Peggy Gaston v. Tennessee Farmers Mutual Insurance Company

We granted review to decide whether there was sufficient evidence to require a jury to determine
whether the insurer waived compliance with insurance policy provisions requiring the insurer’s
consent to a third-party settlement by its insured. After the insurance company denied her claim, the insured filed a complaint alleging breach of contract, violation of the Tennessee Consumer Protection Act, and bad faith. The trial court directed a verdict for the insurance company, finding that the insured failed to comply with the subrogation provisions of her policy and that the insurance company did not waive these provisions. The Court of Appeals reversed. After reviewing the record and applicable authority, we agree with the Court of Appeals that there was evidence from which a reasonable jury could find that the insurance company waived the subrogation provisions. We also conclude that the insured was not required to demonstrate that the insurance company had not been prejudiced and that the trial court improperly directed verdicts on the insured’s claims under the Tennessee Consumer Protection Act and the bad faith statute. We therefore affirm the Court of Appeals’ judgment and remand to the trial court for a new trial. Tenn. R. App. P. 11 Appeal by Permission; Judgment of the Court of Appeals Affirmed; Case Remanded to the Trial Court.