Court Opinion

ID: 3219031
Source: CourtListenerOpinion
Date Created: 2016-06-30 17:11:10.126708+00
Date Added: 2024-06-11T14:30:40.103924
License: Public Domain

IN THE COURT OF APPEALS OF TENNESSEE
                              AT KNOXVILLE
                                     February 10, 2016

      CHUCK’S PACKAGE STORE ET AL. V. CITY OF MORRISTOWN

                   Appeal from the Chancery Court for Hamblen County
                      No. 2014-CV-458 Thomas J. Wright, Judge1

                   No. E2015-01524-COA-R3-CV-FILED-JUNE 30, 2016

This case originated when six retail wine and liquor stores filed suit against the City of
Morristown seeking a refund of a portion of inspection fees that had been erroneously
calculated by the City. The fees were assessed by the City on the purchases at wholesale
of alcoholic beverages. The City failed to use the correct percentage mandated by Tenn.
Code Ann. § 57-3-501 (2013).2 It is undisputed that the plaintiffs overpaid the City; since
the plaintiffs were understandably unaware of the error, they failed to state that they were
paying the fees under protest. The City moved to dismiss the case, citing the plaintiffs‟
failure to pay “under protest.” The trial court held that Tenn. Code Ann. § 67-1-1807
(2013) relieved the plaintiffs of the requirement to pay the inspection fees under protest.
Accordingly, the trial court denied the City‟s motion. The case proceeded to a bench trial
where the court resolved all of the issues in the plaintiffs‟ favor. The City appeals,
arguing that Tenn. Code Ann. § 67-1-1801, et seq. (2013) does not apply to challenges
involving fees paid to municipalities. The State Attorney General filed an amicus curiae
brief supporting the City‟s position. We affirm the trial court.

      Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court
                           Affirmed; Case Remanded

CHARLES D. SUSANO, JR., J., delivered the opinion of the court, in which D. MICHAEL
SWINEY, C.J., and JOHN W. MCCLARTY, J., joined.

Daniel R. Pilkington and Brian R. Bibb, Knoxville, Tennessee, for appellant, City of
Morristown, Tennessee.

       1
           Sitting by interchange.
       2
          This statute and others cited in this opinion have been changed since the complaint in
this case was filed on October 14, 2014. We will apply the version of the law in effect when the
complaint was filed.
F. Braxton Terry, Morristown, Tennessee, and W. Lewis Jenkins, Jr., Dyersburg,
Tennessee, for appellees, Chuck‟s Package Store; The Cellar, Inc.; T&T Package Store,
LLC; Morristown Beverage Associates, Inc., d/b/a Cork & Keg Package Store; The
Package Store; and C&C Package, Inc.

Herbert H. Slatery III, Attorney General and Reporter; Andrèe Sophia Blumenstein,
Solicitor General; Charles L. Lewis, Deputy Attorney General; and Mary Ellen Knack,
Senior Counsel, for the amicus curiae, State of Tennessee.

                                        OPINION

                                             I.

        The material facts in this case are not in dispute. Tenn. Code Ann. § 57-3-501
authorizes municipalities to impose an inspection fee upon licensed retailers of alcoholic
beverages. The statute provides that municipalities may collect a maximum inspection
fee of either five or eight percent – depending upon the population of the county in which
the city is located, as reflected in the most recent federal census – on wholesale purchases
of alcoholic beverages. Municipalities located in counties with a population of 60,000 or
more may collect no more than five percent in inspection fees, while those in counties
with a population less than 60,000 may collect up to an eight percent inspection fee.

       At trial, the plaintiffs used the terms “inspection fee” and “tax” interchangeably
and maintained the revenue paid pursuant to Tenn. Code Ann. § 57-3-501 is a tax. The
City also used the terms interchangeably and relied on Lebanon Liquors, Inc. v. City of
Lebanon, 885 S.W.2d 63, 66 (Tenn. Ct. App. 1994), which treated the inspection fee as a
tax. The stipulation of facts submitted by the parties at trial again used the terms
“inspection fee” and “tax” interchangeably. Accordingly, the trial court treated the
inspection fee as a tax and stated at trial, “there‟s no question that the inspection fee is
simply a euphemistic reference to a tax.” We note that the inspection fee at issue is
referred to as a “tax” in Tenn. Code Ann. §§ 57-3-503(a) (2013) and -202(h)(i)(2) (2014).
In their brief, the plaintiffs maintain that “the money collected under Tenn. Code Ann. §
57-3-501 constitutes a „tax‟ within the meaning of Tenn. Code Ann. § 67-1-1807.” In the
same brief, however, the plaintiffs assert – admittedly for the first time on appeal – that
the inspection fee is not a tax, but rather a fee, citing Memphis Retail Liquor Dealers’
Ass’n, Inc. v. City of Memphis, 547 S.W.2d 244, 245-46 (Tenn. 1977) (finding, in part,
that a prior version of “the inspection fee on „licensed retailers of alcoholic beverages‟ ”
is “not a tax”). The resolution of this case does not depend upon the correct
nomenclature of the City‟s assessment. As did the parties, we will use the terms
“inspection fee” and “tax” interchangeably.

      The City, located in Hamblen County, prior to 2011, enacted a local ordinance
imposing an inspection fee of eight percent on the purchases at wholesale of alcoholic

                                             2
beverages. The 2010 federal census was published January 1, 2011; in that census the
County‟s population exceeded 60,000. As a result, Tenn. Code Ann. § 57-3-501
prevented the City from collecting more than a five percent inspection fee. Despite this,
the City – in error – continued to collect the inspection fee at a rate of eight percent.
Several years passed before the City and those paying the inspection fee learned of the
error. Each of the six plaintiffs – Chuck‟s Package Store, The Cellar, Inc., T&T Package
Store, LLC, Morristown Beverage Associates, Inc., dba Cork & Keg Package Store, The
Package Store, and C&C Package, Inc. – operated as a wine and liquor store in the City
during the relevant time period, January 1, 2011 to June 30, 2014. During this time, it is
undisputed that the plaintiffs collectively paid the City $452,120.51 over and above what
was permitted under the statute.3 Not realizing the error in the rate, and justifiably
believing they were paying the correct amount, the plaintiffs did not state that they were
paying the fee “under protest.”

        In June 2014, Larry Bolten, owner and president of one of the plaintiffs‟ stores,
received a letter from an attorney in which the attorney stated that the City might be
imposing an erroneous inspection fee rate. Bolten forwarded the letter to the City, which
sent it to Larry Clark, the City‟s administrative services director. In response, Clark sent
a letter, dated July 8, 2014, to the plaintiffs that both acknowledged and apologized for
the error. The letter also stated, “The City will go back to January of 2011 and refund
any funds that were charged erroneously.” However, after discussing the issue at a
meeting among Clark, the city attorney, city administrator, mayor, and city council, the
City determined that it did not owe the plaintiffs a refund of the erroneously-assessed
fees. Clark then sent the plaintiffs a letter dated July 23, 2014, conveying this
information. It is undisputed that none of the plaintiffs filed a “formal” request for a
refund.

        On October 14, 2014, the plaintiffs brought suit against the City in the trial court.
They sought no less than $675,000 in damages, including the fees paid in error, as well as
interest, damages for loss of profits, attorney‟s fees, and costs of litigation. The City
responded by filing a motion to dismiss, partly on the ground that the plaintiffs had not
paid the excess inspection fees “under protest.” After a hearing on January 22, 2015, the
trial court held that payment under protest was no longer a prerequisite for the recovery
of overpaid taxes. The trial court stated in its order that “[t]he former requirement of
payment under protest as a condition of suit to recover overpayment of taxes has been
removed by statute, and the statutory change applies to taxes collected at the municipal
level.” The trial court cited as authority Admiralty Suites & Inns, LLC v. Shelby

       3
         After the trial, the parties stipulated that from January 1, 2011 to June 30, 2014, each of
the plaintiffs overpaid the City in the following amounts: Chuck‟s Package Store, $173,346.33;
The Cellar, Inc., $82,416.92; T&T Package Store, LLC, $62,917.82; Morristown Beverage
Associates d/b/a Cork & Keg Package Store, $111,999.41; Connie Shepard (former owner of
The Package Store), $5,536.45; and C&C Package Store, $15,903.58.
                                                 3
County., 138 S.W.3d 233, 238 (Tenn. Ct. App. 2003) and Tenn. Code Ann. § 67-1-1801,
et seq.

        The City then filed an answer that raised several affirmative defenses. The City
also filed a motion to alter or amend the trial court‟s pre-trial order, arguing that the suit
is governed by Tenn. Code Ann. § 67-1-901, et seq., (2013), and specifically § 67-1-911,
which requires that a payment be made “under protest” as a prerequisite to recovery. The
plaintiffs filed a motion to strike the City‟s affirmative defenses, arguing that all but one
lacked factual allegations. Prior to a bench trial, the court denied the City‟s motion to
alter or amend its pre-trial order. The trial court then granted the plaintiffs‟ motion,
striking all but one of the City‟s defenses, but reserving “the right to consider the effect
of any statutory requirements.” The case was tried before the court on April 30, 2015.
The court held that the plaintiffs are taxpayers under Tenn. Code Ann. § 57-3-501 and
that excess inspection fees “were wrongfully collected and paid, and must be refunded to
the taxpayers.” The trial court also granted the plaintiffs prejudgment interest in
accordance with Tenn. Code Ann. § 67-1-1803(b), as well as attorney‟s fees under Tenn.
Code Ann. § 67-1-1803(d).

       The City appeals the trial court‟s order denying its motion to dismiss and its later
order denying the City‟s motion to alter or amend. The City also appeals (1) the trial
court‟s order granting the plaintiff‟s motion to strike affirmative defenses, (2) the trial
court‟s final judgment in the matter, and (3) the trial court‟s post-trial order granting
attorney‟s fees.

                                             II.

       In its brief, the City presents five issues for review, which we repeat verbatim:

              Whether the Trial Court erred by applying the incorrect
              statutory scheme and concluding that payment of the subject
              municipal tax under protest is not a condition precedent to
              recovery.

              Whether the Trial Court erred by finding in favor of the
              Plaintiffs pursuant to Tenn. Code Ann. § 67-1-1801, et seq.
              where the Plaintiffs failed to comply with the statute‟s
              jurisdictional pre-suit requirements.

              Whether the Trial Court erred by applying the incorrect
              statute of limitations.

              Whether the Trial Court erred by awarding attorney fees
              where the applicable statutory scheme does not permit the

                                              4
             assessment of attorney‟s fees.

             Whether the Trial Court erred by granting the Plaintiff‟s
             Motion to Strike the City‟s affirmative defenses.

(Numbering in original omitted.) In its amicus brief, the State of Tennessee presents the
following issue for review:

             Whether the trial court erred by relieving the plaintiffs of the
             statutory requirement of paying the municipal inspection fees
             under protest and filing suit for their recovery within six
             months of paying the fees.

                                           III.

       We review the trial court‟s factual findings with a presumption of correctness and
will overturn those findings only if the evidence preponderates against them. Lee v. Lee,
No. E2006-00599-COA-R3-CV, 2007 WL 516401, at *4 (Tenn. Ct. App., filed Feb. 20,
2007) (citing Tenn. R. App. P. 13(d)). We review the trial court‟s legal conclusions de
novo, with no presumption of correctness. Lee, 2007 WL 516401, at *4 (citing S.
Constructors, Inc. v. Loudon Cnty. Bd. of Educ., 58 S.W.3d 706, 710 (Tenn. 2001)).

       This case involves questions of statutory interpretation, all of which are questions
of law. Memphis Managed Care Corp. v. State, Dep’t of Commerce & Ins., No.
M2007-02437-COA-R3-CV, 2009 WL 112573, at *2 (Tenn. Ct. App., filed Jan. 14,
2009) (citing Gleaves v. Checker Cab Transit Corp. Inc., 15 S.W.3d 799, 802 (Tenn.
2000)). We have previously stated that our standard of review for questions of statutory
interpretation is as follows:

             The primary rule of statutory construction is “to ascertain and
             give effect to the intention and purpose of the legislature.”
             Carson Creek Vacation Resorts, Inc. v. Dep’t of Revenue,
             865 S.W.2d 1, 2 (Tenn. 1993); McGee v. Best, 106 S.W.3d
48, 64 (Tenn. Ct. App. 2002). Our duty is to seek a
             reasonable construction “in light of the purposes, objectives,
             and spirit of the statute based on good sound reasoning.”
             Scott v. Ashland Healthcare Center, Inc., 49 S.W.3d 281,
             286 (Tenn. 2001) (quoting State v. Turner, 913 S.W.2d 158,
             160 (Tenn. 1995)). To determine legislative intent, we must
             look to the natural and ordinary meaning of the language in
             the statute. We must also examine any provision within the
             context of the entire statute and in light of its over-arching
             purpose and the goals it serves. State v. Flemming, 19

                                              5
S.W.3d 195, 197 (Tenn. 2000); T.R. Mills Contractors, Inc.
              v. WRH Enterprises, LLC, 93 S.W.3d 861, 867 (Tenn. Ct.
              App. 2002). The statute should be read “without any forced
              or subtle construction which would extend or limit its
              meaning.” Nat’l Gas Distribs., Inc. v. State, 804 S.W.2d 66,
              67 (Tenn. 1991).

              We are to “give effect to every word, phrase, clause and
              sentence of the act in order to carry out the legislative intent.”
              Tidwell v. Collins, 522 S.W.2d 674, 676-77 (Tenn. 1975); In
              re Estate of Dobbins, 987 S.W.2d 30, 34 (Tenn. Ct. App.
              1998). We must also presume the General Assembly selected
              their words deliberately, Tennessee Manufactured Hous.
              Ass’n. v. Metro. Gov’t., 798 S.W.2d 254, 257 (Tenn. Ct. App.
              1990), and the use of their words conveys some intent and
              carries meaning and purpose. Tennessee Growers, Inc. v.
              King, 682 S.W.2d 203, 205 (Tenn. 1984); Clark v. Crow, 37
S.W.3d 919, 922 (Tenn. Ct. App. 2000).

Memphis Managed Care Corp., 2009 WL 112573, at *2.

                                             IV.

       There is no dispute that the plaintiffs failed to assert that they were paying the fees
assessed by the City “under protest.” In earlier cases, we had held, under Tenn. Code
Ann. §§ 67-1-901 and -911, that a payment under protest was “a condition precedent to
the recovery of any tax collected by a municipality which is thought to be erroneously
collected or unjust.” Lebanon, 885 S.W.2d at 65-66. Interestingly enough, none of those
cases mention Tenn. Code Ann. § 67-1-1807(b)(1). That statute, which was the
codification of legislation enacted in 1986, expressly states that payment under protest
“shall not be a condition precedent for suit for recovery of taxes paid on or after January
1, 1986. . . .” (Emphasis added.) That statute also provides that “[a]ll taxes paid on or
after January 1, 1986, shall be governed by the laws regarding refunds and suits for the
recovery of taxes as set out in this part” and that “to the extent this section conflicts with
any other law, this section shall control and supersede all such laws.” Tenn. Code Ann. §
67-1-1807(a), (c) (emphasis added).

       The plaintiffs stated in their original complaint that Tenn. Code Ann. §§ 67-1-
1801, et seq., applies to taxes collected by municipalities. The trial court agreed. The
City argues that payment under protest remains a condition precedent to filing suit for the
recovery of municipal taxes and that Tenn. Code Ann. § 67-1-911 is the “sole remedy”
for taxpayers seeking a refund of such taxes. Similarly, in its amicus brief, the Attorney
General argues that the procedures set forth in Tenn. Code Ann. §§ 67-1-1801 to -1807

                                              6
“have no application to taxes that are not administered by the Commissioner [of
Revenue].” Therefore, the threshold question before us is whether the language of Tenn.
Code Ann. § 67-1-1807 in applicable to the “under protest” requirement found in Tenn.
Code Ann. § 67-1-901, et seq.

                                           V.

       This case brings into sharp focus the interplay of various statutory provisions in
Tenn. Code Ann. §§ 67-1-901, et seq., and 67-1-1801, et seq., to determine whether
payment under protest is a condition precedent to sue for the recovery of taxes paid to a
municipality. The City argues that Tenn. Code Ann. § 67-1-901, et seq., governs the
present action, while Tenn. Code Ann. § 67-1-1807 is irrelevant. In Tenn. Code Ann. §
67-1-901, et seq., the requirement that a disputed tax must be paid “under protest” first
appears in Tenn. Code Ann. § 67-1-901(a):

             In all cases where not otherwise provided in which an officer,
             charged by law with the collection of revenue due the state,
             shall institute any proceeding, or take any steps for the
             collection of the sum alleged or claimed to be due by the
             officer from any citizen, the person against whom the
             proceeding or step is taken shall, if that person conceives the
             same to be unjust or illegal, or against any statute or clause
             of the constitution of the state, pay the revenue under protest.

(Emphasis added.) Subsection (b) of the same statute clarifies that the requirement in
subsection (a) does not apply to certain taxes “collected or administered by the
commissioner of revenue”:

             This section shall not apply to any tax collected or
             administered by the commissioner of revenue when such tax
             is paid on or after January 1, 1986. Notwithstanding any
             other law to the contrary, it is the intent of the general
             assembly that it shall not be a condition precedent to any
             claim or suit for recovery of any taxes collected or
             administered by the commissioner [of revenue] when such
             taxes were paid on or after January 1, 1986, that the taxes
             were paid under protest, involuntarily, or under duress.

Tenn. Code Ann. § 67-1-901(b) (emphasis added).

       Relying on Tenn. Code Ann. § 67-1-911, the City asserts the requirement to pay a
disputed tax “under protest” applies to taxes collected by a municipality: “Sections 67-1-
901 – 67-1-905 and 67-1-908 – 67-1-910 apply to the recovery of all taxes collected by

                                            7
any of the municipalities of this state.” Tenn. Code Ann. § 67-1-911(a). The same
statute further provides a procedure for disputing a municipal tax:

             In order to carry out the legislative intent that all of such
             sections, which now apply to the recovery of state taxes
             erroneously paid, be conformed to apply also to the recovery
             of taxes erroneously paid to municipalities, the following
             provisions are added:

                    (1) The municipal officer collecting any
                    municipal taxes paid under protest shall pay
                    such revenue into the municipal treasury and, at
                    the time of payment, shall give notice to the
                    mayor and board of commissioners or other
                    governing body of such municipality that the
                    taxes were paid under protest;

                                     *      *      *

Tenn. Code Ann. § 67-1-911(b)(1). We note that Tenn. Code Ann. § 67-1-912 provides
substantively similar language regarding taxes paid to a county government.

        The City also argues that the procedure provided in Tenn. Code Ann. § 67-1-911
is the “sole remedy” for a taxpayer to recover a tax paid to a municipality, in part based
on the following:

             (a) There shall be no other remedy in any case of the
             collection of revenue, or attempt to collect revenue illegally,
             or attempt to collect revenue in funds only receivable by the
             officer under the law, the same being other or different funds
             than such as the taxpayer may tender, or claim the right to
             pay, than that provided by this part.

             (b) Subsection (a) shall not apply after January 1, 1986, to
             any tax collected or administered by the commissioner of
             revenue.

Tenn. Code Ann. § 67-1-908 (emphasis added).

      Contrary to the City‟s position, the plaintiffs argue that Tenn. Code Ann. § 67-1-
1807 relieves the requirement of paying a disputed tax “under protest”:

                                            8
             (a) All taxes paid on or after January 1, 1986, shall be
             governed by the laws regarding refunds and suits for the
             recovery of taxes as set out in this part.

             (b)(1) It shall not be a condition precedent for suit for
             recovery of taxes paid on or after January 1, 1986, that the
             taxes be paid under protest, involuntarily, or under duress.

             (2) No suit for the recovery of any tax paid prior to January 1,
             1986, shall be allowed unless such tax was paid under protest.

             (c) To the extent that this section conflicts with any other law,
             this section shall control and supersede all such laws.

Tenn. Code Ann. § 67-1-1807 (emphasis added). The City maintains that these statutes
are applicable only to taxes collected or administered by the state based, in part, on the
following language: “The procedure established by this part is the sole and exclusive
jurisdiction for determining liability for all taxes collected or administered by the
commissioner of revenue. . . .” Tenn. Code Ann. § 67-1-1804.

       The plaintiffs point out that Tenn. Code Ann. § 67-1-1807, the provision quoted
above that eliminates the “under protest” requirement, is broadly written and does not, in
any way, expressly limit its application to taxes paid to the State. The plaintiffs further
point out that the provisions of Tenn. Code Ann. § 67-1-1807 “control and supersede all
[conflicting] laws.”

                                           VI.

       This court, in Lebanon, has addressed a very similar set of facts as the one now
before us. In Lebanon, liquor stores in Lebanon, Tennessee, sought to recover excess
privilege license fees and inspection fees paid on the purchase of liquor to the City of
Lebanon, pursuant to Tenn. Code Ann. §§ 57-3-501 and -502. 885 S.W.2d at 64. In that
case, as in this one, the city imposed an inspection fee beyond the amount allowed by law
after a new federal census showed that the municipality was in a county that had a
population in excess of 60,000. Id. at 64-65. The liquor stores paid the excess inspection
fees without written protest and later filed suit against the city in chancery court to
recover the overpayment. Id. The trial court ruled in favor of the liquor stores, and the
city appealed. Id. at 64. Based on the issues and arguments raised by the parties, we
considered whether the interplay of Tenn. Code Ann. § 67-1-901(b) and -911(a) relieved
the requirement to pay the tax under protest. Id. at 65-66. For the following reasons, we
found that it did not:

                                            9
             Plaintiffs argue that T[enn]. C[ode] A[nn § 67-1-901(b)
             relieves the requirement of payment under protest as a
             condition precedent to the recovery of taxes to a municipality,
             by virtue of the language of T[enn]. C[ode] A[nn § 67-1-
             911(a) which states that “[t]he provisions of §§ 67-1-901 . . .
             apply to the recovery of all taxes collected by any of the
             municipalities of this state.” The legislature added T[enn].
             C[ode] A[nn § 67-1-901(b) in 1986 relieving the requirement
             of payment under protest for taxes due or collected by the
             State. However, no effort was made by the legislature to
             amend the specific provisions of T[enn]. C[ode] A[nn § 67-1-
             911(b) which explicitly require payment under protest to a
             municipality.

Id. at 66 (emphasis in original). What is most important about Lebanon as it pertains to
the facts now before us is that Lebanon does not discuss or reference, in any way, Tenn.
Code Ann. § 67-1-1807. The holding in Lebanon was followed by Hoover, Inc. v.
Rutherford Cnty., 885 S.W.2d 67, 70 (Tenn. Ct. App. 1994).

       Subsequently, in Decatur Cnty. v. Vulcan Materials Co., No. W2001-00858-
COA-R3-CV, 2002 WL 31786985 (Tenn. Ct. App., filed Dec. 12, 2002), we revisited the
issue of whether payment under protest is a condition precedent to the filing of suit to
recover local taxes. Decatur County addressed a group of taxpayers‟ constitutional
challenge of and resistance to pay a mineral severance tax imposed by Decatur County.
Id. at *1. In that case, as in the current one, the local government argued that the
taxpayers were barred from challenging the legality of the tax because they failed to pay
the tax under protest. The taxpayers, on the other hand, maintained that payment under
protest is no longer a condition precedent under Tenn. Code Ann. § 67-1-1807. Id. at *4-
5. Addressing both Lebanon and Hoover, we noted that “[i]n neither case . . . was
section 67-1-1807 of Tennessee Code Annotated raised as an issue on appeal.” Id. at *5,
n.4. We found that because the applicability of Tenn. Code Ann. § 67-1-1807 was not
raised as an issue in either case, then “[c]onsequently, these decisions are inapplicable
and we conclude that section 67-1-1807 governs, removing the requirement of payment of
disputed taxes as a condition precedent to a suit for recovery of taxes from a municipality
as well as the State.” Id. (emphasis added). We concluded that:

             in a suit to recover taxes paid after January 1, 1986, payment
             of the tax under protest is not a condition precedent to a claim
             against the governmental entity imposing the tax. The
             language of section 67-1-1807 is quite broad, and would
             encompass claims regarding taxes paid to a municipality such
             as Decatur County, as well as taxes paid to the State. Further,
             the statute clearly states that the provisions of section 67-1-

                                            10
              1807 will control in the event of a conflict of law. Under
              these circumstances, we must conclude that the mineral
              companies were not required to pay the disputed tax under
              protest as a condition precedent to asserting a claim against
              the county regarding the illegality of the tax.

Id. at *5 (footnote omitted).

       We later applied the Decatur County holding in Admiralty Suites, 138 S.W.3d at
238. In that case, certain hotels and motels, as well as certain guests of those
establishments, sued the local municipal governments and Shelby County over the
constitutionality of a hotel-motel occupancy taxes. Id. at 234. On appeal, this court
considered whether the trial court erred by not dismissing the claims for refunds of hotel-
motel occupancy taxes that were not paid under protest. Id. at 237. The defendants
asserted that Tenn. Code Ann. § 67-1-911 requires a taxpayer to pay a disputed tax under
protest before filing suit. Id. We disagreed with the defendants‟ argument and instead
held that:

              We recently visited this issue in Decatur County v. Vulcan
              Materials Co., No. W2001-00858-COA-R3-CV, 2002 WL
31786985, at *1 (Tenn. Ct. App. 2003) and found that
              “payment under protest” is no longer the exclusive procedure
              to challenge a tax. Id. at *5. In that case, we recognized that
              Tenn. Code Ann. § 67-1-1807 (2003) relieves the obligation
              to pay “under protest” before pursuing a claim against the
              governmental entity imposing the tax. Id. The wording of the
              statute, we found, is sufficiently broad to encompass claims
              involving taxes paid to local entities such as counties and
              municipalities. Id. Accordingly, we find that the Plaintiffs in
              the present action had no precedent obligation to pay the
              disputed taxes “under protest” before bringing their claims,
              and we affirm the finding of the lower court on this issue.

Id. at 238 (emphasis added).

       In the current appeal, the City argues that the plaintiffs “rely exclusively” on
Admiralty Suites and Decatur County and one subsection of Tenn. Code Ann. § 67-1-
1807. Alternatively, the City maintains that “the plainest conclusion” is that those cases
“were wrongly decided” and that “Tenn. Code Ann. § 67-1-1807 did not impact the
payment under protest requirement of Tenn. Code Ann. § 67-1-911.” The City also states
that “other courts have repeatedly acknowledged the requirement of paying challenged
city and county taxes under protest.” It cites multiple decisions that “hold that payment
under protest is still required.”

                                            11
       We adhere to our holdings in Admiralty Suites and Decatur County. First, by its
plain language, Tenn. Code Ann. § 67-1-1807(b)(1) makes clear that “[i]t shall not be a
condition precedent for suit for recovery of taxes paid on or after January 1, 1986, that
the taxes be paid under protest . . . .” (Emphasis added.) The statute goes on to state that
“[t]o the extent that this section conflicts with any other law, this section shall control
and supersede all such laws.” Tenn. Code Ann. § 67-1-1807(c) (emphasis added). When
interpreting statutes, “[t]o determine legislative intent, we must look to the natural and
ordinary meaning of the language in the statute” and do so without applying “any forced
or subtle construction which would extend or limit its meaning.” Memphis Managed
Care Corp., 2009 WL 112573, at *2 (internal citations and quotation marks omitted).
Additionally, “[d]oubts as to the application of tax statutes will be resolved in favor of the
citizen and tax statutes will be construed most strongly against the state.” Union Carbide
Corp. v. Alexander, 679 S.W.2d 938, 942 (Tenn. 1984) (citing H.D. Watts Co. v. Hauk,
231 S.W. 903 (Tenn. 1923)). Given these well-established principles, we hold that “[t]he
wording of the statute . . . is sufficiently broad to encompass claims involving taxes paid
to local entities such as counties and municipalities.” Admiralty Suites, 138 S.W.3d at
238 (citing Decatur Cnty., 2002 WL 31786985, at *5).

       Further, none of the cases the City cites to support its assertion that “payment
under protest is still required” persuade us to abandon our prior holdings in Admiralty
Suites and Decatur County. As discussed earlier in this opinion, this court distinguished
Lebanon and Hoover from cases, such as the one now before us, in which Tenn. Code
Ann. § 67-1-1807 is raised as an issue on appeal. Decatur County, 2002 WL 31786985,
at *5, n.4. In fact, this court described cases in which Tenn. Code Ann. § 67-1-1807 has
not been raised as “inapplicable” to those where it has been raised. Id. The City cites to
several cases4 that maintain payment under protest is a prerequisite to challenge a
       4
           See Youngblood v. Linebarger Googan Blair & Sampson, LLP, No. 10-2304, 2012 WL
4597990, at *3 (W.D. Tenn. Sept. 30, 2012) (finding that Tenn. Code Ann. § 67-1-912(b)(2) makes
payment under protest a condition precedent to recover a local tax); In re Penking Trust, 196 B.R. 389,
395 (Bankr. E.D. Tenn. 1996) (“[t]he law is clear in Tennessee that, at a minimum, payment under protest
is a condition precedent to the recovery of real property taxes paid to a county or a municipality”);
Nashville Metro Gov’t v. New Orleans Manor, Inc., No. M2013-00706-COA-R3-CV, 2014 WL
3540765, at *2-3 (Tenn. Ct. App., filed July 16, 2014), appeal denied (Nov. 19, 2014) (“Tenn. Code Ann.
§§ 67-1-901-905 and §§ 67-1-908-911 provide a full, complete, orderly, and exclusive remedy for the
taxpayer who believes that there was an improper exercise of the taxing power” and “as distilled from
numerous cases addressing the requirement in § 67-1-901, the only question in determining whether the
statute applies is whether a tax liability is being disputed”); State, ex rel. Williamson Cnty. v. Jesus
Christ’s Church at Liberty Church Rd., No. M2009-02439-COA-R3-CV, 2011 WL 251212, at *2 (Tenn.
Ct. App., filed Jan. 13, 2011) (“to the extent [the taxpayer] asserts that the tax violates the state
constitution or laws, payments of the tax under protest is a prerequisite to such contest”); Moscheo v.
Polk Cnty., No. E2008-01969-COA-R3-CV, 2009 WL 2868754, at *6 (Tenn. Ct. App., filed Sept. 2,
2009) (“[u]nder Tenn. Code Ann. § 67-1-903, the taxpayer must (1) pay the tax under protest and (2) file
suit to recover the sum paid under protest within six months from making the payment”); Metro. Gov’t of
Nashville & Davidson Cnty. v. Delinquent Taxpayers, No. M2004-00040-COA-R3-CV, 2005 WL
12
municipal or county tax in court. However, none of the cases cited by the City listed in
footnote four address the issue of Tenn. Code Ann. § 67-1-1807, and therefore they are
“inapplicable.” Decatur County, 2002 WL 31786985, at *5, n.4.

        Of the cases cited by the City to indicate “payment under protest is still required,”
only one – Memphis Managed Care Corp., 2009 WL 112573 – considers Tenn. Code
Ann. § 67-1-1807. In that case, a health maintenance organization filed an action with
the Tennessee Claims Commission to seek a refund of penalty and interest paid to the
Department of Commerce and Insurance for the late payment of insurance premium
taxes, required under Tenn. Code Ann. § 56-4-201. 2009 WL 112573, at *1. The Claims
Commission found Managed Care was required to make a payment under protest of the
penalties and interest owed for the late payment. Id. On appeal, we considered whether
Tenn. Code Ann. § 67-1-901 requires payment under protest for the payment of penalty
and interest imposed by the Department of Commerce and Insurance. Id. We held that
payment under protest was required by the Claims Commission pursuant to Tenn. Code
Ann. § 9-8-402(a)(2), but also found that Tenn. Code Ann. § 67-1-1801, et seq., as well
as the holdings in Admiralty Suites and Decatur County, were inapplicable. Id. at *4-5.
“The Tennessee Claims Commission has exclusive jurisdiction to determine monetary
claims against the state for all claims to recover taxes collected or administered by the
state, with the exception of taxes that are collected or administered by the Department of
Revenue.” Id. at *3 (citing Tenn. Code Ann. § 9-8-307(a)(1)(O)) (footnote omitted).
The refund at issue in Memphis Managed Care was under the “exclusive jurisdiction” of
the Tennessee Claims Commission. Id. As a result, we distinguished Memphis
Managed Care and held that:

                 Managed Care‟s reliance on the Wilder Bill5 is misplaced
                 because the Wilder Bill does not pertain to actions within the
                 jurisdiction of the Claims Commission. This is because the
                 Wilder Bill only pertains to claims concerning taxes collected
                 or administered by the Department of Revenue. Tenn. Code
                 Ann. § 67-1-1801, -1804. Moreover, the Wilder Bill created

737126, at *6 (Tenn. Ct. App., filed Mar. 31, 2005) (“the taxpayer is required, as a prerequisite to gaining
access to the courts, to pay the disputed tax under protest and sue for a refund”)Error! Bookmark not defined.;
Heath v. Creson, 949 S.W.2d 690, 692 (Tenn. Ct. App. 1997) (“the exclusive remedy for an aggrieved
taxpayer disputing a county tax is to pay the tax and seek a refund”); State ex rel. Manville Bldg.
Materials Corp. v. Foster, No. CA 81, 1991 WL 34554, at *4 (Tenn. Ct. App., filed Mar. 18, 1991)
(“[o]ur courts have consistently held that there are only two ways a taxpayer can recover county taxes[,] .
. . the administrative process provided for in T.C.A. § 67-1-707 and . . . where the taxes have been paid
under protest pursuant to T.C.A. § 67-1-901”).
        5
         The Wilder Bill, named after Lt. Gov. John Wilder, became Public Acts 1986, Chapter
749, which enacted the original language of Tenn. Code Ann. § 67-1-1801, et seq., and amended
portions of Tenn. Code Ann. §§ 9-8-307, 9-8-402, 67-8-411, 67-8-116, and 67-1-801, -707, -901,
-903, -904, -905, -908, and -909.
                                                      13
              an entirely separate statutory scheme concerning actions to
              recover taxes collected or administered by the Department of
              Revenue, one significant component of which is it conferred
              exclusive jurisdiction of such matters upon the Chancery
              Court. Tenn. Code Ann. § 67-1-1803(a). Managed Care is
              not seeking to recover a tax, penalty or interest “collected or
              administered by the Department of Revenue.” We, therefore,
              find the Wilder Bill has no application to the issues on appeal.

              Managed Care also contends that this court‟s holdings in
              Admiralty Suites . . . and Decatur County . . . stand for the
              proposition that payment under protest is no longer a
              prerequisite to recover taxes, penalties, and interest pursuant
              to Tenn. Code Ann. § 67-1-1807. We find Managed Care‟s
              reliance on these cases is also misplaced because these cases
              are distinguishable from the matter on appeal.

                                      *      *      *

              We . . . find Decatur County distinguishable from the present
              case because the mineral severance tax imposed by counties
              is part of Title 67, specifically Tenn. Code Ann. § 67-7-201,
              and it appears in the same statutory scheme with the statute
              abrogating the payment under protest requirement, Tenn.
              Code Ann. § 67-1-1807. The premium tax at issue here,
              however, is part of Title 56 and is administered by the
              Department of Insurance pursuant to Tenn. Code Ann. § 56-
              4-201, et seq[.]

                                      *      *      *

              [W]e find Admiralty Suites distinguishable from the present
              case. The tax at issue in Admiralty, like that in Decatur
              County, is part of Title 67. Tenn. Code Ann. § 67-1-101.
              Thus, for the same reason as stated above, we find the facts of
              Admiralty Suites distinguishable from the present case.

Id. at *3-5 (footnotes from original omitted; footnote added).

       Similarly, we find a distinction between Memphis Managed Care and the present
action. Unlike in the case now before us, the tax at issue in Memphis Managed Care
was under the “exclusive jurisdiction” of the Claims Commission, which included an
express payment “under protest” provision in Tenn. Code Ann. § 9-8-402(a)(2). Id. at

                                            14
*3. The tax at issue here – imposed pursuant to Tenn. Code Ann. § 57-3-501 – provides
no such explicit requirement to pay “under protest.” The statute only provides that the
inspection fee is to be paid to a municipality. As this court has previously held, Tenn.
Code Ann. § 67-1-1807 “is sufficiently broad to encompass claims involving taxes paid
to local entities such as . . . municipalities.” Admiralty Suites, 138 S.W.3d at 238.

       For the reasons stated above, we find that Tenn. Code Ann. § 67-1-1807 applies in
this case. That statute makes clear that “[a]ll taxes paid on or after January 1, 1986, shall
be governed by the laws regarding refunds and suits for the recovery of taxes as set out in
this part.” Tenn. Code Ann. § 67-1-1807(a). Therefore, the trial court did not err by
applying Tenn. Code Ann. § 67-1-1801, et seq. Under this statutory scheme, payment
under protest is not a condition precedent to a suit for the recovery of a tax paid to a
municipality.

                                            VII.

       The City next asserts that even if Tenn. Code Ann. § 67-1-1801, et seq., does
govern the present action, the plaintiffs failed to comply with the jurisdictional pre-suit
notice requirements contained in Tenn. Code Ann. § 67-1-1802(a)(1). That statute
provides, in part:

              The commissioner of revenue, with the approval of the
              attorney general and reporter, except as provided in
              subdivision (a)(4), is empowered and directed to refund to
              taxpayers all taxes collected or administered by the
              commissioner that are, on the date of payment, paid in error
              or paid against any statute, rule, regulation or clause of the
              constitution of this state or of the United States. . . . The
              commissioner is also authorized to automatically issue a
              credit or refund, without the necessity of the approval
              processes set out in this subsection (a), for the portion of
              estimated taxes paid in excess of the actual liability
              established by the initial and subsequently filed return for the
              tax period. The authority granted in this subdivision
              (a)(1)(A) extends only to taxes for which a claim is filed, with
              the commissioner under penalties of perjury, within three (3)
              years from December 31 of the year in which the payment
              was made. The claim must set forth each ground upon which
              a refund is claimed, the amount of such refund, the tax
              period, the tax type, and information reasonably sufficient to
              apprise the commissioner of the general basis for the claim.
              . . . The entire disputed amount of tax, penalty and interest
              must be paid before any claim for refund can be filed. . . .

                                             15
Tenn. Code Ann. § 67-1-1802(a)(1)(A) (emphasis added). Even if a claim for a refund
has not been filed as outlined above,

              [t]he commissioner is authorized to make refunds without a
              claim being filed if the commissioner is in possession of
              proper proof and facts that a refund is due within three (3)
              years from December 31 of the year in which the payment
              was made.

Tenn. Code Ann. § 67-1-1802(a)(2).

        The record reflects that the plaintiffs did not file a “formal” claim for refund with
the City prior to filing suit in the trial court in October 2014. The only communication
between the plaintiffs and the City is as follows. One of the plaintiffs received a letter
from an attorney stating that the City might be collecting inspection fees in excess of
what was allowed by law; it forwarded the letter to the City in June 2014. The City sent
two letters in response, one dated July 8, 2014, that conveyed, among other things, the
City would reimburse the business for the overpayment and another, dated July 23, 2014,
that conveyed the message the City would not reimburse the overpayment. The first
letter stated, in part:

              This letter is in regards to the inspection fee that is being
              charged to package stores located inside Morristown. It has
              come to our attention that the percentage being charged
              should be 5% instead of 8%. The change is because of the
              latest census numbers that place the County‟s population
              above 60,000 people. The distributors are being made aware
              of the situation to change their records. The City will go back
              to January of 2011 and refund any funds that were charged
              erroneously. We apologize for the error . . . .

Despite this, the final letter from the City stated, among other things, “Upon review from
the City Attorney‟s Office, it has been determined that no refund I [sic] due under the
current Tennessee law.”

        The trial court applied Tenn. Code Ann. § 67-1-1802(a)(2), in determining that the
plaintiffs properly brought their claim under the statutory scheme, stating:

              To the extent that this statute applies in this case, to the extent
              that the City of Morristown is, in essence, the commissioner
              of revenue in this statute, there‟s no question that the City had
              the information in its possession within three years from the

                                              16
              day of the end of the year when payment was due, so I think
              that the City is authorized to make a refund without a claim
              being made.

We also find that the City had the information and authority necessary to refund the
taxpayers the excess inspection fees under Tenn. Code Ann. § 67-1-1802(a)(2). A claim
for a refund, pursuant to Tenn. Code Ann. § 67-1-1802(a)(1)(A), requires that the claim
“set forth each ground upon which a refund is claimed, the amount of such refund, the tax
period, the tax type, and information reasonably sufficient to apprise the commissioner of
the general basis for the claim.” Here, the City knew of the tax type at issue, the error in
the rate of inspection fees, the cause of the error, the relevant time period in which the
erroneous rate was applied, which businesses were affected, and the general basis of why
a refund was due. Further, the City indicated to the plaintiffs that they knew this
information via the July 8, 2014 letter.

       After discussing Tenn. Code Ann. § 67-1-1802(a)(2), the trial court then read
aloud subsection (c)(3) of the same statute, which provides:

              The commissioner [of revenue], by written notice promptly
              delivered to the taxpayer, may waive the requirement that the
              taxpayer file a claim for refund, in which case the taxpayer
              may file suit in the appropriate chancery court of this state for
              a refund within one (1) year following the date of such waiver
              by the commissioner, and such suit shall proceed in all
              respects, including for the purpose of determining the date
              from which interest thereon should be calculated, as if proper
              and timely claim for refund had been filed by the taxpayer,
              and either denied or not acted upon by the commissioner
              within the period specified herein.

The court then stated:

              I don‟t think you need anything more there.

              In the present case, the two letters sent in July by the City to
              the taxpayers I think would constitute a waiver of the
              necessity of jumping through the hoop of filing a written
              claim when the City made clear to the taxpayer that they had
              all the information, which is what the claim requirement is
              intended to do. . . .

              On the present case, the City had all the information, and they
              just told them we [are not] giving you your money back and,

                                             17
              in essence, I believe, to the extent that 1802 requires it,
              waived the filing of a claim by these taxpayers. From a legal
              standpoint, what I find is that in the present case no claim is
              required to have been filed to proceed on the lawsuit seeking
              to recover the overpaid taxes.

(Emphasis added.)

       Despite the City‟s knowledge regarding its incorrect calculation of the inspection
fees collected from the plaintiffs, the City communicated by written notice to the
taxpayers its decision not to refund the overpayment. In doing so, the City effectively
released its right to hear and assess each taxpayer‟s potential claim for a refund.
“[W]aiver is a voluntary relinquishment by a party of a known right.” BMG Music v.
Chumley, No. M2007-01075-COA-R9-CV, 2008 WL 2165985, at *5 (Tenn. Ct. App.,
filed May 16, 2008) (quoting Reed v. Washington Cnty. Bd. of Educ., 756 S.W.2d 250,
255 (Tenn. 1988)) (internal quotation marks omitted). “Oral or written statements
relinquishing known rights or privileges constitute an express waiver.” BMG Music,
2008 WL 2165985, at *5 (citing Grimsley v. Kittrell, No. M2005-02452-COA-R3-CV,
2006 WL 2846298, at *3 (Tenn. Ct. App., filed Sept. 29, 2006) (no perm. app. filed)).
Pursuant to Tenn. Code Ann. § 67-1-1802(c)(3), the City‟s July 23, 2014 correspondence
to the plaintiffs waived the requirement for the plaintiffs, as the taxpayers, to file a claim
for a refund before filing suit. The same subsection of the statute then permits the
taxpayers to file suit in chancery court, which the plaintiffs timely did in this case. For
the above reasons, we hold that the plaintiffs complied with the statute‟s pre-suit
requirements under Tenn. Code Ann. § 67-1-1802(a)(2), (c)(3).

                                            VIII.

        The trial court ordered the City to refund the improperly collected taxes for the
period January 1, 2011 until June 30, 2014, as well as interest incurred since September
6, 2014, forty-five days after the City sent the July 23, 2014 letter informing the
taxpayers that they would not refund the overpayment. The City maintains that the
plaintiffs are only entitled to recover six months of overpaid inspection fees. The City
again argues that “the appropriate remedial scheme that the Trial Court should have
applied is Tenn. Code Ann. § 67-1-901, et seq.” and states that the plaintiffs‟ recovery is
limited by Tenn. Code Ann. § 67-1-903 to “any overpaid taxes for the six months
preceding the date they filed their lawsuit.” As discussed in detail in section IV of this
opinion, we have determined that Tenn. Code Ann. § 67-1-1807 applies in this case.
Having found that Tenn. Code Ann. § 67-1-1807 applies, then Tenn. Code Ann. § 67-1-
1801, et seq., governs the present action: “[a]ll taxes paid on or after January 1, 1986
shall be governed by the laws regarding refunds and suits for the recovery of taxes as set
out in this part.” Tenn. Code Ann. § 67-1-1807(a) (emphasis added). Therefore, the
plaintiffs‟ recovery is not limited by Tenn. Code Ann. § 67-1-903.

                                             18
                                            IX.

       Through an order entered in July 2015, the trial court awarded a total of
$73,620.87 in attorney‟s fees to the plaintiffs‟ counsel as the prevailing party, pursuant to
Tenn. Code Ann. § 67-1-1803(d). This statute states, in part, that “[t]he court shall award
to the prevailing party reasonable attorneys‟ fees and expenses of litigation up to twenty
percent (20%) of the amount finally assessed or denied, including interest after payment.”

        On appeal, the City does not contest the reasonableness of the rate charged by
plaintiffs‟ counsel or the amount of the fee. Instead, the City maintains that Tenn. Code
Ann. § 67-1-1803 “does not apply to suits contesting a municipal tax.” As discussed in
detail earlier in this opinion and in this section, we disagree with the City on this point.
Again, we have found that Tenn. Code Ann. § 67-1-1807 applies to this case and that
Tenn. Code Ann. § 67-1-1801, et seq., therefore governs. Tenn. Code Ann. § 67-1-
1807(a). As a result, we decline to find the trial court erred in granting the attorney fee
award, which is permitted by Tenn. Code Ann. § 67-1-1803(d).

                                             X.

      Prior to the April 30, 2015 trial, the City submitted an answer that listed several
defenses, including:

              32. The Defendant pleads and relies upon all immunities,
              protections and procedures provided by the Tennessee
              Governmental Tort Liability Act, Tenn. Code Ann. §29-20-
              101 et seq.

              33. Plaintiffs‟ Complaint is barred by the applicable statute of
              limitations.

                                      *      *       *

              35. Plaintiffs‟ claims are barred by the doctrines of laches,
              waiver and equitable estoppel.

              36. Plaintiffs‟ have failed to mitigate any alleged damages.

              37. Plaintiffs‟ Complaint fails to state a claim upon which
              relief can be granted.

              38. Plaintiffs‟ claims are barred by the doctrine of
              comparative fault.

                                             19
              39. Plaintiffs have failed to exhaust administrative remedies.

              40. This Court lacks subject matter jurisdiction.

              41. Plaintiffs‟ claims are barred for failure to comply with the
              following statutes: Tenn. Code Ann. § 67-1-707, Tenn. Code
              Ann. § 67-1-901, Tenn. Code Ann. § 67-1-903, Tenn. Code
              Ann. § 67-1-908, Tenn. Code Ann. § 67-1-911, Tenn. Code
              Ann. § 67-1-1801, Tenn. Code Ann. § 67-1-1802, Tenn. Code
              Ann. § 67-1-1803, Tenn. Code Ann. § 67-1-1804, Tenn. Code
              Ann. § 67-1-1807 and Tenn. Code Ann. § 67-1-1808.

              42. Plaintiffs have failed to join as indispensable party the
              wholesalers or distributors who collected the tax at issue.

              43. Plaintiffs‟ claims are barred because the tax at issue was
              not paid under protest.

(Numbering in original.)

        The plaintiffs filed a motion seeking an order that the City‟s defenses were waived
or, in the alternative, to strike defenses. The plaintiffs argued in their motion that “[o]nly
one of the affirmative defenses raised by Defendant contains any factual statements at all
. . . . The remaining defenses are bare assertions of legal principles and they do not
comply in any way, shape, or form . . . with Tenn. R. Civ. P. 8.03.” Tenn. R. Civ. P. 8.03
provides:

              [i]n pleading to a preceding pleading, a party shall set forth
              affirmatively facts in short and plain terms relied upon to
              constitute . . . comparative fault . . . estoppel . . . statute of
              limitations . . . waiver . . . and any other matter constituting
              an affirmative defense. When a party has mistakenly
              designated a defense as a counterclaim or a counterclaim as a
              defense, the court, if justice so requires, shall treat the
              pleading as if there had been a proper designation.

The City did not file a response to the plaintiffs‟ motion. The trial court granted the
plaintiffs‟ motion – deeming the above defenses to be “waived or . . . stricken from the
answer of the Defendant” – but, significantly, “reserve[d] the right to consider the effect
of any statutory requirements and to give effect to those statutory requirements as part of
this trial of this matter.” In doing so, the trial court preserved for trial all defenses
regarding statutory requirements or the effect of statutory requirements.

                                             20
        On appeal, the City asks us to find that the trial court erred by granting the
plaintiffs‟ motion to strike. We decline to do so. The City avers that “[t]hough the
Motion to Strike is not dispositive of any issue on appeal, the Trial Court nonetheless
committed reversible error in granting it.” The City states that “not all of the . . .
paragraphs were affirmative defenses,” specifically identifying paragraphs numbered 40,
41, and 43, listed above.

       We note that “affirmative defenses must be pled with specificity.” ACG, Inc. v.
Se. Elevator, Inc., 912 S.W.2d 163, 170 (Tenn. Ct. App. 1995). For instance, “[a]
generic invocation of the words „failure to state a claim‟ cannot be used as a vehicle to
assert an affirmative defense.” Pratcher v. Methodist Healthcare Memphis Hosps., 407
S.W.3d 727, 736 (Tenn. 2013). Here, the City provided only conclusory statements,
failing to provide supporting allegations of facts in short and plain terms in its answer.
The City argues that “the same liberal pleading standards applied to complaints are also
applied to answers.” But conclusory allegations are insufficient to meet the requirements
of Tenn. R. Civ. P. 8.03, which rule addresses what is required of affirmative defenses.
ACG, Inc., 912 S.W.2d at 170.

       Further, the paragraphs that the City identifies as not including affirmative
defenses – 40, 41, and 43 – effectively were not waived or stricken by the trial court. In
its order waiving or striking certain defenses, the trial court “reserve[ed] the right to
consider the effect of any statutory requirements and to give effect to those statutory
requirements” in this matter. As a result, the City was not barred from asserting the
defenses raised in paragraphs numbered 33, 41, and 43, regarding statute of limitations,
the plaintiffs‟ alleged failure to comply with certain statutes, and the plaintiffs‟ failure to
pay the excess inspection fees under protest.

       Finally, the City points out that that a defense of subject matter jurisdiction cannot
be waived. We agree. See Estate of Brown, 402 S.W.3d 193, 199 (Tenn. 2013). As this
court has previously stated,

              [t]he concept of subject matter jurisdiction implicates a
              court‟s power to adjudicate a particular type of case or
              controversy. A court derives its subject matter jurisdiction,
              either explicitly or by necessary implication, from the
              Constitution of Tennessee or from legislative acts.

                                       *      *       *

              The existence of subject matter jurisdiction depends on the
              nature of the cause of action and the relief sought. Thus,
              when a court‟s subject matter jurisdiction is questioned, it

                                              21
              must first ascertain the nature or gravamen of the case. The
              court must then determine whether the Constitution of
              Tennessee, the General Assembly, or the common law have
              conferred on it the power to adjudicate cases of that sort.

Midwestern Gas Transmission Co. v. Reese, No. M2005-00805-COA-R3-CV, 2006 WL
468688, at *11 (Tenn. Ct. App., filed Feb. 24, 2006) (internal citations omitted).

       The trial court did not bar the City from asserting a subject matter jurisdiction
defense. Because the trial court reserved the right to consider statutes and their effect, the
City was permitted to argue the court lacked jurisdiction. In fact, the City did assert such
a defense at trial and on appeal. For example, the City argued at trial that even if Tenn.
Code Ann. § 67-1-1801, et seq., does apply, the plaintiffs failed to meet that statute‟s pre-
suit notice requirements “and if those are not complied with, then this Court doesn‟t have
subject matter jurisdiction to even adjudicate the case.” The City maintained the same on
appeal. There is no reversible error here.

                                             XI.

       The judgment of the trial court is affirmed. Costs on appeal are assessed to the
appellant, the City of Morristown. This case is remanded for enforcement of the trial
court‟s judgment and the collection of costs assessed below.

                                                     _______________________________
                                                     CHARLES D. SUSANO, JR., JUDGE

                                             22