1 Pero’s compl aint was filed August 29,

1996; Louis Inn’s complaint was fi led August

30, 1996.
2 Stone v. Hinds , 541 S.W.2d 598 , 599 (Tenn. Ct. App. 1976). 

### IN THE COURT OF APPEALS OF TENNESSEE

AT KNOXVILLE July 9, 2001 Sessi

on PERO’S STEAK AND SPAGHETTI HOUSE, et al. v. ELIZABETH JEAN HINKLE LEE, e

t al. Appeal from the Circuit Court for Knox County Nos. 3-541-96 and 3-544-96 Dale C. Workman, Judge

FILED OCTOBER 8, 2001
No. E2001-00254-COA-R3-CV

C HARLES D. S USANO , J R ., J., diss enting.

I cannot concur in t

he majority’s h

olding that summar

y judgment i

s appropriate in t

hese
cons olida tedcases. The majority’s holding is bottomed on its determination that, even if the plaintiffs’ causes of action accrued in 1995 or 1996 (pre- June 1 of that yea r), those actions

had to be filed before June

1, 1996, in order to

avoid the bar of the statute of limitations. I believe (1) that the dat e of the accrual of these causes of action is critical; (2) that, based upon the materi al no w beforeus, there is a factual dispute as to when the causes of action accrued, with dates in 1992 and 1995 – and maybe dates in other time frames – being possibilities; (3) that, assuming the trier of fact finds t ha t the causes of ac tion accrued les s than three y ears prior to the

plaintiffs’ filing

s of their complaints, 1 the applicable three-year statute of limitations is T.C.A. § 28-3-105 (2000), with the computation of

time under it being impacted by the discovery rule, 2 see Pacific Properties v. Home Federal Bank, F.S.B. , C/A No. 03A01-941 0-CH-00393, 1995 WL 59112, at *4 (Tenn. Ct. App. E.S., filed February 14, 1995); and (4) that, if the foreg oing assumption turns out to be true, these
causes of action are not time-barred. The c ru x of my disagr

eement with the ma

jority is this: assuming the trier of fact determines, under the discovery rule, tha t th e subject causes of action accrued in 1995 or later, but pr ior to June 1, 1996 , I do not believe – as the majority does – that T.C.A. § 47-3-118(g) (1996 ), a statute of limitations first effective on June 1, 1996 , can be constitutionally

applied to th

ose causes of ac tion so as to bar suits filed on August 29, 1996 and August 30, 1996.3 T.C.A. § 28 -3-105 provide s, in pertinent part, as follows:

The following a

ctions shal

l be commenced within three (3) years from the accruing of the cause of action:

* * *
(2) Action s for...convers ion of perso nal prope rty.... -2- Before I expound upon my belief that summary judgment is inappropriate in these cases, I want to express my agreement with the majority that T.C.A. § 47-3-118(

g), being a pa

rt of the UCC, should be construed in ha

rmony with the

decisions of those

other UCC jurisdictions – a clear majority – which have held

that the discover

y rule is not im

plicated in an ana

ly sis invol ving this particular statute of limitations, absent fraudulent concealment on the part of the defendant asserting the limitations defens

e. My disag

reement with the m

ajority as it

pertains to

this statute

is that I do notbelieve that it can be applied to a cause of action that accrued before its effective date of June 1, 1996. Generally speaking, the ascertainment of the date of the accrual of a cause of action is the first step in any st

atute of limitations

analysis. Th

is is because, again generally speaking, the period of limitations does not begin to run until the cause of action has accrued. See McCroskey v. Brya nt Air Conditioning Co ., 524 S.W.2d 487, 49 1 (Tenn. 19 75); Wyatt v. A-Best Produsts Co. , 924 S.W.2d 98, 103 (Tenn. Ct. App. 1995).
We have previously

held that “[t]he phrase ‘from the accruing of the cause of action,’ as set forth in T.C.A. § 28-3-105, 3 ‘means from the time when the plaintiff knew or reasonably

should have known that a cause of action existed .’” Pacifi c Properties , 1995 WL 591 12 at *4 (cit ing Stone v. Hinds , 541 S.W.2d 598, 599 (Tenn. Ct. App. 1976)). In Pacific Properties , we held that analleged conversionof a certificate of deposit was governed by the three-year statute of limitations for conversionunder T.C.A. § 28- 3-105 and that the re was a dispute in

the record as to when the plaintiff’s managing partner “knew or reasonably should have known” about the alleged conver sion andthat the dispute mea

nt it was unclear a

s to whether the thr

ee-year statute of limitati

on s, i.e. , T.C.A. § 28-3-105, had expired before suit was brought. Id . Because of this, we reversed the trial court’s grant of summary judgment and remanded f or further proceedings. Id . at *5.
If the trier of fact in the instant case accepts as true the facts underly ing the plaintiffs’ theory of this case, the accrual of the cau se s of action, under the rationale of Pacific Properties , did not
occur until 1995 at the ea

rliest. In my

judgment, a

reasonable jury

could conclude th

at the plaintiffs’ quantumof knowledge pr ior to 1995 was not su

fficient to put a reasonable p erson on notice that there had been a conversion by the Bank. Construing the evidenc e in this summary judgment analysis as we must – in the lig

ht most favorable

to the plaint iffs – I find a genuine dispute

as to when the plaintiffs knew or reasonably should have known about the alleg ed conversion.-3-

In 1995 through 1996, but prior to June 1, 1996 – during whic h time frame the pl

aintiffs’
causes of action arguably accrued – the applicable statute of limitations was T.C.A. § 28-3-105. The
new statute – T.C.A. § 47-3-118(g) – while passed in June, 1995, was not effective until June 1, 1996. Thus, if the plaintiffs’ causes of action accrued in 1995 or in 1996, but prior to June 1, 1996, they accrued prior to the effective date of the new statute.
As a general proposition, a litigant has a vested right in the statute of limitations in

effect and applicable

to its cause of ac

tion on the date tha

t the cause

of action accru

es. See Tenn. Const. Art. I, § 20; Watts v. Putnam Co ., 525 S.W.2d 488, 492 ( Tenn. 1975); Wyatt , 924 S.W.2d at 103.
The majori ty r elies upon the case of Pacific Eastern Corp. v. Gulf Life Holding Co. , 902 S.W.2d 9 46 (Tenn. Ct. App. 1995), for the proposition that a change in the applicable statute of limitations “that shortens an existing statute of limitations cannot extinguish

a cause of action that has already acc

rue d without giving the plaintiff a reasonable opportunity to bring suit after the effective date” of

the new statute. Id . at 956. While I agree that Pacific Eastern Corp. stands for this prop osition, I do not

agree that the

principle enunci

ated in that case

is implicated by

the facts of the instant case.

In the case before

us, it is clear to me that the new statute “shortened” the period of limitations. This is because the applicable peri

od was changed

from a span of thr

ee years with the discovery rul e to a th ree- ye ar pe riod without the discovery rule. As pertinent to my dissent, the change in the period of limi tations is signific

ant in at least

two respects. First, the new statute does not expressly

provide that the a

ccrual of a cau

se of action subje

ct to its terms

would occur at the time of the conversionand not when the conversion was disco vered or sho uld ha ve bee n disc overe d. In fact, it was not unt il t he m ajo rit y interpreted the statute in the more restrictive manner in this very case – and, again, I agree with that interpretation – that one was put onnotice that there had been, in effect, a shor

tening of the pe

riod within which a

n aggrieved p

arty could f

ile suit.
The second important aspect of the new statute i s that there is no express statement in the statute putting a person onnotice that the claimant has a

certain period o

f time to bring suit after the effective date of the new statute of limitations . I do not believe the one-year delay in the effective date of the statute

satisfies the requirement that before a new shortened period of limitations can be appliedto an accrued c

ause of action, the new

statute must put a

claimant on notice that the claimant has a specified period of

time within which to file suit. In my judgment, this requirement could have beenmet – but was not –

had the new statute provided that all causes of action accruing prior to the effectivedate of the statute had to be fil ed on o r befo re a rea sonab le spe cifie d date in th e futu re. In my judgment

, this is the typ

e of provision con

templated by

cases such as Pacific Eastern Corp.

I would reverse th

e grant of summa

ry judgmen

t and remand for f

urth er pro ceedings. I believe we should let the jur y decide the

critical facts

impacting the accrual issue. Regardless of how the jury resolv

es this issue, I

believe the appli

cable period of limitations is T.C.A. § 28-3-105 since
no one in thiscase contends that the causes of action barred by the trial court’s judgment accrued on or after June 1, 1996.-4- _______________________________ CHARLES D. SUSANO, JR., JUDGE