Summary of a Recent
Judicial Development in
Agritourism

Tennessee Supreme Court Alters Rules for Shifting
Burden of Production for Summary Judgment

Walt McCarter
National AgLaw Center Research Associate

Summary of Decision

In Hannan v. Alltel Publishing Co., 270 S.W.3d 1, 2008 WL 4790535 (Tenn. 2008), the Tennessee Supreme Court held that a party moving for summary judgment could not shift the burden of production to the nonmoving party by merely alleging an absence of evidence, and stated that to shift that burden, a movant must either affirmatively negate an essential element of the nonmoving party's claim or show that the nonmoving party cannot prove an essential element of the claim at trial.

Background

Plaintiffs advertised their realty company and their bed and breakfast in the local Alltel telephone directory for several years, until 2003 when the directory omitted their ad and also omitted the realty company's telephone number from its white pages. Id. at *1. Alltel included the telephone number in a supplement issued shortly thereafter and, as compensation, printed plaintiffs' ad in the following year's directory for free. Id. Plaintiffs sued Alltel, alleging that the omissions caused them to lose business and that as a result of the dramatic economic loss and emotional distress, they were forced to close their businesses. Id. Alltel's motion for summary judgment stated that the plaintiffs were unable to prove that they suffered any damages as a result of the alleged breach of contract, relying on evidence that the plaintiffs were unable to quantify the actual amount of damages, and the plaintiffs responded that they would be able to prove the existence of damages at trial. Id. at *2. The trial court granted Alltel's motion for summary judgment, but the appellate court reversed and held that Alltel had failed to negate an essential element of the plaintiffs' claim, and Alltel appealed. Id.

Arguments

Alltel argued that summary judgment was appropriate because the plaintiffs could not prove within a reasonable degree of certainty that they suffered damages. Id. at *7.

Analysis and Holdings

The Tennessee Supreme Court explained that with regard to summary judgment motions, some courts in Tennessee had adopted a "put up or shut up" approach, which basically shifted the burden of proof to the nonmoving party by alleging an absence of evidence. Id. at *3. The court noted, however, that it had not adopted this approach, and restated its rule that a moving party must either conclusively establish an affirmative defense or "affirmatively negate an essential element of the nonmoving party's claim" to shift the burden of production to the nonmoving party. Id. at *4. The court explained that the existence of damages cannot be uncertain or speculative, but the amount can, as long as the plaintiff lays sufficient foundation to allow the court to reasonably assess the damages. Id. at *7. The court pointed out that neither party had indicated that such a foundation could not be provided. Id. at *8. Rather, the plaintiffs had stated that there was no way for them to quantify the amount of damages, which did not negate an essential element of their claim nor show that they could not prove the existence of damages at trial, and therefore the court held that the burden of production had not shifted to the plaintiffs and summary judgment was inappropriate. Id. One dissenting justice was in favor of the "put up or shut up" approach, and opined that this holding radically altered the required burden of production for summary judgment in Tennessee, stating that the approach adopted by the majority undermined the utility of summary judgment proceedings as opportunities to weed out frivolous lawsuits and to avoid the time and expense of unnecessary trials. Id.

The case was decided on October 31, 2008.