                  NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
                             File Name: 16a0003n.06

                                    Case Nos. 15-5507/5516

                             UNITED STATES COURT OF APPEALS
                                  FOR THE SIXTH CIRCUIT                               FILED
                                                                                Jan 06, 2016
                                                                            DEBORAH S. HUNT, Clerk
DEPOSITORS INSURANCE COMPANY,                           )
                                                        )
       Plaintiff-Appellee,                              )
                                                                ON APPEAL FROM THE
                                                        )
                                                                UNITED STATES DISTRICT
v.                                                      )
                                                                COURT FOR THE WESTERN
                                                        )
                                                                DISTRICT OF TENNESSEE
ESTATE OF TIMOTHY A. RYAN III &                         )
MARGARET JEAN RYAN,                                     )
                                                                       OPINION
                                                        )
       Defendants-Appellants.                           )


BEFORE: SILER, MOORE, and GIBBONS, Circuit Judges.

       JULIA SMITH GIBBONS, Circuit Judge. After Margaret Ryan was injured in a

vehicle accident involving a car that her husband, Timothy Ryan, was driving, she sued the

Estate of Timothy Ryan for damages. Depositors Insurance Company, through which Timothy

Ryan had an automobile insurance policy, brought an action for a declaratory judgment, seeking

to declare that a policy exclusion precluded coverage for Margaret Ryan. Margaret Ryan and the

Estate (collectively, the appellants) appeal the district court’s grant of Depositors’ motion for

judgment on the pleadings. Because the unambiguous language of the Policy precludes coverage

for Margaret Ryan, and the three affirmative defenses she raises fail on the merits, we affirm the

district court’s judgment.

                                                I.

       On December 13, 2009, Timothy Ryan died in a car accident involving the vehicle he

was driving. His passengers, his wife Margaret Ryan and their grandchildren, were injured in the
Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
accident. At the time of the accident, Timothy Ryan’s insurance policy (the Policy) through

Depositors Insurance Company (Depositors) was in effect.                          In a letter to Andrew Ryan—

personal representative for his two children injured in the accident—dated October 21, 2010,

Depositors advised him that there was “$5000 in available medical payments coverage under this

policy that is available regardless of fault,” and that the statute of limitations for his bodily injury

claims would expire December 13, 2010. Letter to Andrew Ryan 1, ECF No. 38-2. Margaret

Ryan was copied on this letter, but the letter references only her grandchildren’s claims, not her

own.

           On December 1, 2010, Margaret Ryan and Andrew Ryan, 1 individually and as father and

personal representative of the grandchildren, filed an action against the Estate of Timothy Ryan

(the Estate) in state court, seeking damages for physical and emotional pain and suffering.

Depositors provided legal representation to the Estate in the state court action but alleged that

one of the Policy’s exclusions (the Exclusion) precludes coverage for Margaret Ryan’s injuries.

           The Policy has a “Quick Reference” page that does not reference the Exclusion. Twice,

however, in all capital letters, this page states “READ YOUR POLICY CAREFULLY.”

Insurance Policy 19, ECF No. 38-1.

           The Policy provides, in relevant part:

           PART A – LIABILITY COVERAGE

           INSURING AGREEMENT

           A. We will pay damages for “bodily injury” or “property damage” for which any
              “insured” becomes legally responsible because of an auto accident. Damages include
              pre-judgment interest awarded against the “insured.” We will settle or defend, as we
              consider appropriate, any claim or suit asking for these damages. In addition to our
              limit of liability, we will pay all defense costs we incur. Our duty to settle or defend
              ends when our limit of liability for this coverage has been exhausted. We have no

1
    Andrew Ryan did not file a notice of appeal from the district court’s judgment, so he is not a party to this appeal.


                                                           -2-
Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
           duty to defend any suit or settle any claim for “bodily injury” or “property damage”
           not covered under this policy.

Insurance Policy 21. On the same page that provides this coverage, and on the subsequent page,

exclusions are listed, but not the exclusion relevant to this appeal.

       The policy later states, on a page entitled “CHANGES PROVISION,” that “this policy

contains all of the coverage agreements between you and us. Its terms may not be changed or

waived except by an endorsement issued by us.” Id. at 37.

       At the end of the Policy is the Exclusion. On a page entitled “LIABILITY COVERAGE

EXCLUSION ENDORSEMENT,” it states:

       LIABILITY COVERAGE

       The following exclusion is added to Part A, Section A:

       We do not provide Liability Coverage for any person for “bodily injury” to you or any
       “family member.”

       This endorsement must be attached to the Change Endorsement when issued after the
       policy is written.

Id. at 57. The Exclusion is located at the top of the page, in the same size font as the rest of the

Policy. Also, the Exclusion is the only provision on the page. The endorsement number for the

Exclusion, PP0326, is referenced on the “DECLARATIONS” page.

       The “DEFINITIONS” section of the Policy contains the following relevant definitions:

       A. Throughout this policy, “you” and “your” refer to:
            1. The “named insured” shown in the Declarations; and
            2. The spouse if a resident of the same household. . . .
       F. “Family member” means a person related to you by blood, marriage or adoption who
       is a resident of your household. This includes a ward or foster child.

Id. at 20. Timothy Ryan and Margaret Ryan are both listed on the “DECLARATIONS” page as

“named insured.” Id. at 17.




                                                 -3-
Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
         In a letter to Margaret Ryan dated March 28, 2013, Depositors informed her that “even if

you are successful in your claims against [the Estate], this insurance policy will provide no

coverage or pay any judgment you might obtain against the estate.” Letter to Margaret Ryan 2,

ECF No. 38-3. On May 22, 2014, Depositors amended its claim under 28 U.S.C. § 2201 and

Rules 15(a)(1)(B) and 57 of the Federal Rules of Civil Procedure, seeking a declaration that the

Policy does not provide coverage for Margaret Ryan’s injuries. Margaret Ryan and the Estate

filed answers, raising the affirmative defenses of laches and waiver and estoppel, and asserting

that the relevant exclusion is contrary to public policy2 and that the Policy is a contract of

adhesion. Depositors then moved for judgment on the pleadings. Margaret Ryan opposed the

motion and the Estate adopted her brief in opposition.

         The district court granted Depositors’ motion. It concluded that the Exclusion is not

ambiguous and that it is standard for insurance companies to provide coverage in one section and

narrow it through an exclusion, as Depositors did here. Regarding the affirmative defenses, the

court noted that the Ryans did not cite authority for their argument that Depositors’ three-year

delay was unreasonable. In addition, the court indicated that the Ryans alleged prejudice only to

Margaret Ryan, not the Estate, so the laches defense did not apply.                                  Regarding the

waiver/estoppel defense, the court concluded that to succeed, Depositors would have had to

make a misrepresentation to the Estate, not to Margaret Ryan, but also that the express terms of

the Policy precluded application of the doctrine. Finally, the court concluded that the Policy’s

terms were not “oppressive or unconscionable,” nor “beyond the reasonable expectations of an

ordinary person,” so the contract of adhesion defense also failed. Order 13–14, ECF No. 45.


2
  The argument that the Policy is contrary to public policy was not raised in the appellants’ briefing on appeal, so
the issue is waived. See Guilmette v. Howes, 624 F.3d 286, 292 (6th Cir. 2010) (“Our general rule is that an
appellant abandons all issues not raised and argued in its initial brief on appeal.”) (quoting United States v. Johnson,
440 F.3d 832, 845–46 (6th Cir. 2006)) (internal quotation marks omitted).


                                                         -4-
Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
         The appellants filed timely notices of appeal.3

                                                         II.

         We review a district court’s grant of a motion for judgment on the pleadings under Rule

12(c) using the same de novo standard as a motion to dismiss under Rule 12(b)(6). Johnson v.

Bredesen, 624 F.3d 742, 746 (6th Cir. 2010). A party’s Rule 12(c) motion is properly granted

“when no material issue of fact exists and the party making the motion is entitled to judgment as

a matter of law.” JPMorgan Chase Bank, N.A. v. Winget, 510 F.3d 577, 582 (6th Cir. 2007)

(quoting Paskvan v. City of Cleveland Civil Serv. Comm’n, 946 F.2d 1233, 1235 (6th Cir.

1991)).4 We will accept as true “all well-pleaded material allegations” of the opposing party.

Johnson, 624 F.3d at 746 (quoting Tucker v. Middleburg-Legacy Place, LLC, 539 F.3d 545, 549

(6th Cir. 2008)). However, we “need not accept as true legal conclusions or unwarranted factual

inferences.” Winget, 510 F.3d at 581–82 (quoting Mixon v. Ohio, 193 F.3d 389, 400 (6th Cir.

1999)). Jurisdiction in this case is based on diversity of citizenship, so we apply Tennessee

substantive law. See id. at 582 (citation omitted). We follow the decisions of the Tennessee

Supreme Court, but unless that court would decide the issue differently, state appellate court

decisions are persuasive. See Savedoff v. Access Grp., Inc., 524 F.3d 754, 762 (6th Cir. 2008); In

re Dow Corning Corp., 419 F.3d 543, 549 (6th Cir. 2005).

                                                         III.

         Appellants argue that the district court erred because it analyzed the affirmative defenses

under a heightened pleading standard. The district court asserted that “a defendant’s pleadings
3
  The appeals of Margaret Ryan and the Estate were consolidated. Margaret Ryan filed an Appellant Brief and a
Reply Brief. The Estate moved to adopt the Appellant Brief, and this panel granted the motion.
4
  Appellants argue that there are disputed issues which preclude a grant of judgment on the pleadings. They assert
that the fact that they dispute whether the Policy provides coverage and that they raised several affirmative defenses
both create disputed issues, but they mischaracterize the relevant inquiry. We look not to whether there are any
disputed issues, as any opposed motion will necessarily involve issues in dispute. Rather, we must look to whether
any issues of fact are in dispute. Winget, 510 F.3d at 582. Appellants have noted only disputed legal conclusions,
not factual disputes, so we will consider the merits of this appeal.


                                                        -5-
Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
must contain sufficient facts to state a [defense] that is plausible on its face.” Order 5 (alteration

in original) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)) (internal quotation marks

omitted).   Nonetheless, the court did not limit its analysis to the statements contained in

appellants’ answers but rather analyzed the merits of the arguments presented in the briefs and

concluded they lacked merit. It seems this circuit has not addressed the precise issue of whether

the Twombly/Iqbal heightened pleading standard applies to affirmative defenses. But because

the district court did not actually apply that standard to appellants’ affirmative defenses, it is

unnecessary for us to resolve this issue.

                                                  IV.

        Next, appellants contend the Policy is ambiguous because of its structure. They point to

several provisions that could be read to provide coverage, highlight the fact that the “Quick

Reference” page at the beginning of the Policy does not include the Exclusion, and conclude

“[f]iguratively, throughout this policy, it giveth, giveth, giveth . . . and then at the last page . . .

taketh away.” R. at 24, Appellant Br. 21.

        Under Tennessee law, insurance contracts are governed by the same rules of construction

as ordinary contracts. McKimm v. Bell, 790 S.W.2d 526, 527 (Tenn. 1990). They “must be

interpreted fairly and reasonably, giving the language its usual and ordinary meaning.”

Travelers Indem. Co. of Am. v. Moore & Assocs., 216 S.W.3d 302, 306 (Tenn. 2007) (citation

omitted). Provisions subject to more than one reasonable interpretation are ambiguous, Hollis v.

Doerflinger, 137 S.W.3d 625, 629 (Tenn. Ct. App. 2003), and must be construed against the

insurer. Setters v. Permanent Gen. Assurance Corp., 937 S.W.2d 950, 954 (Tenn. Ct. App.

1996); Omaha Prop. & Cas. Ins. Co. v. Johnson, 866 S.W.2d 539, 541 (Tenn. Ct. App. 1993)

(quoting Harkavy v. Phoenix Ins. Co., 417 S.W.2d 542, 547 (Tenn. 1967)). However, the court




                                                 -6-
Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
must take care not to create ambiguities. Setters, 937 S.W.2d at 954. Absent ambiguities, the

court must “take the ordinary meaning of the words used, favoring neither party in their

construction.” Id. (quoting Omaha, 866 S.W.2d at 541). If there is no “fraud, overreaching, or

unconscionability, the courts must give effect to a provision in an insurance policy when its

terms are clear and its intent certain.” Merrimack Mut. Fire Ins. Co. v. Batts, 59 S.W.3d 142,

148 (Tenn. Ct. App. 2001). Moreover, a policy exclusion should be upheld as long as it “merely

limits coverage and does not totally emasculate a previously stated coverage.”           Setters,

937 S.W.2d at 954 (citation omitted).

       The Exclusion here is substantively unambiguous. It is plainly labelled as an exclusion,

explicitly references which coverage provision it limits (Part A, Section A), and does not wholly

eliminate the coverage previously granted. Moreover, Tennessee courts have routinely upheld

similar provisions as unambiguous. See id. at 952, 954 (finding an exclusion “[f]or bodily injury

to you or any ‘family member’” to be unambiguous); see also Purkey v. Am. Home Assurance

Co., 173 S.W.3d 703, 704–05 (Tenn. 2005) (“This Court has twice held that household and

family exclusion clauses in automobile insurance contracts are valid and enforceable.”) (citing

Dockins v. Balboa Ins. Co., 764 S.W.2d 529, 530 (Tenn. 1989); Holt v. State Farm Mut. Auto.

Ins. Co., 486 S.W.2d 734, 735 (Tenn. 1972)).

       The heart of appellants’ argument is that the Policy is structurally ambiguous because of

the distance between the coverage provision and the Exclusion. Yet, appellants point to no

binding precedent supporting that an exclusion located many pages away from the coverage

provision it limits renders a policy ambiguous. To the contrary, though not specifying the

distance between the coverage provision and the exclusion, Tennessee case law indicates that it

is not uncommon for an exclusion to be separate from the coverage provision to which it relates.




                                               -7-
Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
In Setters, the court found that a policy containing coverage provisions that “later enumerate[d]

certain exclusions” was not ambiguous when the policy was viewed as a whole. 937 S.W.2d at

954 (emphasis added). Similarly, in Omaha, the court found a policy unambiguous where

“[c]overage of all types [was] initially set forth in one part, and all the exclusions [were]

grouped separately.” 866 S.W.2d at 541 (emphasis added). Holt v. Pyles upheld a policy where

the exclusions “appear[ed] later in the policy,” but were referred to in the “declarations/summary

portion” by a clause stating “[t]he coverage and limits shown here are subject to the restrictions,

conditions, and exclusions of the policy and its endorsements,” and included a list of

endorsement numbers.        Nos.     M2005-02092-COA-R3-CV, M2005-02094-COA-R3-CV,

2007 WL 1217264, at *5–6 (Tenn. Ct. App. Apr. 24, 2007) (second alteration in original)

(emphasis added). The court, noting that “the declarations portion of a contract cannot be

construed in isolation from the remainder of the contract,” concluded that the policy, when read

as a whole, was not ambiguous. Id. at *6.

       When reading the Policy as a whole and taking care not to construct ambiguities, the

separation between the coverage and the Exclusion provisions does not create an ambiguity.

The Exclusion’s number, PP0326, and other endorsement numbers are referenced in the

“DECLARATIONS” page at the beginning of the Policy. While appellants insist that based on

the “Quick Reference Guide,” a “reasonable consumer” would believe the first 15 pages

comprised the entire Policy, R. at 20, Appellant Br. 20–21, we believe a reasonable consumer

would heed the warnings to “READ YOUR POLICY CAREFULLY” and not ignore the pages

following the main policy provisions, particularly one labelled “LIABILITY COVERAGE

EXCLUSION ENDORSEMENT,” that references a provision—Part A, Section A—within the

main policy. See Insurance Policy 19, 57. Because it is common for an insurance policy to grant




                                               -8-
Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
coverage, then exclude it later in the policy, appellants’ arguments that the “Declarations Page”

and the “Insuring Agreement” appear to grant coverage to Margaret Ryan fail, because any

coverage these provisions purported to grant was excluded by the Exclusion.5

        Because there is no ambiguity, based on the Exclusion’s ordinary meaning, Margaret

Ryan is not covered under the Policy. The Exclusion applies to “you” or any “family member.”

Margaret Ryan falls under the definition of “you” because she is a “named insured,” as well as

the definition of “family member” because she is related to another named insured, Timothy

Ryan, by marriage and they lived together. Thus, the Exclusion precludes coverage for Margaret

Ryan’s injuries.

                                                        V.

                                                        A.

        Without argument or citation to case law or the record, appellants maintain that

Depositors’ three-year delay “clearly shows a lack of diligence.” R. at 25, Appellant Br. 16.

Regarding the prejudice prong of the laches analysis, they argue that the 2010 letter to Margaret

Ryan “effectively induc[ed] or at least encourag[ed] the litigation,” that both Margaret Ryan and

the Estate suffered prejudice because of expenses incurred in the state court litigation, and that

the Estate was prejudiced because it will face judgment if Margaret Ryan is successful in that

suit. R. at 24, Appellant Br. 16–17.

        The equitable defense of laches rests on the principle that “equity will not intervene on

behalf of one who has delayed unreasonably in pursuing his rights.” Long v. Bd. of Prof’l

Responsibility, 435 S.W.3d 174, 181 (Tenn. 2014) (quoting Dennis Joslin Co. v. Johnson,

5
  Appellants also argue a provision entitled “Transfer of Your Interest in the Policy” should be read to “provid[e]
coverage to Ms. Ryan in the event of Mr. Ryan’s death.” R. at 24, Appellant Br. 19–20. This is a misreading of the
provision, which merely allows the name insured’s interest in the policy to be transferred to a surviving spouse.
If Margaret Ryan received Timothy Ryan’s interest in the Policy, she would still be precluded from coverage under
the Exclusion, which applies to “you,” i.e., a “named insured.”


                                                       -9-
Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
138 S.W.3d 197, 200 (Tenn. Ct. App. 2003)). To succeed on a laches defense, one must

establish “inexcusable, negligent, or unreasonable delay on the party asserting the claim.”

Gleason v. Gleason, 164 S.W.3d 588, 592 (Tenn. Ct. App. 2004) (citing Archer v. Archer,

907 S.W.2d 412, 416 (Tenn. Ct. App. 1995)). Where delay in filing suit can be explained or

justified, courts are reluctant to apply laches. Shell v. Law, 935 S.W.2d 402, 410 (Tenn. Ct. App.

1996). However, delay alone is insufficient. Rather, the “determinative test” is whether the

party has been prejudiced by the delay. Grand Valley Lakes Prop. Owners Ass’n v. Burrow,

376 S.W.3d 66, 83–84. (Tenn. Ct. App. 2011) (citation omitted); Ferguson Harbour, Inc. v.

Flash Mkt., Inc., 124 S.W.3d 541, 551 (Tenn. Ct. App. 2003) (citation omitted). “Prejudice

includes the loss of evidence, expenditure of money, change of value, or a change of a party’s

right.” Archer, 907 S.W.2d at 416 (citing Consumer Credit Union v. Hite, 801 S.W.2d 822, 825

(Tenn. Ct. App. 1990)); see also Brown v. Ogle, 46 S.W.3d 721, 727 (Tenn. Ct. App. 2000)

(quoting Evans v. Steele, 145 S.W. 162, 165 (Tenn. 1912)) (noting the doctrine of laches applies

“only in such cases where the loss of evidence, death of witnesses or parties, and failure of

memory resulting in the obscuration of facts to the prejudice of the defendant, render uncertain

the ascertainment of truth, and make it impossible for the court to pronounce a decree with

confidence”).

       Despite appellants’ declaration that Depositors’ three-year delay “clearly shows a lack of

diligence,” R. at 24, Appellant Br. 16, there is no bright-line rule for how long a delay will

tolerated. See, e.g., Gleason, 164 S.W.3d at 592–93 (concluding laches did not bar a claim

delayed by twelve years because there was no prejudice); Ferguson, 124 S.W.3d at 551–52

(concluding laches did not bar a claim delayed by six years because there was no prejudice);

Archer, 907 S.W.2d at 416–18 (finding the five and one-half year delay in bringing a claim was




                                              - 10 -
Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
negligent, but concluding the delay did not result in prejudice).                       Depositors provides no

justification for its delay.          However, we need not contemplate whether the delay was

“inexcusable, negligent, or unreasonable” because the Estate suffered no prejudice.

         In the district court, Margaret Ryan responded to Depositors’ motion for judgment on the

pleadings and the Estate filed a motion adopting her response. The response does not allege any

prejudice to the Estate, just to Margaret Ryan, and the Estate makes only conclusory allegations

of prejudice in its answer. Therefore, any arguments as to prejudice suffered by the Estate are

forfeited. See FTC v. E.M.A. Nationwide, Inc., 767 F.3d 611, 630 (6th Cir. 2014) (quoting

Armstrong v. City of Melvindale, 432 F.3d 695, 700 (6th Cir. 2006)).6 As the district court noted,

because the underlying declaratory judgment action concerns Depositors’ legal obligations

regarding the Estate, not with Margaret Ryan, the proper inquiry is whether the Estate, not

Margaret Ryan, suffered prejudice. Thus, appellants’ laches defense fails.

                                                          B.

         Appellants declare that Depositors did not tell Margaret Ryan about the Exclusion until

2013, yet it copied her to the 2010 letter to her son, which did not mention that coverage was

excluded for Margaret Ryan. The letter, they assert, created promissory estoppel, inducing

Margaret Ryan to act to her detriment.

         Though the parties use the terms interchangeably, Tennessee courts have recognized a

distinction between estoppel and waiver. See Kentucky Nat’l Ins. Co. v. Gardner, 6 S.W.3d 493,

500–01 (Tenn. Ct. App. 1999). Waiver is an intentional or voluntary relinquishment of a known

right. Chattem, Inc. v. Provident Life & Accident Ins. Co., 676 S.W.2d 953, 955 (Tenn. 1984);

6
   To the extent the Estate alleges it suffered prejudice because of expenses incurred in conducting the state court
litigation, this argument fails. Depositors provided legal representation to the Estate in the state court proceedings,
and regardless of the delay, Margaret Ryan was precluded from coverage under the Policy. The Estate points to no
facts that would “render uncertain the ascertainment of truth,” see Brown, 46 S.W.3d at 727, so it was not
prejudiced.


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Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
Gardner, 6 S.W.3d at 500. However, in Tennessee, this definition has been held to apply only

“to a waiver of the right to enforce a provision in a contract,” (a “procedural or technical

condition”), but “not to the waiver of a right acquired under the contract in the agreed exchange”

(a “substantive right”). GuestHouse Int’l, LLC v. Shoney’s N.A. Corp., 330 S.W.3d 166, 201–03

(Tenn. Ct. App. 2010). The doctrine applies defensively as an excuse for nonperformance of

contractual duties, but not offensively to establish forfeiture of the opposing party’s contractual

rights. Id. at 201, 203–204; see also Cincinnati Ins. Co. v. Banks, 610 F. App’x 453, 459 (6th

Cir. 2015).

        Here, appellants are not using waiver as an excuse for nonperformance, but rather to

establish that Depositors forfeited its rights to enforce the Exclusion. Thus, under Tennessee law

the doctrine of waiver is not applicable to this case. See GuestHouse, 330 S.W.3d at 203.7

        To succeed on the defense of equitable estoppel, appellants must prove the following

with respect to Depositors:

        (1) Conduct which amounts to a false representation or concealment of material facts, or,
        at least, which is calculated to convey the impression that the facts are otherwise than,
        and inconsistent with, those which the party subsequently attempts to assert;
        (2) Intention, or at least expectation that such conduct shall be acted upon by the other
        party; [and] (3) Knowledge, actual or constructive of the real facts.

Osborne v. Mountain Life Ins. Co., 130 S.W.3d 769, 774 (Tenn. 2004) (citation omitted). With

respect to themselves, they must establish: “[(4)] Lack of knowledge and of the means of

7
  Even if the doctrine did apply here, appellants fail to point to any “unequivocal and decisive act of [Depositors]
showing a purpose to forgo the right or benefit which is waived.” Guesthouse, 330 S.W.3d at 202 (citation omitted).
They merely argue that the 2010 letter advising Andrew Ryan he had one year to sue and the fact that Depositors did
not tell Margaret Ryan for three years that there was no coverage constitutes waiver. These acts are far from an
unequivocal relinquishment of a right, particularly because the 2010 letter does not even reference Margaret Ryan’s
claim. Furthermore, there may be no claim for waiver where the policy’s terms state it can only be waived by the
company. Builders Mut. Ins. Co. v. Pickens, No. 3:13-CV-00022(WOB-HBG), 2013 WL 3788225, at *3 (E.D.
Tenn. July 18, 2013) (citing Finchum v. Davenport, No. M2007-00559-COA-R3-CV, 2008 WL 2019408, at *7–8
(Tenn. Ct. App. May 9, 2008); Reed v. Nat’l Found. Life Ins. Co., No. 03A01-9603-CV-00081, 1996 WL 718467, at
*3–4 (Tenn. Ct. App. Dec. 16, 1996)). Thus, the Policy’s declaration that “[i]ts terms may not be changed or waived
except by an endorsement issued by us,” Insurance Policy 37, is another ground upon which to reject appellants’
waiver defense.


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Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
knowledge of the truth as to the facts in question; [(5)] Reliance upon the conduct of the party

estopped; and [(6)] Action based thereon of such a character as to change [their] position

prejudicially.” Id. (citation omitted). Tennessee law does not favor the doctrine of equitable

estoppel. Burks v. Elevation Outdoor Adver., 220 S.W.3d 478, 490 (Tenn. Ct. App. 2006).

While either negligent silence or silence when one has a duty to speak may support a claim for

equitable estoppel, there will be no estoppel “where the facts are known to both parties, or both

have the same means of ascertaining the truth.” Id. at 491 (quoting Lusk v. Consol. Aluminum

Corp., 655 S.W.2d 917, 920 (Tenn. 1983); Crabtree v. Bank, 67 S.W. 797, 799–800 (Tenn.

1902)).

          As discussed in the preceding section, the relevant inquiry is whether misrepresentations

were communicated to the Estate, not to Margaret Ryan.8 Neither the response to Depositors’

motion for judgment on the pleadings, nor appellants’ brief on appeal alleged any affirmative

misrepresentation was made to the Estate. The Estate alleges only that it was not notified until

2013 that coverage was unavailable for Margaret Ryan. Though an estoppel defense may be

predicated upon the opposing party’s silence, the Estate had access to the Policy. Despite

appellants’ assertion that to understand the Policy, one would have to read it “in the painstaking

level of detail and comprehension beyond that of the ordinary consumer,” R. at 24, Appellant Br.

18, as discussed, the provisions at issue, despite being separated by scores of pages, are quite

simple. See Omaha, 866 S.W.2d at 541 (describing the language in nearly identical policy

provisions as the “‘easy reading’ type”). Because the Estate had “the same means of ascertaining

8
    Even if the inquiry were whether misrepresentations were made to Margaret Ryan, the estoppel defense would
fail. The 2010 letter which appellants allege induced her to litigate did nothing of the sort. Though she was copied
on the letter, neither she nor her injuries were referenced. The letter did not make any false statements or imply that
Margaret Ryan was entitled to coverage, so the first element is not met. She had means to ascertain the truth
because she had access to the Policy, so the fourth element is not met. Finally, the sixth element is not met because
she suffered no prejudice from any alleged misrepresentations because, as discussed in the preceding section,
whether Depositors provides coverage for her injuries does not affect her recovery against the Estate.


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the truth” as Depositors, the estoppel defense cannot stand. See Burks, 220 S.W.3d at 491

(citation omitted).

                                                C.

       “[A]n insurance policy is a contract of adhesion drafted by the insurer.” Alcazar v.

Hayes, 982 S.W.2d 845, 851 (Tenn. 1998) (quoting Bill Brown Constr. v. Glens Falls Ins.,

818 S.W.2d 1, 12 (Tenn. 1991)). However, such a contract is not per se invalid. Berent v. CMH

Homes, Inc., 466 S.W.3d 740, 747 (Tenn. 2015). Rather, the enforceability of a contract of

adhesion is contingent upon whether its terms are “beyond the reasonable expectations of an

ordinary person, or oppressive or unconscionable.” Id. (quoting Taylor v. Butler, 142 S.W.3d

277, 286 (Tenn. 2004)); Buraczynski v. Eyring, 919 S.W.2d 314, 320 (Tenn. 1996) (citation

omitted). Adhesion contracts that oppress the weaker party or limit the obligations and liabilities

of the stronger party are not enforced.       Berent, 466 S.W.3d at 747 (citing Buraczynski,

919 S.W.2d at 320).

       Tennessee courts have repeatedly held that family member exclusions, such as the

Exclusion here, are enforceable. Purkey, 173 S.W.3d at 704–05 (citing Dockins, 764 S.W.2d at

530) (“This Court has twice held that household and family exclusion clauses in automobile

insurance contracts are valid and enforceable.”); Holt, 486 S.W.2d at 735); Setters, 937 S.W.2d

at 952–53 (noting Tennessee law has consistently held family member exclusions are valid, and

validating a provision excluding from coverage “bodily injury to you or any ‘family member’”).

       Appellants’ argument seems to be that because of the alleged structural ambiguity in the

Policy, it is beyond the reasonable expectations of an ordinary consumer. However, as discussed

above, there is no such ambiguity. Further, nearly identical provisions have consistently been

upheld in Tennessee. Hence, the Policy is enforceable.




                                              - 14 -
Nos. 15-5507/5516
Depositors Insurance Co. v. Estate of Timothy Ryan, et. al.
                                               VI.

       For the aforementioned reasons, we affirm the district court’s judgment.




                                              - 15 -
