484 S.W.3d 914
Tenn.2016Background
- Circle C Construction hired Nilsen (attorneys) to defend a False Claims Act suit; the federal court entered judgment against Circle C and the Sixth Circuit later issued an opinion.
- Circle C and Nilsen executed a written tolling agreement that tolled the statute of limitations so that the filing deadline would not expire until 120 days after the Sixth Circuit issued its opinion (the "Termination Date"). The agreement stated that if Circle C desired to assert negligence claims it "must do so on or before the Termination Date." Recitals stated the extension would be without prejudicing Circle C’s rights to assert claims.
- Circle C filed the malpractice suit within the contractually extended period, voluntarily nonsuited it, and then refiled within one year after the nonsuit (the period provided by Tennessee’s savings statute) but after the contract’s Termination Date.
- Nilsen moved for summary judgment arguing the refiling was untimely because it missed the contractually fixed Termination Date; the trial court and Court of Appeals agreed.
- The Tennessee Supreme Court reviewed de novo whether the savings statute (Tenn. Code Ann. § 28-1-105(a)) applies when a suit was first filed within a tolling-agreement extension, nonsuited, and refiled within one year but after the agreement’s extended deadline.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Tennessee's savings statute can save a refiling when the first suit was filed within a party-agreed extension of the limitations period, nonsuited, and the second suit was filed within one year but after the agreement's Termination Date | Circle C: The tolling agreement extended the statute of limitations (it "tolled so that the statute of limitations will not expire" until 120 days after the appellate decision); Circle C filed the first suit within that extended limitations period, so the statutory savings provision applies to save the refiled suit | Nilsen: The agreement created a contractual filing deadline that is not a "rule or statute of limitation," so the savings statute (which applies only when the action was commenced within the time limited by a rule or statute of limitation) does not apply; the contract’s mandatory language precludes refiling after the Termination Date | The Court held the agreement simply tolled and extended the statutory limitations period; because Circle C commenced the action within that extended statutory period, the savings statute applies and the refiled suit (within one year of nonsuit) is timely |
Key Cases Cited
- Rye v. Women's Care Ctr. of Memphis, MPLLC, 477 S.W.3d 235 (Tenn. 2015) (standard of review for summary judgment and legal questions)
- Ellis v. Pauline S. Sprouse Residuary Trust, 280 S.W.3d 806 (Tenn. 2009) (existing law is incorporated into contract interpretation absent contrary intent)
- Henley v. Cobb, 916 S.W.2d 915 (Tenn. 1996) (savings statute is remedial and should be liberally construed)
- Cronin v. Howe, 906 S.W.2d 910 (Tenn. 1995) (effects of refiling under the savings statute)
- Guthrie v. Connecticut Indem. Ass'n, 49 S.W. 829 (Tenn. 1899) (distinguished; contract-based filing deadlines and savings statute interplay)