Tennessee Court Allows Plaintiffs to Proceed with Lawsuit Despite Untimely Service

Plaintiffs are generally required to file their cause of action within a certain time period, or they may be barred from bringing their claim by the statute of limitations. In Clark v. Powers (Tenn. Ct. App. Aug. 19, 2016), the Court of Appeals of Tennessee was presented with an issue concerning the statute of limitations in a car accident case. The plaintiffs in Clark failed to serve process upon the defendants within the required timeframe, although the parties were involved in settlement negotiations. Nevertheless, the defendants subsequently filed a motion to dismiss based on lack of service. The plaintiffs, in turn, argued that their lawyer had entered into an agreement with the defendant’s insurance company to forgo service of process until settlement negotiations ended. After the motion was denied by the lower court, the defendants appealed, but the decision was upheld as the appeals court ruled in favor of the plaintiffs.car

In Tennessee, a cause of action for personal injury must generally be brought within one year of the injury. An action is commenced within the meaning of the statute of limitations upon filing a complaint with the court. However, if process remains unissued or is not served for 90 days, the plaintiff cannot rely on the original date of filing to toll the running of the statute of limitations. The plaintiff must issue new process within one year of the filing of the complaint or the issuance of the previous process.

In Clark, the plaintiffs were involved in a car accident on July 6, 2012. They filed suit against the negligent driver on July 3, 2013 and against their own insurance company for underinsured motorist coverage on July 16, 2013. The plaintiffs began negotiations to settle the claim with the driver’s insurance company soon thereafter. The driver’s insurance company agreed that its insured would not be served while settlement negotiations were ongoing. The plaintiffs eventually accepted the offer of the defendant’s insurer to pay the amount of its policy limit and notified their insurance company. The plaintiffs’ insurer elected to pay the amount of the policy in order to protect its subrogation rights against the defendant driver. However, the driver asserted that the statute of limitations had expired, since he was not served with process within the required timeframe. The plaintiffs’ insurer then argued that since the actual tortfeasor was never served, it could not be liable for his actions.

The plaintiffs argued that the defendants were equitably estopped from relying upon the statute of limitations as a defense because they had an agreement with the other driver’s insurance company that he would not be served while settlement negotiations were ongoing. The appeals court agreed, holding that the existence of an agreement between the plaintiffs’ counsel and the driver’s insurer, on behalf of the driver, would estop the driver from relying upon the statute of limitations as a defense in this matter, despite the fact that the plaintiffs’ insurer was not a party to the agreement. Accordingly, the court ruled that the plaintiffs could continue to pursue their case.

If you are pursuing legal action against an insurance company or negligent driver, it is important to be aware of procedural rules that may apply in your situation. The Nashville car accident attorneys at Martin Heller Potempa & Sheppard have years of experience handling personal injury claims and can provide trusted advice in cases involving motor vehicle collisions, premises liability, medical malpractice, and more. To discuss your claim with a qualified injury lawyer, call Martin Heller Potempa & Sheppard at (615) 800-7096 or contact us online to schedule a consultation.

More Blog Posts:

Tennessee Court Discusses Requirements for Surviving Summary Judgment in Deadly Car Accident Case, Tennessee Attorneys Blog, published October 13, 2016

Tennessee Court Upholds $200,000 Jury Verdict in Favor of Plaintiff Who Partially Caused Car Accident, Tennessee Attorneys Blog, published July 11, 2016