IN THE COURT OF APPEALS OF TENNESSEE

AT JACKSON

June 20, 2001 Session

SUSAN WEISS, ET AL. v. STATE FARM FIRE & CASUALTY COMPANY,

ET AL.

Direct Appeal from the Circuit Court for Shelby County

No. 306126 T.D. John R. McCarroll, Jr., Judge

No. W2000-02506-COA-R3-CV - Filed August 21, 2001

The Weisses procured supplemental insurance from State Farm through its agent, Mr. Brooks. In

procuringsuch insurance,Mr. Weiss rejected uninsured/underinsured motorist coverage. Mrs.Weiss

was involved in an automobile accident wherein she sustained damages exceeding the amount

covered by her insurance policy. As the other driver involved in the accident was either uninsured

or underinsured, the Weisses sought recovery from State Farm. State Farm denied the claim,

determining that the Weisses did not have coverage under their umbrella policy. The Weisses

brought an action against State Farm and Mr. Brooks. State Farm and Mr. Brooks filed a motion for

summary judgment, which the trial court granted. We affirm. 

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed; and

Remanded

DAVID R.FARMER,J., delivered the opinion of the court, in which W.FRANK CRAWFORD, P.J.,W.S.

and ALAN E. HIGHERS, J., joined.

R. Douglas Hanson, Memphis, Tennessee, for the appellants, Susan Weiss and Joseph L. Weiss.

George T. Lewis, III, and Lori Hackleman Patterson, Memphis, Tennessee, for the appellees, State

Farm Fire & Casualty Co. and Larry O. Brooks.

OPINION

Joseph L. Weiss (Mr. Weiss) and Susan Weiss (Mrs. Weiss, collectively the Weisses)

maintained an automobile insurance policy with State Farm Fire & Casualty Company (State Farm)

with coverage in the amount of $100,000 per person/$300,000 per occurrence and with the same

amounts in force for uninsured/underinsuredmotorist(UM) coverage. In 1993, Mr. Weiss purchased

from State Farm agent, Larry O. Brooks (Mr. Brooks), a personal liability umbrella policy in the

amount of $1,000,000, wherein both Mr. Weiss and Mrs. Weiss were named insured. Mr. Brooks

offered Mr. Weiss the option of purchasing UM coverage in amounts that would match the Weisses’
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liability coverage under the umbrella policy, but Mr. Weiss expressly rejected such. Mr. Weiss

relied upon Mr. Brooks to keep him advised of necessary coverages and limits to make sure his

family was fully insured. Mr. Brooks provided the Weisses with advertisements and brochures

concerning additional and important coverages; however, he did not notify the Weisses regarding

UM issues.

In December of 1998, Mrs. Weiss was involved in an automobile accident with Brian Wilson

(Mr. Wilson). As a result, Mrs. Weiss sustained injuries and incurred medical bills of approximately

$350,000, which exceeded the Weisses’ $100,000 per person UM coverage. Because Mr. Wilson

was either uninsured or underinsured, the Weisses made a claim to State Farm under their insurance

policy. State Farm denied coverage under the umbrella policy. As a result, the Weisses brought an

action against State Farm and Mr. Brooks, alleging various breaches of duties owed by insurance

agents and companies, violation of the Tennessee Consumer Protection Act, and statutory violations

governing UM coverage. State Farm and Mr. Brooks filed a motion for summary judgment, which

was granted by the trial court. In its grant of summary judgment to State Farm and Mr. Brooks, the

trial court determined that State Farm and Mr. Brooks did not have a duty to sell the Weisses more

coverage than they requested or selected; that Mr. Weiss’s rejection of UM coverage on the umbrella

policy was effective to also reject such coverage on behalf of Mrs. Weiss; and that Mr. Weiss’s claim

of loss of consortium, as well as the Tennessee Consumer Protection Act claims, were inapplicable.

This appeal followed.

The Weisses raise the following issues, as stated in their brief, for this court’s review:

1. Whether Joseph Weiss had actual or apparent authority to waive or reject

Susan Weiss’ right to uninsured motorist coverage under the umbrella policy.

2. Whether Susan Weiss made a knowing and intelligent waiver of uninsured

motorist coverage under [the] umbrella policy.

3. Whether there exist[s] an issue of fact as to whether Larry Brooks and State

Farm owed a duty to Susan Weiss to make sure she understood her available

insurance coverages.

4. Whether State Farm and Larry Brook[s’] failure to advise Mrs. Weiss as to

her level of uninsured motorist coverage was a cause in fact of her damages.

This appeal is from a grant of summary judgment in favor of the defendants, State Farm and

Mr. Brooks. Summary judgment is appropriate if no genuine issues of material fact exist and the

movant proves it is entitled to a judgment as a matter of law. See Tenn. R. Civ. P. 56.03. On appeal,

we must take the strongest view of the evidence in favor of the nonmoving party, allowing all

reasonable inferences in its favor and discarding all countervailing evidence. See Shadrick v. Coker,

963 S.W.2d 726, 731 (Tenn. 1998) (citing Byrd v. Hall, 847 S.W.2d 208, 210-11 (Tenn. 1993)).
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Since our review concerns questions of law, we review the record de novo with no presumption of

correctness of the judgment below. See Tenn. R. App. P. 13(d); Bain v. Wells, 936 S.W.2d 618, 622

(Tenn. 1997).

Actual or Apparent Authority

The facts are undisputed that in 1993, Mr. and Mrs. Weiss discussed and decided to procure

supplemental automobile insurance coverage in the form of an umbrella policy in the amount of

$1,000,000. Mr. Weiss met with Mr. Brooks regarding the umbrella policy, and when asked by Mr.

Brooks whether he wished to have UM coverage under the umbrella policy, Mr. Weiss expressly

rejected such. Mr. Weiss regularly handled all the transactions pertaining to insurance, and neither

Mr. Weiss nor Mrs. Weiss dispute that Mr. Weiss had the authority to procure such insurance.

Rather, the Weisses contend that Mr. Weiss did not have the authority to reject UM coverage on Mrs.

Weiss’s behalf. 

Section 56-7-1201(a)(2) of the Tennessee Code states, in pertinent part, as follows, “[A]ny

named insured may reject in writing such uninsured motorist coverage completely or select lower

limits of such coverage . . . . Any document signed by the named insured or legal representative

which initially rejects such coverage or selects lower limits shall be binding upon every insured to

whom such policy applies . . . .” Tenn. Code Ann. § 56-7-1201(a)(2) (2000) (emphasis added).

Based upon this language, the Weisses, in their brief, state that the issue before us, then, is whether

Mr. Weiss acted as Mrs. Weiss’s legal representative in rejecting or waiving her uninsured motorist

coverage. We find such issue to be without merit.

The umbrella policy procured by Mr. Weiss listed both Mr. Weiss and Mrs. Weiss as the

named insured. Because both Mr. Weiss and Mrs. Weiss are named insured, they can act on behalf

of the other and bind the other to the terms of the insurance policy. Further, we note that Mrs. Weiss

indeed ratified her husband’s decision to reject UM coverage.

Ratification is considered valid and binding if the principal has, at the time of ratification,

full knowledge of the material facts and circumstances surrounding the unauthorized act. See

Webber v. State Farm Mut. Auto. Ins. Co., ____ S.W.3d ____, No. E1999-01909-SC-R11-CV,

2001 WL 740770, at *3 (Tenn. July 3, 2001) (citing Gough v. Insurance Co. of N. Am., 11 S.W.2d

887, 888 (1928)). According to her testimony in her deposition, Mrs. Weiss ratified the acts of her

husband after obtaining full knowledge of the material facts and circumstances surrounding her

husband’s rejection of UM coverage:

Q: When did you become aware that Mr. Weiss had signed those two boxes in

the lower left-hand corner rejecting uninsured motorist coverage with respect

to the umbrella policy?

A: After his deposition [February 15, 2000]. 
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. . . . 

Q: Do you think your husband was wrong not to have bought the uninsured

motorist coverage? 

. . . . 

A: No, I don’t feel like my husband was, no. 

Q: Why do you feel that way?

A: Because we didn’t have a lot of money then. It would cost a lot more money.

We were, you know - - 

Ratification, in this case, may also be said to have occurred as a matter of law. Bringing a

lawsuit to enforce the terms of a contract evidences the intention of the principal to ratify an

otherwise unauthorized contract. See Webber, 2001 WL 740770, at *4 (“The law has long been

settled that ‘[b]y bringing an action on the contract a principal will be held to have ratified it,

whether the action be against the third person, or against the agent, for the proceeds of the

contract.’”)(citingMemphis St. Ry. Co. v. Roe, 102 S.W. 343, 348 (Tenn. 1907)). Thus, based upon

the clear language of section 56-7-1201(a)(2) of the Tennessee Code and upon Mrs. Weiss’s

ratification of Mr. Weiss’s rejection of UM coverage, we find that Mr. Weiss’s rejection, as a named

insured, was binding on Mrs. Weiss as she was also a named insured to whom the umbrella policy

applied.

Duties of Insurance Agents and Insurance Companies

The Weisses ask this court on appeal whether State Farm and Mr. Brooks had a duty to make

sure Mrs. Weiss understood her insurance coverage and whether the failure to advise her of her level

of UM coverage was a cause in fact of her damages. According to Tennessee law, unless there exists

an agreement creating continuing responsibilities, an insurance agent’s obligation to a client ends

when the agent obtains the insurance asked for by the client. See 16 Tenn. Juris. Insurance § 8

(2001) (citing Quintana v. Tennessee Farmers Mut. Ins. Co., 774 S.W.2d 630 (Tenn. Ct. App.

1989)). Here, Mr. Weiss met with Mr. Brooks in order to obtain supplemental insurance in the form

of an umbrella policy. As part of the umbrella policy, Mr. Brooks offered the Weisses UM coverage

in amounts equal to their liability coverage under the umbrella policy. Mr. Brooks recommended

this coverage to the Weisses, stating that it was an important coverage and that it was relatively

inexpensive. Despite this information, Mr. Weiss expressly rejected such coverage. The record does

not demonstrate that the Weisses entered into an agreement with Mr. Brooks continuing Mr. Brooks’

responsibilities. Based upon the foregoing facts and law, we find that State Farm and Mr. Brooks

did not owe a duty to the Weisses to sell them more coverage than they requested or selected.
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Further, we are of the opinion that State Farm and Mr. Brooks did not owe a duty to inform Mrs.

Weiss of the coverages selected by her husband; hence the failure of State Farm and Mr. Brooks to

do so was not a cause in fact of Mrs. Weiss’s damages.

Conclusion

In summary, we have determined that Mr. Weiss’s rejection of UM coverage under the

Weisses’ umbrella policy was binding on Mrs. Weiss. We have further determined that State Farm

and Mr. Brooks owed no duty to the Weisses to sell them more coverage than they requested or

selected. Based upon the foregoing conclusions, the remaining issues are pretermitted. We hereby

affirm the trial court’s grant of summary judgment in all respects. Costs of this appeal are taxed to

the appellants, Susan Weiss and Joseph L. Weiss, and their surety, for which execution may issue

if necessary.

___________________________________ 

DAVID R. FARMER, JUDGE