Luvell L. Glanton v. Bob Parks Realty

Citation: Not availableDocket: M2003-01144-COA-R3-CV

Court: Court of Appeals of Tennessee; April 27, 2005; Tennessee; State Appellate Court

Original Court Document: View Document

SummaryOriginalCytator Case TreatmentBackward CitatorAnalysis

EnglishEspañolSimplified EnglishEspañol Fácil

Luvell L. Glanton purchased a house marketed by Bob Parks Realty and other defendants, believing it to have over 5,800 square feet of living space based on listings and brochures. After closing the sale for $925,000, Glanton discovered that the actual square footage was significantly less, reported as 4,600 square feet in an appraisal obtained by his mortgage lender. Glanton sued for unfair or deceptive practices under the Tennessee Consumer Protection Act and for intentional misrepresentation. The trial court dismissed his complaint on summary judgment and ordered him to pay the defendants’ attorney fees. The Court of Appeals affirmed the dismissal but modified the attorney fee award. The case involved conflicting statements about the inclusion of a pool house in the square footage calculations, and Glanton's failure to closely examine blueprints that indicated the property's irregular shape contributed to the court's findings. The ruling emphasized the discrepancies between marketing representations and actual property measurements.

Mr. Newsham informed Mr. Glanton of a discrepancy in property square footage, leading Glanton to contact defendant Bottorf, who promised to follow up but failed to do so. Two brochures were found, one listing 5,855 square feet and the other 5,866 square feet of living space. On November 13, 2000, Mr. Glanton filed a complaint in the Williamson County Chancery Court against Bottorf, Cummings, and their respective brokers, alleging violations of the Tennessee Consumer Protection Act due to misrepresentation of the house's square footage. He sought $198,000 in damages for intentional misrepresentation. 

Following the complaint, the Williamson County Tax Assessor, having read about the case, measured the house and found it to have approximately 4,800 square feet, or 5,233 square feet with the pool house included. Mr. Glanton also hired appraiser J. Donald Turner, who determined the living space was 4,543 square feet and valued the property at $810,000 at the time of purchase. The defendants denied liability and sought attorney fees, arguing the lawsuit was frivolous.

A lengthy discovery process ensued, involving depositions from Mr. Glanton, Ms. Cummings, Ms. Bottorf, and employees of Bob Parks Realty. The focus was on the methods used to determine square footage for real estate transactions. Cummings and Bottorf detailed their process, starting with a tax appraisal figure of 5,380 square feet and making adjustments based on blueprints and room measurements. However, despite having extensive notes, they could not replicate the original calculations or confirm what was included in their final square footage. They were uncertain about the inclusion of the recreation room and garage in their calculations, noting that garage space is typically excluded but acknowledging the garage's high quality. 

Depositions from Robert A. Parks and agents Spicher and Mayfield addressed industry standards for measuring square footage, with a manual on the subject introduced as evidence. It was noted that Cummings and Bottorf did not adhere closely to the manual's guidelines.

To determine the total square footage of a house, measurements should be taken of the exterior walls, calculating length times width, with the square footage of unheated, unfinished interior spaces subtracted. For multi-story homes where the second floor does not align with the first, individual room measurements should be used, adding for wall thickness. Robert Parks advised against physical measurements for complex structures, recommending reliance on tax records or blueprints instead. Mr. Mayfield concurred that calculations could be based on reliable blueprints. Only heated and finished spaces are counted in the final square footage, with garages excluded unless converted to living space. Heated and finished pool houses are included regardless of attachment to the main structure.

On November 8, 2002, defendants filed a motion for summary judgment with supporting affidavits and a memorandum asserting that Mr. Glanton had misapplied the 'bait and switch' provision of the Tennessee Consumer Protection Act, which was not pertinent to his case. Mr. Glanton countered that he was still entitled to relief under the Act for consumer protection against unfair or deceptive acts. After a hearing on December 9, 2002, the trial court granted the defendants' motion, citing no genuine issues of material fact and ruling in favor of the defendants as a matter of law. The court’s decision referenced numerous documents but excluded the affidavit of the appraiser commissioned by Mr. Glanton. The court subsequently approved a hearing for the defendants’ counterclaims regarding discretionary costs and attorney fees, resulting in judgments of $14,134 against Mr. Glanton for Bottorf and Bob Parks Realty, and $12,167 for Cummings and Legacy Properties. The plaintiff's motion to alter or amend the judgment was denied, and the court found the plaintiff’s action legally and factually baseless, leading to an appeal. The appellate court will review the summary judgment without a presumption of correctness, following Tennessee Rule of Civil Procedure 56.

Summary judgment in Tennessee requires that the motion's supporting documents demonstrate no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law, as outlined in Tenn. R. Civ. P. 56.04. Summary judgment is only appropriate when undisputed facts lead to a single conclusion favoring the moving party. The evidence must be viewed in the light most favorable to the non-moving party, with all reasonable inferences resolved in their favor. If factual disputes exist, they must be material to the case, and if such disputes require resolution before legal determinations can be made, summary judgment must be denied. The burden rests on the moving party to prove entitlement to summary judgment, which shifts to the non-moving party to present specific facts that necessitate resolution by a trier of fact. To support a motion, the moving party must either negate an essential element of the non-moving party's claim or establish an affirmative defense. If the moving party fails to negate any claims, the non-moving party is not required to provide evidence of a genuine issue for trial, resulting in the failure of the motion. Conversely, if the moving party successfully negates a claim, the non-moving party must produce proof of the essential elements of their claim. Additionally, under the Tennessee Consumer Protection Act, individuals may pursue a private right of action for ascertainable losses resulting from unfair or deceptive practices.

Tennessee Code Annotated 47-18-104(b) identifies thirty-six practices deemed unfair or deceptive, with thirty-five being specific. The complaint alleges that Defendant Lucy Bottorf misrepresented the living space of a property advertised through a multi-listing service. This claim invokes T.C.A. Section 47-18-104, which prohibits misleading advertising that could cause a buyer to switch to other goods or services. However, the court finds that the cited "bait and switch" provision, Tenn. Code Ann. 47-18-104(b)(21), does not apply because there was no switching involved—Mr. Glanton purchased the advertised house without being directed to another. Furthermore, the statute specifically pertains to "goods," defined as tangible chattels, and does not encompass real property misrepresentations. The complaint, therefore, fails to establish a violation of this statute. 

The Rules of Civil Procedure require specific pleading for statutory violations, necessitating either direct reference to the statute or a detailed account of the facts constituting the breach. While Mr. Glanton quoted the statute, his allegations did not legally substantiate a violation, nor did he amend his complaint after deficiencies were noted. In his opposition to the summary judgment motion, he claimed a general right of action under the Act for unfair or deceptive practices, yet did not specify any misrepresentation related to services. While other provisions of the Tennessee Consumer Protection Act could apply to real estate transactions, they do not cover isolated sales by individuals not engaged in the business of selling homes. The court must evaluate the complaint under both the required specificity and the more lenient liberal pleading standards, ultimately requiring a clear statement of claim for relief.

The allegations in Mr. Glanton's complaint do not constitute a violation of the relevant statute, Tenn. Code Ann. 47-18-104(b)(21). He focuses on the misrepresentation aspect but neglects the statute's requirement that such misrepresentation must lead to a likelihood of switching buyers to other goods, an element that is not applicable to the facts he presented. Additionally, Mr. Glanton incorrectly applies the statutory definition of 'goods' to real property, as 'goods' pertains to chattels (personal property), thus further negating his claim under the Tennessee Consumer Protection Act, leading to the affirmation of summary judgment against him.

Regarding Mr. Glanton's claims of fraudulent or intentional misrepresentation, he must demonstrate several elements: a misrepresentation of a material fact, falsehood at the time of the statement, knowledge or reckless disregard of the falsehood by the defendant, reasonable reliance on the misrepresentation, and resultant damage. Mr. Glanton alleges that he was misled about the house's square footage (5,855 square feet), asserting that the defendants knew this claim was false or recklessly made it. He contends that he relied on this misrepresentation in his purchasing decision.

For summary judgment, the defendants must negate one of these essential elements or establish an affirmative defense. Their evidence includes conflicting square footage figures, with an appraiser reporting 4,600 square feet of living space, excluding the pool house. This discrepancy indicates that the materiality of the alleged misrepresentation is in dispute, which could impede the defendants' entitlement to summary judgment.

Mr. Glanton's appraiser did not provide an official appraisal report; instead, he submitted an affidavit asserting the house had 4543 square feet of living space, excluding the garage and pool house. A tax appraiser later inspected the property, estimating 4800 square feet without the pool house and 5233 with it, indicating the pool house's size at approximately 430 square feet. This created a dispute over the house's correct square footage. The court determined that summary judgment was inappropriate for resolving this factual issue, noting that measuring square footage can lead to discrepancies based on the methods used. 

Mr. Glanton's evidence suggested the house's size was roughly 4600 square feet without the pool house and about 4900 with it, leading to a significant variance of 950 to 1250 square feet from the brochure's figures. For a misrepresentation claim to succeed, it must be shown that the misrepresentation was intentional, made without belief in its accuracy, or made with reckless disregard for the truth. Depositions from Ms. Cummings and Ms. Bottorf indicated they attempted to calculate the square footage responsibly, consulting various sources, but admitted to errors and inconsistencies in their methods. Their actions did not demonstrate intentional misrepresentation or reckless disregard, as negligence alone does not equate to intent.

While including the pool house was deemed acceptable practice by the agents, Mr. Glanton claimed one agent told him it was excluded from the brochure's figure, a fact dispute that cannot be settled through summary judgment. Additionally, the complaint failed to assert a negligent misrepresentation claim, lacking necessary elements such as the defendants acting in a professional capacity, supplying false information, failing to exercise reasonable care, and showing the plaintiff's justified reliance on that information.

The tort of negligent misrepresentation applies broadly to business persons, establishing liability when false information is negligently provided, and it is foreseeable that a plaintiff will rely on it. Sellers must exercise reasonable care in making factual representations, and real estate agents have a duty to ensure their claims are accurate. In the case at hand, Mr. Glanton failed to challenge the agents' credibility or provide evidence of their intent, arguing instead that they should have recognized their failure to adhere to square footage measurement standards. This argument does not prove the agents' knowledge of their inaccuracies or reckless disregard for the truth, leading to the affirmation of summary judgment in favor of the defendants on the intentional misrepresentation claim.

Regarding attorney fees, the trial court awarded the defendants fees incurred under the Tennessee Consumer Protection Act. This Act allows for fee awards to the prevailing party in specific situations. The statute permits fees to a successful plaintiff when a violation is found, and it allows the court to impose fees on plaintiffs if their actions are deemed frivolous or lacking merit. The court retains discretion in awarding fees, which should be based on legal standards and logical reasoning. The Act aims to protect consumers from deceptive practices and to make pursuing valid claims economically feasible for plaintiffs, while discouraging the filing of baseless claims against defendants.

A strict interpretation of the statutory term 'without legal or factual merit' would lead to an unfair 'winner take all' outcome, undermining consumer protection objectives. The court clarified that this term refers to claims that lack a sufficient factual or legal basis, making success improbable. In this case, the plaintiff's claim under the Tennessee Consumer Protection Act was deemed meritless because it was based on a section of the Act that does not pertain to real property and was not applicable to the alleged conduct. The trial court rightly ruled the claim as lacking legal merit and correctly applied Tenn. R. Civ. P. 12.02 to dismiss it. Although the trial court did not label the claim as frivolous or indicate it was filed for harassment, the plaintiff failed to rectify the identified deficiencies. Conversely, the plaintiff's misrepresentation claim was not dismissible at the complaint stage, leading to discovery. Evidence presented suggested that defendants misrepresented the home's square footage, which was significant to the plaintiff's negotiations. However, the court dismissed the intentional misrepresentation claim due to a lack of evidence showing intentional or reckless conduct by the defendants. Under Tennessee's American Rule, parties generally bear their own attorney's fees unless a statute or contract states otherwise. No such provision existed in this case, meaning neither party was entitled to attorney fees. Furthermore, the plaintiff should not be required to pay the defendants' attorney fees related to both claims, as awarding such fees would not align with the purposes of the Act, especially given the defendants' actions contributed to the lawsuit’s initiation.

The defendants were actively involved in the miscalculation of square footage and cannot be considered uninvolved. The affidavits from the defendants’ attorneys did not specify fees related to individual claims, making it impractical to separate legal costs by claim. Remanding the case for this task would lead to further expenses without clear benefit. Consequently, the plaintiff is ordered to pay half of the defendants’ attorney fees. Additionally, each defendant's award is to be reduced by $500 to correct previously awarded discretionary costs. The trial court's summary judgment in favor of the defendants is affirmed, and the attorney fee responsibility is modified as specified. The case is remanded to the Circuit Court of Williamson County for further necessary proceedings, with appellate costs split equally between the parties.