Raymond Konop v. James Henry

IN THE COURT OF APPEALS OF TENNESSEE

AT NASHVILLE

June 15, 2010 Session

RAYMOND KONOP, ET AL. v. JAMES HENRY, ET AL.

Appeal from the Chancery Court for Marshall County

No. 14330 J. B. Cox, Chancellor

No. M2010-00037-COA-R3-CV - Filed August 18, 2010

Purchasers of real estate brought suit against the sellers as well as against the appraiser, the

sellers’ real estate agent, the agent’s managing broker and brokerage firm alleging fraudulent

misrepresentation and breach of duty to disclose adverse facts related to the property

purchased. Upon their motions for summary judgment, the appraiser, real estate agent, the

agent’s managing broker and brokerage firm were dismissed as defendants; the purchasers

appeal the dismissal of the real estate agent, the managing broker and the brokerage firm.

Finding no error, we affirm.

Tenn R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed

R ICHARD H. D INKINS, J., delivered the opinion of the court, in which P ATRICIA J. C OTTRELL,

P.J., M.S., and A NDY D. B ENNETT, J., joined.

Jonathan Jackson Pledger, Franklin, Tennessee, for the appellants, Raymond Konop, Jennifer

Konop, Dennis Parker, and Penny Parker.

Derrick A. Free and Teresa Reall Ricks, Nashville, Tennessee, for the appellees, David Jent

and Jason Jent, d/b/a David Jent Realty and Auction, and David Jent Realty and Auction.

OPINION

I. Background 1

On September 19, 2006, the Appellants, Dennis and Penny Parker, purchased the

home and property of John and Mary Webb located at 2143 Old Columbia Road in

1

The factual background is drawn from the trial court’s findings of fact, which are not in dispute

and reflected in the record.

Lewisburg.2 On November 15, 2006, Raymond and Jennifer Konop, the other Appellants,

purchased the home a property of James and Myrtle Henry, which was located adjacent to

the property purchased by the Parkers.3 The Webbs and Henrys (collectively referred to

hereinafter as the “sellers”) were represented in their respective transactions by Jason Jent,

a licensed affiliate broker. The Parkers and Konops (collectively referred to hereinafter as

the “purchasers”) were represented by a real estate agent in their respective transactions. 4

There was an existing landfill visible from the back portion of both properties and the

purchasers were aware of the landfill’s existence prior to closing on the respective

properties.5

On December 8, 2006, the landfill purchased 174 acres (the “Coble property”)

adjoining the purchasers’ properties; the sale was reported in the local newspaper on January

12, 2007. The purchasers filed suit on May 2, 2007, against the sellers; Mary Ann Neill d/b/a

Neill & Associates, a real estate appraiser who performed an appraisal of the Konops’

property; the sellers’ real estate agent, Jason Jent; David Jent Realty & Auction, Jason Jent’s

brokerage firm; and David Jent, the managing broker of David Jent Realty & Auction. The

complaint alleged that all of the Defendants made fraudulent misrepresentations and

breached their “duty to disclose” regarding the relevant real estate transactions;6 specifically

that the each of the defendants told the purchasers that the landfill was to be closed and

converted to a green way and park despite knowing that the landfill planned to expand its

operations and purchase the adjacent Coble property.

2

The Parkers entered into a contract to purchase the property on September 3.

3

The Konops entered into a contract to purchase the property on October 3.

4

The Parkers were represented by real estate licensee Troy Charlton; the Konops were represented

by real estate licensee Jeff Haupt. Neither Mr. Charton nor Mr. Haupt are parties to this suit.

5

While the Tennessee Residential Property Condition Disclosure form completed by each of the

sellers for their respective properties indicated that the seller was unaware of a “landfill (compacted or

otherwise) on the property or any portion thereof,” the purchasers acknowledged in their complaint that they

were aware of and discussed the existence of the landfill with the sellers as well as their real estate agent,

Jason Jent prior to either of them submitting an offer on the respective properties.

6

The complaint alleges that each of the defendants breached a “duty to disclose” without reference

to any statutory duty. Any common law fiduciary duty that may arise between an agent and a principal is

inapplicable here as the complaint acknowledges that no agency relationship existed between the purchasers

and either the sellers, the sellers’ real estate agent, the agent’s managing broker or the agent’s brokerage firm.

The trial court applied the duties set forth at Tenn. Code Ann. § 62-13-403. As more fully explained, infra,

the interpretation and application of section 62-13-403 is consistent with the interpretation and application

of Tenn. Code Ann. § 66-5-206, cited on appeal by the purchasers.

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The Defendants all filed answers in June 2007, denying the allegations of the

complaint.7 Defendants David Jent, Jason Jent, and David Jent Realty and Auction filed a

motion for summary judgment on September 4, 2008, accompanied by a memorandum of

law, statement of undisputed material facts, and affidavits of David and Jason Jent. David

Jent’s affidavit stated that he “did not know about the sale of the Coble Property to the

Landfill until the Marshall County Tribune reported it on January 12, 2007,” and that “[e]ven

after [he] learned about the sale of the Coble Property to the Landfill from the newspaper

article on January 12, 2007, [he] did not know that the Coble Property adjoined the Kanop

[sic] and Parker properties.” His affidavit further stated that he was a licensed real estate

broker, that he complied with the standard of care with regard to real estate licensees working

in and around the Marshall County” and that he “disclosed all adverse facts that [he] had

knowledge of related to the real estate transactions at issue involving both the Kanops [sic]

and the Parkers.” Jason Jent’s affidavit stated the same. The purchasers responded asserting

that material facts were in dispute; in support of their contention they submitted the affidavit

of a neighbor, Richard Holt, as well as Marshall County Tribune articles dated July 28, 2006,

and October 6, 2006, related to the landfill.

Following the depositions of David and Jason Jent, a hearing on the motion was held

and in an order entered on June 8, 2009, the trial court granted the motion for summary

judgment. The court found, relying on the undisputed facts in the record, that

[T]hese defendants did not breach their duty to disclose adverse facts to the

plaintiffs of which they had actual notice or knowledge. Further, the Court

finds that these defendants specifically disclosed the existence of the landfill

to the plaintiffs and the landfill was readily visible from the plaintiffs’

properties. Accordingly, the Court finds that these defendants did not

fraudulently misrepresent any material facts to the plaintiffs regarding the

respective transactions nor did these defendants breach the standard of care for

a real estate licensee in either transaction.

The purchasers filed a motion to alter, amend or set aside the trial court’s June 8 order,

asserting that the trial court’s order failed to consider David Jent’s deposition testimony

stating that he knew, three to four months prior to the sale of the Coble property to the

landfill, that the landfill signed an option contract with the Cobles to purchase their property.

The trial court denied the purchasers’ motion and the purchasers appeal. The purchasers do

not challenge the grant of summary judgment on the fraudulent misrepresentation claim; the

7

Ms. Neill filed a motion for summary judgment on April 9, 2008, which was granted by order

entered June 18. The purchasers do not appeal the dismissal of Ms. Neill.

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purchasers appeal asserting that material factual issues exist with respect to the defendants’

duty to disclose adverse facts, such as to preclude summary judgment.

II. Standard of Review

Summary judgment is appropriate where a party establishes that there is no genuine

issue as to any material fact and that a judgment may be rendered as a matter of law. Tenn.

R. Civ. P. 56.04; Stovall v. Clarke, 113 S.W.3d 715, 721 (Tenn. 2003). Moreover, it is

proper in virtually all civil cases that can be resolved on the basis of legal issues alone, Byrd

v. Hall, 847 S.W.2d 208, 210 (Tenn. 1993); Pendleton v. Mills, 73 S.W.3d 115, 121 (Tenn.

Ct. App. 2001); however, it is not appropriate when genuine disputes regarding material facts

exist. Tenn. R. Civ. P. 56.04. The party seeking a summary judgment bears the burden of

demonstrating that no genuine disputes of material fact exist and that the party is entitled to

judgment as a matter of law. Godfrey v. Ruiz, 90 S.W.3d 692, 695 (Tenn. 2002). Summary

judgment should be granted at the trial court level when the undisputed facts, and the

inferences reasonably drawn from the undisputed facts, support one conclusion, which is the

party seeking the summary judgment is entitled to a judgment as a matter of law. Pero's

Steak & Spaghetti House v. Lee, 90 S.W.3d 614, 620 (Tenn.2002); Webber v. State Farm

Mut. Auto. Ins. Co., 49 S.W. 3d 265, 269 (Tenn. 2001). The court must take the strongest

legitimate view of the evidence in favor of the non-moving party, allow all reasonable

inferences in favor of that party, discard all countervailing evidence, and, if there is a dispute

as to any material fact or if there is any doubt as to the existence of a material fact, summary

judgment cannot be granted. Byrd, 847 S.W.2d at 210; EVCO Corp. v. Ross, 528 S.W. 2d

20 (Tenn. 1975).

Summary judgments do not enjoy a presumption of correctness on appeal. BellSouth

Adver. & Publ'g Co. v. Johnson, 100 S.W.3d 202, 205 (Tenn. 2003). This court must make

a fresh determination that the requirements of Tenn. R. Civ. P. 56 have been satisfied.

Hunter v. Brown, 955 S.W.2d 49, 50-51 (Tenn. 1977). We consider the evidence in the light

most favorable to the non-moving party and resolve all inferences in that party's favor.

Stovall, 113 S.W.3d at 721; Godfrey, 90 S.W.3d at 695. When reviewing the evidence, we

first determine whether factual disputes exist. If a factual dispute exists, we then determine

whether the fact is material to the claim or defense upon which the summary judgment is

predicated and whether the disputed fact creates a genuine issue for trial. Byrd, 847 S.W.2d

at 214; Rutherford v. Polar Tank Trailer, Inc., 978 S.W.2d 102, 104 (Tenn. Ct. App. 1998).

III. Analysis

The purchasers contend that summary judgment was inappropriate with respect to

David Jent, Jason Jent and David Jent Realty and Auction’s duty to disclose; specifically, the

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purchasers argue that David Jent knew the landfill had an option contract to purchase the

Coble property and failed to disclose this fact to the purchasers. The purchasers further argue

that David and Jason Jent “have denied having any actual knowledge or notice of the

impending sale of the Coble Property to the landfill,” but that it is “reasonable to assume that

[they] knew more than has been admitted” and their veracity is a question for the trier of fact

such that summary judgment is inappropriate.

The purchasers alleged that the defendants breached their “duty to disclose.”

Although the purchasers did not allege a specific statutory duty, the trial court found that the

relevant statutory authority for the creation of such a duty can be found within the Tennessee

Real Estate Brokers Act of 1973 codified at Tenn. Code Ann. §§ 62-13-101 et seq., and

specifically at Tenn. Code Ann. § 62-13-403(2). On appeal, the purchasers contend that “a

homebuyer’s exclusive remedy against a real estate licensee” is provided by the Tennessee

Residential Disclosure Act at Tenn. Code Ann. § 66-5-206.

Tenn. Code Ann. § 66-5-206 provides:

A real estate licensee representing an owner of residential real property as the

listing broker has a duty to inform each such owner represented by that

licensee of the owner's rights and obligations under this part. A real estate

licensee representing a purchaser of residential real property or, if the

purchaser is not represented by a licensee, the real estate licensee representing

an owner of residential real estate and dealing with the purchaser has a duty to

inform each such purchaser of the purchaser's rights and obligations under this

part. If a real estate licensee performs those duties, the licensee shall have no

further duties to the parties to a residential real estate transaction under this

part, and shall not be liable to any party to a residential real estate transaction

for a violation of this part or for any failure to disclose any information

regarding any real property subject to this part. However, a cause of action for

damages or equitable remedies may be brought against a real estate licensee

for intentionally misrepresenting or defrauding a purchaser. A real estate

licensee will further be subject to a cause of action for damages or equitable

relief for failing to disclose adverse facts of which the licensee has actual

knowledge or notice. “Adverse facts” means conditions or occurrences

generally recognized by competent licensees that significantly reduce the

structural integrity of improvements to real property, or present a significant

health risk to occupants of the property.

Id. (Emphasis added).

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Tenn. Code Ann. § 66-5-208(d)(2) provides that “[n]othing in this subsection (d) shall

be construed to exempt or excuse a real estate licensee from making any of the disclosures

required by § 62-13-403, § 62-13-405 or § 66-5-206, nor shall it be construed to remove,

limit or otherwise affect any remedy provided by law for such a failure to disclose.”

Tenn. Code Ann. § 62-13-403 provides in relevant part:

A licensee who provides real estate services in a real estate transaction shall

owe all parties to the transaction the following duties, except as provided

otherwise by § 62-13-405, in addition to other duties specifically set forth in

this chapter or the rules of the commission:

(2) Disclose to each party to the transaction any adverse facts of which the

licensee has actual notice or knowledge[.]

Tenn. Code Ann. § 62-13-403.8 Adverse facts for purposes of this chapter are defined as

“conditions or occurrences generally recognized by competent licensees that have a negative

impact on the value of the real estate, significantly reduce the structural integrity of the

improvements to real property, or pose a significant health risk to occupants of the property.”

Tenn. Code Ann. § 62-13-102(2). A real estate broker who breaches the duty of disclosure

is potentially liable to a party injured by such breach. Id.; see Land v. Dixon, No.

E2004-03019-COA-R3CV, 2005 WL 1618743, *5 (Tenn. Ct. App. Jul 12, 2005).

The duty to disclose adverse facts under Tenn. Code Ann. § 66-5-206 and § 62-13-

403(b) is essentially the same. Both impose the duty on a real estate licensee involved in the

real estate transaction9 to disclose adverse facts of which he or she has actual notice or

knowledge to all parties in the transaction. While the two statutes’ definition of “adverse

facts” is slightly different, we will apply the definition of “adverse facts” provided in Tenn.

Code Ann. § 62-13-102(2) as it is more comprehensive.10

8

Tenn. Code Ann. § 62-13-405 relates to required disclosures when one party to the real estate

transaction is not represented by another real estate licensee. This provision is inapplicable here.

9

The scope of Tenn. Code Ann. § 66-5-206 is limited to real estate licensees who represent either

the owner or the purchaser, while Tenn. Code Ann. § 62-13-403 specifically limits its application to real

estate licensees who “provide services in a real estate transaction.”

10

Tenn. Code Ann. § 62-13-102(2) requires the additional disclosure of conditions or occurrences

“that have a negative impact on the value of the real estate.”

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Jason Jent, David Jent and David Jent Realty and Auction moved for summary

judgment and in support of their motion they filed the affidavits of David Jent and Jason Jent,

both of which stated, respectively, that they were real estate licensees familiar with the

standard of care of such licensees within Marshall County and that they complied with the

standard of care as they had no knowledge of the sale of the Coble property to the landfill

prior to January 12, 2007, more than three months after the completion of the purchasers’ real

estate transactions. Also in support of their motion, the defendants filed a statement of

undisputed facts, which included the dates of the relevant transactions and the purchasers’

admission that they were aware of the existence of the landfill prior to closing on their

respective properties. Based on the foregoing, the defendants affirmatively negated an

essential element of the purchasers’ claims – that David and Jason Jent had actual notice or

knowledge of an adverse facts. See Martin v. Norfolk Southern Ry. Co., 271 S.W.3d 76, 84

(Tenn. 2008) (to shift the burden to the nonmoving party, the moving party must

affirmatively negate an essential element of the nonmoving party's claim or show that the

nonmoving party cannot prove an essential element of the claim at trial).

“If the moving party makes a properly supported motion, then the nonmoving party

is required to produce evidence of specific facts establishing that genuine issues of material

fact exist.” Martin, 271 S.W.3d at 84. The nonmoving party can meet this burden 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 56.0[7].

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

nonmoving party’s evidence must be accepted as true, and any doubts concerning the

existence of a genuine issue of material fact shall be resolved in favor of the nonmoving

party.” Id.

The purchasers responded to the summary judgment motion by submitting two

newspaper articles and the affidavit of a neighbor, Richard Holt. The headline of the first

newspaper article, dated July 28, 2006, states “Commission considers county monitoring for

the Cedar Ridge landfill.” The article discusses a recently held meeting of the Marshall

County Solid Waste Committee of the county commission wherein community members

voiced concerns about foul odors, sludge and waste along Mooresville Highway, high levels

of traffic and fires near the landfill; the article does not mention any potential expansion by

the landfill. The other article, dated October 6, 2006, and which headline states “Landfill

expansion discussed, Odor remedy to cause temporary smell.” Related to the issue of

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expansion, the article quotes a representative of Congressman Bart Gordon’s office saying,

“It’s my understanding that Waste Management has spoken with the Tennessee Department

of Conservation about potential expansion,” but the article goes on to state that “[e]xpansion

discussions could not be confirmed by TDEC’s spokewoman, Dana Coleman, who said ‘The

department had not received anything other than the application for a permit modification for

additional groundwater monitoring.’ . . . Information received by the Marshall County

Tribune indicated that the landfill might have enough room for operations to continue for

some 18 months.”

The affidavit of Richard Holt stated that he lived on Old Columbia Road in

Lewisburg, Tennessee since 1974, that he kept cattle on the Coble Property “since about

2003" and that he knew “Waste Management began looking to purchase the Coble Property

or other surrounding land since approximately 2004.” Mr. Holt’s affidavit further stated that

“Waste Management and Cedar Ridge Landfill began core drilling the Coble Property in

2004 or 2005" and that it “has been common knowledge to residents in the community that

Waste Management and Cedar Ridge Landfill were attempting to purchase the Coble

Property or other property in [the] area since approximately 2004 [or] 2005.”

The purchasers also responded to the defendants’ statement of undisputed facts. They

admitted that Jason Jent disclosed the existence of the landfill to the purchasers’ respective

real estate agents and that the purchasers were aware that the landfill was visible from the

back portion of the property prior to closing on their respective properties. They denied,

however, the statements that Jason Jent and David Jent did not have knowledge of the sale

of the Coble Property to the Landfill. The purchasers’ response stated:

Plaintiffs contend have contended [sic] that the sale of the Coble Property to

the Landfill was common knowledge in the community. The sale of the Coble

Property to the Landfill had been discussed in the Marshall County Tribune as

early as October 6, 2006. See Attached Exhibit A. That according to Mr.

Richard Holt, a resident of Lewisburg living within the vicinity of the Landfill,

states that the purchase of the Coble Property by the Landfill was common

knowledge to the residents in the community and had been testing the soil on

the Coble Property since 2004-2005.

The only other statement of material fact that the purchasers denied was that David Jent and

Jason Jent complied with the applicable standard of care regarding real estate licensees. The

purchasers’ response stated:

Defendants failed to disclose to Plaintiffs that the Landfill was in the process

of purchasing the Coble Property. Furthermore, Defendants failed to disclose

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other material facts regarding the landfill, including problems with sludge and

odor. See Article from the Marshall Tribune dated July 28, 2006, attached

hereto as Exhibit C.

We will examine the evidence presented by the parties relative to each defendant.

A. Jason Jent

Jason Jent provided real estate services in the real estate transactions at issue as the

agent of the sellers. While the purchasers were each represented by their own real estate

agent in the relevant transactions, under Tenn. Code Ann. § 62-13-403, Mr. Jent was

obligated to disclose adverse facts of which he had actual notice or knowledge to the

purchasers as parties to the transaction. Assuming that the landfill’s purchase of the Coble

property was an adverse fact,11 Mr. Jent submitted an affidavit in support of his motion for

summary judgment in which he stated that he had no actual notice or knowledge of the sale

of the Coble property to the landfill prior to January 12, 2007, approximately one month after

the sale and several months after the purchasers’ respective transactions. Jason Jent’s

affidavit affirmately negated an essential element of the purchasers claim in that he

established he had no actual notice or knowledge of the sale of the Coble property to the

landfill.

The purchasers responded by contending that Mr. Jent should have known about the

sale because “the sale of the Coble Property to the Landfill was common knowledge in the

community.” The purchasers’ contention, however, is not only not supported by the record,

but it does not comport with the statute’s requirement that the real estate licensee have actual

notice or knowledge.

The affidavit of Mr. Holt relates to his knowledge of the owner of the landfill’s

interest in the Coble Property in 2004 and 2005, rather than 2006 when the transactions

relevant to this case occurred. Moreover, the affidavit states that, in addition to the Coble

property, the owner of the landfill was looking at “other property in [the] area.” Viewing this

evidence in the light most favorable to the purchasers, it leads only to a finding that the

11

Jason Jent and David Jent contend that the sale of the Coble property to the landfill was not an

adverse fact because the landfill did not have plans to expand its operations onto the Coble property because

local zoning ordinances prevented the landfill from doing so; further, the landfill’s representative stated in

the January 12, 2007, newspaper article reporting the landfill purchased the Coble property “so it [would]

have adequate supply of dirt to cover garbage dumped at the [existing] facility” and that the landfill was “not

asking to expand onto the []Coble property.” We make no determination on the issue of whether this fact

was or was not an adverse fact as such is pretermitted by our finding, infra, that Jason Jent had no actual

notice or knowledge of the sale.

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landfill’s purchase of the Coble property was not a “known fact,” rather it was speculative

or one of many options being considered by the landfill. The purchasers also rely on two

newspaper articles in support of their contention that the sale of the Coble property to the

landfill was “common knowledge,” or a known fact. Neither of these articles, however,

support such a contention. The July article doesn’t mention expansion; the October 6 article,

which was published after the Parkers closed on their property, reports the landfill’s possible

expansion as an unconfirmed rumor and does not mention the Coble property or a sale of any

particular land in the area to the landfill. In any event, under the statute Jason Jent was only

obligated to disclose adverse facts of which he had actual notice or knowledge. Mr. Jent’s

affidavit stated that he did not have actual notice or knowledge of the sale of the Coble

property to the landfill at any time relevant to the purchasers’ respective transactions. The

purchasers have failed to present evidence contradicting Mr. Jent’s affidavit or raising a

genuine issue of fact. Accordingly, Jason Jent was entitled to summary judgment.

B. David Jent

The purchasers assert that David Jent admitted in his deposition that he knew that the

landfill had signed an option contract to purchase the Cobles’ property three to four months

prior to the sale and that he was required to disclose this fact to the purchasers as the listing

agent of the properties sold to the purchasers.12 David Jent, however, owed no duty to the

purchasers.

As noted earlier, Jason Jent was an affiliate broker hired by the sellers to list their

properties for sale; as such, he was required to be supervised by a managing broker who, in

this case, was David Jent. See Tenn. Code Ann. § 62-13-406(b). David Jent’s duty to the

purchasers was to ensure that Jason Jent complied with all appropriate laws, rules and

regulations. See Tenn. Code Ann. § 62-13-406(b) (the duty of a managing broker whose

affiliated licensee provides real estate services in a real estate transaction is to ensure that all

licensees affiliated with or employed by the broker conduct business in accordance with

appropriate laws, rules and regulations); see also Tenn. Op. Att’y. Gen. No. 96-015, 1996

WL 66988, at *2 (1996) (“The managing or principal broker must fulfill her obligation to

ensure that all licensees that she employs carry out their responsibilities ethically and in

accordance with the law[,] but the principal broker does not have a specific duty to either the

buyer or the seller.”). Inasmuch as David Jent was not involved in or did not otherwise

provide real estate services in the transactions, he was not obligated under Tenn. Code Ann.

§ 62-13-403 to disclose his knowledge, if any, of adverse facts.

12

David Jent’s deposition testimony of his knowledge of the relationship or transaction between the

Cobles and the landfill consisted of the following: “I asked [Mr. Coble] if he had [sold his property to the

landfill] and he said, no, they had an option.”

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C. David Jent Realty and Auction

The purchasers also assert that David Jent’s knowledge of the landfill’s option

contract to purchase the Coble Property three to four months prior to the sale “is imputed to

David Jent Realty and Auction and its agents” and, consequently, that Jason Jent, as an agent

of David Jent Realty and Auction, “had a duty to disclose the existence of the option contract

to Plaintiffs.” In support of their argument, the purchasers rely on Bass v. Kimbrough, No.

02A01-9508-CH-00178, 1996 WL 560263, at *4 (Tenn. Ct. App. Oct. 3, 1996), which states

that “[i]nformation known by a company agent is imputed to be knowledge of the company.”

While Bass, a case concerning liability in connection with the default on a promissory

note for the purchase of stock in a closely held corporation, is distinguishable both in terms

of facts and context, the Tennessee Real Estate Brokers Act expressly supercedes the

common law to the extent common law is inconsistent. Tenn. Code Ann. § 62-13-408; see

also Tenn. Op. Att’y. Gen. No. 96-015, 1996 WL 66988, at *1 (1996). Tenn. Code Ann. §

62-13-406(c) provides “[t]here shall be no imputation of knowledge or information among

or between clients, the managing broker and any designated agent or agents in a designated

agency situation.” In light of this specific statute, common law agency principles regarding

imputation of knowledge do not apply to this circumstance. Consequently, to the extent

David Jent had any knowledge of an option contract between the landfill and the Cobles, and

assuming arguendo that the option contract was an adverse fact, this knowledge cannot be

imputed either to David Jent Realty and Auction or to Jason Jent.

IV. Conclusion

For the foregoing reasons, we affirm the judgment of the trial court granting summary

judgment to Jason Jent, David Jent and David Jent Realty and Auction.

Costs of this appeal are assessed to the Appellants.

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RICHARD H. DINKINS, JUDGE

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