                  IN THE SUPREME COURT OF TENNESSEE
                             AT NASHVILLE
                                 October 6, 2009 Session

           JOSEPH DAVIS ET AL. v. PATRICK J. McGUIGAN ET AL.

                    Appeal by Permission from the Court of Appeals
                          Circuit Court for Davidson County
                    No. 05C-115    Hamilton V. Gayden, Jr., Judge


                No. M2007-02242-SC-R11-CV - Filed October 26, 2010


This appeal arises from a trial court’s grant of summary judgment in an action against a real
estate appraiser for fraudulent misrepresentation and for violation of the Tennessee
Consumer Protection Act. A husband and wife alleged that the appraiser, who was hired by
the bank financing the husband and wife’s home construction, recklessly overestimated the
value of their proposed construction and that they reasonably relied on the appraisal value
to their detriment. The Court of Appeals affirmed the trial court’s ruling, holding that an
appraisal is an opinion that cannot form the basis for a fraudulent misrepresentation claim.
We hold that an opinion can form the basis of a fraudulent misrepresentation claim. We
further hold that genuine issues of material fact preclude summary judgment as to the
husband and wife’s claims against the appraiser. We reverse the Court of Appeals and
remand the case to the trial court for further proceedings consistent with this opinion.

                      Tenn. R. App. P. 11 Appeal by Permission;
                     Judgment of the Court of Appeals Reversed;
                Case Remanded to Trial Court for Further Proceedings

J ANICE M. H OLDER, J., delivered the opinion of the Court, in which G ARY R. W ADE and
S HARON G. L EE, JJ., joined. W ILLIAM C. K OCH, J R., J., filed a separate dissenting opinion,
in which C ORNELIA A. C LARK, C.J., joined.

Daniel P. Berexa, C. Bennett Harrison, Jr. and Brian W. Holmes, Nashville, Tennessee, for
the appellants, Joseph Davis and Kimberli Davis.

Michael G. Hoskins, Nashville, Tennessee, for the appellees, Patrick J. McGuigan and
McGuigan & Associates.
                                         OPINION

                              I. Facts and Procedural History

        Joseph and Kimberli Davis (“the Davises”) purchased an unimproved, corner lot in
the Horseshoe Bend subdivision near Nashville, Tennessee, for $135,500. They
subsequently retained an architect to design a custom home for the lot and selected Frawood
Custom Builders as the contractor. After working extensively with the Davises to refine the
home’s design and to select amenities, furniture, and fixtures for the home, the contractor
calculated that the cost of building the home to the Davises’ specifications was $595,394.50,
resulting in a total cost of $730,894.50 for the lot and construction.

        To finance the construction, the Davises contacted Alene Gnyp, a loan consultant at
SunTrust Bank (“SunTrust”) and submitted a Uniform Residential Loan Application to
SunTrust for a $580,000 residential loan. The loan application states, in part, “The [Davises]
specifically acknowledge and agree that: . . . (9) the Lender, its agents, successors and
assigns make no representation or warranties, express or implied, to the Borrower(s)
regarding the property, the condition of the property, or the value of the property.” As part
of the loan application, the Davises also signed a document entitled “Disclosure Notices-
Right to Receive A Copy of Appraisal,” which states, “You have the right to a copy of the
appraisal report used in connection with your application for credit.” SunTrust began
processing the Davises’ loan application on May 15, 2002.

       On June 18, 2002, an employee of SunTrust faxed an Appraisal Request to Patrick
McGuigan, an appraiser whom SunTrust regularly used. The employee had written “Rush!”
at the top of the request, and the request stated that the “sales price” for the Davises’
proposed house was $735,000. Mr. McGuigan was provided the contractor’s plans and
specifications for the Davises’ custom home. Mr. McGuigan accepted the assignment and
executed a Uniform Residential Appraisal Report the next day.

       According to the appraisal report, Mr. McGuigan used two approaches to appraise the
property: the “cost approach” and the “sales comparison approach.” Pursuant to the cost
approach, Mr. McGuigan consulted the “Marshall & Swift Residential Cost Handbook, local
builder estimates, and [his] own cost files” to estimate the cost per square foot to reproduce
the home. Mr. McGuigan then multiplied the estimated cost per square foot by the total
square feet of the home, added the product to the estimated site value, and added an “‘As-is’
Value of Site Improvements.” Using the cost approach, Mr. McGuigan appraised the
property’s value as $731,000 if the home were completed according to the contractor’s plans
and specifications.



                                             -2-
       Using the sales comparison approach, Mr. McGuigan estimated the amount that a
reasonable buyer would pay for the home by evaluating recent sales of comparable properties
and adjusting the comparable properties’ sales prices based on the subject home’s
specifications. Mr. McGuigan did not use any homes from the Horseshoe Bend subdivision
for comparison and instead chose the recent sales of three properties in the LaurelBrooke
subdivision, located approximately one mile from the Horseshoe Bend subdivision.
According to the appraisal report,

              These sales were chosen due to their similarity to the subject
              [property] in size, quality, and appeal and are deemed the best
              and/or the most similar sales available as of the date of this
              report. All sales were given site adjustments due to the known
              difference in site values. Design/Appeal adjustments were
              given to all sales because the subject [property] is one story and
              cost[s] more to build. Equal weight was given to all sales in
              estimating the market value for the subject property.

Using the sales comparison approach, Mr. McGuigan appraised the Davises’ property value
as $735,000 if the home were completed according to its plans and specifications.

        The appraisal report estimates the market value of the home as $735,000. It reconciles
the differences in value resulting from the cost approach and the sales comparison approach
by stating that “[b]ecause buyers rely heavily on comparisons, the direct sales comparison
approach is considered the best indicator of market value” but that “[t]he cost approach
supports the sales comparison approach.”

       Mr. McGuigan forwarded a copy of his appraisal report to SunTrust on June 21, 2002,
including the Uniform Standards of Professional Appraisal Practice Compliance Addendum
with the report. Under the heading “Purpose of the Appraisal,” Mr. McGuigan included the
following statement: “This appraisal report is prepared for the sole and exclusive use of the
lender as mentioned in the client section of this report, to assist with the mortgage lending
decision. It is not to be relied upon by third parties for any purpose, whatsoever.” SunTrust
was the only entity identified in the Lender/Client section of the appraisal report.

       Ms. Gnyp informed the Davises by telephone that their proposed home had been
appraised for $735,000 and that their loan application for $580,000 had been approved. At
some time between June 21 and June 24, 2002, the Davises signed a cost-plus contract with
Frawood Custom Builders to construct their home. The Davises had not obtained a copy of
the appraisal report before they signed the contract with Frawood Custom Builders, nor did



                                             -3-
they read the appraisal report when they received a copy of it at the loan closing on July 2,
2002.

        After living in the completed home for more than a year, Mr. Davis returned to
SunTrust seeking a home equity line of credit. SunTrust ordered another appraisal of the
Davises’ home as part of the loan approval process, and the second appraisal stated that the
home’s value was $510,000. The bank denied the Davises’ loan application. After inquiring
into the denial, Mr. Davis learned of the second appraisal. Around the same time, Ms. Davis
became unemployed.

       The Davises subsequently decided to sell their home. They consulted six real estate
agents, each of whom told them that the home would sell for between $590,000 and
$625,000. The Davises hired real estate agent Michael Hays to sell the property. On Mr.
Hays’s advice, the Davises listed the property for sale at $679,000 on November 30, 2004.
The Davises accepted an offer on the home from the first prospective buyer and, on April 8,
2005, closed on the sale of the property for $660,000. On April 13, 2005, Mr. Davis filed
a complaint for divorce, stating that he and Ms. Davis had separated on November 11, 2004.

        On April 20, 2005, Mr. and Ms. Davis filed a complaint against Mr. McGuigan in the
Circuit Court of Davidson County. The Davises asserted that Mr. McGuigan had
intentionally or negligently misrepresented the market value of their home when he appraised
it in June 2002 and that he had also violated the Tennessee Consumer Protection Act. After
discovery, the trial court entered an order granting Mr. McGuigan summary judgment with
regard to the Davises’ intentional misrepresentation and Tennessee Consumer Protection Act
claims. The Davises subsequently filed a notice of voluntary dismissal of their negligent
misrepresentation claim.

       The Davises appealed the summary judgment as to the intentional misrepresentation
and Tennessee Consumer Protection Act claims to the Court of Appeals. The intermediate
appellate court affirmed summary judgment, holding in part that because “appraisals are not
considered facts, but rather estimates or opinions,” an appraisal cannot provide the basis for
a n in te n tio n a l m isre p re s e n ta tio n c la im . D a v is v . M c G u i g a n , N o .
M2007-02242-COA-R3-CV, 2008 WL 4254150, at *6 (Tenn. Ct. App. Sept. 10, 2008). We
granted the Davises permission to appeal.

                                         II. Analysis

       Summary judgment may be granted only if the record shows “that there is no genuine
issue as to any material fact and that the moving party is entitled to a judgment as a matter
of law.” Tenn. R. Civ. P. 56.04. Because the granting or denying of summary judgment is


                                              -4-
a question of law, we apply a de novo standard of review. Blair v. W. Town Mall, 130
S.W.3d 761, 763 (Tenn. 2004). We first address whether the trial court properly granted Mr.
McGuigan summary judgment on the Davises’ intentional misrepresentation claim before
turning to whether summary judgment was properly granted on the Davises’ Tennessee
Consumer Protection Act claim.

                              A. Intentional Misrepresentation Claim

       The Davises must prove six elements to establish their claim of intentional
misrepresentation at trial: (1) that Mr. McGuigan made a representation of an existing or past
fact; (2) that the representation was false when it was made; (3) that the representation
involved a material fact; (4) that Mr. McGuigan made the representation recklessly, with
knowledge that it was false, or without belief that the representation was true; (5) that the
Davises reasonably relied on the representation; and (6) that they were damaged by relying
on the representation. Walker v. Sunrise Pontiac-GMC Truck, Inc., 249 S.W.3d 301, 311
(Tenn. 2008) (citations omitted).

         To satisfy his burden of production for summary judgment on the Davises’ intentional
misrepresentation claim, Mr. McGuigan must either produce evidence or refer to evidence
in the record that affirmatively negates an essential element of the Davises’ claim or shows
that the Davises cannot prove an essential element of their claim at trial. Mills v. CSX
Transp., Inc., 300 S.W.3d 627, 631 (Tenn. 2009) (citing Hannan v. Alltel Publ’g Co., 270
S.W.3d 1, 8-9 (Tenn. 2008)). To affirmatively negate an essential element of the claim of
intentional misrepresentation, Mr. McGuigan must point to evidence that tends to disprove
a material factual allegation made by the Davises. Id. (citing Martin v. Norfolk S. Ry. Co.,
271 S.W.3d 76, 84 (Tenn. 2008)). Mr. McGuigan has identified evidence to challenge the
first, fourth, fifth, and sixth elements.1

                                                      i.

       Regarding the first element, Mr. McGuigan contends that his appraisal was an
opinion, not a representation of fact, and that an opinion cannot provide a basis for the
Davises to show at trial that Mr. McGuigan made a representation of existing or past fact.
For support, Mr. McGuigan points to his appraisal report, which states that it provides an
estimate of the market value. Additionally, we observe that a real estate appraisal is defined
by Tennessee Code Annotated section 62-39-102(3) (2009) as “the act or process of

        1
           In his brief, Mr. McGuigan contends that there is no genuine issue of material fact as to any of the
six elements. Before the trial court, however, he argued that summary judgment was warranted only on the
first, fourth, fifth, and sixth elements. We therefore consider Mr. McGuigan’s arguments regarding the
second and third elements to be waived. See Fayne v. Vincent, 301 S.W.3d 162, 171 (Tenn. 2009).

                                                     -5-
developing an opinion of value of identified real estate.” (Emphasis added). The Davises
do not dispute that an appraisal is an opinion of value but argue that it is a representation for
the purpose of an intentional misrepresentation claim.

       In Sunderhaus v. Perel & Lowenstein, this Court stated that the general rule is that
“ordinarily representations of value made by one seeking to dispose of property commercially
are to be regarded as expressions of opinion . . . not constituting a basis of fraud.” 388
S.W.2d 140, 142 (Tenn. 1965). We observed, however, “a number of exceptions to this
general rule.” Id. “Representations as to market price or market value are not mere
statements of opinion, but are representations of fact which, if false, will support an action
for fraud or deceit.” Id. (quoting 23 Am. Jur. Fraud and Deceit § 62). We also stated,

                Wherever a party states a matter, which might otherwise be only
                an opinion, and does not state it as the mere expression of his
                own opinion, but affirms it as an existing fact material to the
                transaction, so that the other party may reasonably treat it as a
                fact, and rely and act upon it as such, then the statement clearly
                becomes an affirmation of fact within the meaning of the
                general rule, and may be a fraudulent misrepresentation.

Id. at 142-43 (quoting 3 Pomeroy’s Equity Jurisprudence § 878b (5th ed. 1941)). “The
statements which most frequently come within this branch of the rule are those concerning
value.” Id. at 143 (quoting 3 Pomeroy’s Equity Jurisprudence § 878b (5th ed. 1941)).

        The Restatement (Second) of Torts also states that an opinion may give rise to an
intentional misrepresentation claim. Restatement (Second) of Torts § 525 (1977). It further
explains that the form of an opinion may control whether it is a representation. “‘I believe
that there are ten acres here,’ is a different statement . . . from ‘The area of this land is ten
acres.’ The one conveys an expression of some doubt while the other leaves no room for it.”
Restatement (Second) of Torts § 538A cmt. c (1977). The speaker’s relationship to the
recipient also is important. A person may doubt a seller’s statement about the value of the
property being sold while the same person may accept as true a disinterested expert’s opinion
of value about the same property. See Restatement (Second) of Torts § 539 cmt. c (1977).2
Indeed, section 543 of the Restatement (Second) of Torts states, “The recipient of a
fraudulent misrepresentation of opinion is justified in relying upon it if the opinion is that of

        2
          “[A] representation that a person who is reasonably believed by the recipient to be disinterested
has a particular opinion[] may reasonably be understood as impliedly asserting that the opinion expressed
is an honest one and that he knows of no facts that make it incorrect. This is true since there is no apparent
reason for a disinterested person to exaggerate the facts upon which it may be assumed that his opinion is
based and of which the recipient knows nothing.”

                                                     -6-
a person whom the recipient reasonably believes to be disinterested and if the fact that such
person holds the opinion is material.”

       We therefore hold that an opinion of value may provide the basis for a fraudulent
misrepresentation claim and overrule the holding of the Court of Appeals that Mr.
McGuigan’s appraisal is not actionable because it is an opinion of value. Because Mr.
McGuigan has not shown that the Davises are unable to prove the first element of their
intentional misrepresentation claim at trial, he has not satisfied his burden of production for
summary judgment on the first element. We therefore turn to Mr. McGuigan’s arguments
concerning the other elements of the Davises’ intentional misrepresentation claim.

                                               ii.

       Regarding the fourth element, Mr. McGuigan contends that there is no genuine issue
of material fact as to whether he made the representation recklessly, with knowledge that it
was false, or without belief that the representation was true. In the context of determining
whether punitive damages are warranted, we have held that a person acts recklessly when
“the person is aware of, but consciously disregards, a substantial and unjustifiable risk of
such a nature that its disregard constitutes a gross deviation from the standard of care that an
ordinary person would exercise under all the circumstances.” Flax v. DaimlerChrysler Corp.,
272 S.W.3d 521, 531 (Tenn. 2008) (quoting Hodges v. S.C. Toof & Co., 833 S.W.2d 896,
901 (Tenn. 1992)); see Doe 1 ex rel. Doe 1 v. Roman Catholic Diocese of Nashville, 154
S.W.3d 22, 37-38 (Tenn. 2005).

        In support of his position, Mr. McGuigan points to his deposition in which he states
that he considered recent sales of homes in the Horseshoe Bend subdivision but deliberately
used homes from the LaurelBrooke subdivision because he thought they provided a better
comparison for the proposed construction. Mr. McGuigan also points to his appraisal’s use
of the objective cost approach as well as its use of the more subjective sales comparison
approach to arrive at the $735,000 value of the house. Finally, Mr. McGuigan points to the
appraisal report, which states that it was prepared in accordance with the Uniform Standards
of Professional Appraisal Practice (“USPAP”). The Tennessee Real Estate Appraiser
Commission, which was created by statute, has adopted the USPAP as its standard for
professional practice. Real Estate Appraisers Licensing & Certification Act, ch. 865, § 7,
1990 Tenn. Pub. Acts 412-13 (codified as amended at Tenn. Code Ann. §§ 62-39-201 to
-202); Tenn. Comp. R. & Regs. 1255-5-.01 (Lexis through May 2010).

        Mr. McGuigan has affirmatively negated an essential element of the Davises’ cause
of action. By pointing to evidence that he considered homes in the LaurelBrooke subdivision
to provide better comparisons, Mr. McGuigan has provided evidence that tends to disprove


                                              -7-
the Davises’ factual allegation that he intentionally chose homes in a more upscale
neighborhood to inflate the proposed home’s value. See Mills, 300 S.W.3d at 631. Also, Mr.
McGuigan’s statement that the value stated in the appraisal report was supported by the cost
approach is evidence that tends to disprove the Davises’ factual allegation that Mr.
McGuigan did not believe his appraised value was accurate. Finally, by pointing to evidence
that he adhered to the standard of professional practice for appraisers, Mr. McGuigan has
provided evidence that tends to disprove the Davises’ factual allegation that his actions
grossly deviated from the standard of care for an ordinary appraiser. Mr. McGuigan
therefore has satisfied his burden of production for summary judgment on this element.

      Consequently, the Davises must “produce evidence of specific facts establishing that
genuine issues of material fact exist” to show that summary judgment is not warranted.
Martin, 271 S.W.3d at 84. The Davises may satisfy their burden of production by:

                 (1) pointing to evidence establishing material factual disputes
                 that were over-looked or ignored by the moving party; (2)
                 rehabilitating the evidence attacked by the moving party; (3)
                 producing additional evidence establishing the existence of a
                 genuine issue for trial; or (4) submitting an affidavit explaining
                 the necessity for further discovery pursuant to Tenn. R. Civ. P.,
                 Rule 56.06.

Id. (quoting McCarley v. W. Quality Food Serv., 960 S.W.2d 585, 588 (Tenn. 1998)).

       The Davises point to several specific facts to establish a genuine issue of material fact,
including that the appraisal request from SunTrust asked for a “Rush!” appraisal; the request
included the “sales price” for the proposed construction, which both parties agree is
unnecessary for an appraiser’s analysis; Mr. McGuigan completed the appraisal in less than
one business day; the appraisal value matched the “sales price”; and Mr. McGuigan did not
use any properties in the Horseshoe Bend subdivision when using the sales comparison
approach to determine the market value of the proposed construction.

       Additionally, the Davises point to the deposition and affidavit of J. Donald Turner,
an appraiser whom the Davises disclosed as an expert witness testifying on their behalf.3 Mr.


        3
           Mr. McGuigan challenges Mr. Turner’s affidavit based on allegedly contradictory statements in
his affidavit and deposition regarding whether Mr. McGuigan had intentionally created an inaccurate
appraisal of the Davises’ home. We conclude that the trial court did not err in denying Mr. McGuigan’s
motion to strike the statement in the affidavit pursuant to the cancellation rule because the statement in the
affidavit is not contradictory to the statements in the deposition. See Church v. Perales, 39 S.W.3d 149,
                                                                                                 (continued...)

                                                     -8-
Turner stated that Mr. McGuigan failed to conform to the USPAP by failing to include
properties from the Horseshoe Bend subdivision for comparison when conducting the sales
comparison approach. Mr. Turner stated that placing too much reliance on the cost approach
to appraise proposed construction is inappropriate because a home’s cost of construction does
not necessarily equal the home’s ultimate value. He stated that an appraisal of proposed
construction should include properties for comparison from the same neighborhood to
prevent overbuilding, that is, spending significantly more to construct a home than other
homes in the neighborhood are worth.

       To determine whether the specific facts identified by the Davises create a genuine
issue of material fact precluding summary judgment, we take the strongest legitimate view
of the evidence in favor of the Davises, allow all reasonable inferences in their favor, and
discard all countervailing evidence. Blair, 130 S.W.3d at 768 (quoting Byrd v. Hall, 847
S.W.2d 208, 210-11 (Tenn. 1993)). There is a genuine issue of material fact if the
undisputed facts and inferences drawn in the Davises’ favor permit a reasonable person to
reach more than one conclusion. See Staples v. CBL & Assocs., Inc., 15 S.W.3d 83, 89
(Tenn. 2000). In reviewing the statements of Mr. Turner, a reasonable person can reach
different conclusions as to whether Mr. McGuigan deviated from the USPAP in preparing
his appraisal of the Davises’ proposed home and whether that deviation was substantial
enough to amount to a conscious disregard of a substantial and unjustifiable risk of such a
nature so as to constitute a gross deviation from the standard of care.4 The Davises therefore
have shown that there is a genuine issue of material fact as to whether Mr. McGuigan acted
recklessly, and summary judgment is not warranted based on this element.5


        3
         (...continued)
169-70 (Tenn. Ct. App. 2000); accord Johnston v. Cincinnati N.O. & T.P. Ry. Co., 240 S.W. 429, 435-36
(Tenn. 1922). Although there may be appropriate questions regarding the weight to be given Mr. Turner’s
testimony at trial in light of his equivocation, determining the weight of the evidence is not appropriate at
the summary judgment stage. Martin, 271 S.W.3d at 87.
        4
          The dissent states that “Mr. Turner’s testimony regarding Mr. McGuigan’s beliefs or intent in
performing the appraisal should not be considered in determining whether the trial court properly granted
the summary judgment” because “Mr Turner’s testimony regarding whether Mr. McGuigan intentionally
performed an inaccurate appraisal is, by his own admission, speculation.” The speculative nature of Mr.
Turner’s testimony was not raised by Mr. McGuigan. If it had been raised, however, it would not preclude
us from considering Mr. Turner’s testimony that Mr. McGuigan’s conduct was outside the standard of care
for appraisers, which cannot be characterized as speculation. It is on the basis of Mr. Turner’s testimony
concerning the standard of care for appraisers that we recognize a genuine issue of material fact that
precludes summary judgment based on the fourth element.
        5
          The dissent disagrees with this holding, stating that “the Davises have been unable to present any
direct evidence substantiating their assertion that Mr. McGuigan ‘intentionally or recklessly misrepresented
                                                                                               (continued...)

                                                    -9-
                                                    iii.

      Regarding the fifth element, Mr. McGuigan argues that the Davises cannot show they
reasonably relied on his appraisal as a matter of law. We must first address how the Davises
can show at trial that they reasonably relied on Mr. McGuigan’s appraisal before we can
determine whether Mr. McGuigan has pointed to evidence satisfying his burden of
production for summary judgment.

        Whether a person’s reliance on a representation is reasonable generally is a question
of fact requiring the consideration of a number of factors. E.g., City State Bank v. Dean
Witter Reynolds, Inc., 948 S.W.2d 729, 737 (Tenn. Ct. App. 1996). The factors include the
plaintiff’s sophistication and expertise in the subject matter of the representation, the type of
relationship – fiduciary or otherwise – between the parties, the availability of relevant
information about the representation, any concealment of the misrepresentation, any
opportunity to discover the misrepresentation, which party initiated the transaction, and the
specificity of the misrepresentation. See, e.g., id.; accord Allied Sound, Inc. v. Neely, 58
S.W.3d 119, 122-23 (Tenn. Ct. App. 2001).

       The cause of action alleged by the Davises, however, differs from most intentional
misrepresentation claims. The Davises do not allege that Mr. McGuigan directly represented
to them the value of the home. Instead, Mr. McGuigan provided the appraisal to SunTrust,
and Ms. Gnyp, a SunTrust employee, conveyed the result of Mr. McGuigan’s appraisal to the
Davises. The Davises in turn contend that they relied on the figure conveyed to them by Ms.
Gnyp, not the appraisal report prepared by Mr. McGuigan, when they decided to execute the
construction contract.


        5
           (...continued)
that his best estimate of the value of the plaintiffs’ proposed construction was $735,000.’” The dissent
reaches this conclusion by applying an incorrect summary judgment analysis. First, a party opposing a
summary judgment motion need not present direct evidence. Rather, the party only “must set forth specific
facts showing that there is a genuine issue for trial.” Tenn. R. Civ. P. 56.06. Second, the dissent
acknowledges four undisputed, specific facts introduced by the Davises, excluding the testimony of Mr.
Turner. To determine if there is a genuine issue of material fact for trial, we are limited to taking the
strongest legitimate view of the evidence in favor of the party opposing the summary judgment motion,
allowing all reasonable inferences in that party’s favor, and discarding all countervailing evidence. Blair,
130 S.W.3d at 768. Although the dissent acknowledges this standard, it nevertheless evaluates the Davises’
facts in the context of “the parties’ lengthy and detailed discovery,” comparing the Davises’ facts to those
facts introduced by Mr. McGuigan. Our well-established summary judgment analysis precludes us from
weighing facts in this manner. Martin, 271 S.W.3d at 87 (citing Byrd, 847 S.W.2d at 211); accord Martin,
271 S.W.3d at 89 (Koch, J., concurring) (concluding that “[w]hile there may be substantial doubt about the
weight that a reasonable jury might give to [a witness’s] testimony, it is sufficient for summary judgment
purposes to create a genuine issue”).

                                                   -10-
       In an analogous case, the United States District Court for Kansas held that a person
seeking to recover for a misrepresentation not heard directly from the source “must
demonstrate that his or her reliance on the original fraudulent misrepresentation would have
been justifiable.” Deboer v. Am. Appraisal Assocs., Inc., 502 F. Supp. 2d 1160, 1168 (D.
Kan. 2007). In Deboer, the plaintiff executed a loan guarantee to a company after learning
from the company’s owner that “a fairly current appraisal from [defendant] American
Appraisal” had appraised the value of the company at “‘a million three or some such
number.’” Id. at 1167. After the company went bankrupt, the plaintiff brought an action for
fraudulent misrepresentation against the appraiser.

        The district court initially observed that “under Kansas law a third party may have an
action for fraud without any direct contact with and without having received any direct
misrepresentations from the defrauding party.” Id. at 1168. The plaintiff, however, could
not base his action “on the pared down version of the appraisal that he received from” the
company’s owner. Id. Construing section 533 of the Restatement (Second) of Torts, which
states that “[t]he maker of a fraudulent misrepresentation is subject to liability for pecuniary
loss to another who acts in justifiable reliance upon it,” the court reasoned that the plaintiff
must show that he could justifiably rely on a misrepresentation in the appraisal report, not on
the company owner’s incomplete summary of the appraisal report, to recover from the
appraiser. Id. (emphasis added). The court granted summary judgment to the defendant
appraiser because “the appraisal was so laden with qualifications and disclaimers that no
reasonable financier would have accepted it as appropriate to support a $595,000 loan
guarantee without conducting any further investigation.” Id. at 1169.

       We agree with the court’s reasoning in Deboer. Recovery should be determined based
on the defendant’s representation, not on how the representation was relayed. To that end,
we adopt section 533 of the Restatement (Second) of Torts, which states in its entirety,

                      The maker of a fraudulent misrepresentation is subject to
              liability for pecuniary loss to another who acts in justifiable
              reliance upon it if the misrepresentation, although not made
              directly to the other, is made to a third person and the maker
              intends or has reason to expect that its terms will be repeated or
              its substance communicated to the other, and that it will
              influence his conduct in the transaction or type of transaction
              involved.

To show at trial that they reasonably relied on Mr. McGuigan’s representation, the Davises
therefore must show that (1) they could have reasonably relied on Mr. McGuigan’s appraisal
report, (2) Mr. McGuigan intended or had reason to expect that the terms or substance of his


                                              -11-
appraisal report would be repeated to the Davises, and (3) Mr. McGuigan intended or had
reason to expect that his appraisal would influence the Davises’ conduct in deciding to
proceed with the construction.

        We now turn to whether Mr. McGuigan has identified or introduced facts in the record
that affirmatively negate the reasonable reliance element of the Davises’ claim. Mr.
McGuigan points to the appraisal report, which states, “This appraisal report is prepared for
the sole and exclusive use of the lender [SunTrust] . . . , to assist with the mortgage lending
decision. It is not to be relied upon by third parties for any purpose, whatsoever.” The
evidence shows that Mr. McGuigan stated in the appraisal report that it was prepared solely
for the client and that third parties should not rely on it. We hold that this evidence tends to
disprove the Davises’ material factual allegation that they could have reasonably relied on
the appraisal report. It therefore affirmatively negates an essential element of the Davises’
claim, and Mr. McGuigan has satisfied his burden of production for summary judgment. See
Mills, 300 S.W.3d at 631; Hannan, 270 S.W.3d at 8-9.

         In response, the Davises point to evidence in the record to identify a genuine issue of
material fact as to this element. See Martin, 271 S.W.3d at 84. They point to Mr. Davis’s
deposition, in which he stated that Ms. Gnyp conveyed to him Mr. McGuigan’s appraisal
value for the home and that he relied on it as a representation of a disinterested appraiser
when proceeding with construction. They point to the appraisal report, which states, “I stated
in the appraisal report only my personal, unbiased, and professional analyses, opinions, and
conclusions,” and “I certify to the best of my knowledge and belief: The statements of fact
contained in this report are true and correct.” The Davises also point to the statements in Mr.
Turner’s affidavit that “[a]ppraisers know that buyers of property are interested in and could
learn of the value at which they appraise that property. Appraisers know that those buyers
. . . are likely to rely upon their conclusions in making decisions regarding the purchase, or
in this case construction, of a residence.”

        Taking the strongest legitimate view of the evidence in favor of the Davises, allowing
all reasonable inferences in their favor, and discarding all countervailing evidence, we hold
that summary judgment is not warranted based on this element. See Blair, 130 S.W.3d at 768
(quoting Byrd, 847 S.W.2d at 210-11). Looking to the appraisal report, a reasonable person
could reach different conclusions as to whether the Davises could have reasonably relied on
the appraisal report as a statement of a disinterested expert as to the value of their home.6

        6
          The dissent concludes that no reasonable fact-finder could determine based on the undisputed facts
that the Davises relied on Mr. McGuigan’s appraisal because, in part, “the Davises could only have relied
on the statement of the bank employee that their project had appraised for $735,000.” The Davises contend,
however, that they reasonably relied on the appraisal estimate from the appraisal report and that they could
                                                                                              (continued...)

                                                   -12-
See Staples, 15 S.W.3d at 89. Furthermore, looking at the statements of Mr. Turner in his
affidavit, a reasonable person could reach different conclusions as to whether Mr. McGuigan
had reason to expect that SunTrust would communicate the substance of the appraisal report
to the Davises and that the result might influence the Davises’ conduct despite the report’s
disclaimer. As we stated in Martin, “although a trial court may conclude that the plaintiffs’
case is not particularly strong, it is not the role of a trial or appellate court to weigh the
evidence or substitute its judgment for that of the trier of fact.” 271 S.W.3d at 87.

                                                     iv.

        Regarding the sixth element of the Davises’ intentional misrepresentation claim, Mr.
McGuigan contends that the Davises sold their home for less than its $735,000 value because
of a superseding cause, namely the loss of Ms. Davis’s job and the Davises’ impending
divorce. A superseding cause “breaks the chain of proximate causation and thereby
precludes recovery.” White v. Lawrence, 975 S.W.2d 525, 529 (Tenn. 1998). To establish
that an intervening event is a superseding cause, Mr. McGuigan must show: (1) that the
harmful effects of the intervening event occurred after his allegedly reckless conduct; (2) that
the intervening event was not brought about by his conduct in forming the appraisal; (3) that
the intervening event actively worked to bring about a result that would not have followed
from his conduct; and (4) that he could not reasonably foresee the intervening event. White
v. Premier Med. Grp., 254 S.W.3d 411, 417 (Tenn. Ct. App. 2007) (citing Godbee v. Dimick,
213 S.W.3d 865, 882 (Tenn. Ct. App. 2006)); see White v. Lawrence, 975 S.W.2d at 529.
Because Mr. McGuigan bears the burden of proof at trial to establish this affirmative
defense, he must introduce undisputed facts showing the existence of the superseding cause
to satisfy his burden of production for summary judgment. See Hannan, 270 S.W.3d at 9 n.6.

        Mr. McGuigan points to the deposition of Ms. Davis, who stated that the Davises
needed to sell their home because she lost her job and could not make mortgage payments
without her income. Mr. McGuigan also identifies the Divorce Complaint filed by Mr.
Davis, which states that the Davises separated on November 11, 2004, less than three weeks
before they listed the home for sale. Mr. McGuigan further points to the affidavit of the
Davises’ real estate agent, Mike Hays, who stated that the Davises agreed to list their home
for $679,000 without first listing it for $735,000. Finally, Mr. McGuigan points to the
affidavit of Steven Johnson, who purchased the Davises’ home. In his affidavit, Mr. Johnson
states that he and his wife noticed signs of unemployment and divorce and “extended an offer

        6
          (...continued)
have reasonably relied on the appraisal report if they reviewed it. By pointing to specific facts showing that
the appraisal report stated it was an unbiased and accurate estimate of the home’s value, the Davises have
identified a genuine issue of material fact as to whether they could have reasonably relied on Mr.
McGuigan’s representation.

                                                    -13-
to the Davises that was substantially below their asking price[] because we felt the Davises
were exceptionally motivated to sell the property and were willing to take less than what the
property was worth.” Mr. Johnson also stated that he and his wife “might have been willing
to pay more than the list price.”

        Mr. McGuigan has not satisfied his burden of production for summary judgment on
this element. He has not pointed to undisputed facts establishing the third element of the
superseding cause analysis, that the intervening events of Ms. Davis’s unemployment or the
Davises’ divorce brought about a result that would not have followed from Mr. McGuigan’s
appraisal. More specifically, the record includes the affidavit of Mr. Davis, in which Mr.
Davis states that they were not unduly motivated to sell their home and that they had the
financial ability to continue paying their mortgage despite Ms. Davis’s loss of her job.
Viewing the evidence in a light most favorable to the Davises, a reasonable person could
reach different conclusions as to whether the Davises’ circumstances resulted in the sale of
their home for less than market value. See Staples, 15 S.W.3d at 89. Mr. McGuigan has
failed to show that there is no genuine issue of material fact regarding the existence of a
superseding cause, and summary judgment therefore is not warranted based on the sixth
element of the intentional misrepresentation claim. See McClung v. Delta Square Ltd.
P’ship, 937 S.W.2d 891, 905 (Tenn. 1996) (stating that “the existence of a superseding,
intervening cause [is a] jury question[] unless the uncontroverted facts and inferences to be
drawn from the facts make it so clear that all reasonable persons must agree on the proper
outcome” (citations omitted)).

                          B. Tennessee Consumer Protection Act

        Mr. McGuigan also moves for summary judgment on the Davises’ Tennessee
Consumer Protection Act claim. The Tennessee Consumer Protection Act creates a cause
of action for “[a]ny person who suffers an ascertainable loss of money or property . . . as a
result of the use or employment by another person of an unfair or deceptive act or practice
declared to be unlawful by” the Consumer Protection Act.                     Tenn. Code Ann.
§ 47-18-109(a)(1) (2001). In their complaint, the Davises do not allege that Mr. McGuigan
engaged in any specific act or practice declared unlawful by the Tennessee General Assembly
in Tennessee Code Annotated section 47-18-104(b) (2001 & Supp. 2009). As such, to
establish their Tennessee Consumer Protection Act claim at trial, the Davises must prove that
they suffered “an ascertainable loss of money or property . . . as a result” of Mr. McGuigan’s
“engaging in any . . . act or practice which is deceptive to the consumer or to any other
person.” Tenn. Code Ann. §§ 47-18-104(b)(27), -109(a).

      Mr. McGuigan contends that his actions were neither deceptive nor unfair. “[A]
‘deceptive act or practice’ is a material representation, practice or omission likely to mislead


                                              -14-
a reasonable consumer.” Ganzevoort v. Russell, 949 S.W.2d 293, 299 (Tenn. 1997) (quoting
Bisson v. Ward, 628 A.2d 1256, 1261 (Vt. 1993)); see Fayne, 301 S.W.3d at 177. An act is
unfair if it “causes or is likely to cause substantial injury to consumers which is not
reasonably avoidable by consumers themselves and not outweighed by countervailing
benefits to consumers or to competition.” Tucker v. Sierra Builders, 180 S.W.3d 109, 116-17
(Tenn. Ct. App. 2005) (quoting 15 U.S.C.A. § 45(n) (1977)).

        We need not decide whether Mr. McGuigan satisfied his burden of production for
summary judgment because the Davises have identified a genuine issue of material fact
precluding summary judgment on this claim. Mills, 300 S.W.3d at 634-35. The Davises
point to the appraisal report’s use of the sale of homes only from the LaurelBrooke
subdivision for the sales comparison approach. The Davises also point to the deposition of
Mr. Turner, who opined that Mr. McGuigan deviated from the standard of care for appraisers
in failing to include a home from the Horseshoe Bend subdivision as a comparison. We have
held that negligent misrepresentations may be found to be a violation of the Tennessee
Consumer Protection Act, see Fayne, 301 S.W.3d at 177, and that “[w]hether a particular act
is unfair or deceptive is a question of fact,” id. at 170. Viewing the evidence in a light most
favorable to the Davises, drawing all reasonable inferences in their favor, and discarding all
countervailing facts, a reasonable person could reach different conclusions as to whether Mr.
McGuigan’s appraisal was unfair or deceptive. See Staples, 15 S.W.3d at 88-89. Summary
judgment therefore is not warranted based on this claim.7

                                              III. Conclusion

       We hold that Mr. McGuigan has failed to satisfy the requirements for summary
judgment as to either the Davises’ intentional misrepresentation claim or their Tennessee
Consumer Protection Act claim. We therefore reverse the decision of the Court of Appeals
and remand the case to the trial court for further proceedings consistent with this opinion.
Costs are assessed against the appellees, Patrick J. McGuigan and McGuigan & Associates,
for which execution may issue if necessary.




                                                            _________________________________
                                                            JANICE M. HOLDER, JUSTICE

        7
          Mr. McGuigan also contends that the Davises cannot show that they suffered an ascertainable loss
as a result of his action. As we explained in Section II.A.iii., there is a genuine issue of material fact as to
whether the Davises’ reliance on Mr. McGuigan’s appraisal was reasonable. This issue of material fact
likewise precludes summary judgment as to whether Mr. McGuigan’s appraisal caused the Davises an
ascertainable loss.

                                                     -15-
