Owner-Operator Independent Drivers Association, Inc. v. Concord EFS, Inc.

Summary

The Tennessee Supreme Court held that independent truck drivers and their association were not intended third-party beneficiaries of contracts governing credit-card fuel transactions. Because the plaintiffs lacked standing to enforce the no-surcharge provisions, the court reversed the Court of Appeals and reinstated summary judgment for the defendants. The court also articulated a revised framework for determining intended third-party beneficiary status under Tennessee law.

Holdings

1. A third party is an intended beneficiary entitled to enforce a contract only if the contracting parties have not otherwise agreed, recognition of the third party's right to performance is appropriate to effectuate the parties' intent, and the contract or surrounding circumstances indicate either that performance will satisfy an obligation or discharge a duty owed by the promisee to the third party or that the promisee intends to give the third party the benefit of the promised performance.
2. The plaintiffs were not intended third-party beneficiaries of the EFS-Flying J and EFS-Pilot contracts and therefore had no right to enforce the no-surcharge provisions.
3. The plaintiffs were not intended third-party beneficiaries of the Visa-EFS and MasterCard-EFS contracts.
4. Summary judgment was properly granted to the defendants because the plaintiffs lacked an enforceable third-party beneficiary right.

Questions Presented

1. Whether the plaintiffs were intended third-party beneficiaries of the EFS-Flying J and EFS-Pilot contracts and therefore could enforce the no-surcharge provisions.
2. What analytical test Tennessee courts should use to distinguish intended third-party beneficiaries from incidental beneficiaries.
3. Whether the plaintiffs were intended third-party beneficiaries of the Visa-EFS and MasterCard-EFS contracts.

Disposition

reversed