Legal Memorandum: Statute of Limitations for Negligence and Fraud

Issue: What is the Tennessee statute of limitations on a claim of malpractice or negligence against an insurance agent? What is the statute of limitations on fraud?

In Carter v. American Republic Ins. Co., No. 03A01-9102CV65 (Tenn. Ct. App. July 25, 1991), the court stated that "the gravamen of an action rather than its designation" determines the applicable statute of limitations.  The court held that the "loss in value sustained by plaintiff from the alleged tort of fraud and deceit is included within the phrase, ‘injuries to personal property’ as contemplated in T.C.A. § 28-3-105."  The court reiterated that the question was not whether the plaintiff sued in contract or tort, but whether the plaintiff is suing the defendant for injuries to the person (e.g., mental anguish, humiliation, embarrassment, or damages to reputation) or injuries to property (e.g., loss of funds).  In the former situation, a one-year statute of limitations applies (Tenn. Code § 28-3-104, which governs the statute of limitations for personal injuries, attorney malpractice, and some injuries with a statutory remedy) and in the latter situation, a three-year statute of limitations applies (Tenn Code. § 28-3-105). 

In Monroe v. First Colony Life Ins. Co., (Tenn. Crim. App. Feb. 15, 1989), the court held that an action for fraud, negligence and intentional misrepresentation against an insurance agent was subject to the three-year statute of limitations as provided in Tenn. Code § 28-3-105.  However, a claim for outrageous conduct against the insurance agent was subject to the one-year statute of limitations as provided by Tenn. Code § 28-3-104.  The court stated that the "gravamen of a complaint is ascertained not by the theoretical foundation of the suit but […]