as a re su lt of the a c c ide nt that occ ur re d whi le Pla int if

f wa s a c tin g wi thi n the cour se and sc ope of he r employ ment, and that Plaintiff was e ntitled t o a j u d gm en t ag ainst her employ er on he r worke r’s c ompensation claim.

After further hear ings on F arme rs’ motion for summ ary judgme nt and Plaintiff’s motion to require F arme rs to be held liable for the sum of $100,000, the Trial Court ente red a n order November

7, 2005, finding and holding , inte r a lia , that the lim its of lia bil ity of Pla int if f’ s mo tor ist po lic y are $1 00 ,0 00 .0 0; M s. Ha ll w a s d isc ha rg e d b y ba nk ru ptc y ; th e Tri al Co urt ha d p re vio us ly g rante d Fa

rmers pa rtial summary

judgme nt holding that “the l i mits of liabili ty of the uninsure d mot or ist po lic y at is su e in t

his c a se sh a ll be re du c e d, do lla r f or do lla r, by the amou nt o f a ny wo rk e rs ’-3-

c omp e ns a tio n b e ne fi ts p ay a ble or pa id t o Pl a int iff...; ” and , b e c a us e the amou

nt o f w or

ke rs ’ compensation benefits paid t o Plaintiff exceeded the limit s of Plaintiff’s motorist policy , Fa rmers ha d no lia bil ity to Pla int if

f. Th e No ve mbe r 7 , 2 00 5, or de r d ism iss e d F arm e rs fr om t he c a se and

a lso d i s m i s s e d P l a i n t i f f ’ s c l a i m s a g a i n s tM s . H a l l b e c a u s e M s . H a l l h a d b e e nd i s c h ar g e d b y b an kr u p t c y. Pla int if f a pp e a ls t o th is C ourt

.
Discussion Although not state d exactly as such, Plaintiff raise s one issue on appe al, whethe r the T ri al Court erre d in holding that F arme rs was e ntitled to offset its policy limit s by the amount of worke rs’ c ompensation bene fits paid or payable to Plaintiff, and based upon this holdi ng g ranting summary judgme nt to Far

mers. In Teter v. Re

public Parking System , Inc. , 1 8 1 S

. W

. 3 d 3 3 0 ( T e nn . 2 0 0 5) , o ur

Sup re me Court reiterated the standa rds applica

ble when a

ppellate c ourts are revie wing a motion for summary jud g me nt. Th e Court

state d: The purpose of summary judgme nt is to resolve controlling issues of law rathe r than to find fa cts or re solve disputed issues of fa ct. Be lla my v . F e d. Ex pr ess Co rp. , 749 S.W. 2d

31 , 3 3 ( Te nn . 1 98 8) . Summa ry jud g me nt i s a

pp ro pr iate on ly when the movingparty demonstrates that there are no g enuine issues of material fa ct an d t h at he or she is entitled to judgment a s a matter of law. See T e n n . R. C iv. P. 56 .0 4; Penley v. Honda M otor Co. , 31 S.W.3 d 181 , 183 (T e nn . 2 00 0) ; By rd v . H all , 84 7 S. W.2 d 2 08 , 21 0 (T e nn . 19 93 ). In re vie wi ng the re c or d, the a pp e llate c ourt

mus t view all the evidenc e in the l ight most favor able to the non- moving pa rty and dra w all rea sonable infe renc es in favor of the no n -m o v i ng party

. Sta ple s v . CB L & Assocs., Inc

. , 1 5 S. W.3 d 8 3, 89 (T e nn . 200 0)

. An d b e c a us e thi s in qu ir

y inv olv e s a question of law only , the standar d of re view is de novo with no p re s u m ption of corr ectne ss attache d to the trial court' s conclusions. See Mooney v. Snee d , 30 S.W .3d 30 4, 30 6 ( Te nn . 2 00 0) ; Carvell v. Bottoms , 900 S.W .2d 23, 26 (Tenn. 1995)

. Teter , 181 S.W .3d at 337.

As pe rt ine nt t o th is a

pp e a l, T e nn . Co de Ann. § 5 6- 7- 12 05 , p ro vid e s: 56-7-1205. M inimum policy limits not incre ased. – Nothing contained in this part sh a ll b e c on str

ue d a s r e qu ir ingthe fo rm s o f c ov e ra g e pr ov ide d purs ua nt to t his pa rt , whether alone o r i n combi nation with simi lar c overa g e af forde d under othe r automobile liability

policies, to aff

ord limits i n excess of those that would be aff orded ha d the insured ther eunder been involved in a

n acc ident with a motorist who was insure d under a policy of liability insurance with the minimum limit s descr ibed in § 55 -12 -107 , o r t

he un ins ur e d mo tor ist

lia bil ity lim its of the ins ur e d’ s p oli c y

ifT .C .A . § 5 6 -1 1 5 2 , cu rr e n tly is c o d ifi e d a t T e n n . C o d e A n n . § 5 6 -7 -1 2 0 5 ,a n d T .C .A . § 5 6 -1 1 4 8 , cu rr e n tly is 2
c o d ifi e d a t T e n n . C o d e A n n . § 5 6 -7 -1 2 0 1

.

Te r r y v. Aet na Cas

. and Sur

. Co. h as bee n s u per ce ded i n par t by ame n dmen t s t o T en n . Code An n . § 56- 7- 1201. 3 S e e , A lb in v . M e m p h is , 1 9 9 8 T e n n . A p p . L E X IS 5 3 7 , at *5 (T e n n . C t. A p p . A u g . 2 4 , 1 9 9 8 ), no app l

. per m
. app eal f i l ed ; Wei r v
. G l ens Fal ls I

ns
. Co. , 1 9 8 7 T e n n . A p p . L E X IS 2 8 0 8 , at *1 1 (T e n n . C t. A p p . Ju ly 1 6 , 1 9 8 7 ), n o a p p l

. p e r m. ap peal f i l ed . T h e se sta tuto ry a m e n d m e n ts ha v e no e ff e c t up o n the issu e inv o lve d in this a p p e a l. -4- such limits are h i gher tha n the limits descr ibed in § 55-12-107. Such f orms of c ov e ra g e may

inc lud e su c h te rm s, e xclu sio ns , li mit a tio ns , c on dit ion s, and of fs e ts, wh ic h a re de signe d to avo id d

up lic a tio n o f i ns ur anc e and oth e r b e ne fi ts. Tenn. Code Ann. § 56- 7-1205 (2000)

.

Our Supreme Co u

r t c o n s tr u e d o u r u n in s u r e d mo to r v ehicle c overa g e statutes in Te rry 2 v. Ae tna Cas. & Sur. Co. , i n s tru ct i n g: 3
I t results, and we so hold, by enac tment of T.C.A. § 56-1152 as a section of our uninsured motorist statutes, it is the legislative pur pose to provide a

n insured motorist a rig ht of recov er y under the uninsured motorist provisions of his poli cy on ly up to th e stat

uto ry re qu ir e d mi nim

um ( T. C.A . § 56 -1 14 8) , a nd pr ov isi on s in such policies, approved by the Commiss ioner of I nsuranc e, oper ating to reduc e such cover ag e whe re othe r cove rag e or be nefits ar e available to the insured ar ising fr om acc ident cau s i ng the loss, are valid if such provisions do not operate to deny pa y me nts to a

n in sure d o f l e ss t

ha n th e statut or

y min imum. Terry v. Ae tna Cas. & Sur. Co. , 510 S.W .2d 509, 513-14 (Te nn. 1974).

This Court r elied upon Te rry in holding in Dw igh t v. Te nn esse e Fa rm e rs M ut. In s. Co. that the uni nsured motorist insurer was entit led to set off the amount of worke rs’ c ompensation be ne fi ts a va ila ble to the pla int if

f de sp ite the fa c t that the pla int if f ha d c ho se n no t to purs ue wo rk e rs ’ compensation benefits and the time f or plaintiff to pursue the worke rs’ c ompensation bene fits had expired. Dwight v

. Tennessee Farmers Mut. Ins. Co. , 701 S.W .2d 621, 622 (Tenn. Ct. App. 1985).

Our Supreme Cour t discussed Te rry and Dwight

in Hudson v. Hudson M un. Contractors, Inc. , a

nd re ite rate d: Under the holdings in Terry v. A etna C as. & Sur. Co. and Dwight v. TennesseeFarmers Mut. Ins. Co. , it is clea r that an insured par

ty ’s rig ht to recove r under a n uninsured motori st policy that contains a se toff provision such a s the one involved in this case may be reduc ed by the amount that the insured ha s collecte d, or could collec t, under the Worker s’ Compensation L aw. Hudson v. Hudson M

un. Contractors, Inc. , 898 S.W .2d 187, 189 (Tenn. 1995)

.-5- In 2002, in Poper v. R ollins , o u r S upreme Court discussed Te rry in light of the compar ative fault principles that the Supreme Court adopted in McI ntyre v . Balentine , 833 S.W .2d 5 2 (T en n . 1 9 9 2 ), s t at i n g:

Our de cision in Mc

In ty re d id not address the spe cific pr ovisions of Te nn e sse e ’s un ins ur e d mo tor ist statut e . Pr ior to t

he a do pti on

of c omp arativ e fa

ult , howeve r, we construed T ennesse e’s uninsure d motorist st atute in Terry v. Ae tna Casualty and Surety Co. , 510 S.W .2d 509 (Tenn. 1974) , and State A u t o
. Mut ual In s u r a n ce Co. v. Cummings , 519 S.W .2d 773 (Tenn. 1975) . In Te rry , th is Co urt discussed the two g ener al ty pes of uninsure d motorist st atutes - those pr ovidi n g b road cover ag e and those providing only lim i t ed co v era g e. In a “br oad cove rag e” jurisdiction, the insured plaintiff may rec over up to th e poli cy

limit s so long a s the sum of pl aintiff’s r ecove ry under the uninsured motorist cover ag e and a ny other pay ments do not ex cee d the i nsured’ s actua l damag es. S uch cove rag e does not a llow offse ts which limit the insured plaintiff’s full dama g e re cover y . In contra st, a
“ lim ite d c ov e ra g e ” jur isd ic tio n a llo ws the ins ur e d pla int if f t o c oll e c t da

ma g e s o nly up to a statutory

minimum n o t wi t h s tanding the ac tual damag es. In such a jurisdiction, all

sums collected c an be c redite d t o wards rea chingthe statutory minimum

. Te rry , 5 10 S.W. 2d a t 513. We f ound that T e nn e sse e ’s statut e fa lls wi thi n the lim ite d c ov e ra g e c ate g or y and he ld that the sp e c if

ic purp os e of

the statut e is “ to pr ov ide an in sure d a ri g ht of re c ov e ry un de r the un ins ur e d mo tor ist pr ov isi on s o f h is policy only up to the statutory

require d minimum ....” Id

. * * * Acc ording ly , Poper’s ar gument that Tenn. Code Ann. § 56- 7-1201(d) provides broa d cover ag e for the insured a

nd that adher ence to Mc

In ty rerequire s that he re ceive pay

ments up to his actua l damag es eve n if the total exceeds the statutory min imum, c on fl ic ts w ith the lim ite d langua g e of the statut e and

its na rr owpurp os e as desc ribed in Te rry

and re inforce d in Cummings

. We there fore conclude that Tenn. Co de Ann. § 5 6- 7- 12 01 (d ) i s n ot a ff e c te d b y the pr inc ipl e s o f c omp ara tiv e fa ult outlined in Mc

In ty re . Poper v. R ollins , 90 S.W .3d 682, 686-87 (Te nn. 2002) (e mphasis in origina l).

Our d isc us sion is by no me ans e xha us tiv e on the su bje c t, b ut r a the r i s inte nd e d to show that the law in Te nnessee is well-settled on the is s u e i n v o l v ed in this appeal. Althoug h our Supreme Court has not dea lt directly with the issue as ra i s ed i n this appeal in many y ear s, the Supreme Court has r eiterated its holding in Te rry nume ro us tim e s and

ha s d on e so in r e c e nt ye ars . I t is c le ar t

hat Te rry sti ll i s th e law i n T e nn e sse e a s to the iss ue ra ise d in thi s a pp e a l.
P lai ntif f r e c og nize s th a t th e law i s a s d isc us se d, but argue s th a t th is C ourt sh ou ld revisit the issue, re -eva luate Te nn. Code Ann. § 56-7- 1205, depar t from the curr ent rule, a

nd fashion-6-

a new rule that would a llow for setoff only to avoid duplication of bene fits. I n support of her argument advocating c hang e, Plaintiff cites, among othe r thing s, Broadwell v . Holmes , a nd qu ote s: This Court has a continuing duty to consider whe ther the c ommon-law, as cre ated a nd develope d throug h case law, is obsolete. “‘ [W ]e abdi ca t e o ur own function, i n a field peculiar ly non-statutory , when we ref use to consider

an old and court made rule.’” Hanove r v. Ruch , 809 S.W .2d 893, 896 (Tenn.) , cert. de nied , – U. S

. – , 1 1 2 S

. C t

. 3 8 1 , 1 1 6 L

. E d

. 2 d 3 3 2 (1 9 9 1 ) ( qu o t i n g Kilb ou rn e v . H an ze lik, 648 S.W .2d 932, 934 (Tenn. 1983) [)]

. Broadwell v. Holmes , 871 S.W .2d 471, 473 (Tenn. 1994) . Plaintiff f ails to a cknowledg e, howe ver, that Br oa dwe ll

is ina pp lic a ble in thi s situ a tio n be c a

us e the iss ue a t ha

nd is g ov e rn e d n ot j us t by

c a se law, but also by

statute. As this Court st ated in En gli sh v . Pre tti : [T] he holding of Te rry

c le arly re ma ins the law o f t his state . We a dd iti on a lly no te that the leg islature has had near ly thirty year s to r evise the statute in li gh t o f t he supreme c ourt’s holding in Te rry , an d h a s d e c li n e d to d o s o . In th e a b s e nce of a leg islative directive, the holding of the s upreme court is controlli ng prec edent whic h may not be disturbed by

this Court.
En gli sh v . Pre tti , No .W2 00 1- 01 65 7- CO A- R3- CV , 20 02 Te nn . Ap p. L EX I S 75 2, a t *1 5 ( Te nn . Ct

. App. Oct. 24, 2002) , Rule 11 appeal v oluntaril y dismissed April 11, 2003

. S ucha c ha ng e in t his se ttl e d la w a s r e qu e ste d b y

Pla int if f m us t c ome , if

a t a ll, fr om a s ourc e oth e r t ha n th is i nte rm e diate a pp e llate c ourt

.

In the ca se now be fore us, Plainti ff’ s motorist pol icy co n t ai n s a cle ar a

nd un ambi g uo us pr ov isi on s th at st ate s: “ Th e amou nt o f Unin sure d M oto ri st C ov e ra g e we wi ll p ay sh a ll be re du c e d b y

the amou

nt o f a ny Wor ke rs ’ C omp e ns a tio n b e ne fi ts p ay a ble or pa id i n th e same acc ident to an insured pe rson.” ( emphasis delete d). The r ecor d on appea l shows that Plainti ff ha s re c e ive d o r i s e nti tle d to r e c e ive wo rk e rs ’ c omp e ns a tio n b e ne fi ts i n e xce ss o f t he lim its of

lia bil ity of her uninsured motorist policy . There are no g enuine issues of material fa ct and, unde r the lawas it ex ists, F arme rs is e ntitled to summary judgme nt a s a matter of law. Given this, we aff irm the Trial Court’s November

7, 2005, order

.-7- Conclusion The judgme nt of the Trial Court is aff irmed, and this ca

use is rema

nded to the Tria l Co urt for c oll e c tio n o f t

he c os ts b e low . T he c os ts o n a pp e a l are a sse sse d a g a ins t th e Ap pe lla nt, Tere sa D. Sherlin, and he r sure ty

.

___________________________________ D. MI CHAEL

SW I NEY, JUDGE