                IN THE COURT OF APPEALS OF TENNESSEE
                           AT KNOXVILLE
                                  May 13, 2013 Session

   DENNIS MICHAEL HARRIS, ET UX. v. MICKEY DEANNE HAYNES,
                           ET AL.

                 Appeal from the Circuit Court for Anderson County
                    No. BOLA0333       Donald R. Elledge, Judge


                No. E2012-02213-COA-R3-CV-FILED-JULY 10, 2013


This appeal concerns whether certain exclusions in a coverage document are permissible.
Dennis Michael Harris (“Harris”), then a patrolman with the Anderson County Sheriff’s
Department, was injured when he was struck by a vehicle driven by Mickey Deanne Haynes
(“Haynes”). Harris and his wife, Judy A. Harris, (collectively, “the Plaintiffs”) sued Haynes
and the alleged owner of the vehicle, Richard H. Furrow, in the Circuit Court for Anderson
County (“the Trial Court”). The Plaintiffs also raised claims against Anderson County’s
motor vehicle liability coverage provider, Tennessee Risk Management Trust (“TRMT”), for
uninsured or underinsured motorist coverage. TRMT filed a motion for summary judgment,
arguing that under the relevant coverage document (“the Coverage Document”), Harris was
excluded from uninsured coverage as he was an employee of Anderson County who had
received workers compensation. The Trial Court granted TRMT’s motion. The Plaintiffs
appeal. We hold that Anderson County was self-insured through TRMT, and, therefore, the
uninsured/underinsured motorist statutes do not apply. The Coverage Document excluded
employees such as Harris from uninsured coverage. We affirm.

  Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed;
                                  Case Remanded

D. M ICHAEL S WINEY, J., delivered the opinion of the Court, in which C HARLES D . S USANO,
J R., P.J., and T HOMAS R. F RIERSON, II, J., joined.

David A. Stuart, Clinton, Tennessee, for the appellants, Dennis Michael Harris and Judy A.
Harris.

Jonathan Swann Taylor, Knoxville, Tennessee, for the appellee, Tennessee Risk
Management Trust.
                                         OPINION

                                       Background

               The material facts of this appeal are undisputed. On August 15, 2009, Harris
was working as a patrolman for the Anderson County Sheriff’s Department when he was
assigned to assist traffic control at the scene of a vehicular collision in Anderson County,
Tennessee. While attending to his duty at the scene of the collision, Harris was struck by a
pickup truck driven by Haynes and suffered personal injuries. Pursuant to the Coverage
Document issued by TRMT to Anderson County, Harris received workers compensation
benefits for the injuries he sustained in this incident. In October 2009, Harris returned to
work with the Anderson County Sheriff’s Department. In March 2011, Harris was promoted
to investigator.

              The Coverage Document was issued by TRMT to Anderson County after the
Operations Committee of the Anderson County Board of Commissioners approved a motion
that sent out a request for proposals for County liability, property casualty, and workers
compensation insurance. On April 20, 2009, the Anderson County Board of Commissioners
renewed a one year contract with TRMT. Section III, Paragraph C of the Coverage
Document provides:

       Liability for bodily injury to non-employees and other casual occupants of
       owned vehicles other than drivers or operators is afforded in respect of any
       CLAIM not to exceed the limits set forth in the Tennessee Tort Liability Act,
       if applicable, or the limit set forth in the SCHEDULE OF LIMITS,
       regardless of the number of claimants in any one OCCURRENCE. A
       CLAIM for such coverage may be made to TNRMT only after all other
       applicable coverage is exhausted and only for the amounts allowed by the
       Tennessee Tort Liability Act inclusive of any recovery from any other
       coverage available. This coverage shall not apply to employees, agents or
       contractors acting on behalf of the MEMBER or to any injury covered by
       Workers Compensation law. The intent of this coverage is to apply to vehicle
       occupants only, excluding drivers. If coverage is afforded under this section
       (Automobile Liability paragraph C), then coverage under Auto Liability
       paragraph “A” does not apply.

              Section III’s exclusions provide that coverage under Section III does not insure
against:

       Any obligation for which the MEMBER may be held liable under any

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       Worker’s Compensation, disability benefits law, employers liability or under
       any similar law or to BODILY INJURY to any employee or to any liability
       for indemnity or contribution brought by any party for BODILY INJURY to
       any employee.

                The parties also agree as to certain facts regarding the history and nature of
TRMT. TRMT was created in 1987 by local school boards and other public entities in
Tennessee pursuant to the Interlocal Cooperation Act, Tenn. Code Ann. § 12-9-101, et seq.
TRMT provides liability, workers compensation, and property coverage to more than 200
governmental entities and schools in Tennessee. TRMT is similar to an insurance company
in that it collects premiums, provides coverage and loss control, and pays claims. TRMT,
however, asserts that it is not an insurance company. TRMT asserts that it allows
governmental entities and school systems to come together as one to share risks and losses.
Members receive customized coverage, rates and services, and avoid underwriting cycles
experienced with traditional carriers.

               We next review the relevant procedural history in this case. The Plaintiffs filed
their complaint in July 2010. The Plaintiffs sued Haynes, the driver of the vehicle, and
Richard H. Furrow, the vehicle’s owner, alleging negligence and vicarious liability claims,
and asserting injuries to Harris stemming from the incident. TRMT was involved in the case
as the county’s vehicle liability carrier. TRMT filed an answer in opposition. TRMT also
filed a motion for summary judgment in March 2012.

            In August 2012, the Trial Court entered an order granting summary judgment
to TRMT. In its oral ruling, the Trial Court explained its reasoning:

       [I]t’s clear that this is strictly a contract case as it pertains to whether or not
       this is insurance, and as it pertains to whether or not Tennessee Risk
       Management Trust should have provided uninsured motorist insurance for the
       Plaintiff in this case. It is further clear, totally clear, no question of fact that
       on or about January 12, 2009, the subcommittee of Anderson County approved
       their liability coverage. And on April 20, 2009, they approved and renewed
       their contract with Risk Management Trust. The Court finds that Risk
       Management Trust is an entity created under TCA 29-20-401, et seq. It’s a
       governmental pool. There is no question it’s a government pool as it addresses
       liability.

                                               ***

               And under the self-insurance provisions of TCA 29-20-401, because

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       he is an employee of the insured and because he was covered by workers’
       compensation insurance, and this Court so finds, then the Tennessee Risk
       Management does not have to defend Mickey Deanne Haynes; is not liable for
       damages because it’s specifically excluded. And there’s no question of fact
       that Anderson County is in the risk management pool. There’s no question of
       fact that they provide their own coverage. They pool to limit their liability.
       There’s no question of fact when Anderson County met, that they accepted the
       contract, and they rejected uninsured motorist coverage for an employee,
       which Mr. Harris was, or for someone covered by insurance. It’s also a matter
       of law that a governmental entity acts through its minutes, and its minutes
       reflect that. That’s it. A governmental entity acts through its minutes, and its
       minutes reflect that. And that’s what they accepted; that’s what they rejected.
       And unfortunately for Mr. Harris, that’s what we have in this case. (format
       modified)

In October 2012, the Trial Court entered judgment in favor of the Plaintiffs against Haynes
in the amount of $1,000,000 for Harris and $250,000 for his wife. Harris appeals to this
Court.

                                         Discussion

             Though not stated exactly as such, the Plaintiffs raise one issue on appeal:
whether the Trial Court erred in granting summary judgment to TRMT.

              Our Supreme Court reiterated the standard of review in summary judgment
cases as follows:

                     The scope of review of a grant of summary judgment is
              well established. Because our inquiry involves a question of
              law, no presumption of correctness attaches to the judgment, and
              our task is to review the record to determine whether the
              requirements of Rule 56 of the Tennessee Rules of Civil
              Procedure have been satisfied. Hunter v. Brown, 955 S.W.2d 49,
              50-51 (Tenn. 1997); Cowden v. Sovran Bank/Cent. S., 816
              S.W.2d 741, 744 (Tenn. 1991).

                     A summary judgment may be granted only when there is
              no genuine issue of material fact and the moving party is entitled
              to judgment as a matter of law. Tenn. R. Civ. P. 56.04; Byrd v.
              Hall, 847 S.W.2d 208, 214 (Tenn. 1993). The party seeking the

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              summary judgment has the ultimate burden of persuasion “that
              there are no disputed, material facts creating a genuine issue for
              trial . . . and that he is entitled to judgment as a matter of law.”
              Id. at 215. If that motion is properly supported, the burden to
              establish a genuine issue of material fact shifts to the
              non-moving party. In order to shift the burden, the movant must
              either affirmatively negate an essential element of the
              nonmovant’s claim or demonstrate that the nonmoving party
              cannot establish an essential element of his case. Id. at 215 n.5;
              Hannan v. Alltel Publ’g Co., 270 S.W.3d 1, 8-9 (Tenn. 2008).
              “[C]onclusory assertion[s]” are not sufficient to shift the burden
              to the non-moving party. Byrd, 847 S.W.2d at 215; see also
              Blanchard v. Kellum, 975 S.W.2d 522, 525 (Tenn. 1998). Our
              state does not apply the federal standard for summary judgment.
              The standard established in McCarley v. West Quality Food
              Service, 960 S.W.2d 585, 588 (Tenn. 1998), sets out, in the
              words of one authority, “a reasonable, predictable summary
              judgment jurisprudence for our state.” Judy M. Cornett, The
              Legacy of Byrd v. Hall: Gossiping About Summary Judgment
              in Tennessee, 69 Tenn. L. Rev. 175, 220 (2001).

                     Courts must view the evidence and all reasonable
              inferences therefrom in the light most favorable to the
              non-moving party. Robinson v. Omer, 952 S.W.2d 423, 426
              (Tenn. 1997). A grant of summary judgment is appropriate only
              when the facts and the reasonable inferences from those facts
              would permit a reasonable person to reach only one conclusion.
              Staples v. CBL & Assocs., Inc., 15 S.W.3d 83, 89 (Tenn. 2000).
              In making that assessment, this Court must discard all
              countervailing evidence. Byrd, 847 S.W.2d at 210-11.
              Recently, this Court confirmed these principles in Hannan.

Giggers v. Memphis Housing Authority, 277 S.W.3d 359, 363-64 (Tenn. 2009). Issues
involving the scope of coverage present questions of law, which may be resolved by
summary judgment if the facts are undisputed. Victoria Ins. Co. v. Hawkins, 31 S.W.3d 578,
580 (Tenn. Ct. App. 2000). Here, the material facts are undisputed.

               Initially, it is useful to review portions of the law governing self-insurance
pools for trusts such as TRMT:



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      (a) Any governmental entity may create and maintain a reserve or special fund
      for the purpose of making payment of claims against it payable pursuant to this
      chapter or for the purpose of purchasing liability insurance to protect it from
      any and all risks created by this chapter.

      (b)(1) Any two (2) or more governmental entities are hereby granted the
      power, any provision of law to the contrary notwithstanding, to enter into an
      agreement or agreements with one another for joint or cooperative action to
      pool their financial and administrative resources for the purpose of providing
      to the participating governmental entities risk management, insurance,
      reinsurance, which is defined to mean reinsurance by an entity created under
      this section, self-insurance, or any combination thereof for any and all of the
      areas of liability or insurability, or both, for such governmental entities,
      including, but not limited to, the liabilities created by this chapter (including
      general and professional liabilities), liabilities under the workers'
      compensation law, liabilities under the unemployment compensation law, and
      motor vehicle insurance. All such agreements shall be made pursuant to title
      12, chapter 9.

                                            ***

      (c)(1) Any governmental entity choosing to create and maintain a special fund,
      or to enter into an agreement, as authorized in this section for the purpose of
      insuring against the liabilities created by this chapter, shall be deemed to be
      electing to self-insure against the liabilities established in this chapter and
      shall, therefore, have the same limits of liability as if the minimum limits of
      liability established in § 29-20-403 had been purchased.

                                            ***

      (d)(1) No special fund established by an agreement authorized under this
      section and under title 12, chapter 9, shall be considered as an “insurance
      company” nor shall any contribution of financial or administrative resources
      to such a special fund be considered a “premium” or “gross premium” under
      title 56 for any purpose, including regulation and taxation.

Tenn. Code Ann. § 29-20-401 (2012).

              The Plaintiffs argue that Anderson County and TRMT were required to comply
with the uninsured/underinsured motorist statutes at Tenn. Code Ann. § 56-7-1201, et seq.,

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and that they failed to do so. TRMT, for its part, contends that the uninsured/underinsured
motorist statutes are inapplicable. TRMT points to the case of Maines v. Hill, 190 F.Supp.2d
1072 (W.D. Tenn. 2002) as persuasive authority. In Maines, the plaintiffs were injured in
a vehicular collision. Id. at 1071. The Maines court held:

               Under Tennessee law, “[e]very automobile liability insurance policy
       delivered, issued for delivery or renewed in this state ... shall include uninsured
       motorist coverage ...” Tenn. Code Ann. § 56-7-1201(a). The State permits a
       named insured, however, to reject in writing such coverage completely or to
       select lower limits of such coverage. Tenn. Code Ann. § 56-7-1201(a)(2).

              In this case, Carriers was insured by a general commercial liability
       insurance policy issued by The Insurance Company of the State of
       Pennsylvania. Although Carriers was given the option of accepting UM
       coverage, it rejected such coverage in writing. It is clear, therefore, that
       Carriers validly rejected UM coverage under the insurance policy issued by
       The Insurance Company of the State of Pennsylvania.

               Plaintiffs argue that even if the Court finds the rejection of UM
       coverage under that policy to be valid, Plaintiff Maines was not bound by that
       rejection. Specifically, Plaintiffs point to a Contract Hauling Agreement, and
       assert that in order to bind Plaintiff Maines by contract, Carriers needed to
       have specifically provided authority.

               The Court need not address the terms of the Hauling Agreement
       because Plaintiffs' argument is incorrect under Tennessee law. “Any document
       signed by the named insured or legal representative which initially rejects
       [uninsured motorist coverage] shall be binding upon every insured to whom
       such policy applies ...” Tenn. Code Ann. § 56-7-1201(a)(2). In construing this
       section of the Tennessee Code, the Supreme Court of Tennessee determined
       that the “rights of an additional or omnibus insured can rise no higher than, but
       are clearly controlled by, the choices and selections of coverage made by the
       named insured ...” Burns v. Aetna Casualty & Surety Co., 741 S.W.2d 318,
       323 (Tenn. 1987). Therefore, despite Plaintiffs' protestations to the contrary,
       Plaintiff Maines, as an additional or omnibus insured of the named insurer,
       Carriers, was bound by Carriers' rejection of UM coverage under the insurance
       policy issued by The Insurance Company of the State of Pennsylvania.

              Carriers argues next that it is not required to provide UM coverage with
       respect to its self-insured retention. Under Tennessee law, as was set forth

                                               -7-
       above, every “automobile liability insurance policy” issued in the State must
       provide UM coverage. Tenn. Code. Ann. § 56-7-1201(a). The insurance
       policy issued by The Insurance Company of the State of Pennsylvania
       provided coverage for liability claims in excess of one million dollars
       ($1,000,000), while Carriers had a self-insured retention of up to one million
       dollars ($1,000,000) per occurrence. The issue is whether the self-insured
       retention held by Carriers is an automobile liability insurance policy, making
       it subject to the provisions of Section 56-7-1201 of the Tennessee Code.

               Unfortunately, no Tennessee court has addressed the issue of whether
       a self-insured retention is subject to the UM coverage requirement set forth in
       Section 56-7-1201 of the Tennessee Code. Carriers cites decisions from
       numerous other jurisdictions with similar statutory language as persuasive
       authority for its contention that a self-insured retention is not governed by
       Section 56-7-1201. The majority of those decisions hold that self insurance
       is not an “automobile liability insurance policy.” See e.g. O'Sullivan v.
       Salvation Army, 85 Cal.App.3d 58, 147 Cal.Rptr. 729, 731-32 (1978);
       Hoffman v. Yellow Cab Co. of Louisville, 57 S.W.3d 257, 261 (Ky. 2001);
       Grange Mutual Cas. Co. v. Refiners Transp. & Terminal Corp., 21 Ohio St.3d
       47, 487 N.E.2d 310, 313-14 (1986). The Court is persuaded by the reasoning
       set forth in those decisions. The Court is also persuaded by Carriers' assertion
       that the legal definition of self insurance does not fit within the definition of
       a “contract of insurance” or “motor vehicle liability policy” as set forth in the
       Tennessee Code. See Blacks' Law Dictionary at 806 (6th ed.1991); c.f. Tenn.
       Code Ann. §§ 56-7-101(a), 55-12-202(7). Moreover, “To read [a rejection
       requirement] into the law under the pretext of public policy would be to
       impose a greater burden on a self-insured than is imposed on the named
       insured of an insurance policy.” Hoffman, 57 S.W.3d at 261.

               The Court therefore determines that Carriers' one million dollar
       ($1,000,000) self-insured retention is not subject to Section 56-7-1201 of the
       Tennessee Code. As a result, Carriers was not obligated under Tennessee law
       to provide UM coverage as part of its self-insured retention. With respect to
       Tennessee, Carriers did not possess any UM coverage under any insurance
       policy.

Maines, 190 F.Supp.2d at 1075-76 (some citations omitted). We find the reasoning in
Maines to be sound when the court held that the “UM coverage requirement set forth in
Section 56-7-1201 of the Tennessee Code...” does not apply in a self-insured situation. Id.



                                              -8-
              TRMT has been described in a Tennessee Attorney General’s Opinion as
follows:

       The Trust was created through an interlocal agreement of school boards under
       Tenn. Code Ann. § 12-9-104. It was formed to create and operate a
       self-insurance pool for school systems under the authority of the Tennessee
       Governmental Tort Liability Act, Tenn. Code Ann. § 29-20-401. The risk pool
       allowed members to share risk as an alternative to purchasing commercial
       insurance policies. At some point, coverage was expanded to include county
       government and public utilities in Tennessee in addition to school systems.
       According to information available to this Office, the Trust is an
       intergovernmental agency that provides claims management, loss control
       services and insurance coverage to school systems, county government and
       public utilities in Tennessee.

Tenn. Op. Atty. Gen. No. 06-066, 2006 WL 1197460 (April 11, 2006).

              TRMT is a risk pool. As the statutes authorizing the creation and existence of
TRMT provide, TRMT is not an insurance company, and it would be incorrect to treat it as
such for legal purposes. Further, the statute provides that because Anderson County has
chosen to participate in TRMT, it is deemed to be self-insured. We hold, as did the Trial
Court, that the uninsured/underinsured statutes simply do not apply in this self-insurance
situation. Anderson County decided to reject uninsured/underinsured motorist coverage
though its adoption of the Coverage Document. Arguing further, the Plaintiffs raise a
provision of the Coverage Document which provides that should the terms of the document
conflict with any Tennessee statutes, the terms are amended to conform with the statutes.
However, for the reasons already discussed, the terms of the Coverage Document do not
conflict with Tennessee law. The very statutes governing the existence of TRMT, Tenn.
Code Ann. § 29-20-401, et seq., control. The statutes specifically provide that TRMT may
not be considered an insurance company. The statutes further provide that Anderson County,
having chosen to participate in TRMT, “shall be deemed to be electing to self-insure....”
Tenn. Code Ann. § 29-20-401 (c)(1) (2012). There is no conflict between any terms of the
Coverage Document and the Tennessee uninsured/underinsured statutes.

             We, therefore, must look to the pertinent terms of the Coverage Document to
determine whether coverage extended to Harris under the Coverage Document. The
Coverage Document provides that “coverage shall not apply to employees, agents or
contractors acting on behalf of the MEMBER or to any injury covered by Workers
Compensation law.” Our Supreme Court has stated regarding contract interpretation:



                                            -9-
              When we interpret a contract, our role is to ascertain the intention of the
       parties. The intention of the parties is based on the ordinary meaning of the
       language contained within the four corners of the contract. The interpretation
       of a contract is a matter of law, which we review de novo with no presumption
       of correctness.

84 Lumber Co. v. Smith, 356 S.W.3d 380, 383 (Tenn. 2011) (citations omitted). According
to the plain terms of the Coverage Document, Harris, an employee acting on behalf of
Anderson County and who received workers compensation benefits, is not covered.

                To reiterate, TRMT is not an insurance company. Rather, Anderson County
is deemed to be self-insured, and the uninsured/underinsured statutes are not applicable to
or in conflict with the Coverage Document. The question of whether Anderson County
should provide uninsured/underinsured motorist coverage to its employees, such as Harris,
is a policy decision to be decided by the legislative body of Anderson County and not this
Court. The Anderson County legislative body made that policy decision, and it is not the role
of this Court to second guess that policy decision. With no material facts in dispute, TRMT
is entitled to judgment as a matter of law. We affirm the judgment of the Trial Court in its
entirety.

                                         Conclusion

              The judgment of the Trial Court is affirmed, and this cause is remanded to the
Trial Court for collection of the costs below. The costs on appeal are assessed against the
Appellants, Dennis Michael Harris and Judy A. Harris, and their surety, if any.




                                                     _________________________________
                                                     D. MICHAEL SWINEY, JUDGE




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