James Hancock et ux v. U-Haul Co. of TN

Court of Appeals of Tennessee

James Hancock et ux v. U-Haul Co. of TN

Court of Appeals of Tennessee·Decided December 10, 1998·No. 01A01-9801-CC-00001·Published

Opinion

IN THE COURT OF APPEALS OF TENNESSEE AT NASHVILLE

FILED

December 10, 1998

JAMES HANCOCK and wife, ) BRITT HANCOCK, )

Cecil W. Crowson

)

Appellate Court Clerk

Plaintiffs/Appellants, )

) Appeal No.

) 01-A-01-9801-CC-00001 VS. )

) Montgomery Circuit Civil ) No. C11-225

U-HAUL COMPANY OF TENNESSEE ) d/b/a U-HAUL STORAGE FACILITY, )

)

Defendant/Appellee. )

APPEALED FROM THE CIRCUIT COURT OF MONTGOMERY COUNTY AT CLARKSVILLE, TENNESSEE

THE HONORABLE JAMES E. WALTON, JUDGE

MART G. FENDLEY 107 North Third Street P. O. Box 925 Clarksville, TN 37041-0925 Attorney for Plaintiffs/Appellants

MICHAEL G. MCLAREN STEPHEN C. BARTON 2900 One Commerce Square 40 S. Main Street Memphis, Tennessee 38013 Attorneys for Defendant/Appellee

AFFIRMED AND REMANDED

BEN H. CANTRELL

PRESIDING JUDGE, M.S.

CONCUR: KOCH, J. CAIN, J.

OPINION

The plaintiffs brought suit for the loss of their furniture and other property, which was stolen from the defendant’s self-storage facility. The defendant contended that the contract between the parties relieved it of any liability for the plaintiffs’ loss. The trial court granted summary judgment to the defendant. We affirm.

I.

James Hancock and his wife Britt sold their home in Clarksville because they were planning to build a new house in Phoenix, Arizona. They needed to store their furniture and household goods until their new home was completed, so on July 7, 1995, Mr. Hancock went to a storage facility in Clarksville operated by defendant U-Haul of Tennessee, Inc.

Mr. Hancock noted with approval the strong physical security features at the facility, such as the nine or ten foot high chain link fence topped by serpentine or barbed wire, which surrounded the compound, and the good lighting. He spoke to Paul Browning, the manager of the facility, who told Mr. Hancock that he and his wife lived on the premises. Mr. Browning offered Mr. Hancock a contract, which included a highlighted section with the following provisions:

PROPERTY IS STORED AT OCCUPANT’S SOLE RISK I understand that this self storage facility:

1. is a commercial business renting space, and is not a warehouseman;

2. is not responsible for loss to my property;

3. does not provide insurance on my property for me;

and

4. requires that I provide for my own insurance coverage or be “self insured” (personally responsible for my own loss).

The same section included boxes for the customer to check, to indicate whether he was choosing to purchase insurance from his own agent; choosing to be self insured; or choosing to purchase the optional Safestor package, a limited form of insurance offered by U-Haul, with maximum coverage of $15,000, and premiums of $24 per month.

Mr. Hancock signed a lease for one storage room at $94.95 per month, and checked the box for purchasing insurance from his own agent. However he did not purchase any such insurance. He and his wife subsequently moved all their household goods into the storage room, and placed their own padlock on the unit.

Shortly thereafter, the Brownings went on vacation. The facility then came under the supervision of a manager who remained on the premises only during office hours (7:00 a.m. to 7:00 p.m. on most days). On August 10, 1995, Jim Habacker, an employee of the defendant, discovered that there was no lock on the plaintiff’s storage unit. He placed a U-Haul padlock on the unit, but did not notify the owners. On August 18, 1995, the Hancocks returned to their unit to add a bed comforter they had purchased, and discovered that most of their property had been stolen.

From the quantity of the goods taken (allegedly over $50,000 worth), and the nature of the goods left behind, it appeared that the thieves had the time to bring a large truck into the facility (perhaps through the rear gate), to “pick through” the property of the Hancocks, and to fully load the truck. There were no indications of forced entry. Suspicion naturally fell upon some employees of U-Haul, but no charges were ever brought.

The Hancocks filed a complaint against U-Haul on December 4, 1995, alleging that its employees had either been negligent in their management of the

storage facility, or had participated in the theft. The plaintiffs filed an amended complaint on August 14, 1997 to add a claim for fraudulent or negligent misrepresentation under the Tennessee Consumer Protection Act, Tenn. Code Ann. § 47-18-101 et seq. The defendant answered the original complaint on March 1, 1996, and filed a Motion for Summary Judgment on August 7, 1997.

U-Haul contended that the exculpatory clause quoted above insulated it from any liability for the plaintiffs’ loss. The defendant denied that it had made any representations at all to the plaintiffs as to its security arrangements, and made a specific denial that the Brownings had represented themselves as a 24 hour a day “security team” on the premises.

The defendant also argued that there was no proof that any of its own employees were involved in the theft, but contended that even if they had been, the company was not liable for the intentional conduct of employees acting outside the course and scope of their employment. The trial court agreed with the reasoning of the defendant, and granted the Motion for Summary Judgment on December 1, 1997. This appeal followed.

II. The Consumer Protection Act

The Tennessee Consumer Protection Act offers protection against businesses that prey on the consuming public by the use of unfair or deceptive practices. A long list of such forbidden practices is found in Tenn. Code Ann. § 47- 18-104. In general, these involve false or misleading representations designed to induce the consumer to deal with the business making those misrepresentations.

In the present case, there is no evidence that U-Haul or its employees made any verbal or written representations to the Hancocks as to the nature or quality

of the security measures it would employ to protect its customers’ goods. Since Paul Browning told James Hancock that he and his wife lived on the premises of the storage facility, Mr. Hancock apparently assumed this meant that he would receive the benefit of 24 hour a day surveillance of the facility. But there was no such provision in the leasing contract, the Brownings did not state that this was being offered, and they did not promise that they would never take a vacation or otherwise temporarily leave the facility.

James Hancock testified in deposition that he had previously stored goods at a U-Haul facility in Mesa, Arizona, and had been impressed by the security arrangements there. He observed that the defendant’s Clarksville facility was physically similar to the one in Arizona, and he concluded that it operated the same way. He argues that the existence of a formidable enclosure around the facility amounts to an actionable misrepresentation under the Consumer Protection Act, where it is not accompanied by stringent security measures to prevent entry by unauthorized individuals.

While the Consumer Protection Act can apply to non-verbal as well as oral or written representations, we believe it is stretching the point to contend that the nature of the enclosure around the U-Haul facility amounts to an explicit promise that any specific level of security will be maintained. We also do not believe that the existence of similar physical barriers at two different U-Haul locations creates a guarantee that the same security measures will be employed at both locations.

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